JUDD & ANOR v COWLEY [2020] NZHC 184

JUDD & ANOR v COWLEY [2020] NZHC 184

The trust deed contained operative mistakes: it omitted the settlor as a discretionary beneficiary, failed to restrict 'children' to natural born children and issue, and omitted contingent nephews; contemporaneous solicitor file notes, the settlor's memorandum of wishes and the settlor's transfers of property constituted convincing evidence of her intentions; the mistakes were causative and of sufficient gravity to justify rectification; accordingly the court exercised its discretion to order rectification to give effect to the settlor's intentions but declined to include the nephews because they had renounced their interests.

Citation
[2020] NZHC 184
Parties
Plaintiff (trustee): Robert Dudley Judd; Plaintiff (trustee Company): Drury Nominees Limited; Defendant (beneficiary): Brooke Moral Cowley
Court
High Court
Jurisdiction
New Zealand
Judgment Date
17 February 2020
Procedural Posture
Civil – Trust Rectification / Judgment Delivered
Outcome
Rectification ordered: the 19 May 1994 trust deed is to be rectified to give effect to the settlor's intentions as reflected in the first and second tranches of amendments except that the settlor's nephews are excluded from rectification because they renounced any interest; draft orders dated 3 February 2020 made;...
Legal Topics
Rectification of Trust Deed, Mistake in Instrument, Discretionary Beneficiaries, Deed Amendment
Trusts Equity Civil Procedure Rectification of Trust Deed Mistake in Instrument Discretionary Beneficiaries Deed Amendment

Case Brief

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Parties

Robert Dudley Judd

Plaintiff (trustee)

Drury Nominees Limited

Plaintiff (trustee Company)

Brooke Moral Cowley

Defendant (beneficiary)

Procedural Posture

Civil – Trust Rectification / Judgment Delivered

Legal Issues

  1. 1 Whether the 1994 trust deed should be rectified to reflect the settlor's intentions
  2. 2 Whether the settlor was intended to be a discretionary beneficiary
  3. 3 Whether the class of 'children' should be limited to natural born children and issue

Ratio Decidendi

The trust deed contained operative mistakes: it omitted the settlor as a discretionary beneficiary, failed to restrict 'children' to natural born children and issue, and omitted contingent nephews; contemporaneous solicitor file notes, the settlor's memorandum of wishes and the settlor's transfers of property constituted convincing evidence of her intentions; the mistakes were causative and of sufficient gravity to justify rectification; accordingly the court exercised its discretion to order rectification to give effect to the settlor's intentions but declined to include the nephews because they had renounced their interests.

Court Disposition

Rectification ordered: the 19 May 1994 trust deed is to be rectified to give effect to the settlor's intentions as reflected in the first and second tranches of amendments except that the settlor's nephews are excluded from rectification because they renounced any interest; draft orders dated 3 February 2020 made;...

Orders

  • Rectify the Jeanette Reid Trust deed dated 19 May 1994 to incorporate the first and second tranches of amendments to reflect the settlor's intentions
  • Exclude from rectification the inclusion of the settlor's nephews who have renounced any interest