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Howarth v Howarth

Howarth v Howarth

Case [2019] NZHC 898 24 April 2019

Executor Duties

Conflict of Interest

Removal of Executor

Family Protection Act

Estate Administration Law

Family Law

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IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2018-419-0272

[2019] NZHC 898

UNDER Section 21 of the Administration Act 1969 and s 51 of the Trustees Act 1956

IN THE MATTER

of the estate of Jack Howarth

BETWEEN

DAVID JOHN MACMILLAN HOWARTH

First Plaintiff

JACQUELINE ELLEN KEEN
Second Plaintiff

AND

ANDREW ROBERT HOWARTH

Defendant

Hearing: 11 April 2019

Appearances:

D J G Cox for the Plaintiffs

G H J Brant for the Defendant

Judgment:

24 April 2019

JUDGMENT OF ASSOCIATE JUDGE SMITH

This judgment was delivered by me on 24 April 2019 at 11.00am, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors / Counsel:
Rennie Cox, Auckland Stace Hammond, Hamilton

HOWARTH v HOWARTH [2019] NZHC 898 [24 April 2019]

[1] In this proceeding, the plaintiffs ask for an order removing the defendant as executor and trustee of the estate of the parties' late father. They contend that the estate has potential claims against the defendant (and possibly others) that should be investigated, and that those potential claims place the defendant in a position where he has a conflict of interest between his personal interests and his duties as administrator of his late father's estate. They say that in those circumstances he should have agreed to stand aside as executor and trustee to allow for the appointment of an independent administrator and trustee, but he has refused to do so. They contend that the defendant has no defence to their claim for his removal, and they seek summary judgment on it.

[2] The defendant opposes the application for summary judgment. He says that the plaintiffs have provided no evidential basis for an order removing him as administrator/trustee, and they have themselves refused to undertake to meet the costs of the proposed independent trustee and the investigation they wish to have carried out.

[3]I now give judgment on the plaintiffs' summary judgment application.

Background

[4] The first plaintiff (David) and the defendant (Andrew) are brothers. The second plaintiff (Jacky) is their sister.

[5] The parties' father, the late Jack Howarth of Tairua (the deceased), died on 10 June 2017, aged 92. The deceased's wife, Elizabeth Howarth, had died in October 2000. The deceased had married only once, and the parties to this proceeding were the only children of the deceased and his late wife.

[6] The deceased's last will, dated 28 December 2008, appointed Andrew as one of two executors. The other executor, Mr Michael Radford, renounced his appointment, and probate was granted to Andrew alone on 7 September 2017. Andrew is the sole beneficiary under the deceased's last will.

[7] The parties agree that the deceased's estate has an estimated net value of approximately $335,000, although there will be further administration charges to be deducted from that figure.

[8] Not long after the deceased's death, David and Jacky became concerned that amounts totalling over $300,000 had been paid out of the deceased's bank accounts between 1996 and the…

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 Howarth v Howarth

Details

AGLC: Howarth v Howarth [2019] NZHC 898
Case: [2019] NZHC 898
Decision Date: 24 April 2019

CaseChat Overview and Summary

In this proceeding, the plaintiffs sought an order removing the defendant as executor and trustee of the estate of their late father. They contended that the estate had potential claims against the defendant that should be investigated, and that those potential claims placed the defendant in a position where he had a conflict of interest between his personal interests and his duties as administrator of his late father's estate. The defendant opposed the application for summary judgment, saying that the plaintiffs had provided no evidential basis for an order removing him as administrator/trustee, and they had themselves refused to undertake to meet the costs of the proposed independent trustee and the investigation they wished to have carried out.

The court was required to decide whether the plaintiffs' application for summary judgment could be granted. The court identified the key legal issues as being whether there were conflicts of evidence on important matters of fact that would need to be addressed at trial, and whether Andrew had any arguable defence to the claims. The court concluded that the application for summary judgment could not be granted as there were conflicts of evidence on important matters of fact that would need to be addressed at trial, and the court could not be satisfied that Andrew had no defence to the claims.

The court found that the plaintiffs had not produced sufficient evidence to justify the removal of Andrew on a summary basis. The court also found that it was arguable that Andrew's duties as executor and trustee would not extend to conducting an investigation purely on the grounds that Jacky and David did not understand where the money went or why it was paid. The court also found that there would be potential limitation issues with attempts to recover any loans the deceased may have made going back before the date which was six years before the deceased's death.

Accordingly, the summary judgment application was dismissed. In accordance with usual practice where a plaintiff's summary judgment application had been dismissed, the costs on the application were reserved.

Orders