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Administration Act, appointment and removal of trustees, Wills

The sometimes slow business of administration

Ethel Moudale Uluakiahoia died intestate on or abut 5 January 1989 leaving 10 adult children, three of whom were some years later appointed administrators in 2008.  Following Mrs Uluakiahoia’s death different family members lived in the Estate’s sole asset, a residential property in Papatoetoe.  Eventually, agreement was reached that one of the administrators Ms Povey, who lived in the residential property for some years, would purchase it.  However, this agreement was not able to be finalised.

Fast forward to 2020 when the other administrators tired of the satus quo.

The relevant principles in relation to both s 21 of the Administration Act and s 51 of the Trustee Act are summarised in Farquhar v Nunns as follows:

[31] The circumstances in which a Court will remove an administrator or a trustee, under the statutory provisions in issue, were explained by Myers CJ, delivering the principal judgment of the Court of Appeal in Hunter v Hunter. The issues raised must be considered in a “macroscopic and not microscopic fashion”. The removal jurisdiction is ancillary to the Court’s principal duty to see that a trust is properly executed. …

[36] The touchstone for removal of both an administrator and a trustee is an assessment of what is “expedient”. In Crick, Judge Osborne opined that the term “imparts considerations of suitability, practicality and efficiency”; thus, in the context of estate administration the “overarching question” is: “will removal of the administrator be a suitable, practical and efficient means of advancing the interests of the estate and of its beneficiaries.”

Orders were made that Ms Povey be removed as an administrator and that the residential property vest in the remaining administrators.

Given that Mrs Uluakiahoia died in 1989 it might be somewhat surprising that her estate has not been administered more than 30 years after her death.   However, as a practical reality once probate or letters of administration are granted there is no formal “follow up” to ensure compliance with the duties owed by executors or trustees.  This is to the detriment of the estate’s beneficiaries and highlights the importance of appropriate checks and balances.

Also see Clair v Clair where an application to remove an administrator who had been absent from New Zealand for more than one year and had not distributed the estate after 21 years was determined as a matter of formal proof. See r 15.9 of the High Court Rules.

References:

  • Smith v Povey [2020] NZHC 805
  • Farquhar v Nunns [2013] NZHC 1670
  • Administration Act 1969
  • Trustee Act 1956
  • Clair v Clair [2020] NZHC 1277
  • High Court Rules 2016
  • Administration Act 1969

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