LSP Trust Holdings Limited v Bryant

[2025] NZHC 1262

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2025-485-189

[2025] NZHC 1262

UNDER

Part 19 of the High Court Rules 2016 and the inherent jurisdiction of the High Court of New Zealand

IN THE MATTER OF

the Lawrence Stuart Pilling Family Trust

BETWEEN

LSP TRUST HOLDINGS LIMITED

Applicant

AND

LISA MARIE BRYANT

First Respondent

LAWRENCE STUART PILLING

Second Respondent

GLENYS EVELYN SOPHIA MAHAN
Third Respondent

GRAYSON LAW TRUSTEES LIMITED

Fourth Respondent

On the papers:

Counsel:

N L Walker and F G Wilson for Applicant

K Lenahan and G F Kelly for First Respondent
E Macpherson and J Savage for Second Respondent
A S Butler KC and O C Gascoigne for Fourth Respondent

Judgment:

21 May 2025

JUDGMENT OF GRAU J

Introduction

[1]                On 26 March 2025, LSP Trust Holdings Ltd (LSP), acting as trustee of the Lawrence Stuart Pilling Family Trust (the Trust), filed an originating application for

LSP TRUST HOLDINGS LIMITED v BRYANT [2025] NZHC 1262 [21 May 2025]

rectification of the Trust deed to define the “Final Beneficiaries” of the Trust as “the son of settlor” instead of “the daughter of the settlor”. Accompanying this application was an interlocutory application for leave to proceed by way of an originating application.

[2]                LSP seeks to consolidate this proceeding with a related proceeding brought in relation to the Trust. It also seeks directions as to service and for confidentiality orders to be made in respect of a settlement agreement that has been reached between the parties.

[3]The respondents support the application.

Background

[4]                Since 2019, Grayson Clements Lawyers had been engaged by Lawrence Henry Pilling (Laurie) to provide legal services to him and the Pilling Family Trust, a trust settled by deed dated 27 March 2007. On 5 September 2022, Grayson Law Trustees Limited (GLTL) was appointed as a trustee of the Pilling Family Trust. The beneficiaries of that trust included Laurie, his wife Jean Hunter Pilling (known as Sheena), their children Lisa Marie Bryant and Lawrence Stuart Pilling (Stuart), and their grandchildren Timothy Bryant, Rachel Bryant, Riley Cooney and Liam Cooney.

[5]                Following discussions with Grayson Clements between 2020–2023, Laurie decided to restructure his affairs in a way that would ensure his wishes would be given effect, namely, to divide his assets fairly and evenly between his two children. According to a director of Grayson Clements, Mr Andrew Clements, at a meeting on

16 March 2023, attended by Laurie, his sister Ms Mahan, Stuart, and Laurie’s accountants, Laurie decided to establish two new legacy trusts, one for the benefit of Stuart and his family, and one for the benefit of Lisa and her family. He would achieve his wishes by transferring all of his assets to the Pilling Family Trust, and then fairly and evenly allocating them to Stuart’s Trust and to Lisa’s trust. On 16 August 2023, Laurie signed a deed of distribution which set out how his assets were to be divided and allocated between the two legacy trusts.

[6]                However, this deed was never fully executed. On 22 August 2023, Laurie was assessed by a psychogeriatrician as having lost capacity. As the restructure of Laurie’s affairs was incomplete, GLTL, acting as trustee of the Pilling Family Trust, considered it would be prudent to seek directions from the Court in respect of the proposed transfer of assets to the two legacy trusts as recorded in the partially executed deed of distribution.  The application for directions  (the  Related Proceeding) was filed on   6 May 2024. Sadly, on 1 June 2024, Laurie passed away, which resulted in the Related Proceeding in effect being stayed.

[7]                 On 11 December 2024, the parties attended a confidential mediation session, which resulted in a deed of family arrangement (the Settlement Agreement). One of the conditions of this Agreement was that GLTL was to obtain the Court’s blessing for its decision to enter into and perform obligations under the Settlement Agreement. For this purpose, on 21 March 2025, the originating application in the Related Proceeding was amended to seek such a blessing.  Justice Boldt granted orders to that effect on  4 April 2025.

[8]                This current proceeding is now required as, regrettably, a typographical error was made in the drafting of the trust deed for Stuart’s Trust. Mr Andrew Clements, a director of Grayson Clements, confirms that the error is inconsistent with the instructions he received from Laurie.

Leave to proceed by way of originating application

[9]                LSP seeks leave to commence the rectification application as an originating application, pursuant to pt 19 of the High Court Rules 2016 (HCR). Since an application for rectification of a trust deed is not provided for as of right under r 19.2 of the HCR, the Court may permit the proceeding to be commenced by originating application only if it is in the interests of justice to do so.1 As noted by LSP in its submissions, the originating application jurisdiction is generally permitted in straightforward proceedings where the requirements under pt 18 of the HCR are considered onerous.

1      High Court Rules 2016, r 19.5.

[10]            I agree that it would be in the interests of justice to proceed by way of originating application, as it will secure the just, speedy and inexpensive determination of the matter. This is a straightforward matter concerning an uncontroversial amendment to a  trust deed, where the  parties have consented to the orders sought.   I note that leave to proceed by way of originating application has been granted in similar circumstances previously.2

[11]            Accordingly, I grant leave to commence the proceeding by way of an originating application.

Consolidation of proceedings

[12]            The need for and/or desirability of consolidating these proceedings with the Related Proceedings appears to have been superseded by the fact the blessing application in the Related Proceeding has already been granted. As I understand it, there are no further applications or steps needed to be taken in the Related Proceeding, and no further steps will be required in this proceeding either, after the resolution of this application. Therefore, it appears there is no longer any benefit in consolidating the proceedings, as it will not reduce time and costs to the parties, ensure the efficient use of judicial resources,3 or reduce the risk of inconsistent findings being made.4 As a result, I decline to consolidate the proceedings. However, I grant leave to the parties to file a memorandum outlining why, despite the change in circumstances, consolidation should nevertheless occur.

Directions as to service

[13]            The parties submit that it would serve no useful purpose to require additional service, and it would cause unreasonable delay and expense to the applicant. They note that the parties to the joint memorandum, and to the originating application, include all parties to the Related Proceeding, who are each represented by counsel. The parties also state that Stuart is representing his children’s interests in the Related

2      Carswell v Carswell [2020] NZHC 3307.

3      Medlab Hamilton Ltd v Waikato District Health Board (2007) 18 PRNZ 517 (HC).

4      CallPlus Ltd v Telecom NZ Ltd (2000) 15 PRNZ 14 (HC) at [51].

Proceeding, and therefore they do not require separate counsel or service. On that basis, I am satisfied that additional service is not required.

Confidentiality orders

[14]            The parties seek orders prohibiting publication of any details of the deed of family arrangement dated 11 December 2024 (the Settlement Agreement) and the details of the confidential mediation  contained  in  Mr  Clements’  affidavit  dated 25 March 2025, as well as orders prohibiting access to the Court file including details of the Settlement Agreement. I note that Boldt J has already granted such orders in the Related Proceeding.

[15]            Given these proceedings concern a private settlement amongst family members, I consider that concerns around access to justice are outweighed by the privacy and confidentiality concerns of the parties, and therefore I consider it appropriate to make the limited orders sought.

Rectification application

[16]            It has long been recognised that the Court has the power to rectify a trust deed,5 with the focus being on the settlor’s intentions.6 As noted in Judd v Cowley, the following criteria must be met before a rectification can be made:7

(a)there must be an operative mistake, in that the deed does not reflect the settlor’s intentions;

(b)the mistake must be causative and of sufficient gravity, rather than mere inadvertence;

(c)there must be convincing proof of what would have been intended if the mistake had not been made; and

5      Judd v Cowley [2022] NZHC 184 at [28]; AB v CV [2024] NZHC 1397 at [16]; Re Hindle [2012] NZHC 903 at [7]; Carswell v Carswell [2020] NZHC 3307 at [11]; and Walker v Restieaux [2015] NZHC 1875 at [24].

6      Singh v Ash [2018] NZCA 310 at [5].

7      Judd v Cowley, above n 5, at [30].

(d)it must be appropriate to make the Deed conform with that intention.

[17]            It is evident that there has been a mistake made, when it is clear that twin trusts were intended to be established, but a typographical error on the part of the drafters of the trust deeds has meant that Stuart’s Trust defines the final beneficiary as the settlor’s daughter, being Stuart’s sister Lisa, rather than himself. Mr Clements confirms that the current drafting does not reflect the instructions he received from Laurie. I am therefore satisfied there has been an operative mistake which means the Trust Deed does not reflect the settlor’s intentions. The mistake is also more than mere inadvertence, as it limits Stuart’s entitlements under the Trust by rendering him a discretionary beneficiary but not a final beneficiary, meaning he would not receive the intended benefit under the Trust. It is of sufficient gravity to warrant rectification.

Result

[18]I make the following orders:

(a)permitting the applicant to commence this proceeding by way of originating application pursuant to r 19.5 of the High Court Rules 2016;

(b)granting leave to use and rely on the affidavits filed in the Related Proceeding, pursuant to r 7.32 of the High Court Rules 2016;

(c)directing that the proceeding is only required to be served on counsel for the following, being the same parties to the Related Proceeding:

(i)Lisa Marie Bryant;

(ii)Lawrence Stuart Pilling;

(iii)Glenys Evelyn Sophia Mahan; and

(iv)Grayson Law Trustees Limited, as trustee of the Pilling Family Trust, a trust settled by Laurie by deed dated 27 March 2007;

(d)under the inherent jurisdiction of the Court, that the trust deed for the Lawrence Stuart Pilling Family Trust is to be rectified such that the definition of “Final Beneficiaries” at cl 1.1.9 reads as follows: “Final Beneficiaries” means, subject to section 30, the son of the Primary Beneficiary”;

(e)prohibiting the publication of any details of the deed of family arrangement dated 11 December 2024 and the details of the confidential mediation contained in the affidavit of Andrew Craig Clements dated 25 March 2025 and access to the Court file including details of the Settlement Agreement;

(f)granting leave to the parties to file a memorandum setting out the basis for consolidation of these proceedings with the related proceedings, in light of the blessing application in the Related Proceeding having already been granted; and

(g)that the parties’ costs lie where they fall.

Grau J

Solicitors:
Russell McVeagh, Wellington for Applicant