HENNESSEY HC ROT CIV 2005-463-400

HENNESSEY HC ROT CIV 2005-463-400

The trustees' application for a declaratory judgment was refused because clause 13 cannot lawfully be used to resettle assets in order to acquire a sweeping power to vary the Trust's operative terms where clause 11(a) evidences settlor intent to keep those core terms immutable; allowing the proposed resettlement would improperly enlarge trustees' powers and attack the trust's substratum and s64 does not authorise the general future power sought.

Citation
openlaw-6523dd03_72ff_4b1d_a632_baa6ee4b165d.pdf
Parties
Plaintiff (trustee): Kevin Joseph Hennessey; Plaintiff (trustee): Leslie Nerida Immink; Plaintiff (trustee): Malcolm Edward Law; Plaintiff (trustee): Toni Catherine Owen; Plaintiff (trustee): Brian Edwin Ponting; Plaintiff (trustee): Robin Wray; Settlor / Respondent: Horizon Energy Distribution Limited; Opposing Party: Eastern Bay of Plenty Power Society Incorporated; Opposing Party: Opposing consumers (group)
Court
High Court
Jurisdiction
New Zealand
Judgment Date
13 July 2006
Procedural Posture
Declaratory Relief Under the Declaratory Judgments Act 1908 Concerning Trust Powers / Hearing Concluded; Judgment Delivered on Application for Declaration (13 July 2006)
Outcome
Declaration declined; trustees' application dismissed
Legal Topics
Winding Up Trust, Resettlement Vs Variation of Trust, Trustee Powers and Limits, Interpretation of Trust Deed, Trustee Act S64, Settlor Rights, Beneficiaries' Interests
Trusts Equity Corporate Law Energy Law Procedural Law (declaratory Relief) Winding Up Trust Resettlement Vs Variation of Trust Trustee Powers and Limits +4 more

Case Brief

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Parties

Kevin Joseph Hennessey

Plaintiff (trustee)

Leslie Nerida Immink

Plaintiff (trustee)

Malcolm Edward Law

Plaintiff (trustee)

Toni Catherine Owen

Plaintiff (trustee)

Brian Edwin Ponting

Plaintiff (trustee)

Robin Wray

Plaintiff (trustee)

Horizon Energy Distribution Limited

Settlor / Respondent

Eastern Bay of Plenty Power Society Incorporated

Opposing Party

Opposing consumers (group)

Opposing Party

Procedural Posture

Declaratory Relief Under the Declaratory Judgments Act 1908 Concerning Trust Powers / Hearing Concluded; Judgment Delivered on Application for Declaration (13 July 2006)

Legal Issues

  1. 1 Whether clause 13 of the trust deed authorises trustees to resettle trust assets into a successor trust rather than merely distribute them on winding up
  2. 2 Whether winding up under clause 13 can be used to obtain an expanded power to vary core terms of the trust contrary to clause 11(a)
  3. 3 Whether the trustees may lawfully remove the settlor's veto and assume a general power to vary by resettlement

Ratio Decidendi

The trustees' application for a declaratory judgment was refused because clause 13 cannot lawfully be used to resettle assets in order to acquire a sweeping power to vary the Trust's operative terms where clause 11(a) evidences settlor intent to keep those core terms immutable; allowing the proposed resettlement would improperly enlarge trustees' powers and attack the trust's substratum and s64 does not authorise the general future power sought.

Court Disposition

Declaration declined; trustees' application dismissed

Orders

  • Declaration sought by trustees refusing to be granted
  • Costs reserved; any application for costs to be filed within ten working days of issue of decision