Now

It is not uncommon for will-makers to specify the age at which beneficiaries are to benefit. The question is, if the beneficiaries have capacity, must they wait? Telford v Telford answers this question by reference to the rule in Saunders v Vautier, and more latterly section 121 of the Trusts Act 2019.

By way of background, the deceased Barry Telford directed in his will that his children would share equally in the residue of his estate once they attained the age of 25 with provision for substitution of grandchildren. Barry’s children aged 21 and 23, neither of whom have children, submitted that as together they hold all of the beneficial interest in the residue of Barry’s estate. Accordingly, pursuant to the rule in Saunders v Vautier, since codified in s 121 of the Trusts Act 2019, they say they can require the trustees to terminate the Trust and distribute the assets.

The trustees did not agree and were of the view that section 121 of the Trusts Act did not apply as the children’s interests were contingent on them each attaining the age of 25.

As noted by Isaac J at [6]:

The legal framework is not contentious. As set out at [8]:

As set out at [11]:

Isaac J differentiated Burns v Steel, where the transfer of the shares in question were subject to a pre-emption process. In Telford v Telford the situation was quite different. As stated at [16] to [18]:

References:

• Telford v Telford [2023] NZHC 2331
• Saunders v Vautier (1841) 4 Beav 115
• Trusts Act 2019, s 121
• Burns v Steel [2006] 1 NZLR 559