Re M I Clifford Trust No 2 [2022] NZHC 2015 ()

Re M I Clifford Trust No 2 [2022] NZHC 2015 ()

The Court approved the variation because there is a negligible likelihood of further younger grandchildren who would benefit under the original deed, all living beneficiaries consent, the proposed deed contains mandatory protections (indemnity, executor/successor provisions) for any potential unborn/great-grandchildren, the variation preserves the settlor's requirement of equality and does not extinguish any vested interest; the practical and administrative benefits and likely greater utility of earlier distribution to grandchildren outweigh the settlor's desire for prolonged vesting.

Citation
[2022] NZHC 2015
Parties
Trustee/applicant: Deidre Cowlishaw Wood; Trustee/applicant: Paul Joseph Dorrance; Reporter for Unborn Beneficiaries: William Palmer
Court
High Court
Jurisdiction
New Zealand
Judgment Date
15 August 2022
Procedural Posture
Application Under S 124 Trusts Act 2019 for Approval of Variation of Trust / High Court Judgment Approving Variation (15 August 2022)
Outcome
Variation of the M I Clifford Trust No 2 approved by the High Court
Legal Topics
Variation of Trust, Unborn and Unascertained Beneficiaries, Vesting and Final Distribution, Court Approval Under S124, Settlor Intent
Trust Law Equity Succession Variation of Trust Unborn and Unascertained Beneficiaries Vesting and Final Distribution Court Approval Under S124 Settlor Intent

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Parties

Deidre Cowlishaw Wood

Trustee/applicant

Paul Joseph Dorrance

Trustee/applicant

William Palmer

Reporter for Unborn Beneficiaries

Procedural Posture

Application Under S 124 Trusts Act 2019 for Approval of Variation of Trust / High Court Judgment Approving Variation (15 August 2022)

Legal Issues

  1. 1 Whether the Court can and should approve a variation of the M I Clifford Trust No 2 on behalf of unborn beneficiaries under s124 Trusts Act 2019
  2. 2 Whether the proposed variation is to the detriment of potential great-grandchildren or younger grandchildren
  3. 3 Whether the variation accords sufficiently with the settlor's intentions (equality between beneficiaries)

Ratio Decidendi

The Court approved the variation because there is a negligible likelihood of further younger grandchildren who would benefit under the original deed, all living beneficiaries consent, the proposed deed contains mandatory protections (indemnity, executor/successor provisions) for any potential unborn/great-grandchildren, the variation preserves the settlor's requirement of equality and does not extinguish any vested interest; the practical and administrative benefits and likely greater utility of earlier distribution to grandchildren outweigh the settlor's desire for prolonged vesting.

Court Disposition

Variation of the M I Clifford Trust No 2 approved by the High Court

Orders

  • Order approving variation of the Trust Deed in terms of the draft Trust Deed attached to the amended notice of application dated 30 March 2022
  • Costs of Mr Palmer to be costs of No 2 Trust; applicants' costs to be for the Trust; leave reserved to applicants to apply for further orders to give effect to this judgment or as to costs