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Trusts, Variation, Wills

Variation of will trust

It is not uncommon for discretionary trusts to varied with the assistance of the court, which is provided for in the Trustee Act 1956 (s 64, 64A).  However, the recent decision in the Matter of the Estates of Earl and Beverley Stick highlights the fact that s 64A can also be used to vary will trusts to correct drafting errors.  The issue arose in that case due to the unfortunate circumstances of the deaths of the will-makes who died simultaneously in the Christchurch earthquake on 22 February 2011.  Each had appointed the other executor with provisions for the will-maker not being survived by the executor.  However, each will also included a specific bequest that failed as a result of the will-maker’s simultaneous deaths and due to the manner in which the wills were drafted.  The result would be that the specific bequests would fall to be distributed with the residue, which clearly was not what either will-maker had intended.

While it is more ususal for drafting errors in wills to be corrected under s 31 of the Wills Act, in this instance, this course of action was considered inappropriate (counsel for the minor beneficiaries advising the court that “the wills seem unlikley to survive an application for correction…”). 

The result was that the proposed variation was approved on behalf of the minor beneficiaries.

The case is a useful reminder of the need to take a careful approach to will drafting and to consider the possibility of, not just, sucession, but also the effects of simultaneous death.

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