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Jones v Jones

Jones v Jones

Case [2023] NZHC 1408 7 June 2023

Executors and Administrators

Conflict of Interest

Administration of Estates

Breach of Fiduciary Duty

Succession Law

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IN THE HIGH COURT OF NEW ZEALAND NELSON REGISTRY

I TE KŌTI MATUA O AOTEAROA WHAKATŪ ROHE

CIV-2022-442-000052

[2023] NZHC 1408

UNDER the Administration Act 1969

IN THE MATTER

of the ESTATE OF

BASIL RAYMOND JONES

BETWEEN

LAUREL DAWN JONES

Applicant

AND

CINDY MARIA JONES

First Respondent

AND

JASON RAYMOND JONES

Second Respondent

Hearing: 30 May 2023

Counsel:

A M Halloran for Applicant

D R Weatherley for Respondents

Judgment:

7 June 2023

JUDGMENT OF ISAC J

[Application to remove executors]

Introduction

[1] Mr Basil Jones died on 10 March 2021. This proceeding concerns a dispute between his surviving wife, Laurel, and Mr Jones’ two adult children of a previous relationship, Cindy and Jason.1

1 Given the shared surnames of the deceased, and the parties, I will refer to them throughout this judgment by their first names. I mean them no discourtesy by doing so.

JONES v JONES [2023] NZHC 1408 [7 June 2023]

[2] Shortly before his death, Basil completed a new will. He appointed Laurel, Cindy and Jason as his executors and, broadly, divided his estate between the three of them.

[3] Laurel has made an election to pursue a claim against Basil’s estate under the Property (Relationships) Act 1976. She has also brought a claim for provision under the Family Protection Act 1955. The effect of Laurel’s election to pursue a relationship property claim means that she has renounced her entitlement as a beneficiary of Basil’s estate.2

[4] Laurel accepts that she should no longer serve as an executor given the conflict between her personal interests and her duties as an executor. However, in this proceeding she claims that Jason and Cindy should also be removed under s 21 of the Administration Act 1969. She argues that a combination of factors, including delay in the administration of the estate, the actions of her co-executors and their hostility towards her require the appointment of an independent executor.

[5] The issue I must determine is whether it is expedient to remove all three executors in terms of s 21.3

Background

[6] There is very little dispute between the parties about the relevant facts. Where they differed is on their interpretation of those events and their significance, if any, to the exercise of the Court’s discretion.

[7] According to the evidence, Cindy and Jason’s mother had been married to Basil. However, in 1989 he began a de facto relationship with Laurel and was eventually married to her in 2004. It follows that Laurel and Basil had been in a relationship for 32 years at the time of his death.

2 Property (Relationships) Act 1976, s 76(1).
3 In Vlaar v Van Der Lubbe [2016] NZHC 2398 at [26], Clark J referred to the “significant” discretion the Court holds under s 21.

[8] Prior to the commencement of his relationship with Laurel, it seems Basil owned a family home in Seaton Street, Nelson, together with virtually all of the shares in a company that operated a motor vehicle sales business, Sun City…

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 Jones v Jones

Details

AGLC: Jones v Jones [2023] NZHC 1408
Case: [2023] NZHC 1408
Decision Date: 7 June 2023

CaseChat Overview and Summary

The case of Jones v Jones, heard in the High Court of New Zealand, concerns a dispute among the executors and beneficiaries of the estate of the late Basil Jones. The applicants, Laurel, the surviving wife of Basil, seek the removal of the executors, Cindy and Jason, the children of Basil from a previous relationship. The primary reason for this application is the delay in administering the estate, coupled with Cindy's unilateral actions regarding the estate's assets, particularly the shares of Sun City Motors Limited, and the ongoing conflict between the parties. The legal issues revolve around whether it is expedient, under the Administration Act 1969, to remove all three executors due to their failure to adequately manage the estate and potential conflicts of interest. The court's discretion under section 21 of the Act was heavily considered, with factors such as the suitability, practicality, and efficiency of the executors' conduct being paramount. The court found that the executors had not acted in the best interests of the estate and its beneficiaries, and the removal of all three executors was deemed necessary to ensure proper administration of the estate.

In reaching its decision, the court considered the executors' failure to gather and secure the estate's assets, particularly the shares in Sun City Motors Limited, and Cindy's unilateral actions in transferring these shares into her own name and appointing herself as the sole director. The court was also concerned about the potential conflict of interest this created and the risk of Cindy using her position to delay resolution of Laurel's claims against the estate. Additionally, the court noted Jason's physical absence from New Zealand, which raised concerns about his ability to actively participate in the estate's administration. The court concluded that the removal of all three executors was necessary to ensure the estate's affairs were properly managed and that Laurel's claims were addressed in a manner that served the best interests of all beneficiaries. The court ordered the removal of the executors and directed the parties to propose a replacement executor within a specified timeframe. Laurel was granted costs on a 2B basis.

Orders