Larkins v Kaitaia – Waihou Hutoia D2A Block
[2013] 2013 Maori Appellate Court MB 159 (2013 APPEAL 159)
9 April 2013
Appeal allowed. The lower Court failed to take into account relevant considerations and had incorrectly held that there must be unanimous consent to an application for partial termination of a trust.
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Overview and result
| Trusts – partial termination - lower Court did not have regard to relevant considerations |
| Date | 9 April 2013 |
| Case | Larkins v Kaitaia – Waihou Hutoia D2A Block (851 KB PDF) |
| Citation | [2013] 2013 Maori Appellate Court MB 159 (2013 APPEAL 159) |
| Court | Māori Appellate Court |
| Judge(s) | Deputy Chief Judge Fox, Judges Harvey and Reeves |
| Earlier/later decisions | 6 Taitokerau MB 139 (6 TTK 139); Larkins v Hurae and Ngawaiata Whānau Trust - Waihou Hutoia D2A (2015) 94 Taitokerau MB 120 (94 TTK 120) |
| Legislation cited | Te Ture Whenua Māori Act 1993 ss 2, 17, 241 |
| Cases cited | Rata – Te Rongoa A7 (1991) 13 Aotea Appellate MB 228 (13 WGAP 228); Morgan - Tautuku Block XIII and s 13 (1998) 83 South Island MB 90 (83 SI 90); Lake v Taylor- Ngārara West B3B (2003) 134 Aotea MB 20 (134 AOT 20) |
| Overview and result | Appeal allowed. The lower Court failed to take into account relevant considerations and had incorrectly held that there must be unanimous consent to an application for partial termination of trust. The Appellate Court laid out considerations that must be given regard to when considering an application for partial termination and the lower Court was directed to conduct a rehearing. |
Background
Moa Larkins applied for a partial termination of the Hurae and Ngawaitata Whānau Trust so that he could gift the interests he had vested in the trust to his children. The application was opposed by the trustees and other beneficiaries. They contended that the interests should remain for the benefit of the whole whānau and that Mr Larkins had not provided any reasonable grounds for the application other than simply changing his mind.
The application was dismissed as Mr Larkins had failed to attract the consent of all affected parties and, further, the Judge was concerned that other whānau members would have likely been influenced by Mr Larkin’s decision to vest his shares and thus a partial termination may “sour the aroha of their vesting”.
Discussion
Dealing with the lower Court's point that unanimous support is required for a partial termination, the Court considered that “while Parliament has provided for the Māori Land Court to ascertain the wishes of the owners, and in certain circumstances it has required that it assess sufficiency of support or it has imposed a specific percentage of ownership support, it has never required unanimous support”. Further, “Nothing in the Preamble, s 2 or s 17 changes that position. Accordingly, it would be inconsistent with the legislative scheme to find otherwise. Thus there can be no requirement for unanimous owner or beneficiary support for the termination of a trust under s 241” (at [22]).
After considering relevant authorities, the Court found that three important considerations emerge in relation to an application for partial termination of a trust: (at [27])
(a) A change of mind is usually insufficient as a ground for termination unless there is an absence of opposition;
(b) Termination should be refused where it is likely to result in detriment or create unreasonable disadvantage to affected parties; and
(c) Evidence of a trust failing to adhere to the terms of trust and core accountabilities may be sufficient grounds for termination.
The Court considered there was nothing in the Māori Land Court record to indicate the Judge turned his mind to these factors. He had therefore failed to take into account relevant considerations. Further, while the view of those affected is important, it is also important to consider the impact of the application on them. Here there would be no material detriment to any other party. The Court also noted that the Judge’s findings about future relations between Mr Larkins and his siblings, the ongoing viability of the trust, and the risk of souring the “aroha” of the original gift and intention were made without sufficient evidence.
Result
Appeal allowed. The lower Court was directed to conduct a rehearing and consider: (at [30])
(a) the Preamble, s 2, and other matters listed in s 17, including the extent to which partial termination achieves better retention, use, development and control of the land in accordance with the fundamental principles and purposes of the legislation;
(b) the purposes of the whānau trust;
(c) the extent of beneficiary and trustee consent;
(d) the impact of any termination on the remaining beneficiaries and the trust; and
(e) any evidence of dysfunction by the whānau trustees to justify the Māori Land Court’s intervention.
