Harre v Clark - [2014] NZHC 2533

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2013-404-4304 [2014] NZHC 2533

BETWEEN
LOIS VIOLET HARRE

First Plaintiff

RODERICK MCCRAE HARRE Second Plaintiff

AND

LYNETTE JOY CLARK First Defendant

COLIN JAMES LUCAS Second Defendant

Hearing: 6 October 2014

Counsel:

TM Molloy for Plaintiffs
AE Ferguson and FC Monteiro for Defendants

Judgment:

16 October 2014

JUDGMENT OF BREWER J

This judgment was delivered by me on 16 October 2014 at 11:00 am pursuant to Rule 11.5 High Court Rules.

Registrar/Deputy Registrar

Solicitors: Walker & Associates (Auckland) for Plaintiffs
Wilson Harle (Auckland) for Defendants

Counsel: Tom Molloy

HARRE v CLARK [2014] NZHC 2533 [16 October 2014]

Introduction

[1] Mrs Lois Harre established a Family Trust in 1989. Its sole asset is a 29 acre rural property at Whenuapai. Mrs Harre has the power to appoint trustees. In 2007, Mrs Harre exercised that power to appoint her daughter, Mrs Lynette Clark, and a solicitor, Mr Colin Lucas, as trustees. Mrs Harre’s husband was also a trustee at the time, but he passed away in 2012 and was not replaced.

[2] The Trust’s land is a remnant of a farm which has been in Mrs Harre’s family since 1860. Mrs Harre lives on an adjoining property which she owned in common with her late husband. Mrs Harre has a life interest in her husband’s estate and, on her death, his estate will pass to the trustees of the Trust.

[3] Mrs Harre, now in her 80s, has been associated with the Trust’s land all her life. She and her husband farmed it for many years. Since Mr Harre died, Mrs Harre has continued to run cattle there. The land is not, and never has been, a viable economic unit. It has too small an area. Mrs Harre subsidises the cost of running the farming operation and the Trust has never derived an income from it.

[4] The beneficiaries of the Trust are Mrs Harre’s children, grandchildren, and their spouses. Its purpose is to provide for their “personal support benefit maintenance education or advancement in life”.

[5] Mrs Harre and her husband had five children, four of whom are still alive. They are Mrs Lynette Clark, Mrs Elaine Grant, Mr Roderick Harre, and Ms Andrea Harre. The fifth child, Mr Warren Harre, died in 2003. He is survived by his three children and their mother.

[6] Until recent years, the Trust slumbered. Mrs Harre and her husband farmed the land and looked after it as they always had. The Trust has not furthered its purpose because it has had no funds to do so.

[7] As Mr Harre neared the end of his life, the Harre family began to discuss what should become of the land. I infer that they did so, as is so often the case with families where family land is held in Trust, without particular regard to the legal

position of the Trust. A family meeting was held on 28 November 2009. There was a general feeling that the land…

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 Harre v Clark

Details

AGLC: Harre v Clark [2014] NZHC 2533
Case: [2014] NZHC 2533
Decision Date: 16 October 2014

CaseChat Overview and Summary

The dispute in Harre v Clark [2014] NZHC 2533 was about who should control the sale of the Trust’s land. The plaintiffs, Mrs Harre and Mr Roderick Harre, argued that they should be the ones to do that because they were the validly appointed trustees and would take steps to achieve the greatest return for the Trust. The defendants, Mrs Clark and Mr Lucas, argued that the plaintiffs’ exercise of the power of appointment to remove Mr Lucas as a trustee and to appoint themselves as trustees was invalid due to conflict of interest. The Court held that Mrs Harre exercised her power of appointment for a proper purpose, consistent with the object of the power, and in the best interests of the beneficiaries as a whole. Therefore, the plaintiffs were entitled to be registered as proprietors of the land. The Court declined to make any of the declarations sought by the defendants or the orders sought by Mrs Clark as a beneficiary of the Trust. The plaintiffs were entitled to have their reasonable costs paid out of the Trust estate, and the defendants were also entitled to have their reasonable costs paid out of the Trust estate.

Orders