The moral dimension of trusteeship arises in many contexts. The recent New Zealand court decisions concerning information obligations to beneficiaries, and the way this is dealt with in the new Trusts Bill, highlight the difficulty of judging what information is too much or too little to disclose. However, general principles on disclosure bypass the consideration … Continue reading
The bare facts of Chang v Lee can be summarised as follows: Ms Lee purchases a property in Sunnynook Mr Chang (Ms Lee’s uncle) advances Ms Lee $275,000 of the $566,000 purchase price The advance was not a gift The terms of the loan advance were incomplete Mr Chang made the advance to Ms Lee on the … Continue reading
The Supreme Court decision in Clayton v Clayton changed the trust landscape. But how afraid should we be? Are all trusts vulnerable to Clayton-style challenge? Or just the ones that push the envelope? And, if the latter, how far can one push before there is a problem? A recent decision of Moore J has provided … Continue reading
The use of corporate trustees is a common response to trustee liability. However, where one of two natural person trustees retires and a corporate trustee is appointed, it is important to consider whether the retiring trustee has been discharged. See ss 43, 45 and 46 of the Trustee Act 1956, which provide: Relevant Legislation 43 Power … Continue reading
When a trustee retires, it is necessary to transfer the trust’s assets from the trustees (including the retiring trustee) to the continuing and any new trustee. Where a trustee is removed in contentious circumstances the trustee may be unwilling to assist in the transfer of trust property. Sometimes with good reason – for example where … Continue reading
In Davis v White (see You aren’t my beneficiary – are you??) a trust was found to have failed by reason of uncertainty. The second hearing of the matter related to costs and is a sobering tale for trustees. Mrs White who incurred significant costs (AUD 40,893 and $85,369.50 in New Zealand, plus disbursements) said that the proceedings could … Continue reading
The issue of incapacitated trustees is not a new one. Trustees continue to age and many do not retire when they can still elect to do so. This leaves the issue of removing incapacitated trustees and transferring property held by them to continuing and new trustees. While it is generally accepted that an attorney under an … Continue reading
What information can a discretionary beneficiary of a trust request from the trustees? If the beneficiary has been bankrupted, does that mean they no longer have personal rights to request information? The Supreme Court has now expressed its view on these issues and has upheld the earlier Court of Appeal decision. However, the Supreme Court’s judgment … Continue reading
As noted in the judgment McLaren v McLaren at [1] this case relates to “… a sorry tale of what can occur when a family adopts an inappropriate form of trust deed without adequate advice or sufficient understanding of the legal effect of its terms. In this case, a son who was given a power … Continue reading
Corporate trustees are a common feature of modern trading trusts. The basic rationale is that the use of a company means that any liability that would otherwise accrue – say to a natural person trustee – accrues instead to the company and provided the directors do not breach the duties owed under the Companies Act … Continue reading
