Little v Little - [2014] NZHC 3159

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2014-404-2421 [2014] NZHC 3159

IN THE MATTER of the Trustee Act 1956

BETWEEN

DEIDRE ANN LITTLE Plaintiff

AND

JOHN LAWSON LITTLE Defendant

Hearing: 30 September 2014

Appearances:

K E Swadling for Plaintiff
A D Marsh for Defendant

Judgment:

11 December 2014

REASONS FOR JUDGMENT OF PETERS J

This judgment was delivered by Justice Peters on 11 December 2014 at 10.30 am pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar
Date: ...................................

Solicitors: Carson Fox Bradley Limited, Auckland
Saunders Robinson Brown, Christchurch

Counsel: K E Swadling, Auckland

Copy for: Howick Trustee DL Limited, Auckland

LITTLE v LITTLE [2014] NZHC 3159 [11 December 2014]

Introduction

[1] I issued a results judgment in this matter on 3 November 2014, removing the Plaintiff and Defendant (“Mrs Little” and “Mr Little”) as trustees of the Woodside Trust (“trust”), and appointing Howick Trustee DL Limited (“Howick Trustee”) as sole trustee in their place.1 I said that my reasons would follow, as they now do.

Application

[2] Mrs Little applies to remove Mr Little as a trustee on several grounds, including that he has failed to account for trust funds and has acted unilaterally, contrary to the terms of the deed of trust dated 20 May 2002 by which the trust was settled (“deed of trust”).2

[3] Mrs Little’s application is made pursuant to the Court’s inherent jurisdiction to remove a trustee as an aspect of its more general jurisdiction to supervise the execution of a trust, and pursuant to s 51 Trustee Act 1956, which provides:

51 Power of Court to appoint new trustees

(1) The Court may, whenever it is expedient to appoint a new trustee or new trustees, and it is found inexpedient, difficult, or impracticable so to do without the assistance of the Court, make an order appointing a new trustee or new trustees, either in substitution for or in addition to any existing trustee or trustees, or although there is no existing trustee.

(2) In particular and without prejudice to the generality of the foregoing provision, the Court may make an order appointing a new trustee in substitution for a trustee who—

(a) has been held by the Court to have misconducted himself in the administration of the trust; or

…

[4] It is common ground that the jurisdiction to remove a trustee, whether pursuant to the inherent jurisdiction or to s 51, is to be exercised to ensure the proper
execution of the particular trust. Having heard evidence from the parties, and from

1 Little v Little [2014] NZHC 2714.
2 Statement of Claim dated 15 September 2014, at [19].

Mr Winefield to whom I refer below, I am satisfied that it is necessary to make an order removing Mr Little as a trustee.

[5] In the course of the hearing, counsel for Mr Little made an oral application for an order removing Mrs Little as a trustee. Mrs Little had no prior notice that such an application…

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 Little v Little

Details

AGLC: Little v Little [2014] NZHC 3159
Case: [2014] NZHC 3159
Decision Date: 11 December 2014

CaseChat Overview and Summary

The High Court of New Zealand considered a case involving Deidra Ann Little, who sought the removal of John Lawson Little as a trustee of the Woodside Trust. The trust was established by the parties upon their marriage and included their son as a beneficiary. The dispute arose from allegations of mismanagement and misconduct by Mr. Little, including unilateral actions and failures to disclose financial information. Mrs. Little's application for Mr. Little's removal was supported by evidence demonstrating his disregard for the trust's requirements and his intertwining of personal interests with trust duties. The court found that Mr. Little had acted in breach of his fiduciary duties, necessitating his removal as a trustee. Furthermore, Mrs. Little's retention as a trustee was deemed inappropriate due to the estrangement from Mr. Little and her inability to act impartially. Consequently, the court removed both trustees and appointed Howick Trustee DL Limited as the sole trustee of the Woodside Trust.

The legal issues before the court encompassed the appropriateness of removing trustees under the inherent jurisdiction of the court and the specific powers granted by statute, particularly under section 51 of the Trustee Act 1956. The court had to determine whether the trustees' actions justified their removal and if the continued administration of the trust by either or both trustees was in the best interests of the beneficiaries. Additionally, the court needed to decide on the appointment of a new, independent trustee to ensure the proper administration of the trust's assets.

Justice Peters, delivering the judgment, meticulously examined the evidence provided by the parties and a witness, David Stuart Winefield. The court concluded that Mr. Little's conduct, marked by unilateral decisions and a failure to separate his personal interests from his fiduciary duties, warranted his removal. Mrs. Little's actions, while less egregious, still demonstrated a lack of impartiality necessary for effective trusteeship. The court's decision to remove both trustees was supported by the need for an impartial and capable trustee to manage the trust's affairs. Justice Peters appointed Howick Trustee DL Limited as the sole trustee, ensuring the trust's continued administration by an independent party.

The final orders of the court included the removal of both Deidra Ann Little and John Lawson Little as trustees of the Woodside Trust and the appointment of Howick Trustee DL Limited as the sole trustee. Additionally, the court ordered John Lawson Little to pay Deidra Ann Little's costs on a 2B basis, with disbursements to be fixed by the Registrar.

Orders