Reveley v Reveley

[2020] NZHC 2759

IN THE HIGH COURT OF NEW ZEALAND DUNEDIN REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTEPOTI ROHE

CIV-2020-412-87

[2020] NZHC 2759

UNDER

the Administration Act 1969

AND

UNDER

the Trustee Act 1956

IN THE MATTER

of the estate of JAMES SPENCER ROBERTSON

BETWEEN

MADELEINE VIOLET REVELEY, JUDITH OLWYN MEDLICOTT, as

executors and trustee in the estate of JAMES SPENCER ROBERTSON

Applicants

AND

MADELEINE VIOLET REVELEY, JUDITH OLWYN MEDLICOTT, JAMES

PETER ROBERTSON and LESLIE JAMES

WILLIAM STEWART, trustees and executors in the estate of JAMES SPENCER ROBERTSON

Respondents

Hearing:	(Determined on the papers)
Counsel:	C J Medlicott for the Applicants
Judgment:	21 October 2020

JUDGMENT OF ASSOCIATE JUDGE LESTER

This judgment was delivered by me on 21 October 2020 at 11.30am pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar 21 October 2020

REVELEY v REVELEY [2020] NZHC 2759 [21 October 2020 ]

[1]                  This proceeding concerns a Will Trust in  respect  of  the  late  James  Spencer Robertson (James).

[2]                  James died in May 2010. Probate of his Will was granted to  Madeleine Violet Reveley, Judith Olwyn Medlicott, James Peter Robertson, Leslie James William Stewart and Violet Robertson.

[3]                  Under James’ Will, his widow, Violet, had a life interest in James’ share of their family home at 47 Hunter Crescent, Wanaka (the Wanaka property). Violet died in February 2019. Madeleine Reveley and Christopher Medlicott were granted probate of Violet’s Will in September 2019.

[4]                  This proceeding has been brought about as a result of James Peter Robertson (Jamie, as he is referred to in the papers) and Leslie James William Stewart (Leslie), both having lost capacity.

[5]                  Orders are sought removing Jamie and Leslie as trustees and that Jamie’s daughter, Kirsten Jane Robertson, be appointed trustee in Jamie’s place. The proceeding also seeks the half-share of the Wanaka property held in James’ estate be vested in Madeleine Reveley in her capacity as beneficiary. I will deal with the issues of vesting at the conclusion of this judgment.

[6]                  This proceeding has been commenced by a statement of claim. A without notice application, seeking that service be dispensed with, has also been made.

[7]                  The application to dispense with service requires a consideration of the positions of Jamie and Leslie. Given the evidence is that they lack capacity, I treat the applicants as also seeking an order that the need for any litigation guardian be dispensed with.

Jamie’s capacity

[8]                  Mr Michael Win, solicitor of Dunedin, has sworn an affidavit in which he says he was acting for Jamie at the time the Family Court made an order under the Protection of Personal and Property Rights Act 1988 which permitted a Will to be

made on behalf of Jamie. Mr Win explains he has acted for Jamie and the family since that time. A medical certificate is produced by Mr Win confirming that Jamie lacks capacity. The medical evidence is unambiguous in that regard. Mr Win offers his opinion that it is appropriate that Jamie be removed as trustee and his place taken by his daughter. Mr Win confirms Jamie’s family is aware of that step. By way of clarification, Jamie Robertson is the father of Kirsten Robertson and the son of the late James Robertson.

[9]                  I am satisfied, on the strength of the evidence concerning Jamie, that he is incapable of meeting his obligations as trustee. I am also satisfied no point would be achieved in serving him with these proceedings.

Litigation guardian

[10]              As Jamie is incapacitated r 4.30 of the High Court Rules 2016 requires him to have a litigation guardian unless the Court decides otherwise. I am satisfied in this case it is unnecessary to appoint a litigation guardian. In a sense, Mr Win, as Jamie’s solicitor, has fulfilled that role in an informal way.

[11]Accordingly, I dispense with the need for a litigation guardian.

Leslie’s capacity

[12]              The  evidence  in  respect  of  Leslie  is  very  similar  to  that   of  Jamie.    Mr Devon Miller, also a Dunedin solicitor, has filed an affidavit to similar effect to that of Mr Win.

[13]              In respect of Leslie, the medical evidence is of some age – the medical certificate being dated 21 November 2017, but the medical certificate concludes by saying Leslie lacks capacity and that his mental incapacity is due a health condition that will continue indefinitely. Leslie lives in managed care.

[14]              I am satisfied the medical evidence shows Leslie is not capable of performing his obligations as a trustee. Given Leslie’s lack of capacity, there would, again, be no point in serving him with these proceedings.

[15]              I am satisfied a litigation guardian need not be appointed for Leslie and such is dispensed with.

Removal of trustees

[16]Section 51 of the Trustee Act 1956 (the Act) 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

(b)is convicted of a crime involving dishonesty as defined by section 2 of the Crimes Act 1961; or

(c)is a mentally disordered person within the meaning of the Mental Health (Compulsory Assessment and Treatment)  Act 1992, or whose estate or any part thereof is subject to     a property order made under the Protection of Personal and Property Rights Act 1988; or

(d)is a bankrupt; or

(e)is a corporation which has ceased to carry on business, or is in liquidation, or has been dissolved.

(3)An order under this section, and any consequential vesting order or conveyance, shall not operate further or otherwise as a discharge to any former or continuing trustee than an appointment of new trustees under any power for that purpose contained in any instrument would have operated.

(4)Nothing in this section shall give power to appoint an executor or administrator.

(5)Every trustee appointed by the court shall, as well before as after the trust property becomes by law, or by assurance, or otherwise, vested in him, have the same powers, authorities, and discretions, and may in all respects act as if he had been originally appointed a trustee by the instrument, if any, creating the trust.

[17]              There is no practical means of changing the trustees of the Will Trust without seeking the assistance of the Court. I find the threshold for removal and appointment under s 51(1) is met. In all the circumstances, I am satisfied it is appropriate that James Peter Robertson and Leslie James William Stewart be removed as trustees of the Will Trust of James Spencer Robertson. I am satisfied it is appropriate that Kirsten Jane Robertson be appointed as replacement trustee.

Vesting order

[18]              Section 52 of the Act gives power to the Court to make vesting orders of land in certain circumstances:

52       Vesting orders of land

(1)Subject to the provisions of subsections (2) and (3), in any of the following cases, namely—

(a)where the court appoints or has appointed a trustee of any land or interest therein, or where a trustee of any land or interest therein has been appointed out of court under any statutory or express power:

(b)where a trustee entitled to or possessed of any land or interest therein, whether by way of mortgage or otherwise, or entitled to a contingent right therein, either solely or jointly with any other person—

(i)is under disability; or

(ii)is out of the jurisdiction of the court; or

(iii)cannot be found; or

(iv)being a corporation, has ceased to carry on business or is in liquidation or has been dissolved:

(c)where it is uncertain who was the survivor of 2 or more trustees jointly entitled to or possessed of any interest in land:

(d)where it is uncertain whether the last trustee known to have been entitled to or possessed of any interest in land is alive or dead:

(e)where there is no personal representative of a deceased trustee who was entitled to or possessed of any interest in land, or where it is uncertain  who  is  the  personal  representative  of a deceased trustee who was entitled to or possessed of any interest in land:

(f)where a deceased person was entitled to or possessed of any interest in land and his personal representative is under disability:

(g)where a trustee jointly or solely entitled to or possessed of any interest in land, or entitled to a contingent right therein, has been required, by or on behalf of a person entitled to require a conveyance of the land or interest or a release of the right, to convey the land or interest or to release the right, and has wilfully refused or neglected to convey the land or interest or release the right for 28 days after the date of the requirement:

(h)where land or any interest therein is vested in a trustee whether by way of mortgage or otherwise, and it appears to the court to be expedient—

the court may make an order (in this Act called a vesting order) vesting the land or interest therein in any such person in any such manner and for any such estate or interest as the court may direct, or releasing or disposing of the contingent right to such person as the court may direct.

(2)Where any such order is consequential on the appointment of a trustee, the land or interest therein shall be vested for such estate as the court may direct in the persons who on the appointment are the trustees.

(3)Where any such order relates to a trustee entitled or formerly entitled jointly with another person, and that trustee is under disability or out of  the  jurisdiction  of  the  court  or  cannot  be  found,  or  (being   a corporation) has ceased to carry on business or is in liquidation or has been dissolved, the land, interest, or right shall be vested in the other person who remains entitled, either alone or with any other person that the court may appoint.

[19]              As I noted earlier, the application seeks an order that the half-share of the Wanaka  property  held  in  the  Will  Trust   be  vested  in  Madeleine  Reveley  as   a beneficiary. The powers under s 52(1) of the Act is subject to s 52(2). The vesting order sought here is consequential on the appointment of the new trustee by virtue of s 52(1)(a). On that basis, I do not consider there is jurisdiction to vest the half-share directly in Madeleine Reveley as beneficiary.1 The reference to  “…  any  such person …” in the concluding paragraph of 52(1) is, in my view, to the person or persons referred to in the applicable sub-paragraph of s 52(1).

1      This is consistent with the commentary in Andrew Butler (ed) Equity and Trusts in New Zealand (2nd ed, Thomson Reuters, Wellington, 2009) at 5.2.9(3). See also Rota v Rota HC Rotorua M115/92, 9 December 1992.

[20]              Accordingly,   there   is   an   order    vesting    the   property   situated    at  47 Hunter Crescent, Wanaka being land comprised and described in Record of Title OT7C/1343 being legally described as Lot 2 Deposited Plan 16700 in the names of Madeleine Violet Reveley, Judith Olwyn Medlicott and Kirsten Jane Robertson as trustees of the Will Trust of the late James Spencer Robertson. The trustees of the Will Trust can then transfer the half-share in the Wanaka property to Madeleine Reveley.

Associate Judge Lester

Solicitors:
Medlicotts, Dunedin