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Vesting order

Terms of trust appointing attorney

Parsonage v Parsonage relates to the currently vexed matter as to whether an attorney under an enduring power of attorney (EPoA) can exercise powers to appoint / remove trustees.  In Parsonage the relevant clause was as follows:


(a) THE power to appoint new Trustees shall be vested in Mary Parsonage during her lifetime and after her death the remaining trustees of this trust PROVIDED HOWEVER should the said Mary Parsonage be absent from New Zealand or incapable through sickness or otherwise of exercising the power then the person or persons holding his enduring power of attorney shall be vested with the power.

(b) Mary Parsonage or the persons empowered under the previous subclause are further empowered:

(i) To appoint an additional trustee
(ii) To appoint a retired or retiring trustee or any other person as advisory trustee
(iii) To appoint a new trustee outside the jurisdiction of the New Zealand Court
(iv) To remove any trustee or advisory trustee from all or any of the trusts hereof without assigning any reason therefore.

The question for the court was whether an attorney under an EPoA could exercise powers to appoint and remove.  Counsel acting sought to distinguish Marshall Family Trust (Re Hetrick) and Godfrey.  However, the court was not inclined to accept this course or action.  As set out at [15] and [18]:

“[15] I have two reservations about Ms Crimp’s submission. First, the evidence is that Bernard and Andrea are together Mary’s property attorneys under an Enduring Power of Attorney dated 26 August 2016 but only Bernard purported to exercise the power to remove Mary as a trustee and appoint Andrea as a replacement trustee. He did so on the basis that he and Andrea had several authority to act under Mary’s Enduring Power of Attorney. It cannot be the case, therefore, that Bernard was not acting pursuant to powers contained in the Enduring Power of Attorney as Ms Crimp submits. Second, cl 20(a) confers the power of appointment upon “the person or persons holding [her] Enduring Power of Attorney” but does not specify whether that is a person holding an Enduring Power of Attorney in respect of personal care and welfare or in respect of property affairs or both.6 The meaning of the clause is therefore uncertain.

[17] Here, I consider there is uncertainty around the meaning of cls 20(a) and (b) and the validity of the steps taken to remove Mary as a trustee and appoint Andrea as a replacement trustee. However, Mary is plainly incapable of exercising her functions as a trustee and the orders sought are necessary to enable the proper administration of the Trust. I am also satisfied that it is appropriate to appoint Andrea as a trustee in Mary’s place. Given the conclusions I have reached, I propose to make amendments to the application as sought.

[18] In removing Mary as a trustee and appointing Andrea as a replacement trustee the court may act under section 51 of the Trustee Act 1956 or pursuant to its inherent powers …”

Vesting orders were made accordingly.



One thought on “Terms of trust appointing attorney

  1. Useful note, thanks.

    Posted by David Marks | April 4, 2020, 9:29 pm

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