McCaw Lewis Trustees (No. 4) Limited [2014] NZHC 2627

McCaw Lewis Trustees (No. 4) Limited [2014] NZHC 2627

The court held that a reasonable and properly informed reader of the deed would construe "other public charitable institution" to include charitable trusts such as the Mahi-a-Ngakau Trust; there is no sustainable legal distinction in the deed between "public" and "private" charities sufficient to exclude a registered charitable trust, and therefore trustees are entitled to distribute income or capital to Mahi-a-Ngakau Trust.

Citation
[2014] NZHC 2627
Parties
Applicant / Trustee of the LJ Reynolds No.2 Trust: McCaw Lewis Trustees (No. 4) Limited; Applicant / Trustee of the LJ Reynolds No.2 Trust: Vazey Child Trustees (2001) Limited; Respondents / Beneficiaries: Beneficiaries of the LJ Reynolds No.2 Trust (representative); Proposed Beneficiary / Recipient of Distributions: Mahi-a-Ngakau Trust; Named Beneficiary (not Opposing): The Salvation Army
Court
High Court
Jurisdiction
New Zealand
Judgment Date
28 October 2014
Procedural Posture
Trust Interpretation and Declaratory Relief / Hearing and Judgment on Declaration Application
Outcome
Declaration granted in favour of applicants
Legal Topics
Declaration, Beneficiary Classification, Construction of Trust Deed, Admissibility of Post Contract Evidence, Ejusdem Generis
Trusts Charities Law Equity Civil Procedure Declaration Beneficiary Classification Construction of Trust Deed Admissibility of Post Contract Evidence +1 more

Case Brief

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Parties

McCaw Lewis Trustees (No. 4) Limited

Applicant / Trustee of the LJ Reynolds No.2 Trust

Vazey Child Trustees (2001) Limited

Applicant / Trustee of the LJ Reynolds No.2 Trust

Beneficiaries of the LJ Reynolds No.2 Trust (representative)

Respondents / Beneficiaries

Mahi-a-Ngakau Trust

Proposed Beneficiary / Recipient of Distributions

The Salvation Army

Named Beneficiary (not Opposing)

Procedural Posture

Trust Interpretation and Declaratory Relief / Hearing and Judgment on Declaration Application

Legal Issues

  1. 1 Whether the Mahi-a-Ngakau Trust falls within the class "other public charitable institution" in the LJ Reynolds No.2 Trust deed
  2. 2 Whether trustees may lawfully distribute income or capital to Mahi-a-Ngakau Trust
  3. 3 Whether subsequent documents (will and memorandum) or the later-settled charitable trust are admissible to construe the meaning of the deed

Ratio Decidendi

The court held that a reasonable and properly informed reader of the deed would construe "other public charitable institution" to include charitable trusts such as the Mahi-a-Ngakau Trust; there is no sustainable legal distinction in the deed between "public" and "private" charities sufficient to exclude a registered charitable trust, and therefore trustees are entitled to distribute income or capital to Mahi-a-Ngakau Trust.

Court Disposition

Declaration granted in favour of applicants

Orders

  • It is lawful for the applicants, as trustees of the LJ Reynolds (No.2) Trust, to make a distribution/s of income or capital (interim and/or final) to the Mahi-a-Ngakau Trust.
  • No orders as to costs as none outstanding were confirmed.