CLARKSON AND J K HAMILTON TRUSTEE SERVICES LIMITED v BRADY & ORS HC WN CIV 2012-485-2612

CLARKSON AND J K HAMILTON TRUSTEE SERVICES LIMITED v BRADY & ORS HC WN CIV 2012-485-2612

The Court granted approval under s64A because the proposed variation (limited to income distributions to a 'Beneficiary Trust' whose beneficiaries are all existing beneficiaries of the Clarkson Trusts, with perpetuity and beneficiary-addition constraints) was not detrimental to the minors, unborn or unknown beneficiaries, promoted the sustainability of the related family trust and managed material guarantee risk, and received unanimous consent from sui juris beneficiaries; therefore a properly advised relevant beneficiary would likely approve the arrangement.

Citation
openlaw-2a882dc2_f3f6_4ddd_9725_24ffac54ccb7.pdf
Parties
Plaintiff: Robert Moncrieff Clarkson; Plaintiff: J K Hamilton Trustee Services Limited; Plaintiff: Martha Elizabeth Clarkson; Defendant: Aleece Maree Brady; Defendant: Anthony Walter Clarkson; Defendant: Shirley Alison Brocklehurst; Defendant: Valma Louise Moncrieff; Defendant: Caprice Michelle Powdrill; Defendant: Megan Jennifer Buckley; Defendant: Alexander John Moore; Defendant: Rosanna Cooke; Defendant: Florence Jeanette Douglas; Defendant: Dorothy May Moore; Defendant (minor): Max William Powdrill-Clarkson; Defendant (minor): Maya Grace Powdrill-Clarkson; Defendant (minor): Moncrieff Dean Powdrill-Clarkson
Court
High Court
Jurisdiction
New Zealand
Judgment Date
6 March 2013
Procedural Posture
Application for Court Approval of Variation of Trust Under Trustee Act 1956 S 64 a / Hearing and Oral Judgment on S64 a Applications (approval Sought to Vary Trust Deeds)
Outcome
Application granted in part; Court approved insertion of subclause permitting income distributions to defined 'Beneficiary Trust' subject to limits
Legal Topics
Variation of Trusts Under S64 a, Court Acting for Minors/unborn Beneficiaries, Perpetuity and Beneficiary Classes, Family Trust Risk Management and Guarantees, Tax Consequences of Trust Distributions
Trusts Equity Civil Procedure Tax Law Variation of Trusts Under S64 a Court Acting for Minors/unborn Beneficiaries Perpetuity and Beneficiary Classes Family Trust Risk Management and Guarantees +1 more

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Parties

Robert Moncrieff Clarkson

Plaintiff

J K Hamilton Trustee Services Limited

Plaintiff

Martha Elizabeth Clarkson

Plaintiff

Aleece Maree Brady

Defendant

Anthony Walter Clarkson

Defendant

Shirley Alison Brocklehurst

Defendant

Valma Louise Moncrieff

Defendant

Caprice Michelle Powdrill

Defendant

Megan Jennifer Buckley

Defendant

Alexander John Moore

Defendant

Rosanna Cooke

Defendant

Florence Jeanette Douglas

Defendant

Dorothy May Moore

Defendant

Max William Powdrill-Clarkson

Defendant (minor)

Maya Grace Powdrill-Clarkson

Defendant (minor)

Moncrieff Dean Powdrill-Clarkson

Defendant (minor)

Procedural Posture

Application for Court Approval of Variation of Trust Under Trustee Act 1956 S 64 a / Hearing and Oral Judgment on S64 a Applications (approval Sought to Vary Trust Deeds)

Legal Issues

  1. 1 Whether the Court should approve variation of trust deeds under Trustee Act 1956 s64A
  2. 2 Whether the proposed variation would be to the detriment of minors, unborn or unknown beneficiaries
  3. 3 Whether the trusts can lawfully be varied to permit income distributions to another family trust (BOMA 2 Trust) whose beneficiaries overlap

Ratio Decidendi

The Court granted approval under s64A because the proposed variation (limited to income distributions to a 'Beneficiary Trust' whose beneficiaries are all existing beneficiaries of the Clarkson Trusts, with perpetuity and beneficiary-addition constraints) was not detrimental to the minors, unborn or unknown beneficiaries, promoted the sustainability of the related family trust and managed material guarantee risk, and received unanimous consent from sui juris beneficiaries; therefore a properly advised relevant beneficiary would likely approve the arrangement.

Court Disposition

Application granted in part; Court approved insertion of subclause permitting income distributions to defined 'Beneficiary Trust' subject to limits

Orders

  • Approval is given to insert the following subclause in clause 1 of each trust deed: 'AND as to income of the trust fund only (and not the capital) to, for or towards the benefit of, any Beneficiary Trust: (For this purpose, a "Beneficiary Trust" is any trust which, as at the date of such the payment, application or...