Rodley (EJM Family Trust)
[2023] NZHC 1411
•7 June 2023
IN THE HIGH COURT OF NEW ZEALAND DUNEDIN REGISTRY
I TE KŌTI MATUA O AOTEAROA ŌTEPOTI ROHE
CIV-2023-412-11
[2023] NZHC 1411
UNDER section 52 of the Trustee Act 1956 IN THE MATTER
of the EJM FAMILY TRUST
AND
IN THE MATTER
of an application by JESSICA RUTH RODLEY and WARWICK JAMES GRAHAM
Applicants
Hearing: On the papers Counsel:
A M McCormick and Q D H de Hamel for Applicants
Judgment:
7 June 2023
JUDGMENT OF ASSOCIATE JUDGE PAULSEN
This judgment was delivered by me on 7 June 2023 at 4.00 pm pursuant to Rule 11.5 of the High Court Rules
Registrar/Deputy Registrar Date:
RE RODLEY (EJM FAMILY TRUST) [2023] NZHC 1411 [7 June 2023]
[1]There is before me an application for:
(a)leave to commence a proceeding seeking a vesting order by way of originating application under pt 19 of the High Court Rules 2016; and
(b)an order vesting a property situated at 40 Main Street, Weston in the names of Jessica Rodley (Jessica) and Warwick Graham (Warwick) as the current trustees of the EJM Family Trust.
[2] Jessica and Warwick are the current trustees of the EJM Family Trust. The trust was formerly known as the Lawry Family Trust and was created by a deed of trust dated 25 November 2004.
[3] The settlors of the Trust were Peter Lawry (Peter) and Sarah Lawry (Sarah), and the original trustees were Sarah and Malley & Co Trustees Ltd. The primary beneficiaries of the trust were the settlors and their children.
[4] The trust assets include a property at 40 Main Street, Weston recorded in record of title OT91/263. The current registered owners are Sarah and Malley & Co Trustees Ltd. Although there have been several changes of trustees over the years, the changes were not all recorded on the title to the property. The failure to change the registration was an administrative error.
[5]The changes of trustees were as follows:
(a)by deed dated 31 January 2019, Sarah was removed as trustee and Mike Buchanan appointed as a trustee in her place;
(b)by deed dated May 2020, Malley & Co Trustees Ltd was removed as a trustee and Jessica appointed in its place; and
(c)by deed dated 29 July 2022, Mike Buchanan was removed as a trustee and replaced by Warwick.
[6]Peter was removed a beneficiary of the trust in 2007.
[7] Sarah was removed as a trustee because she lacked mental capacity, and she has recently passed away.
[8] Jessica and Warwick are seeking an order pursuant to s 52(2) or (3) of the Trustee Act 1956 to have the Main Street property vested in them as the current trustees, because that is required for administrative purposes and they recognise their responsibilities and duties as trustees and wish to ensure compliance with those duties.
[9] All of the children of Peter and Sarah are aware of this application and consent to it. There are no other known beneficiaries of the trust.
Leave to use the originating application process
[10] The proposed proceeding for a vesting order is not one that can be brought by way of an originating application as of right under rr 19.2 or 19.3 of the High Court Rules, but the Court may authorise use of the originating application procedure where to do so is in the interests of justice under r 19.5. The interests of justice means securing the just, speedy and inexpensive determination of proceedings.1
[11] This application is concerned with what is a purely administrative matter. There is no opposition to the orders sought from any person with an interest in the trust. I am satisfied this is a case where there is no need for particularised pleadings and interlocutory procedures, such as discovery. The application is also straightforward and suitable for summary determination under the originating application procedure. It is appropriate for the application for leave to proceed by way of an originating application be granted and that service be dispensed with.
Should a vesting order be made?
[12] The Trusts Act 2019 has simplified the process for divesting and vesting trust property in the trustees of the trust. Relevant to a case such as this where there have been the removal and appointment of several trustees, s 116 of the Trusts Act no longer requires a court order to complete transfer of legal title from one trustee to another.
1 Solar Bright Ltd v Martin [2019] NZHC 300 at [18].
[13] However, the transitional provisions in the Trusts Act apply where a trustee has resigned or been removed before the commencement date of the new Act, but the divesting and vesting of the trust property has not been completed.2 That is the circumstance that has arisen in this case, where both Sarah and Malley & Co Trustees Ltd were removed as trustees prior to 30 January 2021, being the commencement date of the Trusts Act. As a result, cl 11(2) of sch 1 of the Trusts Act governs the present application. It provides:
(2)The divesting and vesting of trust property, and the satisfaction of any requirements to which the divesting and vesting are subject, must be completed as if this Act had not commenced.
[14] Jessica and Warwick must therefore seek a vesting order under s 52 of the Trustee Act as if that section remains in force. Relevant for present purposes, s 52(1)(h) of that Act provides:
(1)Subject to the provisions of subsections (2) and (3), in any of the following cases, namely—
…
(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.
[15] Jessica and Warwick’s position is that the making of a vesting order is appropriate and necessary to ensure the trust property is vested in the names of the current trustees. I have no hesitation in accepting that position. I am satisfied that they were both validly appointed as trustees, and the order sought is necessary so as to ensure the Main Street property is correctly vested in the names of the trustees for the time being and so that they may deal with the trust property consistent with their duties as trustees.
2 Trusts Act 2019, sch 1 cl 11.
Result
[16] The applicants are granted leave to commence this proceeding by way of originating application. I dispense with service of the application.
[17]The application for a vesting order is granted.
[18] There shall be an order that the property at 40 Main Street, Weston (identifier OT91/263) vest in the names of Jessica Ruth Rodley and Warwick James Graham as trustees for the time being of the EJM Family Trust.
[19]Leave is reserved to apply for further directions if necessary.
O G Paulsen Associate Judge
Solicitors:
Brandts-Giesen McCormick, Rangiora
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