Hatwell v Hatwell [2018] NZHC 3064 (23 November 2018)

Last Updated: 6 December 2018

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2018-419-317 [2018] NZHC 3064

IN THE MATTER	of an application for vesting orders under section 52 of the Trustee Act 1956
IN THE MATTER	of Part 18 of the High Court Rules
BETWEEN	JOHN LEONARD HATWELL and HOBBS ROSE TRUSTEE COMPANY LIMITED as current trustees of the SOUTHERN TRUST Plaintiffs
AND	JOYCE EVELYN HATWELL, JOHN LEONARD HATWELL AND HOBBS ROSE TRUSTEE COMPANY LIMITED as former trustees of the SOUTHERN TRUST Defendants

Hearing:	On the papers
Counsel:	M Phillipps for the Plaintiffs
Judgment:	23 November 2018

JUDGMENT OF MUIR J

This judgment was delivered by me on Friday 23 November 2018 at 4.10 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date:...........................

Solicitors:

Vicki Ammundsen Trust Law Limited, Auckland

HATWELL v HATWELL [2018] NZHC 3064 [23 November 2018]

Introduction

[1] The plaintiffs who are the current trustees of the Southern trust proceed by way of notice of proceeding and statement of claim seeking orders pursuant to s 52(1)(b)(i) of the Trustee Act 1956 vesting in their names various properties in Te Awamutu (which I will refer to more particularly in the results section of this judgment).

[2] They also seek orders disposing with service.

[3] Typically such applications proceed under Part 19 of the High Court Rules with associated applications for leave and dispensation. There can be no objection, however, to the matter proceeding by way of statement of claim.

Background

[4] The background to the application is that the defendant Joyce Evelyn Hatwell (Joyce), who is the wife of the first named plaintiff and a former trustee of the Southern Trust has now become incapacitated as a result of alzheimer’s disease. In that respect Dr Alison Glover has certified that she is mentally incapable and lacks the capacity to make and communicate decisions about health, property or financial matters, or to understand the implications of decisions made by her. She further states that Joyce’s position is only likely to deteriorate.

[5] The Southern Trust was settled by Joyce and applicant Mr John Hatwell (John) in 2006. They are identified as the “preferred beneficiaries”. The final beneficiaries are the children of either of the preferred beneficiaries. John does not have any biological children. Joyce has three, Mr Mervyn Johnston, Ms Cheryle Gallagher and Ms Vicki Roper. Each of Mr Johnston, Ms Gallagher and Ms Roper consent to the current application.

[6] In addition to preferred and final beneficiaries the Trust Deed identifies a further category of “beneficiaries” which include Mr Johnston, Ms Gallagher, Ms Roper and their children and grandchildren. There are currently eight grandchildren.
[7] Joyce has now been removed as a trustee. This occurred on 20 September 2018 when John exercised his powers of appointment to do so.

Discussion

[8] The plaintiffs bring their claim under Part 18 of the High Court Rules which applies, inter alia, to determinations by the Court under the Trustee Act 1956.¹ Rule
18.7 governs applications for directions as to service in the context of Part 18 proceedings and Rule 18.8(1) provides that “On an application under rule 18.7, the Judge may make any orders for service or representation that the Judge thinks just”.

[9] I regard service in this case as appropriately dispensed with. In that respect I note:

(a) Joyce is incapacitated and, I accept, is not therefore in a position to understand the nature and effect of the proceedings.

(b) The final beneficiaries consent to the application.

(c) To the extent children or grandchildren of the final beneficiaries are themselves beneficiaries, I consider their interests to be adequately protected by their parents/grandparents.

(d) The continuing trustees include Hobbs Rose Trustee Company Limited which is an independent trustee associated with the Trust’s accountant of many years GMH Accountants Limited. In terms of the Deed of Trust of the Southern Trust (cl 4.1), there is an ongoing requirement that at least one of the trustees be an independent trustee.

(e) The orders sought do not derogate from any rights which the beneficiaries may have in respect of such removal and do not affect the obligations which the trustees have to all beneficiaries or the rights or

¹ Rule 18.1(b)(xiii).

entitlements which the beneficiaries have in respect of the trustees or the Trust property.

[10] In terms of the substantive relief sought, I accept that the jurisdictional requirements of s 52(1)(b)(i) of the Act are made out having regard to the definition phrase “under disability” in s 2(2). I consider vesting orders both necessary and appropriate in order that the registered position properly reflects the identity of the current trustees and I am satisfied that Joyce’s incapacity prevents her from executing the documents otherwise necessary to achieve that result.

[11] I accordingly make orders:

(a) dispensing with service of the proceedings on any party;

(b) vesting in the plaintiffs John Leonard Hatwell and Hobbs Rose Trustee Company Limited as trustees of the Southern Trust the right title and interest of the defendants Joyce Evelyn Hatwell of Te Awamutu, retired, John Leonard Hatwell of Te Awamutu, farmer, and Hobbs Road Trustee Company Limited in the following properties:

(i) Identifier SA60A/63 South Auckland being Lot 2 Deposited Plan South Auckland 64936 and Lot 1 Deposited Plan South Auckland 74489.

(ii) Identifier SA10C/49 South Auckland being Lot 1 Deposited Plan South Auckland 12432.

(iii) Identifier SA41B/693, South Auckland being Lot 2 Deposited Plan South Auckland 46927.

(iv) Identifier 513621, South Auckland being Lot 1 Deposited Plan 428972.

(v) Identifier 513622, South Auckland being Lot 2 Deposited Plan 428972.
(vi) Identifier 518648, South Auckland being Lot 1 Deposited Plan 430503.

(vii) Identifier 518649, South Auckland being Lot 2 Deposited Plan 430503.

(viii) Identifier SA1227/69, South Auckland being Lot 1 Deposited Plan South Auckland 3365.

(c) To give effect to order (b) I confirm that the Registrar General of the Land (Land Information New Zealand) is authorised to record the transfer of the properties identified above to John Leonard Hatwell and Hobbs Rose Trustee Company Limited as registered proprietors.

[12] I direct that the reasonable costs of this application be met from the assets of the Southern Trust.

Muir J