ASH v SINGH [2017] NZHC 2909

ASH v SINGH [2017] NZHC 2909

The 1996 deed of variation is void because the original 1993 trust deed did not grant power to vary the substantive trusts by adding beneficiaries or substituting the vesting clause; the resettlement clause (cl 7) is limited to resettling trust assets for existing discretionary beneficiaries and the 1996 instrument was not a resettlement; rectification was implausible and unsupported; s 64A cannot retrospectively validate the variation where competent beneficiaries do not consent; s 64 cannot change substantive trusts.

Citation
[2017] NZHC 2909
Parties
Plaintiff: Gabriel Sebastian Ash; First Defendant: Mahendra Singh; Second Defendant: Geoffrey Hugh Bourchier; Third Defendant: Darsan Singh
Court
High Court
Jurisdiction
New Zealand
Judgment Date
24 November 2017
Procedural Posture
Application Under Trustee Act 1956 for Removal/substitution of Trustees and Declaration as to Validity of Trust Variation Deed / Summary Judgment Decision (hearing 19 Sep 2017; Judgment 24 Nov 2017)
Outcome
Summary judgment granted to plaintiff on first cause of action declaring the 1996 deed void in specified respects; summary judgment dismissed on the fourth cause of action (production of legal advice); remaining issues to proceed to hearing; application for security for costs dismissed; no judicial settlement...
Legal Topics
Variation of Trust, Resettlement Clause, Rectification of Trust Instrument, Section 64 a Trustee Act 1956, Section 64 Trustee Act 1956, Beneficiary Entitlement, Disclosure of Legal Advice, Security for Costs, Judicial Settlement Conference
Trusts Equity Trustee Law Civil Procedure Property Law Costs Variation of Trust Resettlement Clause +7 more

Case Brief

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Parties

Gabriel Sebastian Ash

Plaintiff

Mahendra Singh

First Defendant

Geoffrey Hugh Bourchier

Second Defendant

Darsan Singh

Third Defendant

Procedural Posture

Application Under Trustee Act 1956 for Removal/substitution of Trustees and Declaration as to Validity of Trust Variation Deed / Summary Judgment Decision (hearing 19 Sep 2017; Judgment 24 Nov 2017)

Legal Issues

  1. 1 Whether the deed of variation dated 23 August 1996 validly varied the Shean Singh Family Trust
  2. 2 Whether the resettlement clause (cl 7) authorised the 1996 variation or a resettlement in favour of new beneficiaries
  3. 3 Whether the trust deed should be rectified to include a power of variation

Ratio Decidendi

The 1996 deed of variation is void because the original 1993 trust deed did not grant power to vary the substantive trusts by adding beneficiaries or substituting the vesting clause; the resettlement clause (cl 7) is limited to resettling trust assets for existing discretionary beneficiaries and the 1996 instrument was not a resettlement; rectification was implausible and unsupported; s 64A cannot retrospectively validate the variation where competent beneficiaries do not consent; s 64 cannot change substantive trusts.

Court Disposition

Summary judgment granted to plaintiff on first cause of action declaring the 1996 deed void in specified respects; summary judgment dismissed on the fourth cause of action (production of legal advice); remaining issues to proceed to hearing; application for security for costs dismissed; no judicial settlement...

Orders

  • Plaintiff has summary judgment against the defendants on the first cause of action except as to paragraphs (h) and (j) of the prayer for relief
  • Plaintiff's application for summary judgment under the fourth cause of action is dismissed