Hager v Perpetual Trust Limited t/a Perpetual Guardian

[2025] NZHC 1886

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2025-404-413

[2025] NZHC 1886

BETWEEN

CAROLINE HAGER

First Plaintiff

JUSTINE HARWOOD
Second Plaintiff

AND

PERPETUAL TRUST LIMITED t/a PERPETUAL GUARDIAN

Defendant

Hearing:	10 July 2025
Appearances:	Plaintiffs in person (via VMR) A J Steele for Defendant
Judgment:	10 July 2025

JUDGMENT OF O’GORMAN J

This judgment was delivered by me on 10 July 2025 at 4 pm pursuant to r 11.5 of the High Court Rules 2016.

Registrar/Deputy Registrar

…………………………………

Solicitors/Counsel:

A J Steele, Barrister, Auckland Perpetual Guardian, Auckland

Copy to: Plaintiffs

HAGER v PERPETUAL TRUST LTD t/a PERPETUAL GUARDIAN [2025] NZHC 1886 [10 July 2025]

Introduction

[1]                 This matter has been called before me today to determine whether to approve a trustee’s sale of property, in terms of the requirements in a Court order made on   27 March 2025.

[2]                 The underlying substantive proceeding is brought by the plaintiffs who are the nieces of Mr Brian Angliss and Mrs Christine Angliss (both deceased) in respect of the affairs of the Limerick Trust.

[3]                 The Limerick Trust was established in 2002 by Mr and Mrs Angliss as settlor. The defendant is the current trustee of the Trust. Discretionary beneficiaries are defined broadly in the trust deed to include:

Any other person who is related to the settlor by blood, marriage or adoption and of any degree and of any kind and whether now living or born after the date of this deed.

[4]                 The trust deed differentiates between so-called primary beneficiaries who are described as beneficiaries for whom a person who “settles assets on this trust has or would have had natural love and affection” and secondary beneficiaries who are defined as beneficiaries for whom “no settlor of assets of this trust has or would have had natural love and affection”.

[5]                 The plaintiffs are primary beneficiaries for the purposes of the trust deed, having had a long association with their uncle and aunt.

[6]                 The principal asset of the trust is a luxury home situated at 39 Tongatu Road, Ngunguru.

[7]                 The plaintiffs commenced this proceeding on 20 February 2025 challenging various acts, omissions and decisions of the trustee, including the trustee’s process for selling the Ngunguru property, which was undertaken without consultation with the plaintiffs. They contended that the marketing campaign was inadequate for a property of its calibre.

[8]                 On 26 February 2025, Muir J allocated 19 March 2025 for hearing the plaintiffs’ application for an injunction seeking (among other things) to prevent any sale by tender before the plaintiffs’ substantive claim could be heard.

[9]                 In a minute issued on 17 March 2025, Lang J suggested that a hearing to determine the injunction might be premature, given that the trustee’s tender process was not due to close until 26 March 2025. He adjourned the injunction hearing by consent to 28 March 2025, with a telephone conference scheduled for the day before.

[10]             By 27 March 2025, the defendant was still negotiating with two tenderers, but was not proposing to accept any offer without giving the plaintiffs five working days’ notice of its intention to do so. In those circumstances, Lang J made an interim direction that “no offer shall be accepted unless the plaintiffs consent or the court approves the offer”. Meanwhile, the proceeding was adjourned to the Duty Judge list on 29 May 2025. On 28 May 2025, that mention was further adjourned by consent until 10 July 2025.

[11]             On 16 June 2025, the defendant entered into a conditional sale and purchase agreement for the property, which provides for settlement six months from the agreement becoming unconditional. The sole condition is the High Court’s approval of the sale, required under the orders made by Lang J on 27 March 2025.

Grounds of opposition

[12]             The plaintiffs oppose the defendant’s application for approval of the 16 June 2025 sale and purchase agreement. Among other reasons, they object because:

(a)contrary to the assurances given to them and the Court on 27 March 2025, they were not given five working days’ prior notice of the trustee’s intention to accept the offer; and

(b)another conditional offer on the property was subsequently received on 27 June 2025 at a higher price and with a materially shorter settlement period.

Trustee’s submissions

[13]             The trustee seeks the Court’s approval on the 16 June 2025 agreement. They have filed comprehensive submissions and supporting evidence seeking to substantiate that the sale process was robust, including the following:

(a)obtaining expert valuations of the property;

(b)considering two different real estate agencies before engaging Bayleys real estate agency;

(c)taking the real estate agent’s advice about the sales method and a proper marketing campaign designed to attract both domestic and international interest;

(d)undertaking that marketing, including website advertising; and

(e)considering offers received against the valuations and real estate agent’s appraisal, and further negotiating on price and other terms.

[14]             The trustee emphasises that a number of offers were received (indicating that the campaign had appropriate reach) and, when the trustee signed the 16 June 2025 sale agreement, it was the best offer. By analogy with the equivalent duties on mortgagees and receivers, compliance with the duty to obtain the best price reasonably obtainable should be assessed at the time of sale, not subsequently.1

[15]             While the trustee acknowledges that the plaintiffs should have been provided five working days’ advance notice before the trustee accepted any offer, the defendant’s counsel submits this would not have made any difference on the facts because the plaintiffs were notified on 17 June 2025 and the subsequent offer was not received until 27 June 2025.

1      LJ Group New Zealand Ltd v New Zealand Capital Management Ltd [2025] NZHC 1071 at [37(b)], referencing Long v ANZ National Bank Ltd [2012] NZCA 132 at [18]–[21]; Westpac New Zealand Ltd v Lamb [2012] NZHC 319; and Public Trust v Ottow (2009) 10 NZCPR 879 (HC).

[16]             Having committed to the 17 June 2025 sale and purchase agreement (when no other higher offer was available), the trustee seeks this Court’s consent to satisfy the condition.

Analysis

[17]             In circumstances where the trustee has no beneficial interest, the trustee’s duty is to facilitate a sales process that achieves the best price available to the benefit of beneficiaries as a whole.2 The duty requires the trustee to investigate a higher offer after the stage at which an ordinary vendor might consider himself morally bound by a lower offer.3

[18]             In Buttle v Saunders, Mrs Simpson was seeking to acquire the reversion of a leasehold interest from a trustee. The price of £6,000 had been agreed, and the trustee sent a draft contract to Mrs Simpson's solicitors. They confirmed all terms were agreed except cl 13, which provided that she should pay the vendor’s costs. On 20 October, Mrs Simpson’s solicitors then confirmed that their client agreed to pay the vendor’s costs. In the interim, one of the beneficiaries had indicated interest in purchasing at a higher price. The trustee considered himself committed to sell to Mrs Simpson. The beneficiary brought proceedings seeking to stop that sale. The Court gave the trustees liberty to sell to Mrs Simpson at £6,600, that being the highest price then available.

[19]             I acknowledge that no better offer was available as at 16 June 2025, and the competing offer is still conditional, but I am not satisfied that the existing agreement dated 16 June 2025 is in the best interests of the beneficiaries.   As submitted by    Mr Steele, Buttle v Saunders might be distinguishable on the ground that the trustee in that case has a moral duty only and not a fully executed agreement, but I nevertheless consider those principles applicable when the contract remains conditional on the Court’s approval, which is also focused on achieving best price for the beneficiaries. Whether or not the delay in receiving this latest offer is linked with the quality and duration of the trustee’s sales process, I am satisfied on the evidence

2      McKean v McKean Family Trustee Ltd [2025] NZHC 1621 at [353], referencing Killearn v Killearn [2011] EWHC 3775 (Ch) at [16]; Folds Farm Trustees Ltd v Oliver Alister Sydney Cuffs [2024] EWHC 12 (Ch); and Ruscoe v Houchens [2024] NZHC 419 at [10(b)].

3      Killearn v Killearn, above n 2, at [16(iii)], referencing Buttle v Saunders [1950] 2 All ER 193.

that a higher sales price and more favourable settlement timing is likely achievable now, which would be better for the beneficiaries. I therefore decline to approve the sale agreement dated 16 June 2025. Rather, I direct the trustee to continue with the sale process, with the objective of achieving the best price available.

[20]             Meanwhile, the extant orders of Lang J made on 27 March 2025 continue to apply, including that no offer shall be accepted unless the plaintiffs consent or the Court approves the offer.

[21]             I do not consider it appropriate to make any directions for the payment of the proceeds to an independent solicitor if a sale is concluded. I accept that the defendant is aware of the disputed issues in this proceeding, and related obligations and liabilities that apply if funds are misapplied. I acknowledge that proper trust expenses must be met in the meantime.

[22]             Various other issues were raised in memoranda and submissions filed by the parties, but those matters are not for hearing today.

Result

[23]             The application for the Court’s approval of the sale and purchase agreement dated 16 June 2025 is declined. I direct the trustee to continue with the sale process, with the objective of achieving the best price available.

[24]             I ask Registry to schedule this for a case management conference before an Associate Judge to set an appropriate timetable for the substantive matters.

[25]             Meanwhile, the parties continue to have leave to ask the Registrar to arrange a telephone conference before the Duty Judge in Auckland at any stage on 24 hours’ notice, should that be required for approval of an offer, or to address any aspect of the injunction application that impacts on the sale process or needs urgent determination.

O’Gorman J