MOLLY RUBY v EILEEN RUBY, A B, C D, E F in their capacity as trustees of the A Ruby Trust [2022] NZHC 282

MOLLY RUBY v EILEEN RUBY, A B, C D, E F in their capacity as trustees of the A Ruby Trust [2022] NZHC 282

The Court exercised its statutory and inherent jurisdiction to approve the three variations because they were necessary and desirable for proper management and administration of the A Ruby Trust, facilitated a full and final family settlement, did not extinguish any vested beneficial interest, complied with the mandatory considerations in ss124 and 125 and the principles in s4, and therefore the specific variation orders sought were appropriate and were made on 17 February 2022.

Citation
[2022] NZHC 282
Parties
Applicant: Molly Ruby; First Respondents: Eileen Ruby; A B; C D; E F (trustees of the A Ruby Trust); Second Respondents: A B; Zoe Ruby (trustees of the A Ruby (No 2) Trust); Third Respondents: Zoe Ruby; E F (trustees of the Z Ruby Trust); Applicants (proceeding 432): Zoe Ruby; E F; GH Limited (Applicants in CIV-2021-485-432)
Court
High Court
Jurisdiction
New Zealand
Judgment Date
17 February 2022
Procedural Posture
Trusts Act 2019 Proceedings: Trust Variation and Blessing Order; Trust Review / Post Hearing Settlement and Approval of Deed of Family Arrangement; Orders Made 17 February 2022; Reasons Issued 25 February 2022
Outcome
Variation orders approved and made on 17 February 2022; suppression initially ordered for reasons but a fully redacted judgment released and court files sealed with search access limited to parties
Legal Topics
Variation of Trust Deed, Inherent Jurisdiction of the High Court, Blessing Order Under S133 Trusts Act 2019, Removal of Discretionary Beneficiaries, Appointment of Trustees, Waiver of Beneficiary Consent (ss122, 124, 125, 130)
Trusts Law Civil Procedure Family Disputes Variation of Trust Deed Inherent Jurisdiction of the High Court Blessing Order Under S133 Trusts Act 2019 Removal of Discretionary Beneficiaries Appointment of Trustees +1 more

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Parties

Molly Ruby

Applicant

Eileen Ruby; A B; C D; E F (trustees of the A Ruby Trust)

First Respondents

A B; Zoe Ruby (trustees of the A Ruby (No 2) Trust)

Second Respondents

Zoe Ruby; E F (trustees of the Z Ruby Trust)

Third Respondents

Zoe Ruby; E F; GH Limited (Applicants in CIV-2021-485-432)

Applicants (proceeding 432)

Procedural Posture

Trusts Act 2019 Proceedings: Trust Variation and Blessing Order; Trust Review / Post Hearing Settlement and Approval of Deed of Family Arrangement; Orders Made 17 February 2022; Reasons Issued 25 February 2022

Legal Issues

  1. 1 Whether the High Court has jurisdiction under the Trusts Act 2019 or its inherent jurisdiction to approve variations to the A Ruby Trust deed
  2. 2 Whether to approve three proposed variations: (a) change power of appointment of trustees, (b) add bespoke distribution mechanism to bind trustees, (c) remove redundant classes of discretionary beneficiaries
  3. 3 Whether consent of absent or future beneficiaries can be waived under ss122,124 and 125 and whether any vested interests would be impaired

Ratio Decidendi

The Court exercised its statutory and inherent jurisdiction to approve the three variations because they were necessary and desirable for proper management and administration of the A Ruby Trust, facilitated a full and final family settlement, did not extinguish any vested beneficial interest, complied with the mandatory considerations in ss124 and 125 and the principles in s4, and therefore the specific variation orders sought were appropriate and were made on 17 February 2022.

Court Disposition

Variation orders approved and made on 17 February 2022; suppression initially ordered for reasons but a fully redacted judgment released and court files sealed with search access limited to parties

Orders

  • Revoked and replaced paragraph 11 of the A Ruby Trust Deed so trustees have power to appoint new trustee(s)
  • Added new clause 10A to the Trust Deed making trustees bound to distribute capital in accordance with cl 3.9 of the Deed of Family Arrangement executed 16 February 2022