IN THE HIGH COURT OF NEW ZEALAND TIMARU REGISTRY

I TE KŌTI MATUA O AOTEAROA TE TIHI-O-MARU ROHE	
CIV-2020-476-000027
[2020] NZHC 2910	

UNDER	the Trustee Act 1956	
IN THE MATTER	of an application for a vesting order	
BETWEEN	DAVID ROBERT SHAW and STUART
JOHN SHAW as trustees in the Estate of Myra Loraine Shaw
Applicants	
AND	DERRICK HENRY SHAW
Respondent	

Hearing:	Determined on the papers	
Counsel:	S J Jamieson and G A Ryan for Applicants	
Judgment:	5 November 2020	

JUDGMENT OF ASSOCIATE JUDGE PAULSEN

This judgment was delivered by me on 5 November 2020 at 11.00 am pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

SHAW v SHAW [2020] NZHC 2910 [5 November 2020]

Introduction

[1]	This case concerns the Estate of Myra Loraine Shaw (Myra) who died at Ashburton on 15 June 2017.

[2]	Myra was married to Derrick Henry Shaw (Derrick). Together Myra and Derrick owned a property at 35 Glassey Drive, Ashburton as tenants in common in equal shares.

[3]	Myra died leaving a last will dated 10 September 2013. Probate of the will was granted to Derrick and the applicants on 10 July 2017. The applicants are Myra’s and Derrick’s sons.

[4]	The assets of Myra’s Estate have been distributed with the exception of a one- half share in the property at 35 Glassey Drive, Ashburton.

[5]	Under the terms of Myra’s will, Derrick has a life interest in the Estate’s one- half share of 35 Glassey Drive whilst he enjoyed the use and occupation of the property. Derrick has vacated the property on a permanent basis and his entitlement has terminated. Under Myra’s will the Estate’s one-half share of 35 Glassey Drive is now held on trust for the applicants.

[6]	Derrick has resided at the Tuarangi Home, Ashburton since March 2020. He does not enjoy good health and suffers from Alzheimer’s Disease. He lacks mental capacity and is incapable of managing his own affairs as his Alzheimer’s Disease has significantly impaired his comprehension and judgement. Derrick granted an Enduring Power of Attorney in relation to his property under the Protection of Personal and Property Rights Act 1988 in favour of the applicant David Robert Shaw (David) which I understand has been activated.

[7]	The applicants wish to sell the Glassey Drive property. Derrick is not in a position to sign the required sale and transfer documents as a result of his disability. David is able to sign such documents on Derrick’s behalf in respect of Derrick’s one- half share in the property. However, in respect to the Estate’s interest, the applicants

seek the assistance of the Court to remove Derrick as a trustee and vest the land in them as the continuing trustees of Myra’s will.

The application

[8]	The applicants are applying for the following orders:

(a)	that this proceeding be commenced by originating application under Part 19 of the High Court Rules 2016;

(b)	the Court dispense with the appointment of a litigation guardian in respect of Derrick;

(c)	that service of the proceeding on Derrick be dispensed with;

(d)	that Derrick be removed as a trustee of Myra’s will; and

(e)	that the Estate’s interest in a one-half share in the Glassey Drive property (Record of Title identifier CB18A/868 (Canterbury Land Registry being Lot 9 Deposited Plan 40099) vest in the applicants as the continuing trustees of Myra’s wills.

Discussion

[9]	This proceeding cannot be commenced by way of originating application as of right,1 but the Court may allow that when it is in the interests of justice. 2 Such permission may be sought without notice.3 It is appropriate that leave be granted in this case. This is a straightforward uncontested application. There is effectively no opposing party to the application and no need for particularised pleadings or interlocutory applications. Leave to bring the proceeding under Part 19 is granted.

[10]	I dispense with service of the proceeding. The only persons with an interest in the Glassey Drive property under the will are the applicants. Most importantly, this

1	High Court Rules 2016, rr 19.2 – 19.4.
2	Rule 19.5(1).
3	Rule 19.5(2)

application does not affect the substantive rights or interests of Derrick or any other person under the will.

[11]	I dispense with the appointment of a litigation  guardian for Derrick under     r 4.30 High Court Rules 2016. Once it is accepted that Derrick lacks capacity it is appropriate that he be removed as a trustee and it follows, also as a matter of course, that any trust property should vest in the continuing trustees. I cannot see that the appointment of a litigation guardian would serve any purpose in this case.

[12]	The Court has the power to remove and appoint a new trustee either in substitution for or in addition to an existing trustee under s 51 of the Trustee Act 1956. In this case there is no intention to replace Derrick as a trustee.

[13]	In Robertson v Robertson, Associate Judge Lester said in similar circumstances: 4

[19]	Under s 51 of the Act, the court may appoint a new trustee either in substitution for or in addition to an existing trustee. However, here because no replacement trustee is sought, the s 51 jurisdiction cannot be invoked. However, s 51 co-exists with the court’s inherent jurisdiction to remove and appoint trustees. The court has “an inherent supervisory jurisdiction to ensure that the terms of a trust are carried out. The jurisdiction exists in parallel with the court’s statutory power under s 51 of the Act to appoint new trustees and derives from the court’s powers in equity to supervise Trusts for the welfare of beneficiaries.

[20]	This inherent jurisdiction permits the court to make an order removing trustees where that step is necessary in order to protect the interests of the beneficiaries.

[21]	Given Annie’s lack of capacity, there is no point her remaining as trustee and the remaining trustees having to invoke the majority provision whenever they wish to make a decision.

[22]	I am satisfied it is in the best interests of the Trust to remove Annie as a trustee and there is an order accordingly.

[14]	Derrick no longer has capacity to act as a trustee. It is in the interests of the beneficiaries to remove Derrick as trustee so that the Glassey Drive property can be dealt with. This is an appropriate case for the Court to remove Derrick as a trustee. I

4	Robertson v Robertson [2020] NZHC 2659 (footnotes omitted).

follow the same approach as Associate Judge Lester in Robertson in doing so, relying on the Court’s inherent jurisdiction.

[15]	Section 52(1)(b)(i) of the Trustee Act provides the Court with the power to vest land in such persons that it may direct where a trustee entitled to or possessed of any land or interest therein, either solely or jointly with any other person, is under a disability. Once it is accepted that Derrick is to be removed as a trustee it must follow that the remaining trustees must be enabled to deal with the Trust assets in accordance with their duties. I am therefore satisfied that the vesting order sought should be made.

Orders

[16]	I make the following orders:

(a)	This proceeding may be commenced by originating application under Part 19 High Court Rules 2016.

(b)	Service of the proceeding on Derrick Henry Shaw is dispensed with.

(c)	I dispense with the appointment of a litigation guardian for Derrick Henry Shaw.

(d)	Derrick Henry Shaw is removed as a trustee of the Estate of Myra Loraine Shaw.

(e)	The interest of Derrick Henry Shaw, David Robert Shaw and Stuart John Shaw as the trustees of the Estate of Myra Loraine Shaw as to a half share in the property at 35 Glassey Drive, Ashburton (Record of Title identifier CB18A/868 (Canterbury Land Registry) being Lot 9 Deposited Plan 40099) vests in David Robert Shaw and Stuart John Shaw as the continuing trustees of the will of Myra Loraine Shaw.

[17]	No costs on this application were sought or were granted.

[18]	I reserve leave to apply for any directions required to give effect to this judgment.

[19]	I note that I have amended the intituling of this proceeding to comply with the requirements of the Rules.

O G Paulsen Associate Judge

Solicitors:
Tavendale and Partners, Christchurch