Hamilton Family Trust - [2024] NZHC 3893

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2024-485-618

[2024] NZHC 3893

UNDER
Part 19 of the High Court Rules 2016 and

ss 122, 124, and 125 of the Trusts Act 2019 and the inherent jurisdiction of the High Court to supervise the administration of

trusts

IN THE MATTER OF

The T J & H M Hamilton Family Trust

BY

TREVOR JAMES HAMILTON, HARRIET MECHELINA HAMILTON and JAMES

GREGORY EDEN as trustees of the T J & H M HAMILTON FAMILY TRUST

Applicants

On the Papers

Counsel:

G F Kelly and K H Lawrence for the Applicants L M McKeown as Counsel Assisting

Judgment:

18 December 2024

JUDGMENT OF GWYN J

(Orders approving variation of trust deed)

[1] The applicants, Trevor James Hamilton, Harriet Mechelina Hamilton and James Gregory Eden (as trustees of the T J & H M Hamilton Family Trust (Trust)) have applied under the inherent jurisdiction of the Court, and ss 122, 124 and 125 of the Trusts Act 2019 (Act), for orders:

(a)approving a Deed of Variation on behalf of minor, future and unascertained beneficiaries of the Trust;

RE THE HAMILTON FAMILY TRUST [2024] NZHC 3893 [18 December 2024]

(b)waiving any requirement that certain companies and trusts associated with the beneficiaries of the Trust consent to the Deed of Variation;

(c)confirming that the applicants (as trustees) may sign a new Restated Trust Deed which incorporates the Deed of Variation with the existing terms of the Trust; and

(d)that the applicants’ costs in respect of this application be paid from the Trust on a solicitor-client basis.

Background

[2] The Trust was set up by deed on 15 April 1993. It has become wealthy, largely because of a 99.8 per cent shareholding in T. H. Enterprises Ltd, the holding company for a wider group of dairy farming and support companies, with total assets exceeding
$100 million.

[3] The settlors depose that they set up the Trust to provide for their family, but they believe the current Trust structure is no longer suitable for that purpose. However the Trust Deed does not provide for the Trustees to vary the terms of the Trust. They now apply to the Court to vary the Trust Deed.

[4] The applicants’ 1 October 2024 without notice interlocutory application for leave to commence proceedings by way of originating application and for directions as to service and conduct of the proceeding was considered by Associate Judge Skelton on 8 October 2024. The Associate Judge granted leave to commence the proceeding by way of originating application under pt 19 of the High Court Rules 2016, and directed that service on any of the beneficiaries of the Trust be dispensed with, on the basis that all adult beneficiaries have consented to the Deed of Variation.

[5] The Associate Judge appointed Lisa McKeown as counsel to represent the interests of the minor, future, and unascertained beneficiaries and the companies and

trusts in respect of which waiver of service…

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.

Continue reading Hamilton Family Trust

Details

AGLC: Hamilton Family Trust [2024] NZHC 3893
Case: [2024] NZHC 3893
Decision Date: 18 December 2024

CaseChat Overview and Summary

The applicants, trustees of the T J & H M Hamilton Family Trust, sought approval for a Deed of Variation to amend the trust deed, including extending the trust's life and modifying beneficiary provisions. The applicants sought approval under sections 122, 124, and 125 of the Trusts Act 2019 and the Court's inherent jurisdiction. They also sought to waive the requirement for certain beneficiaries to consent to the Deed of Variation and permission to sign a new Restated Trust Deed. The Court was required to determine if the proposed variation was in the best interests of the beneficiaries, particularly the minor, future, and unascertained beneficiaries, and whether the Court should waive the requirement for certain beneficiaries to consent to the variation. The Court considered the intentions of the settlors, the benefit or detriment to the beneficiaries, and whether the variation would reduce or remove any vested interests.

The Court concluded that the Deed of Variation was in the best interests of the beneficiaries, particularly the minor, future, and unascertained beneficiaries, as it modernised the Trust Deed and extended its life. The Court found that the detriments to certain future spouses and companies were outweighed by the advantages of the proposed variation and the interests of the family as a whole. The Court also found that it was appropriate to waive the requirement for certain beneficiaries to consent to the variation, given the difficulty in identifying and obtaining consent from all qualifying beneficiaries. The Court approved the Deed of Variation, waived the requirement for certain beneficiaries to consent, and allowed the applicants to sign the new Restated Trust Deed. The Court also ordered that the applicants' costs be paid from the Trust on a solicitor-client (indemnity) basis.

Orders