Heaphy v Heaphy

[2015] NZHC 2522

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2014-404-2946 [2015] NZHC 2522

UNDER

Part 18 of the High Court Rules, s 51

Trustee Act 1956

AND IN THE MATTER

of the MILOU TRUST, settled by Deed dated 18 December 2003

BETWEEN

CHRISTOPHER JAMES HEAPHY AS TRUSTEE OF THE MILOU TRUST Plaintiff

AND

CHRISTOPHER JAMES HEAPHY, LEE- ANN FAYE MERCER, JONATHAN CHARLES HEAPHY AS TRUSTEES OF THE MILOU TRUST

Defendants

In Chambers:	On papers
Judgment:	14 October 2015

JUDGMENT OF THE HON JUSTICE KÓS (Costs)

[1]        A matrimonial home is held by a trust.  The marriage had dissolved.  The trustees were the former husband and wife, together with the brother of the husband. The trust became deadlocked.   Everyone agreed that some or all of the trustees needed to be replaced.   The former husband therefore applied under s 51 of the Trustee Act 1956  for removal  of his  former  wife as  trustee.   Alternatively,  for removal of all trustees and their replacement with an independent trustee.

[2]      A case management conference was held before Associate Judge Sargisson

on 16 April 2015.   The Associate Judge’s minute records that parties, through

HEAPHY v HEAPHY [2015] NZHC 2522 [14 October 2015]

counsel,  had  agreed  the  current  trustees  be  removed,  and  that  an  independent trustee be appointed in their place.  Counsel were to discuss potential appointees.

[3]      However, on the next case management conference occasion, 15 May 2015, the Associate Judge recorded that the parties had been unable to reach agreement and the matter would have to be determined by the Court.

[4]      The matter was therefore called before me on 7 August 2015.  At that point common sense again prevailed.  After an adjournment of about an hour in which counsel and the parties held discussions, it was agreed that the existing trustees be removed and that Lewis Grant, an Auckland solicitor, be appointed independent trustee instead pursuant to s 51.

[5]      The consent order provided for the Court to determine costs (if not agreed). Disagreement has again broken out.

[6]      Lengthy submissions have been filed, advancing charge and counter-charge. But the fact remains that the defended hearing in which these matters could be examined by the Court did not take place.  In a situation in which the rights and wrongs of the matter are misty, I am not prepared to determine them on the basis of irreconcilable affidavits and submissions.

[7]      Where the Court is in a position to form a clear view as to the merits on a contested s 51 application, a costs order may be appropriate.  In any other case, and this is one, it is not.  There will therefore be no order for costs by the Court.  But the parties are entitled to apply to the new trustee for payment of their reasonable legal costs (as determined by the trustee) from the trust’s estate.

Stephen Kós J

Solicitors:

Jackson Russell, Auckland for Mr Heaphy

Stace Hammond, Auckland for Ms Mercer