Public Trust v Kain
[2020] NZHC 448
•10 March 2020
IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY
I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE
CIV-2018-409-40
[2020] NZHC 448
UNDER the Trustee Act 1956 and Part 18 of the High Court Rules 2016 IN THE MATTER
Of an application by the trustee for
directions under s 66 of the Trustee Act 1956
BETWEEN
PUBLIC TRUST
Plaintiff
AND
GEORGINA KAIN AND OTHERS
First Defendants
AND
MARNIE COUPIE FORCER KAIN AND OTHERS
Second Defendants
AND
WILLIAM ALEXANDER XAVIER COUPER
Interested Party
Hearing: On the papers Counsel:
B D Gray QC and A E Ferguson for Plaintiff (Public Trust)
J Moss for First to Fourth Named First Defendants (the Kain Defendants)
T C Weston QC and A V Foote for Fifth Named First Defendant (Mary Hutton)
J C Anderson QC for Nineteenth to Twenty First Named First Defendants and Fourteenth to Sixteenth Named Second Defendants (Georgia Humphrey, Constance Hutton and Harriet Hutton)A R Galbraith QC for Interested Party
M J Wallace for Sixth to Eighteenth First Defendants and First to Thirteenth Named Second Defendants
Judgment:
10 March 2020
PUBLIC TRUST v KAIN & OTHERS [2020] NZHC 448 [10 March 2020]
JUDGMENT OF ASSOCIATE JUDGE LESTER
This judgment was delivered by me on 10 March 2020 at 3.00pm pursuant to Rule 11.5 of the High Court Rules
Registrar/Deputy Registrar 10 March 2020
[1] From the commencement of this proceeding in which the Public Trust seeks directions, the settlor of the Trust, Mr W A X Couper, was represented as an interested party. It is common ground that no order giving Mr Couper that status was made but he has been represented by senior counsel throughout this proceeding.
[2] Mr Couper has died, and his executors have asked for what amounts to a new parties’ order seeking that they be substituted for Mr Couper, that is that they have status as interested parties in Mr Couper’s place. A separate issue is raised in respect of Mr Couper’s costs, both in the past and for the future, assuming his executors become parties.
Background to Mr Couper’s involvement
[3] In the plaintiff’s memorandum concerning directions as to service dated 20 December 2017, it said the following:
Public Trust submits that it is not necessary to serve Tom Couper, as the settlor of the trust, because he has no ongoing entitlement to the trust assets. However, if disclosure of his wishes as settlor is sought, it may be appropriate to join him as an interested party.
[4] Mr Fowler QC, then counsel for Mr Couper, in a memorandum accepted that Mr Couper did not have an ongoing entitlement to the Trust assets but submitted that he nonetheless had an interest as Settlor and in some of the issues to be determined in the proposed application as the questions related to Mr Couper’s memoranda of wishes. The submission was made that Mr Couper had a legitimate interest in how his historic memoranda of wishes were to be treated and he wished to be identified as a party. Mr Couper becoming a party was opposed and a formal decision on Mr Couper’s status was deferred when the application for leave for this matter to be commenced by way of originating application came before Mander J on 6 March 2018.
[5] Subsequent judgments show Mr Couper being represented as an interested party and recognised as such by the Court albeit it does not see the opposition to that step resulted in any judgment on that issue.
[6] Following Mr Couper’s death, Mr Galbraith QC now instructed, filed a memorandum seeking that Mr Couper’s executors be joined as parties to this
proceeding. He submitted that the issues in the present proceeding are all directly or indirectly related to the acts of Mr Couper including his various memoranda of wishes and his acquisition and funding of properties subject to the Trusts.
[7] Mr Galbraith also noted that the first to fourth defendants seek discovery orders relating to documents that originated with Mr Couper or his agents.
Jurisdiction
[8]Rule 4.56 of the High Court Rules 2016 deals with the adding of parties.
[9] Rule 4.56(1)(b)(ii) provides that a party may be joined if their presence before the Court “may be necessary to adjudicate on and settle all questions involved in the proceeding.”1
[10]Sim’s Court Practice (NZ) at HCR 4.56.9(b) notes:2
The test “may” is one of possibility not probability: Smith v Noble Investments Ltd [2017] NZHC 477. The rule is wide enough to permit an application for joinder to be made by a non-party or intervener: Hallam v Ryan (1989) 1 NZPC 290; (1989) 3 PRNZ 132; NZ Federation of Commercial Fishermen v Ministry of Fisheries (2009) 19 PRNZ 595, either under the Court’s inherent jurisdiction or by application of this rule and rr 1.6 and 7.43A: Taylor v Key [2014] NZHC 3306; (2014) PRNZ 533.
[11]Sim’s notes that:3
The authorities for determining an application for joinder under this limb were comprehensively reviewed in Capital and Merchant Finance Ltd (in rec and in liq) v Perpetual Trust Ltd [2014] NZHC 3205; [2015] NZAR 228, where the Court summarised the principles as:
(a)An applicant must show that its legal rights against or liabilities in relation to the subject matter will be directly affected. Commercial, financial, or reputational interests in the outcome will only be sufficient in exceptional circumstances.
(b)If the intending intervener’s presence before the Court will not improve the quality of information before the Court, that will count heavily against its addition to the proceedings.
1 Emphasis added.
2 Matthew Casey Sim’s Court Practice (NZ) High Court rules 2016 at HCR 4.56.9(b).
3 At HCR 4.56.9(b).
(c)A relevant consideration is the extent to which the proposed intervener can rely on one of the parties to protect its rights and obligations.
(d)If either party would be prejudiced by the intervention, or if the intervention would create an impression of partiality, the application will not be granted.
(e)In cases where development of the law is likely, the application is more likely to be granted if the proposal intervener has special expertise to assist the Court on wider public policy issues.
(f)The underlying issue is whether it would be unjust to adjudicate on the matter in dispute without the intervener being heard. Several of the factors mentioned above tie into this issue.
(g)Where intervention is justified, the degree of participation granted to the intervener should be the minimum necessary to protect the intervener’s interests.
[12] Applying these principles, it is common ground that Mr Couper’s estates, legal rights or liabilities will not be impacted by the proceeding.
[13] The estate’s strongest point is the second one, that is whether the estate’s involvement will improve the quality of information before the Court. However, the relevant information that needed to be produced were the memoranda of wishes of the late Mr Couper. I do not understand it to be suggested that there are further memoranda of wishes under the control of the executors yet to be disclosed.
[14] As to category C from the above list, the executors are Mr Jonathan Hutton of Christchurch and Ms Georgia Humphrey who are already parties in their personal capacity.
[15] As to whether granting the application would create an impression of partiality, that is a factor relied on by Mr Moss in his memorandum where he submits:
The effect of the executors in seeking to be represented in the proceeding is to give an extra voice to one side of the family, being the Huttons. This would be unfairly prejudicial on the Kains and their children and is unnecessary when the Hutton side of the family is already represented in the proceeding.
Given the history of conflict there is something in this point.
[16] The next factor is whether this is a case where development of the law is likely. I will return to this point but note that other parties have senior counsel involved.
[17] The final factor is the underlying issue of whether it would be unjust to adjudicate on the matter in dispute without the intervenor being heard. That turns attention to what the matter in dispute in.
[18] In my judgment of 31 October 2019 dealing with discovery issues, the fact that the application only dealt with legal questions was a key part of my dismissing the discovery application.
[19] It is because the proceeding involves the determination of legal issues that I do not consider that the involvement of Mr Couper’s executors is necessary to permit the Court to settle what is in question in this proceeding.
[20] Counsel for the parties will address the directions relating to the memoranda of wishes. In the event that Mr Couper’s executors consider there are legal issues they consider necessary to be brought to the Court’s attention then they are well able to do that through their own counsel. There is no suggestion that the executors’ views of the memoranda of wishes differ from the views that were held by Mr Couper.
[21] Accordingly, given the focus of this proceeding is on questions of law as discussed in my earlier judgment, I do not consider it is necessary to join the executors of Mr Couper’s estate. In short, I do not consider that it has been demonstrated that the joinder of the estate would assist the Court in determining the legal questions raised in the application for directions.
Associate Judge Lester
Solicitors:
Wilson Harle, Auckland (Plaintiff)
Copy to counsel:B D Gray QC, Auckland
Izard Weston, Wellington (First to Fourth Named First Defendants, the Kain defendants)
Copy to counsel:
A R B Barker QC, Auckland
J Moss, Barrister, Christchurch
Duncan Cotterill, Christchurch (Fifth Named First Defendant, Mary Hutton)
Copy to counsel:T C Weston QC
Succeed Legal, Wellington
A R Galbraith QC (Interested Party)
Canterbury Chambers, Christchurch
M J Wallace, Barrister, Christchurch (Sixth to Eighteenth Named First Defendants and First to Thirteenth Named Second Defendants
Vicki Ammundsen Trust Law Limited, Auckland
J F Anderson QC, Auckland (for Nineteenth to Twenty First Named First Defendants and Fourteenth to Sixteenth Named Second Defendants) (Georgia Humphrey, Constance Hutton and Harriet Hutton)
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