Powell v Powell - [2015] NZHC 1984

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV-2013-409-001371 [2015] NZHC 1984

BETWEEN
JOHN WILLIAM POWELL

Plaintiff

AND

DANIEL JOHN POWELL Defendant

AND

CHARLOTTE TERESA GAVIN (NEE POWELL)

Interested Party

Hearing: 20 August 2015 (On the papers)

Appearances:

J V Ormsby, C L Webber and J P Bell-Connell for Plaintiff
S M Grieve and S A Woods for Defendant
J Moss for Interested Party

Judgment:

20 August 2015

JUDGMENT OF DUNNINGHAM J

[1] This is a dispute over how litigation costs should be funded in proceedings under the Trustee Act 1956 where Mr John Powell (John), a trustee of a Trust known as the Daniel Powell Family Trust (the DP Trust), applied to have himself and his son Daniel Powell (Daniel), removed as trustees of that Trust.

[2] In my decision of 14 March 2014, I held it was appropriate that John be removed as a trustee, but that Daniel remain as a trustee, as I was satisfied that, under the trusteeship of Daniel and an independent trustee, the DP Trust would be properly administered for the benefit of the beneficiaries (the first High Court
decision).1

1 Powell v Powell [2014] NZHC 476.

POWELL v POWELL [2015] NZHC 1984 [20 August 2015]

[3] That decision was appealed to the Court of Appeal (the first Appeal), and referred back to this Court, by consent, to consider the consequences of s 48 of the Trustee Act 1956 on my decision. In a decision dated 2 September 2014, I held that, notwithstanding the provisions of s 48, my earlier decision was unchanged (the second High Court decision).2 The substantive appeal was then heard and, in a
decision dated 24 April 2015, John’s appeal was dismissed (the main appeal).3

[4] The Court of Appeal made decisions as to costs payable as between the parties, holding, after the first appeal, that costs should lie where they fall and, after the main appeal, that John was to pay Daniel’s costs, on a band A basis.

[5] In the High Court decisions, I reserved any issues of costs to be addressed by exchange of memoranda. The memoranda which have now been filed do not seek inter partes costs. Rather, they seek the Court’s determination as to whether the costs incurred by John, in bringing these proceedings, and of Daniel’s sister, Charlotte Gavin (Charlotte), in participating as an interested party, should be reimbursed in full from the DP Trust.

[6] Reimbursement is sought by reference to the principles in Re Buckton,4 saying they are costs incurred when a claim is made by a trustee relating to difficulties in administration of the Trust, and where the litigation expenses were reasonably incurred.5

The parties’ claims

Daniel’s claim

[7] Daniel claims that he is entitled to full indemnity from the Trust for his legal costs in relation to the proceeding. He, in his capacity as trustee, successfully defended the proceeding brought by John, both at first instance in the High Court,
and in the main appeal. He claims…

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 Powell v Powell

Details

AGLC: Powell v Powell [2015] NZHC 1984
Case: [2015] NZHC 1984
Decision Date: 20 August 2015

CaseChat Overview and Summary

This case concerns a dispute over the funding of litigation costs in proceedings under the Trustee Act 1956, where John Powell, a trustee of the Daniel Powell Family Trust (DP Trust), sought to have himself and his son, Daniel Powell, removed as trustees. The court previously held that John should be removed as a trustee, while Daniel could remain. The court dismissed John’s appeal against this decision. The current dispute concerns whether John, Daniel, and Charlotte Teresa Gavin, an interested party and beneficiary of the DP Trust, should be reimbursed for their litigation costs from the trust. Daniel and Charlotte claim they should be fully indemnified for their costs. John claims that, although his position was not upheld, it was reasonable for him to bring the proceedings to resolve a deadlock in the trusteeship. The court found that while it was appropriate for John to seek court intervention to resolve the deadlock in the trusteeship, his actions were not entirely directed to the interests of the trust or the beneficiaries, but rather to vindicate his position in the interfamilial dispute. Daniel’s costs should be fully indemnified from the trust. John should only be indemnified for 2B costs relating to the first and second High Court hearings and the first appeal. Charlotte should be indemnified for 2B costs relating to her participation in the first and second High Court hearings.

Orders