SPENCER V SPENCER HC WN CIV-2001-485-000857

SPENCER V SPENCER HC WN CIV-2001-485-000857

Because the trustees breached their duties by failing to make income payments, charging improper management fees and failing to recover trust debts, the Court required personal restoration by the first and second defendants of specified sums and awarded interest (5% post-2004; specified pre-2004 rates linked to the trust's borrowing) and costs; funds were ordered paid to the plaintiff's solicitors to be held on trust pending appointment of new trustees.

Citation
openlaw-5e1c57b1_e365_49cd_adda_aa6d59b2e3e2.pdf
Parties
Plaintiff: Barry Robert Giuseppe Spencer; First Defendant: Barry Robert Spencer; Second Defendant: David James Underwood; Second Defendant: Philip Joseph Vavasour; Second Defendant: Barry Robert Spencer; Third Defendant: Spencer Group Limited
Court
High Court
Jurisdiction
New Zealand
Judgment Date
3 February 2012
Procedural Posture
Trust Breach / Equitable Claim / Judgment on Quantum (remedy Stage)
Outcome
Judgment for plaintiff on quantum: first and second defendants personally liable to pay specified sums and interest; funds to be held by plaintiff's solicitors in a separate interest-bearing trust account in the name of the Spencer Family No 2 Trust pending appointment of new trustees; costs awarded on a 2B basis.
Legal Topics
Breach of Trust, Restoration of Trust Property, Interest on Judgments, Costs, Removal and Appointment of Trustees, Vesting Orders
Trusts Equity Civil Procedure Remedies Breach of Trust Restoration of Trust Property Interest on Judgments Costs +2 more

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Parties

Barry Robert Giuseppe Spencer

Plaintiff

Barry Robert Spencer

First Defendant

David James Underwood

Second Defendant

Philip Joseph Vavasour

Second Defendant

Barry Robert Spencer

Second Defendant

Spencer Group Limited

Third Defendant

Procedural Posture

Trust Breach / Equitable Claim / Judgment on Quantum (remedy Stage)

Legal Issues

  1. 1 Whether trustees breached duties by failing to pay income entitlements and diverting trust funds
  2. 2 Whether trust property and payments should be restored and in what amounts
  3. 3 Appropriate interest rate and period to compensate loss of use of funds

Ratio Decidendi

Because the trustees breached their duties by failing to make income payments, charging improper management fees and failing to recover trust debts, the Court required personal restoration by the first and second defendants of specified sums and awarded interest (5% post-2004; specified pre-2004 rates linked to the trust's borrowing) and costs; funds were ordered paid to the plaintiff's solicitors to be held on trust pending appointment of new trustees.

Court Disposition

Judgment for plaintiff on quantum: first and second defendants personally liable to pay specified sums and interest; funds to be held by plaintiff's solicitors in a separate interest-bearing trust account in the name of the Spencer Family No 2 Trust pending appointment of new trustees; costs awarded on a 2B basis.

Orders

  • First and second defendants ordered to pay the plaintiff the sum of $65,000 together with simple interest on $65,000 at 5% per annum from 21 December 1995 until date of judgment.
  • First and second defendants ordered to pay the plaintiff's solicitors, David Booth, the sum of $283,680 and interest up to 31 March 2004 of $35,738.15, together with interest on $283,680 from 1 April 2004 to date of judgment at 5% per annum.