McGUIRE v EARL [2020] NZHC 3083

McGUIRE v EARL [2020] NZHC 3083

The court held that the trustees' duty to account and the applicant's status as a close beneficiary outweighed the settlor's wish for confidentiality; the trustees' limited and misleading disclosure concerning a large unexplained 'Estate D McGuire Distributions' entry meant the applicant had established insufficiency of disclosure and summary judgment was appropriate ordering comprehensive disclosure of accounts, minutes, distribution and bank documents subject only to narrowly tailored redactions and safeguards.

Citation
[2020] NZHC 3083
Parties
Applicant: Christopher Alan Leslie McGuire; Respondent (trustee): Christopher Knox Earl; Respondent (trustee): Errol Mannering Barnes; Respondent (trustee): Geoffrey William James Rochester Basher
Court
High Court
Jurisdiction
New Zealand
Judgment Date
20 November 2020
Procedural Posture
Trust Disclosure Application Under Trustee Act 1956; Summary Judgment / Judgment Following Summary Judgment Hearing
Outcome
Summary judgment granted. Trustees ordered to provide full and comprehensive disclosure of specified trust documents subject to limited redactions; disclosure to be provided within 15 working days; costs reserved.
Legal Topics
Disclosure of Trust Documents, Beneficiary Rights to Accounts, Breach of Trust/unauthorised Distribution, Confidentiality of Settlor's Memoranda, Supervisory Jurisdiction of the Court
Trusts Equity Civil Procedure Disclosure of Trust Documents Beneficiary Rights to Accounts Breach of Trust/unauthorised Distribution Confidentiality of Settlor's Memoranda Supervisory Jurisdiction of the Court

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Parties

Christopher Alan Leslie McGuire

Applicant

Christopher Knox Earl

Respondent (trustee)

Errol Mannering Barnes

Respondent (trustee)

Geoffrey William James Rochester Basher

Respondent (trustee)

Procedural Posture

Trust Disclosure Application Under Trustee Act 1956; Summary Judgment / Judgment Following Summary Judgment Hearing

Legal Issues

  1. 1 Whether trustees must disclose trust documents and bank records to a discretionary beneficiary
  2. 2 Whether a settlor's Memoranda of Wishes or confidentiality obligations can justify withholding documents
  3. 3 Whether the Trust made unauthorised distributions to a non‑beneficiary (Ruth Spearing Cancer Research Trust) requiring explanation

Ratio Decidendi

The court held that the trustees' duty to account and the applicant's status as a close beneficiary outweighed the settlor's wish for confidentiality; the trustees' limited and misleading disclosure concerning a large unexplained 'Estate D McGuire Distributions' entry meant the applicant had established insufficiency of disclosure and summary judgment was appropriate ordering comprehensive disclosure of accounts, minutes, distribution and bank documents subject only to narrowly tailored redactions and safeguards.

Court Disposition

Summary judgment granted. Trustees ordered to provide full and comprehensive disclosure of specified trust documents subject to limited redactions; disclosure to be provided within 15 working days; costs reserved.

Orders

  • Trustees to disclose full statements of accounts and source documents for the Trust (including drafts and instructions to accountants)
  • Trustees to disclose all Minutes and Resolutions of the Trust subject only to narrowly tailored redactions for trustees' reasons and truly confidential personal/commercial information