Watson v Watson - [2020] NZHC 2252

IN THE HIGH COURT OF NEW ZEALAND NELSON REGISTRY

I TE KŌTI MATUA O AOTEAROA WHAKATŪ ROHE

CIV-2007-442-374

[2020] NZHC 2252

UNDER Sections 43 and 51 of the Trustee Act 1956

IN THE MATTER

of appointing a new trustee

BETWEEN

KAREN RUBY WATSON

Applicant

AND

ERIC JOHN WATSON AND WILLIAM GERALD GIBSON

Respondents

Hearing: On the papers

Appearances:

P J Bellamy for the Applicant

Judgment:

1 September 2020

JUDGMENT OF COOKE J

[1]By application dated 20 August 2020 the applicant seeks orders:

(a)Removing Eric John Watson and William Gerald Gibson as trustees of the will of Brian Clark Watson; and

(b)Appointing Karen Ruby Watson as sole trustee in their place.

[2] The application is supported by a memorandum of counsel and an affidavit of Karen Ruby Watson dated 13 August 2020. It has been referred to me in my capacity as Duty Judge.

[3] As an initial point, I note that it is usually appropriate for the application to include applications for leave that the proceeding be commenced by originating

WATSON v WATSON [2020] NZHC 2252 [1 September 2020]

application under r 19.5 of the High Court Rules 2016, and that there be directions that the application does not need to be served on any other person. I duly give those directions in the present case on the basis that those orders are routine and that reasonable attempts to serve the respondents have been taken.1

Background

[4] Mrs Watson explains that she is the widow of Brian Clark Watson who died on 26 March 2007. Under Mr Watson’s will probate was granted on 25 September 2007. Mr Eric Watson, who is a high profile businessman, and Mr William Gibson who Mrs Watson says worked for Mr Eric Watson, were appointed the executors. Brian was Eric’s father.

[5] The terms of the will are straightforward. The Trustees were to pay the debts and funeral expenses, administration expenses and then transfer the residue to Mrs Watson. The key asset is the home in which Mr and Mrs Watson lived in Nelson. Mrs Watson now needs to sell the home so that she can move into a Retirement Village.

[6] Despite extensive steps taken by Mrs Watson and her solicitor, neither Mr Eric Watson nor Mr William Gibson have been able to be located. There is evidence that at least Mr Eric Watson has received a letter sent by courier asking him to attend to the steps necessary so that Mrs Watson can move into her retirement home, but no steps have been taken. This most unfortunate state of affairs has led to Mrs Watson making this application. As she said in her affidavit:

I found having to initiate this proceeding stressful. I would really like this over and done with. Until I [commenced] the process of selling the house, I had no idea that the transfer into my name had not taken place.

Assessment

[7] The application is made in reliance on ss 43(1)(b) and (d) and 51(1) of the Trustee Act…

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 Watson v Watson

Details

AGLC: Watson v Watson [2020] NZHC 2252
Case: [2020] NZHC 2252
Decision Date: 1 September 2020

CaseChat Overview and Summary

The High Court of New Zealand heard an application by Karen Ruby Watson to remove Eric John Watson and William Gerald Gibson as trustees of the will of Brian Clark Watson, and to appoint herself as the sole trustee. The applicant, the widow of the deceased, sought to sell the family home to move into a retirement village but was unable to do so as the trustees had not completed the necessary steps. Neither of the trustees could be located despite attempts to contact them. The application was made under sections 43 and 51 of the Trustee Act 1956.

The court had to determine whether it was appropriate to remove the existing trustees and appoint a new one. While section 43 of the Trustee Act could not apply, as it involves a power of appointment not present in this case, section 51 could apply as it allows the court to appoint new trustees when it is expedient to do so. However, the court found that section 21 of the Administration Act 1969 was more appropriate, as it specifically deals with the discharge or removal of administrators and trustees, and allows the court to consider the interests of the beneficiaries and what is expedient in their interests.

The court decided to remove Eric John Watson and William Gerald Gibson as trustees and appoint Karen Ruby Watson as the sole trustee. The court found that the trustees had not acted in accordance with their duties, had not completed the required steps to administer the estate, and had been absent from New Zealand for more than 12 months without appointing attorneys. The court emphasised the importance of the interests of the beneficiaries and the need for the estate to be properly administered.

The court made orders removing Eric John Watson and William Gerald Gibson as executors of the will of Brian Clark Watson, and appointing Karen Ruby Watson as sole executor in their place. The court reserved leave to vary or supplement the orders if necessary.

Orders