Gough v Ram Custodian Limited - [2012] NZHC 2218

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2011-404-006645 [2012] NZHC 2218

BETWEEN H D GOUGH Plaintiff

ANDRAM CUSTODIAN LIMITED, J R STRAHL AND B W M TOTHILL First Defendants

ANDR W RAYMOND, D A H BROWN AND B W M TOTHILL
Second Defendants

ANDR W RAYMOND, D A H BROWN AND B W M TOTHILL
Third Defendants

Hearing: 21-22 May 2012

Appearances: N W Ingram QC and M T Kyriak for Plaintiff
A S Ross and R A Rose for First Defendants
T C Weston QC and A V Foote for Second and Third Defendants

Judgment: 30 August 2012

JUDGMENT OF COURTNEY J

This judgment was delivered by Justice Courtney on 30 August 2012 at 4:00 pm
pursuant to R 11.5 of the High Court Rules

Registrar / Deputy Registrar

Date………………………………………

Solicitors: Kyriak Law Solicitors, 4/40 Eden Crescent, Auckland 1010
Fax: (09) 623-0540 – Email:mtk@kyriaklaw.co.nz
Duncan Cotterill, P O Box 5, Christchurch 8140
Fax: (03) 379-7097 – A V Foote
Chapman Tripp, P O Box 2206, Auckland 1140
Fax: (09) 357-9099 – A S Ross / R A Rose

Counsel: N W Ingram QC, P O Box 6569 Wellesley Street, Auckland 1141
Fax: (09) 379-2226
T C Weston QC, P O Box 3976, Christchurch 8140
Fax: (03)374-5707

GOUGH V RAM CUSTODIAN LTD & ORS HC AK CIV-2011-404-006645 [30 August 2012]

Introduction

[1] This case concerns the Head Trust of the Tracy Thomas Gough Estate and the sub-trusts that represent two branches of the Gough family, the Blair Gough Sub- trust and the Owen Gough Sub-trust. The Head Trust is required to have three trustees. They are appointed in the following way: the trustees of each sub-trust appoint one of their number and those trustees then appoint the third. The issue in this case is the validity of the appointments of two of the Head Trust trustees.

[2] The plaintiff, Harcourt Gough, is a beneficiary under the Owen Gough Sub- trust. The first defendants are trustees of the Head Trust and the second defendants trustees of the Blair Gough Sub-trust. The third defendants are the trustees of the BT Gough Family Trust, which is a private trust. Benjamin Tothill (the third named first defendant and third defendant) is a trustee of the Blair Gough Sub-trust and that sub- trust’s appointee to the Head Trust. Ram Custodian Limited (Ram Custodian), (the first named first defendant), is the independent trustee of the Head Trust.

[3] The plaintiff asserts that the appointments of Mr Tothill and Ram Custodian during the period 2005-2011 were invalid. The issues that arise are:

(a) Can a trustee of the Head Trust be reappointed more than once?

(b)Were Ram Custodian’s appointments in 2006 and 2009 made in accordance with the relevant trust deed?

(c) Were Mr Tothill’s appointments in 2005, 2008 and 2011 made in accordance with the relevant trust deed?

[4] At the request of counsel I have not considered what consequences might follow in the event of some or all of the appointments being ultra…

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: [2012] NZHC 2218
Decision Date: 30 August 2012

CaseChat Overview and Summary

In Gough v Ram Custodian Limited, the plaintiff Harcourt Gough sought to challenge the validity of certain appointments of trustees to the Head Trust of the Tracy Thomas Gough Estate. The Head Trust has three trustees, appointed by the trustees of two sub-trusts representing different branches of the Gough family. The dispute centred on the validity of the appointments of Ram Custodian Limited and Benjamin Tothill as trustees of the Head Trust. The court was required to decide whether the Deed of Variation permitted multiple reappointments of trustees, and whether the appointments in question complied with the terms of the Deed of Variation.

The court found that the Deed of Variation did not limit the number of terms a trustee could serve, and a trustee could be reappointed more than once. The court held that clause 6B(f) was the source of the power to reappoint trustees to the Head Trust. Consequently, the reappointments of Ram Custodian and Benjamin Tothill were not invalid on the basis that they had already served two terms. However, the court found that Ram Custodian was not validly appointed for the periods 28 October 2006 – 28 October 2009 and 28 October 2009 – 28 October 2012 due to procedural errors in the waiver process. The court also found that Benjamin Tothill was not validly appointed for the period between 28 October 2005 and 28 October 2008 due to the lack of evidence of a Deed of Appointment. Tothill was, however, validly appointed for the periods 28 October 2008 – 28 October 2011 and 28 October 2011 – 28 October 2014.

The court did not address the issue of costs, and invited counsel to file memoranda on the issue by specified dates.

Orders