Georgina Kain v Jonathon Rhodes Hutton - [2002] NZCA 180

IN THE COURT OF APPEAL OF NEW ZEALAND

CA 23/01
CA 246/01

BETWEEN	GEORGINA KAIN & OTHERS
Appellants

AND	JONATHON RHODES HUTTON & OTHERS
Respondents

Hearing:	10 & 11 June 2002
Coram:	Elias CJ Keith J Anderson J
Appearances:	R J Craddock QC and S P Rennie for Appellants T C Weston QC for First, Third and Fourth Respondents M R Camp QC for Second Respondent G D Jones for Fifth Respondent R A Osborne for Mary Hutton and A E Couper in their personal capacities
Judgment:	25 July 2002

JUDGMENT OF THE COURT DELIVERED BY ANDERSON J

These are appeals against decisions of Panckhurst J declining successive interlocutory applications by the appellants for removal of trustees and appointment of the Public Trustee as sole trustee in respect of a large number of trusts. The fifth respondent supports the appeals. The first application for, in effect, summary removal of trustees has been overtaken and largely exhausted by the second, in respect of which judgment was delivered on 3 October 2001.
The appellants, who are in various respects beneficiaries, began their substantive proceedings in June 2000 seeking extensive relief in connection with the relevant trusts. Trial of the substantive proceedings is scheduled to commence on 5 August. The intervening two years have been characterised by anxious and immensely expensive interlocutory manoeuvring of which the applications under appeal and these appeals themselves are exemplary.
The relief sought in the substantive proceedings includes an order removing all trustees from the trusts and appointing the Public Trustee, the very relief sought in the applications presently under appeal. Given the imminence of trial, the failure of the first interlocutory application, the distraction from wider issues raised by the litigation and the trouble and expense to which we have adverted, we express the view that it would have been better for the matter to proceed to trial on the substance of the grievances rather than by way of interlocutory and appellate excursions. We say immediately that it would take a compelling case to persuade us that summary removal of the trustees, and in particular the uncle of the appellants, Mr W A X Couper, will resolve the trust entanglements which have created such real and deep concern.
The major adversaries are descendants of Ernest Donald Couper and his wife Helen Ralston Couper, both now deceased. The appellants are five of the six children of the late Mr and Mrs Couper’s daughter, Janet Richmond Kain who married the fifth respondent George Thomas Kain. Janet died in 1986.
The second respondent, who is the focus of the appellants’ concern, is Janet’s surviving brother. Until he was in his sixties Mr W A X Couper was a childless bachelor and as such he appears to have been and to have been seen as a natural benefactor of the prospects and expectations of his late sister’s children, particularly his nephews. But in 1989 he married Annette Elizabeth, referred to herein as Mrs A E Couper, who had four daughters from…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2002] NZCA 180
Decision Date: 25 July 2002

CaseChat Overview and Summary

Georgina Kain and others brought appeals against decisions made by Panckhurst J, who declined successive interlocutory applications by the appellants for the removal of trustees and the appointment of the Public Trustee as the sole trustee of multiple trusts. The appellants sought extensive relief in connection with the trusts, including the removal of all trustees and the appointment of the Public Trustee. The Court of Appeal dismissed the appeals, finding that Panckhurst J was not wrong in his exercise of discretion and that a carefully considered approach was warranted due to the complex interrelationship between the farming operations and the trusts. The Court found that the present trustees have knowledge and experience that no newcomer could readily acquire and that removing them may not necessarily be the most suitable course of action.

The Court of Appeal held that the jurisdiction to appoint and remove trustees is both inherent and statutory, with the inherent jurisdiction stemming from the Court's general supervisory powers in equity relating to the supervision of trusts for the welfare of beneficiaries. The Court emphasized that the objective of properly executing trusts should always be borne in mind, and that removal of trustees should only occur in cases of positive misconduct or endangerment of trust property.

The Court found that Panckhurst J had not erred in his decision to dismiss the applications under appeal. The Court of Appeal was not persuaded that the Judge was wrong in exercising his discretion in favor of a carefully considered approach that took into account the complex realities of the interrelationship between the farming operation and the trusts. The Court found that the present trustees have a knowledge and depth of experience that no newcomer could readily acquire, and that removing them may not necessarily be the most suitable course of action.

The Court also noted that the Court has wide powers to conduct inquiries and accounts without necessarily having to try a multiplicity of issues in a single session. The Court's powers, both in its general equitable jurisdiction and in terms of relevant rules and statutes, may be conducive to an orderly examination of the issues. The Court of Appeal dismissed the appeals and reserved the question of costs.

Orders