Inthayung v Heimsath Alexander Trustee Limited - [2023] NZHC 1867

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-000830

[2023] NZHC 1867

BETWEEN
MALIWAN INTHAYUNG

Applicant

AND

HEIMSATH ALEXANDER TRUSTEE

LIMITED and LEX TRUSTEE COMPANY
LIMITED as Trustees of the DW CORRICK TRUST
First Respondents

OFFICIAL ASSIGNEE as Executor of the ESTATE OF DAVID WAYNE CORRICK

Second Respondent

Hearing: On the papers

Counsel:

P Napier and R Wang for the Applicant

M Russell and R Bingham for the first named First Respondent A Cupples for the second named First Respondent

No appearance for the Second Respondent
No appearance for the Bank of New Zealand (Interested Party)

Judgment:

18 July 2023

REDACTED JUDGMENT OF GORDON J

[As to costs]

This judgment was delivered by me
on 18 July 2023 at 3.30 pm, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Solicitors:
K3 Legal Ltd, Auckland Wotton Kearney, Auckland Kennedys, Auckland

INTHAYUNG v HEIMSATH ALEXANDER TRUSTEE LTD [2023] NZHC 1867 [18 July 2023]

[1] This is a judgment on an application for costs. The applicant, Maliwan Inthayung, seeks costs of $22,346.50 together with disbursements of $150 (a total of
$22,496.50) against the first named first respondent, Heimsath Alexander Trustee Ltd (Heimsath Alexander Trustee).

[2] Heimsath Alexander Trustee opposes the application. It further says that, if costs are awarded, the most Ms Inthayung is entitled to is $12,736.50 and any costs awarded should be paid from the assets of the DW Corrick Trust (the Trust).

[3] Heimsath Alexander Trustee also seeks its costs in respect of the application with those costs to be paid from the assets of the Trust.

Background

[4] A brief background is as follows. Further details are set out in my substantive judgment in Inthayung v Heimsath Alexander Trustee Ltd (the judgment).1

[5]David Corrick died on 9 November 2021.

[6] Mr Corrick had created the Trust by Deed dated 5 November 2008. The trustees were Mr Corrick and Knight Coldicutt Trustees Ltd. On 9 June 2010, Knight Coldicutt Trustees Ltd was replaced by Heimsath Alexander Trustee, a trustee company operated by the legal firm of Heimsath Alexander.

[7] Ms Inthayung is the widow of the late Mr Corrick. Ms Inthayung was added as a beneficiary of the Trust by Mr Corrick’s last will dated 29 January 2021 pursuant to cl 25 of the Trust Deed.

[8]On 28 April 2023, Ms Inthayung applied to this Court for orders that:

(a)the first respondents, Heimsath Alexander Trustee and LEX Trustee Company Ltd (LEX Trustee) be removed as trustees of the Trust; and

1 Inthayung v Heimsath Alexander Trustee Ltd [2023] NZHC 1240.

(b)Mark Graeme Kirkland of Dunedin and Helen Marie Edwards of Auckland be appointed as trustees of the Trust.

[9] Heimsath Alexander Trustee and LEX Trustee agreed to their removal and Mr Kirkland and Ms Edwards consented to being appointed as trustees of the Trust. Despite Heimsath Alexander Trustee saying it would abide by the Court’s decision, it sought particular conditions relating to the principal asset…

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.

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Details

Case: [2023] NZHC 1867
Decision Date: 18 July 2023

CaseChat Overview and Summary

In the High Court of New Zealand, Maliwan Inthayung applied for an order to remove Heimsath Alexander Trustee Ltd and LEX Trustee Company Ltd as trustees of the DW Corrick Trust and to appoint new trustees. Heimsath Alexander Trustee opposed the application and sought particular conditions for its retirement as a trustee. The court had to decide whether Maliwan Inthayung was entitled to costs and, if so, whether those costs should be paid from the assets of the Trust.

The court determined that Maliwan Inthayung was the successful party in the application, as she obtained the order she sought with a condition largely consented to, except for an addition which was essential to the application. The court found that the application fell under the third category of trust litigation, where the usual principles of costs apply, and they will ordinarily follow the event. The court concluded that Heimsath Alexander Trustee’s costs, including the costs awarded against them, should not be indemnified by the Trust, as the conditions sought by Heimsath Alexander Trustee were not reasonable or necessary for the due and orderly administration of the Trust. The court reduced the costs claimed by Maliwan Inthayung based on the number of days allocated for the filing of the application and supporting affidavits and the sealing of the judgment.

The court awarded $12,936.50 in standard scale 2B costs to Maliwan Inthayung against Heimsath Alexander Trustee.

Orders