Lawrence v Lawrence

[2020] NZHC 1698

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2020-404-001089

[2020] NZHC 1698

UNDER

The Trustee Act 1956

BETWEEN

CHRISTOPHER KARL LAWRENCE and PAUL WARWICK CURRANT

Applicants

AND

CHRISTOPHER KARL LAWRENCE and

PAUL WARWICK CURRENT as trustees of the The Quentin Lawrence Trust and FRANKLIN REX QUENTIN LAWRENCE
as a former trustee of The Quentin Lawrence Trust

Respondents

Hearing:	(On the papers)
Counsel:	Andrew Gilchrist for the Applicants
Judgment:	15 July 2020

JUDGMENT OF MOORE J

This judgment was delivered by me on 15 July 2020 at 2:00 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/ Deputy Registrar Date:

LAWRENCE & ANOR v LAWRENCE & ORS [2020] NZHC 1698 [15 July 2020]

Introduction

[1]                 The applicants, who are trustees of The Quentin Lawrence Trust (“the Trust”) seek, by way of without notice originating application, the following orders:

(a)leave to commence the proceedings by way of originating application;

(b)dispensing with service of the application on Franklin Rex Quentin Lawrence (“Quentin”); and

(c)there be a vesting order in favour of the applicants.

Background

[2]                 The background is that Quentin suffers from dementia and was moved to full- time residential care in June 2019.

[3]                 Before that he lived at 215 Glenbrook Station Road, RD 1, Waiuku (“the property”) with his son Christopher Lawrence (“Christopher”), one of the applicants and a trustee of the Trust. The property was transferred to the Trust in July 1997.

[4]                 Quentin was removed as a trustee in March this year by reason of his cognitive incapacity. Since that time Christopher and Paul Warwick Curran, who is the other applicant have been the trustees.

[5]                 The trustees wish to sell the property and use the funds to meet the costs of Quentin’s ongoing care.

[6]                 When Quentin went into long term care, an application was made to Work and Income New Zealand (“WINZ”) for a subsidy to meet the costs of that care. WINZ declined to pay any subsidy on the grounds that it was reasonable to expect the Trust to provide the necessary funds. As a consequence, Christopher has been meeting those costs but claims it is a financial struggle for him and his family. It is now necessary to sell the property so that the proceeds can be used to meet Quentin’s ongoing care.

[7]                 The discretionary beneficiaries under the Trust are Quentin and his children (that is Christopher and two other sons). The property is currently in the names of Christopher, Quentin and Mr Curran, ostensibly as trustees.

The application

[8]                 What is sought is a vesting order, vesting the property in the names of the remaining trustees, being Christopher and Mr Curran, so that the property can be sold at an arm’s length basis to a third party to realise the funds.

[9]                 Although no agreement for sale and purchase has been entered into, subject to the Court making the vesting order sought, the property will then be marketed for sale.

[10]            Thus, the assistance of the Court is required to remove Quentin’s name from the title by vesting the property in the other trustees only.

Legal principles

[11]            Proceedings commenced by way of originating application require leave to be brought.1 It is submitted that while the originating application procedure may be used where there is an opposing party, it is in relation to contested proceedings, an exceptional procedure.2

[12]            I was confronted with a very similar situation to the present in Re Vollemaere.3 I regarded it as appropriate to make the orders on a without notice basis because the application affected only the applicants, involved in relatively routine matter and, in the interests of justice, required the application to be determined without service. The only person directly affected by the application was incapacitated to such an extent that no good or proper purpose would be achieved by service. I am aware that approach has been taken in other similar cases.4

1      High Court Rules 2016, r 19.5.

2      Hong Kong and Shanghai Bank Corporation Limited v Erceg HC Auckland CIV-2010-404-2835.

3      Re Vollemaere [2014] NZHC 1698.

4      Kohn v Kohn [2014] NZHC 1154; Scowen v Scowen [2014] NZHC 1901.

Decision

[13]            I am satisfied it is appropriate to grant leave to commence the proceedings by way of without notice originating application.

[14]            The  next  question  is  whether  Quentin  should  be  served.  As  I  did  in  Re Vollemaere I am satisfied that given the evidence of Quentin’s mental incapacity there is no good reason to personally serve him. Furthermore, on the evidence before me, he is not prejudiced or otherwise adversely affected in the event that the orders sought are made. The decision to sell the property is one which is designed to benefit him by releasing funds from the realisation of capital to meet the costs of his full-time residential care.

[15]            Finally, I turn to the question of the vesting order. Section 52 of the Trustee Act 1956 gives the Court jurisdiction to make such an order where a trustee is entitled to be possessed of land and one of the trustees is disabled,5 or where it appears to the Court to be expedient.6 As Mr Gilchrist, for the applicants, points out, the cases of Kohn and Scowen, arose in almost identical circumstances to the current application. In both, Heath J made the vesting orders sought.

[16]            I am satisfied on the evidence, including Christopher’s evidence, that the other discretionary beneficiaries either consent to the orders or cannot be located for the purpose of consultation. According to Christopher, he has discussed the application with his brother Matthew who supports the steps being taken. A letter to that effect is attached to his affidavit. Christopher’s other brother, Andrew, cannot be located. Neither Christopher nor Matthew knows where he is. In any event, Christopher observes that he doubts Andrew would have any opposition to it.

[17]In those circumstances I am satisfied it is appropriate to make the orders.

5      Trustee Act 1956, s 52(1)(b)(i).

6      Section 52(1)(h).

Result

[18]            The without notice originating application is granted in terms of the orders set out at [1](a), (b), (c).

Moore J

Solicitors:

Mr Gilchrist, Auckland