RE PATIENT [2023] NZHC 2924

RE PATIENT [2023] NZHC 2924

Clause 3 of the deed is expressed to be paramount and its concluding paragraphs confer a broad power to apply income and, where appropriate, capital for any charitable purpose; clause 5 is advisory and does not fetter the trustee's power under clause 3; consequently the trustee has power to wind up the trust and distribute the fund to the three named recipients and the Court grants directions under s133 approving that distribution and charging costs to the trust.

Citation
[2023] NZHC 2924
Parties
Sole Trustee and Applicant: Traceyann Patient; Beneficiary/recipient: University of Otago; Beneficiary/recipient: University of Canterbury; Beneficiary/recipient: Christchurch City Council
Court
High Court
Jurisdiction
New Zealand
Judgment Date
18 October 2023
Procedural Posture
Application for Directions Under the Trusts Act 2019 / Judgment on Application (on the Papers)
Outcome
Application for directions under s133 granted; trustee ordered to distribute trust fund to the three named recipients in specified proportions, funds to be held by new trusts for purposes in clause 3, costs charged to the trust, and leave reserved for further directions.
Legal Topics
Construction of Trust Deed, Winding Up Trust, Powers of Trustee, Distribution of Trust Fund, Court Directions Under S133
Trusts Charities Law Equity Construction of Trust Deed Winding Up Trust Powers of Trustee Distribution of Trust Fund Court Directions Under S133

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Parties

Traceyann Patient

Sole Trustee and Applicant

University of Otago

Beneficiary/recipient

University of Canterbury

Beneficiary/recipient

Christchurch City Council

Beneficiary/recipient

Procedural Posture

Application for Directions Under the Trusts Act 2019 / Judgment on Application (on the Papers)

Legal Issues

  1. 1 Whether clause 3 of the deed confers power to distribute capital as well as income
  2. 2 Whether clause 5 imposes binding distribution obligations or is advisory
  3. 3 Whether the trustee may wind up the trust and distribute the fund to new trusts nominated by the beneficiaries

Ratio Decidendi

Clause 3 of the deed is expressed to be paramount and its concluding paragraphs confer a broad power to apply income and, where appropriate, capital for any charitable purpose; clause 5 is advisory and does not fetter the trustee's power under clause 3; consequently the trustee has power to wind up the trust and distribute the fund to the three named recipients and the Court grants directions under s133 approving that distribution and charging costs to the trust.

Court Disposition

Application for directions under s133 granted; trustee ordered to distribute trust fund to the three named recipients in specified proportions, funds to be held by new trusts for purposes in clause 3, costs charged to the trust, and leave reserved for further directions.

Orders

  • Distribute the trust fund to University of Otago 75%, University of Canterbury 12.5%, Christchurch City Council 12.5%
  • Funds distributed are to be held and applied by the new trustees for the purposes set out in clause 3 of the James H Smedley Charitable Trust Deed dated 15 June 2009