Moore v McCluskey

IN THE HIGH COURT OF NEW ZEALAND MASTERTON REGISTRY

I TE KŌTI MATUA O AOTEAROA WHAKAORIORI ROHE

CIV-2020-435-1

[2020] NZHC 164

UNDER the Trustee Act 1956 and Part 19 of the High Court Rules 2016

IN THE MATTER OF

the J L and C M McCluskey Family Trust

BETWEEN

JOCELYN ANNETTE MOORE AND IAN FRANCIS WEDDERBURN

Applicants

AND

CYNTHIA MARGARET MCCLUSKEY

Respondent

Hearing: On the papers

Counsel:

P A McBride and S P Radcliffe for the Applicants

Judgment:

13 February 2020

JUDGMENT OF COOKE J

[1]By applications dated 5 February the applicants seek orders:

(a)Permitting these proceedings being commenced by way of originating application, without service or notice to any other person, and to be determined on the papers.

(b)That title in the share of certain property in Featherston be vested in their joint names, with the respondent being removed from the title.

[2] The applications are supported by a joint affidavit of the applicants sworn 31 January 2020 and a memorandum of counsel.

MOORE v MCCLUSKEY [2020] NZHC 164 [13 February 2020]

[3] The orders and directions referred to in paragraph [1](a) above are routinely given in matters of this kind, and are in order here.

[4] The respondent was until recently a trustee of the trust that owned the property in question. The application is made as a consequence of the respondent’s dementia which is described in a report from Dr Steve Philip of the Martinborough Health Centre and the joint affidavit of the applicants. I note that with applications of this kind it is preferable for the Court to be provided with detailed information concerning the incapacitation of a trustee, but in the present case I am satisfied that she is incapacitated for the reasons set out in this evidence.

[5] The particular orders that are sought are under s 52 of the Trustee Act 1956. Although the respondent has recently been removed and replaced as a trustee under s 43 of the Trustee Act 1956 her name remains on the title. Whilst she also has given enduring power of attorney to one of the applicants, the orthodox view is that this cannot be exercised in respect to a person’s role as a trustee of a trust.1 Accordingly vesting orders are necessary to effect a transfer of the title to the applicants as the existing trustees.

[6]I accept that such orders are appropriate. I accordingly order that:

In respect of the three-quarter share of the property consisting of land in Featherston, contained in the record of title WN15A/260:

(i)Cynthia Margaret McCluskey is removed from the title of the property identified by WN15A/260.

(ii)The title of that property is vested in the joint names of Jocelyn Annette Moore and Ian Francis Wedderburn.

Cooke J

1 See Godfrey v McCormack [2017] NZHC 420, [2017] 3 NZLR 198; Locker v Browning [2018] NZHC 1127 at [12]–[14].

CaseChat Overview and Summary

The applicants, Jocelyn Annette Moore and Ian Francis Wedderburn, sought to have their names vested as the sole owners of certain property, removing the respondent, Cynthia Margaret McCluskey, from the title. The application was brought under the Trustee Act 1956 and the High Court Rules 2016 in relation to the J L and C M McCluskey Family Trust. The dispute arose due to the respondent's incapacity caused by dementia, which was substantiated by medical evidence and an affidavit from the applicants. The applicants sought orders to permit the proceedings to be conducted without service or notice to others, and for the title of the property to be vested in their names exclusively.

The primary legal issues before the court were whether the applicant's application could proceed without notice to the respondent and whether the title of the property could be transferred to the applicants alone, despite the respondent's enduring power of attorney. The court had to determine if the respondent's dementia rendered her incapable of managing the trust property and if the enduring power of attorney could be exercised in this context. The court also needed to decide if the vesting orders under section 52 of the Trustee Act 1956 were appropriate.

The court found that the orders permitting the proceedings to proceed without notice were standard in cases of this nature and were appropriate here. It accepted the evidence regarding the respondent's dementia, which was supported by medical reports and the affidavit. The court held that the respondent's role as a trustee was incompatible with her incapacity, and thus, her name should be removed from the title of the property. The court also noted that the enduring power of attorney did not extend to the respondent's duties as a trustee. Consequently, the court ruled that the title should be vested in the applicants' names.

The final orders of the court were that Cynthia Margaret McCluskey's name should be removed from the title of the property in Featherston, and that the title should be vested in the joint names of Jocelyn Annette Moore and Ian Francis Wedderburn. This decision effectively transferred ownership of the property to the applicants.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established

UNDER	the Trustee Act 1956 and Part 19 of the High Court Rules 2016
IN THE MATTER OF	the J L and C M McCluskey Family Trust
BETWEEN	JOCELYN ANNETTE MOORE AND IAN FRANCIS WEDDERBURN Applicants
AND	CYNTHIA MARGARET MCCLUSKEY Respondent

Hearing:	On the papers
Counsel:	P A McBride and S P Radcliffe for the Applicants
Judgment:	13 February 2020