Trusts and Estates

Chris has advised and represented trustees, beneficiaries and creditors of trusts and estates. He has appeared in a number of High Court matters involving attacks on the legitimacy of trustees’ actions and the trusts themselves.

The High Court has exclusive jurisdiction to determine disputes involving the application of the Trustee Act and the Administration Act.  The Family Court can also determine some claims brought under the Family Protection Act against estates.   The incidence of claims relating to the obligations of trustees and executors as well as the rights of beneficiaries has grown and continues to do so.  New Zealanders have embraced the use of discretionary trusts not just for estate planning purposes.  The use of discretionary trusts for creditor protection purposes has caused an overlap with the application of insolvency, property and relationship property laws.

The Family Protection Act allows for particular classes of people to apply for provision or further provision out of the estate of a deceased person.  Applications can be made by the partner of the deceased; the children of the deceased; the grandchildren of the deceased living at the time of death; the stepchildren of the deceased who were being or ought to have been maintained by the deceased; and lastly, the parents of the deceased.

An applicant must show that the deceased breached the moral duty he/she was owed at the time of death.

In assessing the extent of the moral duty owed, the deceased’s wishes will be measured by the court against the standards of a “wise and just” person considering what would be adequate provision for the proper maintenance and support of eligible claimants.  The standard is an objective one and influenced by current social attitudes which may change from time to time.

The court will take into account all the circumstances before it.  It is no surprise that the case law reflects the variety of human relationships that exist.  One claim may simply reflect a need for recognition against the wider family who have been provided for – the “black sheep” cases.  On the other hand, an applicant may have a real need for support and maintenance but has not been provided for at all, or, inadequately.

The Court will only interfere with a will so much as necessary as to remedy any breach of moral duty found.  This reflects the fact that, all things being equal, people should be free to choose how their personal property is to be dealt with following their death – the Court’s role is a conservative one.

All family protection claims must be lodged within a strict time limit.  An administrator can start to distribute an estate in accordance with the will after 6 months unless he/she has received notice of an intention to claim against the estate.  Therefore, it is better to signal any family protection claim well before the six-month period.

Family protection claims are brought against the administrator of the estate as defendant.  But, in dealing with any claims, the administrator must act impartially towards all beneficiaries and potential beneficiaries; provide clear information to the Court and assist the Court where necessary.  It is not the job of the administrator to “take sides”.  An application can be made to the High Court to have him or her removed under the provisions of the Trustee Act if an administrator demonstrates less than an objective attitude.

As with general litigation, most family protection claims settle without the need for a hearing.  After sharing relevant information, it is quite usual for the claims to be settled by all related parties without the need for a Court hearing.  This highlights the importance of providing as full and as accurate information as one can in the proceedings so that the parties and their legal advisors can make a robust assessment of the likely result if the matter proceeded to Court.

Chris has acted for and assisted a number of administrators and family members in several family protection claims.