Legal Research
Cases
McKean v McKean

McKean v McKean

Case [2017] NZHC 2212 13 September 2017

Trustee Appointment

Mental Incapacity

Vesting of Property

Dispensing with Service

Inherent Jurisdiction

Trusts & Equity

No judgment structure available for this case.

Type to search within this case.

IN THE HIGH COURT OF NEW ZEALAND DUNEDIN REGISTRY

CIV-2017-412-000089 [2017] NZHC 2212

UNDER the Trustee Act 1956

IN THE MATTER

of the McKean Family Trust

BETWEEN

GARY DAVID MCKEAN AND COOK ALLAN GIBSON TRUSTEE COMPANY LIMITED

Applicants

AND

PAMELA BLYTHE MCKEAN Respondent

Hearing: On the papers

Counsel:

R J M Sim for the Applicants

Judgment:

13 September 2017

JUDGMENT OF ASSOCIATE JUDGE MATTHEWS
as to vesting orders and service

Introduction

[1] The respondent, Pamela McKean, and her late husband, Robbie McKean, were trustees of the McKean Family Trust (the Trust), alongside Cook Allan Gibson Trustee Company Limited (Cook Allan). Cook Allan has replaced Mrs McKean with Gary McKean as a trustee due to her mental incapacity. The applicants now apply for an order vesting in the current trustees 48 Auskerry Street, Palmerston (the Property).

[2] The applicants seek permission to commence this proceeding by way of originating application and orders that service of the application be dispensed with.

MCKEAN v MCKEAN [2017] NZHC 2212 [13 September 2017]

Background

[3] The Trust was settled in October 1999 by William Illingworth, a good friend of Mr and Mrs McKean. He appointed them both as trustees and gave the two of them jointly, or the survivor of them, the power to appoint new trustees. They subsequently appointed Cook Allan as a trustee. The beneficiaries of the Trust are Mr and Mrs McKean, their children, and their grandchildren.

[4] Mr McKean died in August 2015.

[5] Mrs McKean was diagnosed with dementia. In August 2017, her doctor, Dr Andrew McLeod, assessed her. He certified that she is completely unable to make any decisions about property or her personal care and welfare. He certified that her condition is likely to continue indefinitely.

[6] Cook Allan was advised that as Mr McKean was dead and Mrs McKean was incapable of acting, the power to appoint new trustees passed to it. Therefore, by deed dated 1 September 2017 (the Deed), Cook Allan appointed Gary McKean, son of Mr and Mrs McKean, as a trustee in place of Mrs McKean. This power was exercised according to s 43 of the Trustee Act 1956 (the Act) and cl 13 of the Trust Deed. The Deed vests the Trust’s property in Cook Allan and Gary McKean (the Current Trustees).

[7] Mrs McKean is incapable of authorising the transfer of the Property. The

Current Trustees therefore apply to the Court to make vesting orders.

Leave to commence by way of originating application

Originating application

[8] Rules 19.2 to 19.4 High Court Rules 2016 deal with proceedings which can be commenced by way of originating application. The current application is not among them. The applicants are therefore not entitled to commence this proceeding by originating application as of right. However, the Court may, in the interests of

justice, permit such a proceeding to be commenced by originating application.1 The applicants have sought leave as required by r 19.5.

[9] In Jones v H W Broe Ltd, McGechan J considered an…

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 McKean v McKean

Details

AGLC: McKean v McKean [2017] NZHC 2212
Case: [2017] NZHC 2212
Decision Date: 13 September 2017

CaseChat Overview and Summary

This case involved the McKean Family Trust, with the applicants, Gary David McKean and Cook Allan Gibson Trustee Company Limited, applying for vesting orders and leave to commence proceedings by way of an originating application. The respondents, Pamela Blythe McKean, was a trustee of the trust, but due to her mental incapacity, she had been replaced as a trustee by Gary McKean. The applicants sought permission to commence the proceedings by way of an originating application and that service of the application be dispensed with. The court had to decide whether the applicants were entitled to commence the proceeding by way of an originating application as of right, and if not, whether the interests of justice supported the granting of leave. Additionally, the court had to determine whether service should be dispensed with and whether a litigation guardian was required for the incapacitated respondent.

The court found that the applicants were not entitled to commence the proceeding by originating application as of right, as it was not among the proceedings listed in Rules 19.2 to 19.4 High Court Rules 2016. However, the court held that the interests of justice supported the granting of leave, as the application merited the expediency afforded by the originating application procedure. The court also found that there was no need to serve the beneficiaries of the trust or any other person, as the vesting orders sought would not adversely impact upon any beneficiaries of the trust. Furthermore, the court held that a litigation guardian was not necessary, as the applicants were acting in the best interests of the incapacitated respondent.

In conclusion, the court granted leave for the applicants to commence the proceeding by way of a without notice originating application, dispensed with service of the proceeding, held that a litigation guardian was not required, and granted the vesting order sought by the applicants. No order was made as to costs.

Orders