New Zealand Case Law: Decisions & Judgments

Topic

Sham trust

Legal area

Court

10 Aug 2023

NEW ZEALAND BLOODSTOCK FINANCE & LEASING LTD v JONES [2023] NZHC 2111

Citation

[2023] NZHC 2111
Court

High Court

Under s31(3) Insolvency Act the Court granted permission for the creditor to continue execution; tribunal found on admissible evidence the 333 shares are held by the MOF2 Trust, not the judgment debtor personally; there was insufficient evidence that the trust is a sham or alter ego; r17.53(e) permits charging the judgment debtor's estate/right/interest as a beneficiary, therefore a final charging order was appropriate over Jones' contingent interest in the shares; a sale order was declined; execution was not set aside for lack of good faith.
15 Jul 2021

HAWKINS v HAWKINS [2021] NZHC 1788

Citation

[2021] NZHC 1788
Court

High Court

Summary judgment was dismissed because significant factual disputes and credibility/admissibility issues prevented the court from being satisfied the defendant met the high threshold required for a defendant's summary judgment; accordingly costs follow the event and the first defendant must pay the plaintiffs' costs on a 2B basis with allowance for second counsel and a single allocation for steps 24 and 25, but no uplift was awarded due to late evidence and mixed success on admissibility issues.
17 Jun 2021

HAWKINS v HAWKINS [2021] NZHC 1440

Citation

[2021] NZHC 1440
Court

High Court

The defendant failed to meet the high threshold required to show the Trust was a sham on the available evidence; contested factual issues about control, knowledge and conduct of trustees and settlors could not be resolved on summary judgment and therefore the application was dismissed.
31 May 2021

HAWKINS v HAWKINS [2021] NZHC 1248

Citation

[2021] NZHC 1248
Court

High Court

Privilege did not attach because the communications about the sale, use of proceeds and purchase of the Motor Camp were not intended to be confidential among the parties; therefore Ms Clinch's affidavit is admissible. Statements of opinion by the solicitor about the parties' apparent understanding are admissible to the extent they reflect observations and will affect weight rather than being struck out.
15 Dec 2020

PRESCOTT v THOMPSON [2020] NZHC 3322

Citation

[2020] NZHC 3322
Court

High Court

Causes of action 2–5, which seek to void or set aside a contracting out agreement or to treat trust assets as relationship property, are applications for orders under s 25 of the PRA and therefore must be heard in the Family Court; the defendants' protest to High Court jurisdiction is upheld and those causes are dismissed. The first cause of action (alleged constructive trust arising from direct financial contributions to the Trust and claim against the trustee) is conceptually distinct from PRA relief, does not fall within the Family Court's exclusive PRA jurisdiction, is not struck out, and…
19 Sept 2019

FOODSTUFFS NORTH ISLAND LIMITED v RAVLA TRADING LIMITED [2019] NZHC 2357

Citation

[2019] NZHC 2357
Court

High Court

The Court granted modified interim injunctive relief because it found there were serious questions to be tried on multiple pleaded claims (contractual breaches of the franchise agreement including restriction on transfer, potential sham/resulting trust, directors' duties and tortious claims) and the balance of convenience favoured preserving the last peaceable state prior to the transfer of the premises; irreparable harm to Foodstuffs' goodwill and the franchise system could not be adequately remedied by damages, whereas short-term prejudice to respondents could be compensated or managed unde…
6 Jul 2018

UNKA v DODD [2018] NZHC 1665

Citation

[2018] NZHC 1665
Court

High Court

The application for a mandatory interim injunction was dismissed because the applicants failed to establish a serious question to be tried given evidence suggesting the arrangements may be a sham intended to conceal a bankrupt's involvement and therefore potentially unlawful, the balance of convenience and overall justice did not favour the orders, and no signed undertaking as to damages was provided as required by the High Court Rules.
15 Nov 2017

OFFICIAL ASSIGNEE v MWA CONSULTANTS LTD & ORS [2017] NZHC 2801

Citation

[2017] NZHC 2801
Court

High Court

The payments and assignments of the inheritance were insolvent gifts/voidable dispositions made within two years before adjudication; RedCo and MWAC cannot establish the s208 good faith defence (knowledge and intention of sole director/shareholder imputed); accordingly the transactions are cancelled and RedCo and MWAC are ordered to pay to the Assignee under s207 Insolvency Act; the Assignee lacks statutory standing to pursue compensation under s348 PLA so those PLA remedies were dismissed; the KD Trust was not a sham on the evidence.
4 Aug 2016

VERVOORT v FORREST [2016] NZCA 375

Citation

[2016] 3 NZLR 807
Court

Court of Appeal

The Court dismissed the appeal: the trust was not a sham; although equity may impose a constructive trust over express trust assets in principle where a controlling trustee has effectively excluded co-trustees and contributions/expectations are proven, on these facts appellant's contributions were insufficient to establish a proprietary interest or entitlement greater than the substantial settlement she had already received; promissory estoppel was not made out; accordingly no alteration to the High Court's outcome was warranted.
18 Jun 2015

MARK ARNOLD CLAYTON v MELANIE ANN CLAYTON [2015] NZSC 84

Citation

[2015] NZSC 84
Court

Supreme Court

The Supreme Court granted leave to appeal only on the discrete issues identified concerning the Vaughan Road Property Trust (whether it was a sham or illusory trust, whether its bundle of rights and the power of appointment constituted relationship property and valuation) and on the Court of Appeal's interpretation and application of s44C PRA and s182 Family Proceedings Act in relation to the Claymark Trust; all other leave applications were dismissed as not raising questions of general or public importance nor risk of substantial miscarriage of justice.