Roberts v Brown

[2020] NZHC 3077

IN THE HIGH COURT OF NEW ZEALAND TIMARU REGISTRY

I TE KŌTI MATUA O AOTEAROA TE TIHI-O-MARU ROHE

CIV-2020-476-30

[2020] NZHC 3077

BETWEEN

MURRAY GEORGE ROBERTS

Applicant

AND

MARGARET ANN BROWN and MURRAY GEORGE ROBERTS

Respondents

Hearing:	(Determined on the Papers)
Counsel:	P C Dalziel for the Applicant
Judgment:	20 November 2020

JUDGMENT OF ASSOCIATE JUDGE LESTER

This judgment was delivered by me on 20 November 2020 at 2.30pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar 20 November 2020

ROBERTS v BROWN [2020] NZHC 3077 [20 November 2020]

[1]        The applicant, Murray George Roberts (Mr Roberts), seeks the following orders:

(i)leave to bring the present application by way of originating application;

(ii)dispensing with service on the respondent, Margaret Ann Brown  (Mrs Brown);

(iii)dispensing with the need for Mrs Brown to have a litigation guardian; and

(iv)a vesting order in respect of a property at 17 Wilkin Street, Temuka .

Background

[2]        The Paul and Margaret Brown  Family  Trust  (the  Trust)  was  settled  on  22 March 1999. The original trustees were Mrs Brown, Mr Roberts and Clifton William Paul Brown (Mr Brown). Mr Brown died on 10 October 2019.

[3]        The medical evidence is that Mrs Brown no longer has capacity. The medical certificate provided is dated 17 June 2019 and refers to assessments made in March and April 2019. The certificate records Mrs Brown is not mentally capable and that she lacks capacity to make judgments about her daily living, or to foresee the consequences of the failure to make such decisions. Without identifying the condition affecting Mrs Brown, the medical certificate concludes that her mental capacity is due to a health condition that is likely to continue indefinitely.

[4]        Ideally, the medical certificate would be more current, or at least confirmed by a more recent  letter  from  Mrs  Brown’s  medical  practitioner.  However,  both  Mrs Brown’s children, Craig Brown and Nicola Brown, who hold joint power of attorney for Mrs Brown, confirm that her understanding and capacity have not improved. They confirm Mrs Brown is in full-time care.

[5]On that basis, I accept Mrs Brown lacks capacity.

[6]        The only asset in the Trust is a property at 17 Wilkin Street, Temuka (the property) which, I assume, was the residence of Mrs Brown and her late husband.  Mr Roberts explains that because Mrs Brown no longer lives at the property, he considers it appropriate that the property be sold.

Use of originating application procedure

[7]        Applications for vesting orders such as this are now routinely made by way of originating application. Vesting order applications have been characterised as administrative in nature and that is often the case in straightforward uncontested applications. In such applications, it is appropriate that a cost efficient and practical procedure be adopted.

[8]        Accordingly, leave is granted for the originating application procedure to be used.

Litigation guardian and service

[9]        As Mrs Brown is incapacitated, HCR 4.30 of the High Court Rules 2016 requires her to have a litigation guardian unless the court directs otherwise. I am satisfied, in this case, it is unnecessary to appoint a litigation guardian. Such will serve no real purpose given the administrative nature of the application.

[10]      Accordingly, there is an order dispensing with the appointment of a litigation guardian.

[11]      Similarly, I am satisfied there is no need for any party to be served. In that regard, I note Mrs Brown’s children (who are adults), consent to this application. The application is necessary to allow the Trust to function again.

[12]      Accordingly, there is an order dispensing with the need for the application to be served.

Removal of Mrs Brown as trustee

[13]      The application does not seek an order removing Mrs Brown as trustee, but it is appropriate that  she  be  removed.  If  the  property is  vested  in  the  applicant, Mr Roberts, that will not achieve the end sought by this application. If the property is vested in Mr Roberts alone, without removing Mrs Brown as trustee, that would not avoid the need for both trustees to act unanimously in respect of trustee’s decisions. It is implicit in the application, aimed at attaining the ability to sell the property, that Mrs Brown should be removed as trustee.

[14]      The Court has an inherent supervisory jurisdiction to ensure that the terms of a trust are carried out.1 The jurisdiction exists in parallel with the court’s statutory power under s 51 of the Trustee Act 1956 to appoint new trustees and derives from the court’s powers in equity to supervise trusts for the welfare of beneficiaries.2

[15]      This inherent jurisdiction permits the court to make an order removing trustees where the step is necessary in order to protect the interests of the beneficiaries. Dixon J in Miller v Cameron noted the principles which govern the exercise of the court’s jurisdiction, statutory or inherent, to remove a trustee:3

The jurisdiction to remove a trustee is exercised with a view to the interests of the beneficiaries, to the security of the trust property and to an efficient and satisfactory execution of the trusts and a faithful and sound exercise of the powers conferred upon the trustee. In deciding to remove a trustee the Court forms a judgment based upon considerations, possibly large in number and varied in character, which combine to show that the welfare of the beneficiaries  is  opposed to  his continued  occupation  of  the  office.  Such a judgment must be largely discretionary. A trustee is not to be removed unless circumstances exist which afford ground upon which the jurisdiction may be exercised. But in a case where enough appears to authorize the Court to act, the delicate question whether it should act and proceed to remove the trustee, is one upon which the decision of a primary Judge is entitled to especial weight.

[16]      I am satisfied that it is in the best interests of the Trust to remove Mrs Brown as trustee and there is an order accordingly.

1      Kite v Hodge [2014] NZHC 3025 at [40].

2 At [40].

3      Miller v Cameron (1936) 54 CLR 572 (HCA) at 580 - 581.

[17]      This application seeks that Mr Roberts be the sole trustee. I would normally be reluctant to make an order vesting the property in a sole trustee, but given the consent of Mrs Brown’s children, I am prepared to do so in this case. Mr Roberts is not a beneficiary. Counsel has advised me in a telephone conference that the intention is to appoint Mrs Brown’s children as trustees and he holds signed consents in that regard. Counsel confirmed Mr Roberts does not wish to be sole trustee. I accept counsel’s assurances in that regard.

[18]      With the removal of Mrs Brown, a vesting order pursuant to s 52 of the Trustee Act 1956 is necessary.

[19]      Accordingly, there is an order vesting the property at 17 Wilkin Street, Temuka contained in Record of Title 68466 being an estate in fee simple containing 427 square metres more or less and being legally described as Lot 1 Deposited Plan 317456, Canterbury Land Registry, in the name of Murray George Roberts.

Associate Judge Lester

Solicitors:
Peter Dalziel Lawyer, Temuka