Ferguson [2014] NZHC 2343 (25 September 2014)

Last Updated: 29 September 2014

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2014-404-002490 [2014] NZHC 2343

UNDER	the Trustee Act 1956
IN THE MATTER	of an application by EDMOND BRIAN FERGUSON, JANICE CHRISTINE FERGUSON and NAIOMI CHERIE FERGUSON for a Vesting Order under section 52(1)(h) of the Trustee Act 1956

On the papers
Judgment:	25 September 2014

JUDGMENT OF ANDREWS J [Application for vesting order]

This judgment is delivered by me on 25 September 2014 at 11.30 am pursuant to r 11.5 of the High Court Rules.

..................................................... Registrar / Deputy Registrar

FERGUSON, J & E FAMILY TRUST [2014] NZHC 2343 [25 September 2014]

[1] The applicants, Edmond Brian Ferguson (“Mr Ferguson”), Janice Christine Ferguson (“Mrs Ferguson”), and Naiomi Cherie Ferguson have applied without notice for a vesting order under s 52(1)(h) of the Trustee Act 1956, to vest the title of the property at 11 Castaing Crescent, Te Atatu South, Auckland (“the property”) in their names as trustees of the J & E Ferguson Family Trust.

[2] The J & E Ferguson Family Trust was created by a deed of trust dated

9 February 2002. The trustees named in the deed of trust were the settlors (Mr and Mrs Ferguson), their son Bryce Robert Ferguson, and their daughter Naiomi Ferguson. The property is the sole asset of the trust. The primary beneficiaries of the trust are Mr and Mrs Ferguson and the secondary beneficiaries are Bryce Ferguson and Naiomi Ferguson and their respective issue.

[3] The trust deed provides at clauses 6 and 7(a) that Mr and Mrs Ferguson have the power to remove any trustee. Pursuant to clause 6, the statutory power of appointment of new trustees is vested in them during their respective life times (and in their administrators or executors or trustees of their will after their death). Pursuant to clause 7(a), they have the power:

TO appoint at any time or times an additional trustee or trustees of all or any of the trusts whether or not occasion shall have arisen for appointment of a new trustee or trustees and to remove a trustee or trustees.

[4] For reasons which are set out in the affidavit, and need not be repeated here, the applicants agreed that it is necessary to sell the property. It was placed on the market for sale in April 2014. On 14 July 2014, they received an offer to sell the property. An agreement was eventually reached for the sale of the property at

$630,000 which is, according to Mrs Ferguson, in excess of the figure which two separate real estate agents advised would be a likely sale price. They and Naiomi Ferguson agreed to accept the offer.

[5] The sale of the property was due to have been settled on 19 September 2014. As the names of all four trustees (including Bruce Ferguson) are shown on the title of the property, an Authority and Instruction form signed by all four of them is necessary to enable the transfer of title to be registered electronically. However, Bryce Ferguson refused to sign the documents.

[6] By a resolution dated 16 July 2014, Mr and Mrs Ferguson removed Bryce Ferguson as trustee of the trust. The background to that removal is also set out in Mrs Ferguson’s affidavit in support of the application for a vesting order. It is evident that very serious differences have arisen between Mr and Mrs Ferguson and Bryce Ferguson.

[7] In a letter to the solicitors for the trust on 17 September 2014, Bryce Ferguson said that he was not consulted about the sale of the property, the sale was not carried out in a proper manner, the property was possibly sold at an under value, and his removal as a trustee is “an improper attempt to retrospectively cover up the disposal of the trust property without trustee authorisation”. However, since that letter, Bryce Ferguson has taken no steps to protect his interest as trustee.

[8] It is Bryce Ferguson’s refusal to sign the necessary documents that has led to

the application before me.

[9] A without notice application must comply with r 7.23 of the High Court Rules. Rule 7.23 has been complied with in this case. Rule 7.46 then sets out circumstances in which the application can properly be dealt with on a without notice basis. As relevant, r 7.46(3) provides:

7.46 Determination of application without notice

...

(3) The Judge may determine that an application can properly be dealt with without notice only if the Judge is satisfied that—

(a) requiring the applicant to proceed on notice would cause undue delay or prejudice to the applicant; or

(b) the application affects only the applicant; or

(c) the application relates to a routine matter; or

(d) an enactment expressly permits the application to be made without servicing notice of the application; or

(e) the interests of justice require the application to be

determined without serving notice of the application.

[10] In the present case, for as long as the sale of the property cannot be settled, interest for late settlement of the sale accrues at $258.40 a day. In the circumstances, I am satisfied that this application can be dealt with without notice, because requiring the applicants to proceed on notice would cause delay and prejudice to the applicants.

[11] Rule 7.46(4) sets out the orders that a Judge may make if it is determined that the application can properly be dealt with without notice. In particular, the Judge may make the order sought in the application, or may make any other order that the Judge thinks just in the circumstances.

[12] In this case, I am satisfied that an order should be made vesting the title for the property in the names of Edmond Brian Ferguson, Janice Christine Ferguson, and Naiomi Cherie Ferguson in their capacities as trustees of the J & E Ferguson Family

_{Trust. I so order.}

Andrews J