McCALLUM v McCALLUM [2020] NZHC 907

McCALLUM v McCALLUM [2020] NZHC 907

Judge adopted the 'best interests of the trust' test for Beddoe applications and made a case-by-case preliminary merits assessment; granted limited Beddoe indemnities where defence or participation in the litigation served the trust's interests (second cause; limited participation for third, fourth and eighth causes...

Source-derived case information.

Citation
[2020] NZHC 907
Parties
First Applicants (trustees of the Mc Callum Family Trust): Carrick Robert Zachary McCallum and Callum Fraser McCallum; Second Applicants (executors of the Estate of William Fraser Mc Callum Snr): Carrick Robert Zachary McCallum and Callum Fraser McCallum; Plaintiff in the Substantive Proceedings / Respondent to Beddoe Application: William Fraser McCallum Jnr; Beneficiary (litigation Guardian and Property Manager Appointed): Fiona McCallum
Court
High Court
Jurisdiction
New Zealand
Judgment Date
5 May 2020
Procedural Posture
Application for Beddoe Orders (part 19 High Court Rules) / Interim/directions Judgment on Beddoe Application Following Hearing (application Stage)
Outcome
Beddoe application partially granted and partially refused; orders made authorising limited indemnities and directions on costs memoranda
Legal Topics
Beddoe Orders, Resettlement of Trust Assets, Constructive Trust / Knowing Receipt, Undue Influence, Removal of Trustees and Executors, Family Protection Act Claim, Prospective Costs and Indemnity
Trusts and Trusteeship Succession and Estates Family Protection Civil Procedure (beddoe Orders) Conflict of Interests/removal of Trustees/executors Beddoe Orders Resettlement of Trust Assets Constructive Trust / Knowing Receipt +4 more

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Parties

Carrick Robert Zachary McCallum and Callum Fraser McCallum

First Applicants (trustees of the Mc Callum Family Trust)

Carrick Robert Zachary McCallum and Callum Fraser McCallum

Second Applicants (executors of the Estate of William Fraser Mc Callum Snr)

William Fraser McCallum Jnr

Plaintiff in the Substantive Proceedings / Respondent to Beddoe Application

Fiona McCallum

Beneficiary (litigation Guardian and Property Manager Appointed)

Procedural Posture

Application for Beddoe Orders (part 19 High Court Rules) / Interim/directions Judgment on Beddoe Application Following Hearing (application Stage)

Legal Issues

  1. 1 Whether Beddoe orders should be granted to indemnify trustees/executors and whether costs can be met from trust/estate assets
  2. 2 Whether the trustees should be authorised to defend or be neutral in relation to each pleaded cause of action
  3. 3 Preliminary assessment of merits of causes of action including resettlement, knowing receipt, undue influence and Family Protection Act claim

Ratio Decidendi

Judge adopted the 'best interests of the trust' test for Beddoe applications and made a case-by-case preliminary merits assessment; granted limited Beddoe indemnities where defence or participation in the litigation served the trust's interests (second cause; limited participation for third, fourth and eighth causes to provide factual information and legal submissions but not active defence; authorised defence of removal-as-executor claim) and refused indemnities for other causes (first, fifth and sixth) because either they should be abided or lacked sufficient preliminary merit to justify trust-funded defence.

Court Disposition

Beddoe application partially granted and partially refused; orders made authorising limited indemnities and directions on costs memoranda

Orders

  • No order (Beddoe refused) in relation to first cause of action (Family Protection Act claim)
  • Beddoe order granted for reasonable and proper legal and associated costs to defend the second cause of action (breach of moral duty)