Behrent v Behrent

[2019] NZHC 2132

IN THE HIGH COURT OF NEW ZEALAND TIMARU REGISTRY

I TE KŌTI MATUA O AOTEAROA TE TIHI-O-MARU ROHE

CIV-2019-476-000029

[2019] NZHC 2132

UNDER

the Trustee Act 1956 and Part 19 of the High Court Rules 2008

IN THE MATTER

of an Application under Section 52 for a vesting order of land

BETWEEN

LEO SEDDON DESMOND BEHRENT and MURRAY RICHARD BEHRENT as

Trustees of the LSD & SG Behrent Family Trust
Applicant

AND

SHIRLEY GRACE BEHRENT

Respondent

Hearing:	(Determined on the Papers)
Counsel:	P J Walker for Applicant
Judgment:	30 August 2019

JUDGMENT OF ASSOCIATE JUDGE PAULSEN

This judgment was delivered by me at 4.30 pm on 30 August 2019 pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors:

McMillan & Co, Lawyers, Dunedin

BEHRENT v BEHRENT [2019] NZHC 2132 [30 August 2019]

Introduction

[1]                 The applicants are two of three trustees of the LSD & SG Behrent Family Trust (the Trust). The applicants are seeking orders:

(a)For leave to bring this proceeding by way of originating application;

(b)Dispensing with service of the application;

(c)Removing the respondent as a trustee of the Trust; and

(d)Vesting the Trust’s property at 1 Kingslea Street, Oamaru (CT OT361/24) in the applicants (as the remaining trustees of the Trust).

The background

[2]                 The first-named applicant (“Leo”) and the respondent (“Shirley”) are husband and wife. The second-named applicant (“Murray”) is their son.

[3]The applicants and the respondent are the trustees of the Trust.

[4]The Trust was established by a Deed of Family Trust dated 27 July 2000.

[5]                 There is a property at 1 Kingslea Street, Oamaru, which is registered in the name of the trustees. The Kingslea Street property has been the home of Leo and Shirley for the past 65 years. It has a capital value of $350,000 and there is no debt secured against it.

[6]                 Shirley has significant dementia and she is now in a rest-home. A medical report dated 26 June 2019 confirms that she lacks capacity to carry out her duties as a trustee or sign any legal documents.

[7]  There is a proposal for the sale of the Kingslea Street property and the purchase of a new property at the Observatory Village in Oamaru, where Leo will live. These proposals are not matters the Court is required to consider in the present context. It is enough to note that they cannot be progressed until Shirley is removed as a trustee and the Kingslea Street property has vested in Leo and Murray.

Discussion

[8]                 It is now established practice that such applications are commenced by way of originating application.1 I see no reason why that would not be appropriate here and leave is granted to do so accordingly.

[9]                 Given the evidence before the Court of Shirley’s mental state, I am satisfied that service of the proceedings upon Shirley would serve no purpose. I dispense with service of the application upon her.

[10]              I also order pursuant to r 4.30 High Court Rules that no litigation guardian shall be appointed to represent her.

[11]              I have considered whether service of the proceedings upon the beneficiaries is required in this case.  I do not consider that is necessary as the orders that the Court is being asked to make affect only Shirley.2 I dispense with service on the beneficiaries.

[12]              In relation to the application to remove Shirley as a trustee, no relevant section of the Trustee Act or principle or law is referred to. In a case such as this, where there is no intention to replace Shirley as a trustee, the Court acts upon its inherent supervisory jurisdiction.3

[13]              The Court has the power to make vesting orders of land in a case such as this under s 52 of the Trustee Act.4

[14]              I am satisfied that the orders sought should be made to relieve Shirley of her obligations which she can no longer discharge, and to allow the applicants to continue to conduct the affairs of the Trust. I can see no prejudice to beneficiaries of the Trust by the making of the orders.

1      Chapman v Chapman CIV 2018-412-109, 18 December 2018 at [6].

2      Re Whelan [2019] NZHC 2751 at [11].

3      Powell v Powell [2015] NZCA 133 at [47]; Stoakes v Stoakes [2019] NZHC 1312 at [6]-[8].

4      See s 52(1)(b)(i) and (3).

[15]The draft order prepared by Counsel may be finalised and sealed accordingly.

[16]              No order has been sought in relation to costs and for that reason no order in relation to costs is made.

O G Paulsen Associate Judge