Taylor v Inder - [2022] NZHC 73

IN THE HIGH COURT OF NEW ZEALAND BLENHEIM REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WAIHARAKEKE ROHE

CIV-2020-406-28

[2022] NZHC 73

BETWEEN
DAVID HUNTER TAYLOR of Rarangi,

Blenheim, company director Plaintiff

AND

WALTER ROSS INDER of Blenheim, Retired, IAN BRUCE MARTELLA of

Blenheim, company director, NICOLA KIM STRETCH of Blenheim, general manager, CLIVE RANDALL BALLETT of Picton,
company director, DOMENICO GIUSPPE ROMANO of Fairhall, Blenheim, Banker, CATHERINE SUSAN BELL of Blenheim, communications specialist, together the

trustees of the Marlborough Electric Power Trust

Defendant

AND

MARLBOROUGH LINES LIMITED

Interested Party

Hearing: 6–7 September, further submissions received from each party dated 22, 29 September, 1 and 11 October 2021

Appearances:

M B Wigley for Plaintiff

M C Harris and Z A Brentnall for Trustees of Marlborough Electric Power Trust
J W S Baigent and A N Birkinshaw for Marlborough Lines Limited

Judgment:

2 February 2022

JUDGMENT OF CULL J

TAYLOR v INDER and Others [2022] NZHC 73 [2 February 2022]

Table of Contents

Para No.

Background Facts  2
Mr Taylor’s claim  3
The defendant’s counter-claim  9
Structure of this judgment  11
The legal framework  12
Trusts Act 2019  15
Principles of disclosure  17
The Trust Deed  25
The information sought  36
Is the requested information reasonably necessary?  38
Information provided  42
Reasons why disclosure of acquisition documents should not be ordered          47
Information not reasonably necessary to enforce the trust  48
The distinctive nature of an energy trust  55
Inhibiting free and frank communication of Trustees  68
Redacted Minutes  72
Are the redacted minutes disclosable?  83
The Counterclaim  89
Is there a duty of confidence?  91
Costs  108

[1] Mr Taylor is a consumer beneficiary of the Marlborough Electric Power Trust (the Trust), which holds all the shares in the Marlborough Electricity Lines Company (the Company). He seeks disclosure of trust information that dates back six years and primarily concerns the acquisition by the Company of the Yealands Wine Company Group (the Yealands Group).

Background Facts

[2] The Company was established in 1993. It transmits and distributes electricity within the Marlborough region. In the same year, the Trust was also established. The beneficiaries of the Trust are the electric power customers of the Company. In 2015, the Company acquired 80 per cent of the Yealands Group and, by July 2018, the remaining shares.

Mr Taylor’s claim

[3] Mr Taylor, the plaintiff, is a Marlborough resident and a consumer beneficiary as defined in the Trust Deed. He is also a current director and board chair of Astrolabe

Wines Ltd. He has expressed his concerns publicly both at the risk taken by the Company in buying a wine business and in the operations of both the Company and the Trust. He contends that his concerns are shared by a portion of the public. He claims the acquisition should not have occurred, and that the Trustees:

(a)were not adequately involved in the acquisition of the Yealands Group;

(b)should not have approved the purchase;

(c)should have ensured that appropriate directors were appointed to the Company;…

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 Taylor v Inder

Details

AGLC: Taylor v Inder [2022] NZHC 73
Case: [2022] NZHC 73
Decision Date: 2 February 2022

CaseChat Overview and Summary

David Hunter Taylor, a beneficiary of the Marlborough Electric Power Trust, sought disclosure of trust information relating to the acquisition by the Marlborough Electricity Lines Company of the Yealands Wine Company Group. The trustees resisted the disclosure and counterclaimed that Mr Taylor breached his duty of confidence by disclosing the information to others. The court considered whether the requested information was reasonably necessary to enforce the trust, whether it was confidential, and whether the disclosure would inhibit free and frank communication between the trustees and the company. The court found that the information sought was not reasonably necessary to enforce the trust, that it was confidential, and that disclosure would inhibit free and frank communication. The court therefore declined to order the disclosure of the information and granted the trustees' counterclaim for breach of confidence. The court also granted an injunction restraining Mr Taylor from disclosing the information and requiring him to file an affidavit listing the names and contact details of any person to whom he had disclosed the information.

Orders