Hope v Hope [2019] NZHC 2633 (16 October 2019)

Last Updated: 25 October 2019

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-2164 [2019] NZHC 2633

UNDER	Section 52 of the Trustee Act 1956
IN THE MATTER	of the Hope Family Trust
IN THE MATTER	of a claim for orders vesting property under section 52 of the Trustee Act 1956 and appointing a person to convey property under s 58 of the Trustee Act 1956
BETWEEN	BRYCE EVAN HOPE AND PROFESSIONAL TRUSTEE SERVICES 2017 LIMITED, being the trustees of THE HOPE FAMILY TRUST Plaintiffs
AND	CAMILLE ANN HOPE Defendant

Hearing:	On the papers
Appearances:	P Amaranathan for the Applicants
Judgment:	16 October 2019

JUDGMENT OF GORDON J

This judgment was delivered by me on 16 October 2019 at 11 am, pursuant to

r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Solicitors: Rice Craig, Papakura, Auckland

HOPE v HOPE [2019] NZHC 2633 [16 October 2019]

[1] The applicants, Bryce Evan Hope and Professional Trustee Services 2017 Ltd, as trustees of the GS and CA Hope Family Trust (the Trust), seek an order under s 52 of the Trustee Act 1956 (the Act) vesting a realty asset of the Trust in them as continuing trustees and an order appointing the Registrar of Lands to convey the asset concerned to the continuing trustees.

[2] They also seek associated orders permitting commencement of this proceeding by way of originating application and dispensing with both the appointment of a litigation guardian and service of this proceeding. The application is supported by an affidavit of Bryce Hope.¹

Background

[3] The Trust was settled by deed (the Trust Deed) on 17 December 2001 by Graham Stanley Hope and his wife, Camille Ann Hope, the parents of Bryce. The original trustees of the Trust were Graham, Mrs Hope and Hackshaw Trustees Ltd.

[4] The primary beneficiaries of the Trust are the settlors’ children, being Bryce and his three siblings. The discretionary beneficiaries are: Mrs Hope; the primary beneficiaries; the children, grandchildren and great grandchildren of any primary beneficiaries; any wife, husband, widow or widower of any of the primary beneficiaries; any wife, husband, widow or widower of any child, grandchild or great grandchild of the primary beneficiaries; the parents of a settlor; the brothers and sisters of a settlor and the respective wives, husbands, former wives, former husbands, widows, widowers, children and grandchildren.

[5] The Trust owns a property at 10 Byblos Place, The Gardens, Manukau (the property) which was Graham and Mrs Hope’s home. Mrs Hope continued to live in the home after Graham’s death until she moved into a secure specialist dementia facility on 2 August 2019.

[6] Graham died on 23 November 2008. He was retired as trustee and Bryce was appointed as a trustee in his place on 30 May 2009. On 24 October 2017, by deed,

¹ I will refer to the male family members by their Christian names given the common surname.

Hackshaw Trustees Ltd was retired as a trustee and Professional Trustee Services 2017 Ltd was appointed as a new professional trustee.

[7] Following an order of the Court dated 21 August 2018 vesting the property in Mrs Hope, Bryce and Professional Trustee Services 2017 Ltd, Hackshaw Trustees Ltd was removed from the title of the property. Thus, the registered proprietors of the property are Bryce, Mrs Hope and Professional Trustee Services 2017 Ltd.

[8] Sadly, Mrs Hope developed dementia and on 11 June 2019, Dr Dmitri Griner, a registered consultant psychiatrist working with Mental Health Services at Counties Manukau DHB, assessed Mrs Hope to ascertain her mental capacity. He certified that Mrs Hope is mentally incapable and lacks the capacity to make a decision about her personal care and welfare generally. He further certified that her health condition is likely to continue indefinitely.

[9] Bryce holds enduring powers of attorney for property and care and welfare for Mrs Hope. They are now activated consequent on the report of Dr Griner.

[10] Clause 7.2 of the Trust Deed provides that the office of a trustee is automatically vacated if the trustee is found to be of unsound mind or is liable to be dealt with in any way under the law relating to mental health.

[11] On 16 September 2019, Bryce and two directors of Professional Trustee Services 2017 Ltd, as continuing trustees, executed a Deed of Vacating of Trusteeship, recording that Mrs Hope was deemed removed from the office of trustee pursuant to the findings of Dr Griner and that the continuing trustees would take the necessary steps to vest the trust property in the continuing trustees.

[12] The Trust Deed does not require the appointment of a further trustee. Bryce deposes he has spoken to his siblings, being the other primary beneficiaries, and he says they do not require the appointment of a further trustee.
[13] Bryce says the continuing trustees wish to sell the property because Mrs Hope no longer lives there. He says the sale will allow the proceeds of sale to be invested and used for the benefit of Mrs Hope and the other beneficiaries of the Trust.

[14] Although Mrs Hope is no longer a trustee of the Trust, she remains on the title of the property as a registered proprietor. The property cannot be sold while she remains on the title because she does not have the mental capacity to deal with the property.

[15] Before turning to the matter of the vesting order, I deal with the prior matters I need to address.

Should permission be granted to commence the proceedings by way of originating application?

[16] This proceeding is not of a kind that can be commenced by way of originating application as of right, pursuant to rr 19.2–19.4 of the High Court Rules 2016. However, the Court may, in the interests of justice, permit any proceeding not mentioned in rr 19.2–19.4 to be commenced by originating application. The Court’s permission may be sought without notice.²

[17] In Jones v H W Broe Ltd, McGechan J considered an application for leave to use the originating application procedure on an ex parte basis, discussing the rationale underlying r 19.5 as follows:³

The ... originating application procedure was designed as a genuine exception, and as an expedient for cases where there was in reality no opposing party, avoiding clumsy and unnecessary use of a full statement of claim and notice of proceeding. It was not intended for routine use in cases where there was another likely party with contrary interests.

[18] I am satisfied that the above rationale applies in this case and it is appropriate that this proceeding proceed by way of originating application.⁴

² High Court Rules 2016, r 19.5.

3. Jones v H W Broe Ltd (1989) 5 PRNZ 206 (HC) at 207. These comments were made in the context of an earlier version of the High Court Rules (rr 239 and 485D). The comments remain applicable.
4. See, for example, Re Hamertons Trustee Services Ltd [2018] NZHC 2720; Macpherson v Macpherson [2018] NZHC 240; and McKean v McKean [2017] NZHC 2212.

Should appointment of a litigation guardian be dispensed with?

[19] Rule 4.30(1) of the High Court Rules provides that an incapacitated person must have a litigation guardian as his or her representative in any proceeding, unless the Court otherwise orders.

[20] I am satisfied that Mrs Hope is an incapacitated person and I am also satisfied that no representation order needs to be made under r 4.30. Dr Griner describes Mrs Hope as having an established dementia. He considers that there was no other realistic option other than to recommend Mrs Hope be placed in a secure dementia unit. He says her capacity will not ever improve.

[21] Even if someone were appointed to represent Mrs Hope, she would be unlikely to understand either the nature of the advice or the purpose of the proceeding.⁵ I am therefore satisfied that it is not necessary to appoint a litigation guardian to represent Mrs Hope.

Should service of the proceedings be dispensed with?

[22] I am satisfied that it is appropriate to dispense with service on Mrs Hope and the other beneficiaries of the Trust. The vesting order sought is essentially mechanical in nature and does not adversely affect the interests of the beneficiaries.

Vesting of land

[23] Section 52(1)(b)(i) of the Act provides the Court with the power to vest land in any such person that it may direct where a trustee, entitled to or possessed of any land or interest therein, either solely or jointly with any other person, is under a disability. Mrs Hope is possessed of an interest in the property. She has, however, been removed from her position as a trustee. Given the need to ensure the trustees can deal with the property in accordance with their duties, I am satisfied that the vesting order sought is appropriate.

5. See McPherson v McPherson [2016] NZHC 332; and Cade v Cade [2016] NZHC 1624 where the Court was satisfied that it was not necessary to appoint a litigation guardian. The incapacitated person had been removed as a trustee and the application before the Court was simply for certain trust property vest in the new trustees.

[24] The applicant also seeks an order under s 58 of the Act that the Registrar of Lands be appointed to convey the property to the applicants.

[25] Section 58 of the Act provides:

58 Power to appoint person to convey

In all cases where a vesting order can be made under any of the foregoing provisions, the court may, if it is more convenient, appoint a person to convey the land or any interest therein or release the contingent right, and a conveyance, or release by that person in conformity with the order shall have the same effect as an order under the appropriate provision.

[26] As can be seen, s 58 provides an alternative to a vesting order. Having made the vesting order, it is not necessary to make a further order under s 58.

Orders

[27] I order that:

(a) The applicants may commence this proceeding by way of a without notice originating application;

(b) Appointment of a litigation guardian for Camille Ann Hope is dispensed with;

(c) Service of the proceeding on the beneficiaries of the Trust is not required;

(d) The property comprised and described in Certificate of Title NZ120/B (North Auckland Registry) being Lot 54 Deposited Plan 190034 situated at 10 Byblos Place, The Gardens, Manukau Auckland is vested in Bryce Evan Hope and Professional Trustee Services 2017 Ltd.




Gordon J