Trustees Executors Limited v Poppe
[2023] NZHC 126
•8 February 2023
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2022-485-788
[2023] NZHC 126
IN THE ESTATE of ANNE PAISLEY RYAN UNDER
Rule 27.6 of the High Court Rules 2016
BETWEEN
TRUSTEES EXECUTORS LIMITED
Applicant
AND
BEATRICE MARY POPPE
First Respondent
WINIFRED EDITH RYAN
Second Respondent
Hearing: On the papers Appearances:
V M McInman for the Applicant
Judgment:
8 February 2023
JUDGMENT OF COOKE J
(Directions as to service)
[1] By application dated 30 November 2022 the applicant seeks directions as to service of these proceedings.
[2] In the proceedings the applicant seeks to be appointed administrator of the estate of Anne Paisley Ryan pursuant to a will dated 17 April 2019 (the 2019 Will). The first and second respondents were Anne’s sisters. They were named as the executors in Anne’s 2019 will but both have renounced that role, and the applicant has indicated that it is prepared to act as administrator. By statement of claim dated 30 November 2022 the applicant seeks that appointment, or alternatively an appointment under a preceding will dated 4 April 2016 (the 2016 Will).
TRUSTEES EXECUTORS LIMITED v POPPE [2023] NZHC 126 [8 February 2023]
[3] The first respondent says that Anne did not have capacity to execute the 2019 Will, and that probate should be granted on the 2016 Will. In her statement of defence she advances claims of a lack of testamentary capacity, and of undue influence. The second respondent initially filed an appearance reserving rights, but has now indicated that she opposes the orders sought in the first respondent’s defence. The solicitor who acted in relation to the 2019 Will, Mr Kevin Smith, has provided an affidavit.
[4] There are differences between the 2016 and 2019 Wills in terms of the beneficiaries, and the applicant’s without notice application seeks the following directions:
(a)An order … that service of the applicant's Statement of Claim and the Affidavit of Kevin Robert Smith be dispensed with for the following parties:
(i)The First Church of Christ Scientist Wellington;
(ii)Greenpeace of New Zealand;
(iii)Catherine Mary Poppe;
(iv)Malcolm Ian Poppe;
(v)Virginia Janet Poppe;
(vi)Elisabeth Anne Poppe;
(vii)Andre Lawrence Budd;
(viii)Ryan Malcolm Poppe; and
(ix)Hannah Mary Poppe.
(b)Any other directions generally as to service or representation as the court may see fit.
[5] The application was first considered by Gendall J on 9 December 2022. He noted that a copy of the 2016 Will had not been provided, and that the Court could accordingly not consider who may be interested or adversely affected by the application pursuant to r 18.7. He directed a copy of the will be provided.
[6] A copy of the 2016 Will was then provided, and the application was referred to Grice J who by minute dated 16 December 2022 said:
There is no memorandum of counsel which would usually accompany such an application. At a minimum this should set out: relevant law; an explanation as to why the applicant considers that the other named beneficiaries should not be served; further information on the likely effects on the beneficiaries; and options for the representation for any beneficiaries under a disability or of any infant beneficiaries. One approach is to obtain the consent of the beneficiaries to the matter being dealt with without service and those consents should filed in the court. That of course only covers adult beneficiaries with capacity.
Accordingly I direct a comprehensive memorandum detailing the above and any other relevant information be filed for the assistance of the court in dealing with the application to dispense with service. The matter may be then referred to the duty judge.
[7] It is to be noted that a memorandum of counsel is required as a pre-requisite of making the application under r 18.7(5).
[8] A memorandum of counsel for the applicant dated 23 December 2022 has subsequently been filed and the application has been referred to me for determination as Duty Judge.
Relevant principles
[9] Applications for directions as to service are regulated by r 18.7 of the High Court Rules 2016. Rule 18.7(3) provides:
In support of the application, the plaintiff must provide (by affidavit or otherwise) the information that may be necessary to enable the court to decide what persons or classes of persons are interested in, or may be adversely affected by, the relief sought by the plaintiff and by what means the interests of each such person or class of persons may be adequately represented.
[10]Rule 18.8 then provides:
18.8 Orders giving directions as to service
(1)On an application under rule 18.7, the Judge may make any orders for service or representation that the Judge thinks just.
(2)If, in a proceeding involving an incapacitated person or minor, the Judge considers it is not necessary to appoint a litigation guardian, the Judge may make orders with regard to the representation of that person, without the appointment of a litigation guardian under rule 4.35.
(3)The effect of every order for directions as to service or for representation made under this rule must be set out in the notice of proceeding in accordance with rule 5.23.
[11] The applicant has provided no authority indicating how the Court should approach this application in the context of proceedings concerning challenges to a will where beneficial interests may change. The authors of McGechan on Procedure state:1
HR18.8.01 Criteria
This rule lays down no criteria for the Court when making service or representation orders. It implies that the Court will take into account whether persons are interested, or may be adversely affected, and whether means under consideration for representation will be adequate. For minors or incapacitated persons, the Court may consider whether the appointment of a litigation guardian is necessary.
[12] I am unaware of authority outlining how the Court should approach directions as to service in this kind of case where the legitimacy of a will is in question, and where beneficial interests under the will may change as a consequence of the contest in the litigation. It may be inappropriate to apply any fixed, or inflexible approach given the varying circumstances that may arise. Rules 18.7 and 18.8 nevertheless contemplate that there may be circumstances in which service on potentially affected persons may be dispensed with. Key principles include fairness to potentially affected persons, proportionality in terms of the costs of litigation, and ensuring that all relevant issues are properly addressed in the proceedings. The Court should evaluate those principles, and any others that may be relevant, in order to determine whether service may be dispensed with, and also decide whether any other directions may be appropriate. Service, or at least some form of notice, may be appropriate when there is doubt. I approach the case on that basis.
1 Robert Osborne and others McGechan on Procedure (looseleaf ed, Thomson Reuters, updated to 8 November 2022).
Assessment
[13] For a number of related reasons I have concluded that the application as currently formulated should be dismissed. Dismissing the application is without prejudice to the ability for the applicant to make a further application in relation to service.
[14] There have been a number of procedural shortcomings with the application identified by Gendall J and Grice J. The application was also not made without notice before or when the proceedings were first served as is contemplated by r 18.7. As is noted by the authors of McGechan on Procedure:2
HR18.7.02 Without notice
Application is to be without notice. The implication of this requirement is that application for directions for service should usually be made before service on the defendant. The application would usually be filed with the statement of claim. Reading subcls (1) and (3) together, it appears the application should specify the directions the plaintiff considers appropriate, and an accompanying memorandum should provide reasons. The application is to be supported by information necessary for the Court to decide who is interested in or may be adversely affected by the relief sought and how such people may be adequately represented. Such information may be provided by affidavit or otherwise. The word “otherwise” appears to envisage unsworn information. In cases where plaintiff’s counsel has no doubt about the facts he or she should supply the required information with the memorandum required by subcl (5). Subclause (3) appears to distinguish between people who “are interested” in relief, and those who “may be adversely affected” by the relief sought. The first is definite, the other more speculative. The intention appears to be that if people are even potentially adversely affected, information must be supplied. By contrast, if there is no potentially adverse effect, people for whom information must be supplied are limited to those with a definite interest.
HR18.7.03 Estate litigation
Subclause (4) sets out the information to be provided in cases brought under the Family Protection Act 1955 or Law Reform (Testamentary Promises) Act 1949. With the exception of para (c) (value of estate) its requirements are mandatory, and lack of knowledge on the part of the plaintiff is no excuse. This may cause problems in details such as addresses, occupations, and ages of beneficiaries, or potential claimants not known at the start of the proceedings. Where information is unobtainable, the plaintiff could provide the known details, and apply for directions for service but under r 1.5 for an order excusing non-compliance. Subclause (4)(f) requires at least sufficient information to enable a proper Court assessment of any representation orders desirable, bearing in mind r 4.27.
2 At HR18.7.02–18.7.03.
[15] Here the application has not been served on the first or second respondent notwithstanding the steps they have both taken in the proceeding. Their views may be of significance in respect of some prospective beneficiaries for whom service is sought to be dispensed with.
[16] Information has now been provided by the applicant in relation to some of the parties who the applicant seeks not to be served. Counsel explains that the assets of the estate consist of a residential property with an estimate value of $1,040,000, bank accounts with a combined value of approximately $1,170,000, and certain artworks whose value is unknown. Counsel says that Anne had no spouse, children, grandchildren or other persons to whom she may have owed a moral duty. She is said to have placed a high regard on her siblings with the bulk of her assets passing to them under the 2019 Will.
[17] The applicant has focused primarily on ensuring that all relevant issues are properly argued before the Court in advancing the application. It has suggested that further parties do not need to be served because the first or second respondents will be advancing argument that adequately address issues from the perspective of other affected parties. But that does not take into account the need for procedural fairness when those who may be affected by the Court’s orders may wish to be heard. As indicated at [12] above procedural fairness is important, although I accept that ensuring that the proceedings are conducted in a proportionate and cost effective way, and without an unnecessary number of parties participating, is also relevant.
[18] The prime difference between the two wills is that under the 2016 Will the residential property was to be divided approximately in half between the first respondent, and on trust for the second respondent. Under the 2019 Will it passes solely to the second respondent. The first and second respondents are parties to the proceedings. No other parties need to be served in relation to the contest between them about this property.
[19] But the issues are not confined to this property. The application seeks directions that the First Church of Christ Scientist, Wellington, and Greenpeace of New Zealand not be served. In counsel’s memorandum counsel explains that under
the 2016 Will an amount of just over $188,000 was to be distributed equally between them, but under the 2019 Will they receive the reduced amounts of $10,000 and $5,000 respectively. They would accordingly financially benefit from a decision that the 2019 Will was not valid. On the basis of that information I see no basis upon which it could be appropriate not to serve those two entities, each of which has approximately
$85,000–$90,000 in issue. Both of those parties should clearly be served with the proceedings.
[20] There are gifts totalling $24,000 in the 2019 Will to be distributed between the deceased’s nieces, nephew and great nephew. Counsel notes that this is a reduction in amount from a gift of the residue of the estate under the 2016 Will. They are the individuals identified in paragraphs (iii)–(ix) in the application set out at [4] above. Subject to further details it may well be that as a matter of proportionality it is unnecessary for them to be served with the proceeding, including because their interests are adequately represented by the first and second respondent. But more information would be required before that decision could be made, and the attitude of the first and second respondent on that point may also be relevant. For example, the Court is unaware of their ages, circumstances, or the relationships they each have with the first and second respondent. Moreover, given that each will need to be contacted for the purposes of administration in any event the simplest course may well be to serve them. I decline to give the directions sought in those circumstances. Normally service would only involve service of the statement of claim and the affidavit of Mr Smith, but there is now more relevant information on the Court file. The safest course would be to serve them with the statement of claim, the first respondent’s statement of defence, and a copy of this judgment. Any further documents on the file sought by any of those parties could then be requested by them from the applicant.
[21] There are then monetary gifts of $10,000 each to seven named friends of Anne under the 2019 Will. Under the 2016 Will only two of those friends so benefit, with one receiving $20,000 and the other $10,000. Details of who these friends are are not provided other than as recorded in the wills, and the application does not seek a direction that service on these people not take place. It may be that the limited amounts involved could justify an order directing that the seven friends not be served, but there is not sufficient information available to make that decision, and again the safer course
may well be to serve them. All seven would need to be contacted in relation to any distributions in any event. I accept there is no need to serve the person who will receive $10,000 come what may. But the pragmatic course is to serve the other six with the documents in the way I referred to in [20] above.
[22] Under the 2019 Will two entities, and a general cause, are identified as beneficiaries of the residue of the estate. Counsel advises that there is unlikely to be a residue. On that basis there would be no need for any entities to be served.
[23] The suggested course involving service that I have outlined above is not a direction that service should so take place. I direct that the First Church of Christ Scientist, Wellington, and Greenpeace of New Zealand be served. I accept that there is no need to serve any party as a consequence of the clause in the 2019 Will concerning the residue, or in relation to the person who will receive $10,000 in any event. But I decline to give directions that the other parties not be served as there is insufficient information to allow such directions to be given. If necessary a further application could be made with better information, and with the views of the first and second respondent provided. But there has already been cost and delay associated with this application, so the suggested course may be the best way forward from a pragmatic point of view.
[24] For these reasons the directions as to service in [19] and [22] above are given. The application is otherwise dismissed.
Cooke J
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