Smith v Velekof - [2022] NZHC 386

IN THE HIGH COURT OF NEW ZEALAND PALMERSTON NORTH REGISTRY

I TE KŌTI MATUA O AOTEAROA TE PAPAIOEA ROHE

CIV-2021-454-41

[2022] NZHC 386

UNDER Section 21 of the Administration Act 1969 and section 112 of the Trusts Act 2019

IN THE MATTER

of an application to remove and replace the executor and trustee of the Estate of Robert Earl Smith of Palmerston North (deceased)

BETWEEN

ANTON CRAIG SMITH AND MELANIE MARIE SMITH

Plaintiffs

AND

CHRISTINE VELEKOF

Defendant

Hearing: 18 February 2022

Appearances:

M Freeman and N Donaldson for the Plaintiffs D M Abricossow for the Defendant

Judgment:

8 March 2022

JUDGMENT OF COOKE J

Introduction

[1] The plaintiffs in this proceeding are two of the four children of Mr Robert Smith who died in January 2020. The defendant, Ms Velekof, was Mr Smith’s de facto partner, and the person appointed as the administrator of his estate under his will.

[2] In this proceeding the plaintiffs seek orders removing the defendant as administrator and appointing an independent person in her place under s 21 of the Administration Act 1969. The ultimate purpose of having an independent administrator appointed in place of Ms Velekof is so that the administrator can then

SMITH v CHRISTINE VELEKOF [2022] NZHC 386 [8 March 2022]

commence proceedings against Ms Velekof to recover some of the property she obtained or kept following the administration of Mr Smith’s estate, with other proceedings then commenced as contemplated by the plaintiffs, including under the Family Protection Act 1955. It is said that some of that property should have been brought back within the estate under the Property (Relationships) Act 1976, and that the plaintiffs and their siblings should benefit from that property by proceedings subsequently brought.

[3] Ms Velekof opposes the orders. Affidavits have been filed by each of the plaintiffs, and an affidavit from the defendant has been provided in opposition.

The plaintiffs’ contentions

[4] Mr Smith and Ms Velekof had a de facto relationship lasting some 32 years. The plaintiffs and their two brothers were Mr Smith’s children of a former relationship.

[5] Mr Smith died on 3 January 2020. Under his will Ms Velekof was his sole executor, and under the will she inherited his estate. Probate was obtained on 11 February 2020. The reported assets of the estate were $97,262.58. This was distributed within a month of probate being granted.

[6] The plaintiffs say that the majority of Mr Smith and Ms Velekof’s assets acquired during their relationship were held in Ms Velekof’s name or their joint names, and that they accordingly did not fall into Mr Smith’s estate. They say there were substantial term deposits, and also identify three properties which they say have a combined value of $1.5 million, together with two other properties which they believe Mr Smith and Ms Velekof had an interest in.

[7] The plaintiffs say that this property was more properly treated as relationship property, and that they have been disinherited. They say they cannot bring a claim under…

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 Smith v Velekof

Details

AGLC: Smith v Velekof [2022] NZHC 386
Case: [2022] NZHC 386
Decision Date: 8 March 2022

CaseChat Overview and Summary

In the High Court of New Zealand, the plaintiffs, Anton Craig Smith and Melanie Marie Smith, sought to remove and replace Christine Velekof, who was appointed as the administrator of their deceased father's estate. The plaintiffs alleged that Ms Velekof had acted in a manner that disadvantaged them and their siblings, and that she could not be expected to bring proceedings against herself to recover assets that should have been brought back into the estate. The legal issues before the Court were whether the plaintiffs' claims could succeed, and if so, whether an independent administrator should be appointed under section 21 of the Administration Act 1969.

The Court found that the plaintiffs' claims could not succeed because they were time-barred under section 90 of the Property (Relationships) Act 1976. The Court rejected the argument that section 90 did not apply to the proceedings in question, and held that any proceedings brought by an administrator were subject to the time limits set out in section 90. The Court also noted that any application for an extension of time under section 90(2) would need to be made before the final distribution of the estate, which had already occurred in this case.

The Court held that there was no point in removing and replacing Ms Velekof as the administrator, as there were no steps a replacement administrator could take. The Court did not need to address the alternative argument that jurisdiction under section 21 to remove and replace an administrator no longer exists once the administration is complete.

In conclusion, the application to remove and replace the defendant as the administrator was dismissed. The defendant would be entitled to costs, and the parties were directed to attempt to agree on the costs or to file memoranda outlining their positions.

Orders