IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE	
CIV-2018-419-0272
[2019] NZHC 898	

UNDER	Section 21 of the Administration Act 1969 and s 51 of the Trustees Act 1956	
IN THE MATTER	of the estate of Jack Howarth	
BETWEEN	DAVID JOHN MACMILLAN HOWARTH
First Plaintiff

JACQUELINE ELLEN KEEN
Second Plaintiff	
AND	ANDREW ROBERT HOWARTH
Defendant	

Hearing:	11 April 2019	
Appearances:	D J G Cox for the Plaintiffs
G H J Brant for the Defendant	
Judgment:	24 April 2019	

JUDGMENT OF ASSOCIATE JUDGE SMITH

This judgment was delivered by me on 24 April 2019 at 11.00am, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors / Counsel:
Rennie Cox, Auckland Stace Hammond, Hamilton

HOWARTH v HOWARTH [2019] NZHC 898 [24 April 2019]

[1]	In this proceeding, the plaintiffs ask for an order removing the defendant as executor and trustee of the estate of the parties' late father. They contend that the estate has potential claims against the defendant (and possibly others) that should be investigated, and that those potential claims place the defendant in a position where he has a conflict of interest between his personal interests and his duties as administrator of his late father's estate. They say that in those circumstances he should have agreed to stand aside as executor and trustee to allow for the appointment of an independent administrator and trustee, but he has refused to do so. They contend that the defendant has no defence to their claim for his removal, and they seek summary judgment on it.

[2]	The defendant opposes the application for summary judgment. He says that the plaintiffs have provided no evidential basis for an order removing him as administrator/trustee, and they have themselves refused to undertake to meet the costs of the proposed independent trustee and the investigation they wish to have carried out.

[3]	I now give judgment on the plaintiffs' summary judgment application.

Background

[4]	The first plaintiff (David) and the defendant (Andrew) are brothers. The second plaintiff (Jacky) is their sister.

[5]	The parties' father, the late Jack Howarth of Tairua (the deceased), died on  10 June 2017, aged 92. The deceased's wife, Elizabeth Howarth, had died in October 2000. The deceased had married only once, and the parties to this proceeding were the only children of the deceased and his late wife.

[6]	The deceased's last will, dated 28 December 2008, appointed Andrew as one of two executors. The other executor, Mr Michael Radford, renounced his appointment, and probate was granted to Andrew alone on 7 September 2017. Andrew is the sole beneficiary under the deceased's last will.

[7]	The parties agree that the deceased's estate has an estimated net value of approximately $335,000, although there will be further administration charges to be deducted from that figure.

[8]	Not long after the deceased's death, David and Jacky became concerned that amounts totalling over $300,000 had been paid out of the deceased's bank accounts between 1996 and the date of his death, to or for the benefit of Andrew, and/or to other unidentified persons or entities, for unidentified purposes. They say that the payments were in complete contrast with the very frugal lifestyle the deceased had lived.

[9]	David and Jacky approached Andrew seeking an enquiry into the money paid out of the deceased's bank accounts. They believed Andrew was the substantial recipient of the money withdrawn from the deceased's bank accounts.

[10]	David says that, when faced with this alleged conflict of interest and a request that he stand down as executor and agree to an independent executor being appointed in his place, Andrew has refused to stand aside. David says that he and Jacky have no trust and confidence in Andrew as executor and administrator, and that there is now a high degree of hostility between the parties.

[11]	It might be thought that any such conflict and hostility would not matter, given that Andrew is the sole beneficiary named in the deceased's last will. But David and Jacky have filed a proceeding under the Family Protection Act 1955 seeking provision from the deceased's estate,1 and they say that a proper investigation of the deceased's bank accounts may enlarge the deceased's estate. Further, if that investigation shows that Andrew received substantial sums from the deceased during the deceased's lifetime, that would be relevant to the parties' respective claims on the deceased at the date of his death, and accordingly affect their claims under the Family Protection Act.

The proceeding

[12]	In the proceeding, David and Jacky ask for an order removing Andrew as executor and administrator of the deceased's estate and appointing an independent

1	Filed in this Court on 5 September 2018.

executor and administrator in his place. A consent to act as independent executor and administrator has been filed by Mr R N Burnes, a solicitor and principal in the law firm R N Burnes & Associates.

[13]	The jurisdiction relied upon by the plaintiffs is that contained in s 21 of Administration Act 1969 and s 51 of the Trustee Act 1956. Those sections materially provide:

21	Discharge or removal of administrator

(1)	Where … it becomes expedient to discharge or remove an administrator, the court may discharge or remove that administrator, and may if it thinks fit appoint any person to be administrator in his or her place, on such terms and conditions in all respects as the court thinks fit.

(2)	The administrator so removed or discharged shall, from the date of that order, cease to be liable for acts and things done after that date.

(3)	Upon any administrator being discharged or removed as aforesaid (whether or not any other administrator is appointed) all the estate and rights of the previous administrator or administrators which were vested in him or her or them as such shall become and be vested … any administrator appointed under subsection (1) … who shall have the same powers, authorities, discretions, and duties, and may in all respects act, as if he or she or they had been originally appointed as the administrator or administrators.

…

51	Power of court to appoint new trustees

(1)	The court may, whenever it is expedient to appoint a new trustee or new trustees, and it is found inexpedient, difficult, or impracticable so to do without the assistance of the court, make an order appointing a new trustee or new trustees, either in substitution for or in addition to any existing trustee or trustees …

(2)	In particular and without prejudice to the generality of the foregoing provision, the court may make an order appointing a new trustee in substitution for a trustee who—

(a)	has been held by the court to have misconducted himself in the administration of the trust; or

(b)	is convicted of a crime involving dishonesty as defined by section 2 of the Crimes Act 1961; or

(c)	is a mentally disordered person within the meaning of the Mental Health (Compulsory Assessment and Treatment) Act 1992, or whose estate or any part thereof is subject to a

property order made under the Protection of Personal and Property Rights Act 1988; or

(d)	is a bankrupt; or

(e)	is a corporation which has ceased to carry on business, or is in liquidation, or has been dissolved.

…

(5) Every trustee appointed by the court shall, as well before as after the  trust property becomes by law, or by assurance, or otherwise, vested in him, have the same powers, authorities, and discretions, and may in all respects act as if he had been originally appointed a trustee by the instrument, if any, creating the trust.

Applications for summary judgment — legal principles

[14]	Rule 12.2(1) of the High Court Rules 2016 provides:

12.2 Judgment when there is no defence or when no cause of action can succeed

(1)  The court may give judgment against a defendant if the plaintiff  satisfies the court that the defendant has no defence to a cause of action in the statement of claim or to a particular part of any such cause of action.

…

[15]	In Krukziener v Hanover Finance, the Court of Appeal described the Court's approach on a plaintiff's summary judgment application as follows:2

[26] The principles are well settled. The question on a summary judgment application is whether the defendant has no defence to the claim; that is, that there is no real question to be tried: Pemberton v Chappell [1987] 1 NZLR 1 (CA) at 3. The court must be left without any real doubt or uncertainty. The onus is on the plaintiff, but where its evidence is sufficient to show there is no defence, the defendant will have to respond if the application is to be defeated: MacLean v Stewart (1997) 11 PRNZ 66 (CA). The court will not normally resolve material conflicts of evidence or assess the credibility of deponents. But it need not accept uncritically evidence that is inherently lacking in credibility, as, for example, where the evidence is inconsistent with undisputed contemporary documents or other statements by the same deponent, or is inherently improbable: Eng Mee Yong v Letchumanan [1980] AC 331 (PC) at
341. In the end the court's assessment of the evidence is a matter of judgment. The court may take a robust and realistic approach where the facts warrant it: Bilbie Dymock Corporation Ltd v Patel (1987) 1 PRNZ 84 (CA).

2	Krukziener v Hanover Finance

[16]	Counsel both accepted that in an appropriate case the summary judgment procedure may be used where the relief sought is the removal of an administrator under s 21 of the Administration Act or the removal of a trustee under s 51 of the Trustee Act. Mr Brant referred to the judgment of Palmer J in Deng v Ye, in which an order was made on a summary judgment application recalling an order that had been made on a without notice  basis appointing Ms Ye  administrator of the estate of the late  Mr Jun Xie.3 Palmer J considered that the application to recall the letters of administration was one that could be made by summary judgment application under  r 12.2(1). His Honour applied the principles in Krukziener, concluding that Ms Ye had no defence to the claim and that summary judgment should be entered recalling the grant of letters of administration.

[17]	Mr Cox relied on Crick v McIlraith, where Associate Judge Osborne accepted that the summary judgment jurisdiction is available to a plaintiff seeking the removal of an administrator.4 The Associate Judge noted that the Court must be left without any real doubt or uncertainty on the matter, and that in assessing a defence, the Court will look for appropriate particulars. Once the Court is satisfied that there is no defence, the Court retains a discretion to refuse summary judgment, but does so in the context of the general purpose of the High Court Rules, which provide for the just, speedy and inexpensive determination of proceedings. With specific reference to the discretion the Court has in relation to the removal of administrators, His Honour adopted the warning of Fisher J in Claydon v Herron, a case concerning the exercise of the discretion under the Illegal Contracts Act 1970. Fisher J said:5
… Notoriously when one comes to the exercise of a judicial discretion, unforeseen circumstances can have a bearing upon what at the moment may seem obvious.

Principles relating to the exercise of the discretion to remove an administrator or trustee

[18]	In Farquhar v Nunns, Heath J set out the following guiding principles for the exercise of the Court's powers under s 21 of the Administration Act:6

3	Deng v Ye [2018] NZHC 391; [2018] NZAR 560
4	Crick v McIlraith [2012] NZHC 1290 at [22].
5	Claydon v Herron (1994) 7 PRNZ 631 (HC).
6	Farquhar v Nunns [2013] NZHC 1670 at [13].

(i)	The starting point is the Court's duty to see estates properly administered and trusts properly executed.

(ii)	The jurisdiction involves a large discretion which is heavily fact dependent.

(iii)	The wishes of the testator/settlor (evidenced by the appointment of a particular executor or trustee) are to be given consideration, but ultimately the question is what is expedient in the interests of the beneficiaries.

(iv)	Expedience is a lower threshold than necessity, and imports considerations of suitability, practicality and efficiency. Misconduct, breach of trust, dishonesty, or unfitness need not be established.

(v)	Hostility as between administrators/trustees and beneficiaries is not of itself a reason for removal, but hostility will assume relevance if and when it risks prejudicing the interests of the beneficiaries.

[19]	That summary of relevant principles has been affirmed by the Court of Appeal in Tod v Tod,7 and Frickleton v Frickleton.8

[20]	An executor or administrator is obliged to be even-handed as between all beneficiaries. That includes persons potentially entitled to claim against the estate under the Family Protection Act 1955, at least where the executor or administrator has knowledge of their claims.9

[21]	Mr Cox referred to earlier authorities suggesting that where the executor or administrator is in a position of conflict between his own interests and those of other beneficiaries or potential beneficiaries, removal was a likely outcome.10 He acknowledged, however, that more recent authorities suggest that the ultimate question is whether the conflict of interest or hostility risks prejudicing the interests of the beneficiaries or undermines the executor's ability to perform his or her duties.11

7	Tod v Tod [2017] NZLR 145 at [22].
8	Frickleton v Frickleton [2017] NZLR 154 at [29].
9	Nawisielski v Nawisielski [2014] NZHC 1547 at [19], citing Irvine v Public Trustee [1989] 1 NZLR 67 (CA) at 70.
10 Famsworth v Famsworth HC Auckland M176/97, 12 January 1999 at 18, and Re O'Reilly (deceased) (1992) 9 FRNZ 51 (HC).
11 Tod v Tod, above n 7, at [27], where the Court said: "The mere existence of a conflict of interest does not mean that it will be expedient to remove an executor — the conflict must actually prejudice the beneficiaries' welfare or undermine the executor's ability to perform his or her duties as administrator".

[22]	The principles for the exercise of the Court's discretion are the same, whether the application is made under s 21 of the Administration Act 1969 or s 51 of the Trustee Act 1956.12

Andrew's opposition

[23]	Andrew has filed a notice of opposition and a statement of defence, with supporting affidavits sworn by Mr Radford and himself.

[24]	The notice of opposition simply refers to Andrew's statement of defence.

[25]	In the statement of defence, Andrew admits that the deceased lived frugally, but he says the deceased was also generous. He admits that the net value of the deceased's estate is currently approximately $335,000, consisting of a half share in a property in Tairua ($290,000) and funds held on interest-bearing deposit by Ussher Lawyers ($45,319.39).

[26]	Andrew admits that some of the payments out of the deceased's accounts were made for his benefit, and that some were made to unidentified persons and/or for unidentified purposes.

[27]	Andrew denies the allegation by David and Jacky that he was put in a conflict of interest position when they asked for an enquiry into the money paid out of the deceased's banks accounts (including to Andrew). He says that he has identified particular payments that were made to him or for his benefit, but says that there is no evidential basis for the accusations made that payment of any money was on terms requiring the person who received the money to repay it. He describes the plaintiffs' accusation that the money ought to be returned as speculative.

[28]	In response to the contention by David and Jacky that he has refused to stand down as executor and allow an independent executor to be appointed, Andrew pleads that he has offered to step down, if David and Jacky agree to meet the costs of engaging an independent executor. He says they have not accepted that proposal. He expresses

12	Harsant v Menzies [2012] NZHC 3390 at [54].

the view that he was appointed by the deceased to administer the deceased's affairs after his death, and he wants to honour that confidence.

[29]	Andrew denies the lack of trust and confidence allegations.

Evidence for the plaintiffs

David

[30]	David is 66 years of age.

[31]	David provided a brief description of the family background from the date the deceased retired in or about 1984. At that stage, the deceased and his wife had been living in Cambridge. David deposed that, in or about 2000, he was told by the deceased that Andrew had asked the deceased to provide a mortgage over his Cambridge unit in order to further support Andrew's kitchen manufacturing business expansion in Hamilton. That came as news to David, and he travelled to Cambridge to discuss the issue with his parents. He counselled his parents against mortgaging their home during their retirement years.

[32]	David said that, in about 2001, after the death of Elizabeth, the deceased decided to sell the Cambridge unit and move permanently to a property at Tairua that he and Elizabeth had owned for many years. At that time, the deceased wanted to split the proceeds of sale of the Cambridge unit three ways between the children, but David suggested that there should be a four-way split, so that the deceased would retain enough funds to pay for any improvements he might want to make to the Tairua property, to take an overseas trip, or to cover any health costs that might arise. The three children all agreed that that was sensible, and David said that they agreed that the deceased should not be "tapped" for any more loans, which would reduce the funds available to him in his retirement years.

[33]	David said in his evidence that the deceased told him in 1984 that he was able to live off the pensions he received. He and Elizabeth were frugal people, and in David's opinion the deceased became more frugal after he moved to Tairua.

[34]	In about 2004, Jacky and her husband, Graham Keen, moved to Tairua and lived in a downstairs flat at the Tairua property while they developed a local restaurant business. Jacky and Graham's daughter wanted a loan of $2,500 to buy a car about this time, and approached the deceased for the money. David said that he and Jacky were shocked when the deceased refused the $2,500 loan, saying that he had "no money". David's evidence was that the deceased said he would be happy to lend the money when Andrew and his son Jason repaid money the deceased had lent to them. David said that the deceased told him at that point that he had already lent Andrew
$35,000 towards building costs, and had lent Jason $15,000 for a deposit on an investment property.

[35]	When the deceased died in June 2017, Andrew and David went to the Tairua property to look for their late mother's will. It was then that they found the deceased's last (2008) will, which superseded an earlier will made in 1999. David said that neither Jacky nor he could understand why the deceased had executed a new will in 2008.

[36]	In September 2017 David and Jacky visited the deceased's Tairua house to sort through the chattels. They found the deceased's bank books and bank statements, which had not been at the Tairua house when Andrew and David were searching for their late mother's will in June 2017. David inferred that the bank records must have been returned to the Tairua house after that date.

[37]	David described his concern, and that of Jacky, following the deceased's death, when they found that a significant amount of money had been removed from the deceased's bank accounts during his lifetime and credited to Andrew and/or to other unidentified persons or entities. Working from available cheque butts, bank statements, bank passbooks, and bank and ATM receipts from 1996, David and Jacky calculated that $312,000 had been removed. The withdrawals included sums of
$10,000, $20,000 and $35,000.

[38]	Jacky met with Andrew on 17 September 2017 to discuss the schedule. David said that Andrew was simply quiet when the various withdrawals were put to him, and did not offer any explanation or reasons for the withdrawals.

[39]	Andrew asked for a meeting with David and Jacky, and Jacky met with Andrew on 18 September 2017 at Andrew's home. She dropped off to him further copies of bank statements. Andrew again provided no explanations for the withdrawals, other than saying "you know what Dad was like, you just had to mention something and he would offer up the money".

[40]	There were further  exchanges  between  David,  Jacky  and  Andrew  after  18 September 2017, but despite requests for explanations about the withdrawals David and Jacky had identified Andrew could not and did not provide any explanations. David and Jacky then engaged an accountant, Glennis Drane, to assess the available records.

[41]	David and Jacky instructed their solicitors to raise the issue with Andrew's lawyers. Without prejudice correspondence passed between the lawyers in November 2017 and January 2018.

[42]	On 24 January 2018 the lawyers for David and Jacky wrote to Andrew's solicitors asking that Andrew and his co-executor, Mr Radford, step aside as executors, given the allegations Jacky and David were making. Andrew's solicitors responded saying that Andrew saw no need to have another person appointed as executor, and advising that Mr Radford had renounced his appointment as executor.

[43]	On 1 February 2018 Andrew's solicitors wrote advising that Andrew had calculated that he had received approximately $60,000–$70,000 from the deceased during the deceased's lifetime. However Andrew asserted that these payments were gifts, not loans. Andrew's solicitors asked for an affidavit setting out the plaintiffs' evidential foundation for their claims against Andrew before he would consider standing aside as executor.

[44]	David then swore an affidavit on 9 March 2018 setting out his claims. The accountant, Glennis Drane, also provided an affidavit sworn on 7 March 2018, setting out the results of her investigations.

[45]	Andrew responded with an affidavit sworn on 26 April 2018, and an affidavit of Mr Radford sworn on 24 April 2018. In a covering letter, Andrew's solicitors advised that Andrew would oppose the appointment of another executor unless terms were agreed that David and Jacky would meet the costs of the new executor and any investigation.

[46]	Following the exchange of affidavits between the parties, there was some further without prejudice correspondence between the parties' solicitors. However no agreement was reached.

[47]	David summarised the position of Jacky and himself by saying that, in the absence of any credible explanation, the disappearance of the deceased's money, supposedly without the knowledge of any of his children, calls for an investigation. He emphasised that the deceased was a frugal and humble man, who did not spend his money on himself or in acquiring assets or improvements to his home. The only person who can either carry out that exercise, or authorise an appropriate person to do so, is the executor of the deceased's will, and Andrew has refused to carry out or authorise the investigation.

[48]	David noted that Andrew's statement that he had received gifts from the deceased totalling approximately $70,500 excluded the sum of $35,000 that each of the children had received from the deceased on the sale of the deceased's Cambridge property. David said that Jacky and he questioned whether a payment of $35,000 to Andrew that was included in a schedule  attached  to Andrew's affidavit  sworn on  26 April 2018 was additional to, and not the same as, the $35,000 which was Andrew's agreed share on the sale of the Cambridge property. The principal reason for the question was that, while David and Jacky each received their $35,000 direct from the solicitors who acted in the sale of the Cambridge property, the schedule attached to Andrew's affidavit showed that Andrew had received his $35,000 from one of the deceased's bank accounts. David and Jacky question whether Andrew may have received $35,000 from the solicitors who acted on the sale of the Cambridge property, as well as the deceased's one-fourth share in the equity in the Cambridge property.

[49]	Andrew's schedule of moneys received which was attached to his 26 April 2018 affidavit appeared to show that Andrew received $76,564 from the deceased as reimbursement of expenses paid by Andrew on the deceased's behalf, as gifts to the deceased's grandchildren, and by way of a loan to Andrew's son, Jason, to purchase an investment property. Andrew had asserted in his April 2018 affidavit that Jason had repaid the money lent to him by the deceased, and David noted that that is consistent with a statement made by the deceased to David in or about 2004 that money paid to Jason and Andrew at about that time was a loan.

[50]	David noted that Andrew's explanations in his affidavit of 26 April 2018 would still leave over $192,000 of the deceased's money unaccounted for. David suggested that it should be possible to investigate some of these unexplained transactions by tracing cheques where cheques were used. He also suggested that Andrew could also "open his books" and show David and Jacky that he was not the beneficiary of any of the unexplained payments.

[51]	David also referred to his understanding that Andrew had authority over at least two of the deceased's bank accounts from which unexplained transfers were made since 1997. David referred expressly to payments identified by Andrew as gifts, that were said to have been made to Andrew, on 4 July 2013 ($10,000) and 28 August 2015 ($12,000). David said that the $10,000 payment was made when the deceased was unwell, and the $12,000 payment was made when Andrew held an enduring power of attorney for the deceased (the enduring power of attorney was given by the deceased on 4 February 2015). David referred also to the deceased's alleged vulnerability to influence, due to his advanced age and health issues, including heart and kidney problems.

Glennis Drane

[52]	Ms Drane said that she is a registered chartered accountant, currently working as a bookkeeper. She was engaged by David and Jacky to collate all of the information which had been found relating to the deceased's relevant bank accounts, and to put the information into spreadsheet form. She said that the bank records were not complete,

as not all of the bank statements for the period since 1996 were available. Similarly, not all of the cheque book butts had been found.

[53]	Ms Drane went through 13 cheque book butts for the deceased's cheque account. She also reviewed documents relating to a "Freedom account" held by the deceased, for the period 17 July 1997 to 31 May 2017.

[54]	In addition, she reviewed certain term deposits made by the deceased after February 2009, and a "Serious Saver account" held by the deceased.

[55]	Ms Drane compiled a composite spreadsheet covering all of the deceased's accounts she had reviewed, setting out a list of unexplained deposits and withdrawals from the various accounts over the period between June 1997 and 2017. Over the relevant period, she noted unexplained withdrawals or payments (each in excess of
$1,000) totalling $369,039.81. Excluded from that figure were five payments known to have been made by the deceased to each of his grandchildren.

Evidence for Andrew

Andrew's affidavits

[56]	The first affidavit sworn by Andrew was his pre-commencement affidavit sworn on 26 April 2018 that was sent to the solicitors for David and Jacky. A second affidavit was sworn on 12 November 2018 after the proceeding was commenced. The third affidavit was Mr Michael Radford's pre-commencement affidavit provided in April 2018.

[57]	With his April 2018 affidavit, Andrew provided the following schedule listing the withdrawals from the deceased's accounts that he was able to identify:

Date	Amount	Andrew's Comments	
10/04/1998	$1,500	[The deceased] Purchased computer for
Jason (my Son)	
10/01/1999	$3,000	Towards purchase of Holden for Jason	
22/07/1999	$3,000	Jason unsure what this is for	
22/09/1999	$1,500	Contribution towards cost of flights to
Christchurch for family and mum and [the deceased] for Christmas with J and G	

 29/09/1999	 $3,000	 Caring  for mum  and  [the  deceased] for
 6 weeks.  [The deceased] post hip surgery
 – paid because I was not working  during
 this time and [the deceased] wanted to pay
 given the lost income	
16/11/1999	$1,000	Toward rental car costs for Christchurch trip contribution to expenses	
 22/03/2001	 $1,500	 Unsure – possibly towards holiday for
 [Andrew's partner] Donna and I	
 24/12/2002	 $35,000	 Equal share from sale of [the deceased's]
 Cambridge	House	(each	sibling	got
 $35,000)	
17/03/2003	$1,000	Sale of wall unit. I sold wall unit to [the
deceased]	
13/05/2003	$15,000	Lent to Jason for purchase of first home (repaid January 2006)	
 22/08/2003	 $7,000	 Carson Taylor Red transit van there was
 another $6000 as the van cost $13,000	
 25/06/2004	 $15,000	 Buildings costs	
 10/08/2004	 $10,000	 Buildings costs	
 19/11/2004	 $6,000	 Buildings costs	
07/09/2005	$5,000	Leighton (David's son) – purchase of TR4	
In 2006	$25,000	$5,000	(bonus	bonds	for	other	5 grandchildren — Leighton having received
$5000 as above)	
18/03/2009	$2,500	[The deceased's] airfare to Manchester reimbursement to me for costs	
01/04/2009	$5,000	Exchange to English pounds reimbursement to me for costs	
16/06/2009	$1,064	[The	deceased's]	travel	insurance reimbursement to me for costs	
21/07/2009	$5,000	Gifted to Adam (my son) to assist in the purchase of first home	
 04/07/2013	 $10,000	 Gift from [the deceased] for care while
 [the deceased] was unwell	
27/09/2013	$4,000	Gifted to Adam to bring family out from Australia. Wedding January 2014. A further
$4,000 given to each grandchild in 2014	
17/07/2014	$2,000	Money withdrawn for Carolyn Day but not given. [The deceased] intended to give this to Leighton and Estelle for upcoming trip to
Japan/UK which they didn't ultimately go on	
17/07/2014	$1,000	Money withdrawn for Carolyn Day but not given. [The deceased] intended to give this to Leighton and Estelle for upcoming trip to Japan/UK which they didn't ultimately go on	
 28/08/2015	 $12,000	 Deposited into Orbit account – gift from
 [the deceased]	

[58]	The entries in bold type in the table above were those where Andrew acknowledged receiving money from the deceased which was not associated with either reimbursement from the deceased for airfares or the like, or the deceased

contributing to some costs which Andrew's partner Donna and Andrew were incurring on the deceased's behalf (or in one case when the deceased bought a wall unit from Andrew). Many of the other items in the schedule were for the benefit of other family members. Andrew accepted that he received by way of gift from the deceased $70,500 during the deceased's lifetime, plus the $35,000 each sibling received by way of gift when the deceased sold his Cambridge house.

[59]	Andrew said that it was impossible to know what withdrawals represented going back as far as 1997. He said that he did assist the deceased with his banking from time to time, and would assist him to make withdrawals and payments when the deceased asked. He also acknowledged his appointment as the deceased's attorney in or about February 2015, saying that that appointment was at the instigation of the ANZ Bank (the bank was concerned that the deceased's eyesight was failing). All bank accounts went to the deceased until his health deteriorated, and his mail was then redirected to Andrew's address while the deceased lived with Andrew and Donna.

[60]	Andrew said that he viewed the appointment of an independent executor as a waste of time and money, because of the historic nature of the withdrawals. The only basis upon which he would step aside voluntarily would be if David and Jacky agreed that they would personally meet the costs of the executor (or any investigative accountant) to undertake the investigation they propose. He said that if they wanted him to get bank statements printed from the bank, they would have to personally pay that cost (approximately $3.00 per page). Further, his position was that David and Jacky should also pay the costs of any replacement executor, because Andrew has been acting as executor without cost to the estate. If, having gone through the proposed investigation, it turned out that there was no basis for the allegations made against him, Andrew took the position that Jacky and David should not be entitled to reimbursement for their costs from the estate.

[61]	Andrew denied asking the deceased for financial assistance for the expansion of Andrew's kitchen manufacturing business. He said that the issue was eventually resolved by the introduction of two new equity partners into the business. And as far as he was concerned, the proceeds of sale of the deceased's Cambridge home was always going to be split four-ways: that is what the deceased suggested.

[62]	Andrew did acknowledge receiving funds from the deceased totalling $31,000 in 2004 for the purpose of completing a building on a property at Whenuakite. The
$31,000 was made up of the three payments described as "building costs" set out about half way down Andrew's schedule which is reproduced at paragraph [57] of this judgment. Andrew said that these payments were not loans; they were gifts to enable him to complete the building to start a new business. Andrew said that Jacky and David were later upset when they learned of these payments. They remonstrated with the deceased, and the deceased later told Andrew that he was annoyed with David and Jacky, and had told them that he could do what he pleased with his money. At about this time, Jacky had asked for some money for her daughter Amanda, to purchase a car, but the deceased told Jacky that he didn't have any spare money because he had lent money to Andrew's son Jason to purchase a first home, and because he had given Andrew some money to assist with the building costs.

[63]	Andrew said that this was the beginning of a falling out between the deceased and Jacky and David. He described an uncomfortable meeting he had with Jacky and David about this situation. Andrew made a note of the discussions, and produced a copy of the note with his April 2018 affidavit. The note referred to the "rift" between the deceased and David and Jacky, and their inability to talk openly to each other.

[64]	Andrew said that the deceased had income from pensions, and did not spend much on the Tairua property. There was also nice accommodation available at Andrew and Donna's property, which the deceased would use any time he wished. The Tairua bach owned by the deceased and Elizabeth's estate was a simple New Zealand bach, and it would have required more than the deceased could afford to bring it up to the same standard as the Cambridge house in which the deceased and Elizabeth had lived.

[65]	Andrew agreed that, soon after the death of the deceased, he and David went to the deceased's Tairua property to look for their late mother's will. They found that will, and also found the will the deceased had made in December 2008. He said that the deceased's bank statements were in a separate folder in the same cupboard. The bank statements, cheque butts, bank books and the like remained in the (locked) cupboard when  Andrew and David left the property. Andrew acknowledged that he

had the only key to the locked cupboard, but he denied removing the documents or interfering with them in any way.

[66]	Andrew accepted that David and Jacky confronted him with suggestions that there were numerous unexplained withdrawals from the deceased's accounts. He described the meeting as confrontational, with an implicit accusation that the unexplained withdrawals were for his benefit. Andrew said that he explained that he was not "in charge" of the deceased's accounts until he was appointed by his father as attorney in February 2015. He said that he told David and Jacky that he probably could explain some of the withdrawals, but could not explain all of them. He described Jacky and David as "hostile", and elected not to engage in further discussion.

[67]	Andrew described the deceased as generous to his grandchildren and to his children, including Andrew. The deceased assisted when he sensed a family member needed assistance, or when he felt he needed to contribute to some event. Andrew said that he would have said something to that effect at the time of his meetings with David and Jacky, and he attached a copy of an email from Jacky sent on 25 September 2017 in which Jacky referred to the deceased's contribution to expenses always coming from a genuine desire to recompense towards costs of his needs for travel to and from Cambridge, plus help to access his medical care. Jacky said that the deceased always wanted to assist where he could.

[68]	There was some difference between Andrew and David over the dates on which the meetings between Andrew and David and Jacky occurred. Andrew recalled the first meeting as being on 16 September 2017, at his house. The second meeting was on 17 September, when Andrew went to visit David and Jacky at David's house. Andrew's evidence is that all that he said was that Jason received $15,000 to assist him with the purchase of a house, as a loan, and that Andrew received payments as a gift to assist him with the building costs.

[69]	In his affidavit sworn in opposition to the summary judgment application, Andrew confirmed his position as set out in his affidavit sworn on 26 April 2018. Andrew referred again to the fact that the deceased and Elizabeth lived frugal lives and did not enjoy an extravagant lifestyle, but they were generous to the children. In

particular, after the death of Elizabeth the deceased was generous to Jacky, David, Andrew and their children. He was also generous to his friends' children, and would give them small cash presents at Christmas time. Also, the deceased wanted to pay his way, contribute to costs, and not be a financial burden.

[70]	In response to David's statement that the deceased told him he had given Andrew a loan of $35,000 "towards building costs", Andrew said that he never received a loan for $35,000. The only time he received $35,000 from the deceased was on the sale of the Cambridge unit. He did receive the three gifts totalling $31,000 in 2004, and if one included an additional $7,000 that Andrew received from the deceased in about 2003 to complete the purchase of a van, Andrew received gifts from the deceased to assist with his business in the total sum of $38,000. The deceased would not have used a figure of $35,000 in his 2004 discussion with David, as that was not the total of the amounts given by the deceased to Andrew. Nor would the deceased have referred to these payments as having been "lent". They were not loans (unlike the $15,000 the deceased lent to Jason to acquire a home in 2004).

[71]	Andrew gave further evidence about how he had assisted the deceased during his lifetime. This included taking the deceased to hospital when he needed hospital care.

[72]	In all, Andrew acknowledges having received gifts totalling $105,500 ($70,500 plus the $35,000 from the sale of the Cambridge unit).

Michael Radford

[73]	Mr Radford is a retired police officer now living in the United Kingdom. He formerly volunteered at the Tairua Police Station.

[74]	Mr Radford first met the deceased in April 2002, and thereafter he continued his association with the deceased through the Tairua RSA. The two men developed a friendship, and through that friendship Mr Radford met Andrew and David, and later Jacky and her partner.

[75]	Jacky and Graham purchased a restaurant in Tairua, and about that time, they moved in to live with the deceased. Mr Radford said that the deceased was "not enamoured by their presence".

[76]	Mr Radford said that the deceased took him to visit David at his home in Whenuakite, and Mr Radford visited Andrew's home with the deceased on many occasions. Mr Radford formed the impression that the deceased had an affinity with Andrew that was far stronger than his relationship with David. Andrew and Donna had also made a small apartment for the deceased to use as and when he needed it, although the deceased did not go there often: he loved his own house, and he was content to stay there on his own after Jacky and Graham left.

[77]	Mr Radford was involved when the deceased made a new will in 2008; in fact he prepared the will for the deceased.

[78]	As Mr Radford had returned to the United Kingdom, he later accepted a suggestion from Andrew's solicitor that he renounce his appointment as executor/trustee of the deceased's estate.

[79]	Mr Radford said that the deceased told him that he had had many arguments with David and Jacky about money. The deceased did not enjoy them telling him what to do with his own money.

[80]	The deceased also told Mr Radford that, after he had moved to Tairua, David drew up plans for extensive alterations to the Tairua property, all to be carried out at the deceased's expense. Mr Radford said that the deceased was not impressed with being asked to spend his money on these improvements when he was happy with the Tairua property as it was.

[81]	Mr Radford also described difficulties in the deceased's relationship with Jacky and Graham. He said that after Jacky left the Tairua restaurant, the deceased rarely saw her. And while David lived a few kilometres north of the deceased, David rarely called in to see the deceased when he passed through Tairua.

[82]	Mr Radford said that he saw the deceased at least once a week at RSA meetings, over a period of 10 years. Throughout that time, the deceased was adamant that, of the siblings, Andrew would be the only beneficiary after his death.

Evidence in reply

[83]	David provided an affidavit in reply.

[84]	He elected not to reply to Mr Radford's affidavit, which he considered did not relate to the matters in issue on the summary judgment application.

[85]	On the alleged statement by the deceased to David that the deceased had lent Andrew $35,000 for building costs (rather than the $31,000 gifts referred to by Andrew), David acknowledged the possibility that the deceased might have made a mistake over the amount. However, he confirmed that the deceased told him that the money he had given to Andrew for building costs, and the money he had given to Jason for his house deposit, were loans.

[86]	With reference to the issue over whether Andrew received $35,000 or $70,000 from the sale of the Cambridge unit, David rejected Andrew's recollection that the deceased had paid him the $35,000 by bank cheque. He produced a copy of a receipt from the ANZ Bank for the withdrawal of the sum of $35,000 from the deceased's bank account on 24 December 2002 (the day Andrew says he received the $35,000 from the deceased), and the receipt makes no reference to a bank cheque. David contrasted that with other receipts David and Jacky found for other payments to Andrew that had been made by bank cheque from the deceased's accounts. He said that Andrew could easily answer this issue by obtaining bank statements for the deceased's bank accounts for the relevant period in 2002, and by requesting a copy of the trust account ledger operated by the solicitors who acted on the sale of the Cambridge unit. David expressed concerns over Andrew's refusal to take those steps.

[87]	David said that he and Jacky rejected Andrew's offer to stand aside as executor because, in their view, an executor acting appropriately and in accordance with his or her duties would undertake an investigation of their allegations. In those circumstances, the costs of the executor would be paid by the estate. David noted that

the estate does have sufficient funds to pay for an independent executor to look into David and Jacky's allegations. He noted that Andrew has not attempted to answer his and Jacky's concerns over the further $192,000 identified by Ms Drane which Andrew was not himself able to explain.

Discussions and conclusions

[88]	I do not consider that this is a case that can be determined on a summary judgment application. There are conflicts of evidence on important matters of fact that will need to be addressed at trial, and on the evidence available at this stage I cannot be satisfied that Andrew has no defence to the claims to have him removed as executor and/or trustee.

[89]	The substantial issues appear to be as follows:

(i)	Were some of the amounts received by Andrew (or possibly members of his family) loans, rather than gifts?

(ii)	Has Andrew wrongly refused to investigate the concerns raised by David and Jacky?

[90]	If there are concerns on either of those issues, the ultimate question will be whether any conflict of interest or hostility between the parties risks prejudicing the interests of David and Jacky, as claimants in the Family Protection Act proceeding, or whether the conflict or hostility will undermine Andrew's ability to perform his duties as executor and trustee. Consideration of that question will then inform the issue of expediency under s 21 of the Administration Act — are the circumstances such that considerations of suitability, practicality and efficiency require Andrew's removal as administrator?

[91]	All of those are ultimate issues, and I am not required at this stage to find answers to them. The issue at this stage is only whether David and Jacky have sufficiently shown that Andrew has no arguable defence.

[92]	On the question of whether some of the amounts received by Andrew or his family may have been loans, rather than gifts, I do not consider that David and Jacky have produced sufficient evidence to justify the removal of Andrew on a summary basis.  David referred to a statement allegedly made by the deceased that he had lent
$35,000 to Andrew for the costs of building work, but there was no corresponding entry in the deceased's bank accounts recording any such payment, and Andrew denied receiving any such loan.   He did acknowledge receipt of three payments totalling
$31,000 for building costs, but said that they were gifts made to him by the deceased. It is not possible on a summary application such as this to determine whether those payments were loans or gifts.13

[93]	David and Jacky also suggest that Andrew may have received the deceased's
$35,000 share from the proceeds of sale of the Cambridge unit (in addition to Andrew's own share), but Andrew denies that. In my view the circumstance that Andrew says that he received his $35,000 direct from the deceased (while David and Jacky received their shares direct from the solicitors who acted in the sale of the Cambridge unit) does not sufficiently support any inference that Andrew received an additional $35,000 from the solicitors. And the suggestion that Andrew may also have received the deceased's share does not appear to be supported by Mr Radford, who said that the deceased told him, after he had sold the Cambridge unit and moved to Tairua, that he had split the proceeds of sale of the Cambridge unit equally between himself and his three children. At this stage the possibility that Andrew may have received an additional $35,000 from the sale of the Cambridge unit appears to be no more than speculation.

[94]	David and Jacky also raised an issue over a payment of $15,000 made by the deceased to Andrew's son Jason. As I understood the evidence, Andrew accepts that it was a loan, but he says that it was repaid in January 2006. Even if it was not repaid, I expect there would be a question as to whether, by the date of the deceased's death, an action to recover the money would have been out of time. Given that possibility, I

13 Although Andrew would appear to be entitled to  a presumption that the moneys  received were gifts — as Wylie J observed in NJG v SS, there is a presumption that money given to children by their parents is a gift, and not a loan, although that presumption can be rebutted by evidence showing that the money was intended to be repaid at some future time: NJG v SS [2013] NZHC 914 at [62].

do not consider this an issue that can be decided on a summary judgment application. Nor do I consider there is any sufficient basis in the evidence to infer that, because the
$15,000 paid to Jason was a loan, the various payments made to Andrew must also have been loans.

[95]	Turning to the question of Andrew's alleged failure to investigate the concerns raised by David and Jacky, I think these concerns need to be put into proper perspective. David and Jacky appear to be challenging all payments of amounts in excess of $1,000 made from the deceased's bank accounts since 1997, and I think it is at very least arguable for Andrew that his duties as executor and trustee would not extend to conducting such an investigation purely on the grounds that Jacky and David do not understand where the money went or why it was paid. That is especially so in circumstances where David and Jacky are apparently unwilling to fund the investigation (they contend that the estate should fund the investigation, but of course Andrew is the sole beneficiary in the estate and he considers that Jacky and David's proposal would effectively require him to fund their investigation, which he considers unnecessary).

[96]	David and Jacky rely heavily on the deceased's frugal nature, but the evidence shows that, while he may have been frugal as far as his own needs were concerned, he was also generous with family and friends. He clearly did make gifts to others when he thought it appropriate to do so.

[97]	Mr Radford's evidence also makes it clear that, although the deceased may have been elderly, he knew his own mind, and apparently did not appreciate family members telling him what he should or should not do with his money. The fact that when he made his will in 2008 he left everything to Andrew is also arguably consistent with payments made to Andrew during the deceased's lifetime being gifts rather than loans.

[98]	A further consideration is that, in many deceased estates, there are likely to be entries in the deceased's bank accounts going back 20 years which surviving family members cannot explain. In my view, it is at least arguable that the executor's duty would not extend in such circumstances to conducting extensive investigations going

back that far, simply because the deceased was known to be frugal as far as his own needs and wants were concerned. That would be especially so in circumstances where the deceased was known to have been generous in sharing what he had with others.

[99]	I think there would also be potential limitation issues with attempts to recover any loans the deceased may have made going back before the date which was six years before the deceased's death. If the payments made in fact turned out to be gifts, that would presumably be the end of the matter. If they turned out to be loans, the prospect of limitation defences would appear to be a significant consideration for the executor.

[100]	David and Jacky also suggest that the deceased was particularly vulnerable at certain times, including when he was ill and towards the end of his life. But I am not sure that that is consistent with Mr Radford's evidence, which painted a picture of the deceased as a strongly independent character. I do not think I can give any significant weight to the vulnerability allegation in a summary context such as this.

[101]	Nor am I persuaded that Andrew's apparent silence when David and Jacky first put their concerns to him is something to which I can give much weight on a summary judgment application such as this. Some people simply do not like confrontation, and may "withdraw" rather than strongly defend themselves. Whether Andrew is such a person I do not know, but the possibility that he might be is another factor pointing against resolving the claims on a summary basis. Nor is the question of alleged hostility between the parties easily addressed on a summary judgment application. The very nature of the claims make it inevitable that there will be some level of upset and suspicion between the parties, and the Court does need to be wary of the possibility of plaintiffs consciously or subconsciously exaggerating claims of hostility in situations such as this. I am not saying that that has occurred in the present case; I am merely saying that the issue is one better assessed at trial, where the judge can assess the parties' demeanour and decide whether any animosity between them has reached the level where the interests of the plaintiff are prejudiced, or it appears that the defendant's ability to perform his duties as executor and trustee has been undermined.

[102]	Whether or not there are matters concerned with the deceased's bank accounts which call for investigation, which might make it suitable, practical, and efficient to

remove Andrew as executor, are properly matters for consideration at trial, where all of the evidence will be before the Court. I am not persuaded that they are matters for determination on a summary judgment application.

[103]	Accordingly, the summary judgment application is dismissed. In accordance with usual practice where a plaintiff's summary judgment application has been dismissed, the costs on the application are reserved.

Associate Judge Smith