Gordon

[2020] NZHC 1981

IN THE HIGH COURT OF NEW ZEALAND GISBORNE REGISTRY

I TE KŌTI MATUA O AOTEAROA TŪRANGANUI-A-KIWA ROHE

CIV-2020-416-6

[2020] NZHC 1981

UNDER

Part 19 of the High Court Rules and ss 43 and 52 of the Trustee Act 1956

IN THE MATTER OF

an application for an order vesting the Loch Lomond Trust interest in the property to the trustees of the Loch Lomond Trust

BETWEEN

WAYNE RICHARD GORDON AND PAUL HOLMES GORDON

Applicants

Hearing:	On the papers
Appearances:	M R Walker for the Applicants
Judgment:	7 August 2020

JUDGMENT OF COOKE J

[1]By application dated 17 July 2020 the applicants apply for orders or directions:

(a)that the proceedings may be commenced, without notice, by originating application,

(b)dispensing with service on the beneficiaries,

(c)that the applications be determined on the papers, and

(d)that pursuant to s 52 of the Trustee Act 1956 title to the land contained in Record of Title GS114/253 being the property situated at 16 Emily Street, Riverdale, Gisborne, be vested in the names of Paul Holmes

GORDON [2020] NZHC 1981 [8 August 2020]

Gordon and Wayne Richard Gordon as trustees of the Loch Lomond Trust.

[2]                 The application is supported by affidavits from Wayne  and  Paul  Gordon. Mr James Gordon is the applicants’ father, and he established the Loch Lomond Trust with himself and his two sons as the trustees.   The beneficiaries of the Trust are    Mr James Gordon and his two sons.

[3]                 The applicants explain in their affidavits that in light of the information that they had concerning their father, including the medical reports I refer to below, they acted under s 43 of the Trustee Act 1956 to remove him as a trustee. They did this by resolution dated 22 June 2020. That step does not achieve all that is necessary, however, as the Trust owns the property at Gisborne, and he remains registered on the title. Vesting orders are accordingly sought under s 52 of the Trustee Act 1956 vesting title in the applicants as the remaining trustees.

[4]                 The orders/directions referred to in [1](a) and [1](c) above are routinely made in applications of this kind, and are appropriate here. I also accept based on the affidavit evidence there is no need for service of the application on any other person as a beneficiary.

[5]Section 52(1)(b) of the Trustee Act 1956 provides:

52     Vesting orders of land

(1)Subject to the provisions of subsections (2) and (3), in any of the following cases, namely—

…

(b)      where a trustee entitled to or possessed of any land or interest therein, whether by way of mortgage or otherwise, or entitled to a contingent right therein, either solely or jointly with any other person—

(i)is under disability;

…

the court may make an order (in this Act called a vesting order) vesting the land or interest therein in any such person in any such manner and for any

such estate or interest as the court may direct, or releasing or disposing of the contingent right to such person as the court may direct.

[6]                 This power can be utilised when a former trustee is no longer capable but remains on the title. For example it has been used in the case of an incapacitated trustee where the holder of an enduring power of attorney is not able to execute transfers.1 It has also been exercised when powers of an appointment under the trust deed do not address the situation.2 Ultimately the issue for the Court is whether ordering the changes to the certificate of title is appropriate in the circumstances of the case.

[7]                 In the present case the applicants have provided two medical assessments undertaken in relation to Mr James Gordon. The first is from Dr Vinay Angadi Rodresh the resident medical officer at Gisborne Hospital. He reports that Mr Gordon was an inpatient at the hospital in November 2019 and that during his admission concerns were expressed regarding his capacity and memory. A formal assessment was undertaken and this demonstrated sub-standard cognition. He reports that the team at the hospital agreed with the applicants’ decision to act under an enduring power of attorney in those circumstances. A more recent report dated 4 June 2020 from Mr Gordon’s general practitioner for the last 18 years, Dr Bernd Stoltenberg states that he lacks sufficient understanding to act as a trustee of the Trust, and will for the future because of his medical conditions. Although it would have been more helpful to have a little more detail about the conditions from the medical doctors, and have further information in the affidavits about Mr Gordon’s state, given the apparently uncontroversial nature of the application I accept that it is appropriate to make orders in the present case.

[8]                 Accordingly I make all of the orders sought in the applications in the terms sought.

Cooke J

1      Godfrey v McCormick [2017] NZHC 420; Locker v Browning [2018] NZHC 1127.

2      Public Trust v Daken [2017] NZHC 1285.