TO BE REMOVED

Evening Post, Volume CXXIV, Issue 59, 7 September 1937, Page 12

TO BE REMOVED

HUNTER TRUSTEES

COURT'S DECISION

WIN FOR PLAINTIFF

A decision that he would make an order removing Cyril Paul Hunter, of Akitio, and Thomas Percy Hunter, of Porangahau,. from the trusteeship of the estate of their uncle, the late Sir George Hunter, was announced by Mr. Justice Smith in his reserved judgment on the Hunter Estate case, delivered in the Supreme Court today.

Lady Hunter, the plaintiff, succeeded on all four of her causes of action against the defendants, the Hunter brothers, although on the first cause of action, relating to the management of the Porangahau sheep station, the Judge found a number of points in favour of the trustees.

The case occupied twenty-four and a half hearing days in June and July, and the judgment consisted of eightyfive typewritten pages.

Mr. J. D. Willis and Mr. R. R. Scott conducted the case for Lady Hunter, and Mr. C. H/Weston, K.C., and Mr. J. H. Dunn appeared for the Hunter brothers.

"The plaintiff seeks the removal of both defendants as the trustees of the will of her late husband, Sir George Hunter, and the vesting of the trust property in a new trustee or trustees," said his Honour. "She also seeks the removal of the defendant Cyril Hunter from his office as the executor of the will and the appointment of a new executor in his place. To these ends she attacks the administration of the estate. She complains (a) of the farming of the Porangah'au sheep station; (b) of the failure to claim a refund of £1166 13s 4d from the two defendants personally and from the estates of their father and brother; (c) of an improvident lease of the Dixon Street property, in the City of Wellington; and (d) of the arrangements made for the remuneration of the estate agent, Bethune and Hunter. She makes these complaints in the conviction that the estate would be much better administered by some independent person or corporation. . On the other hand, the defendants resist the plaintiff's attack in the conviction that this action constitutes an audacious attempt to oust them from the control of the estate. The 'issues raised are thorny and delicate. They have been exhaustively litigated and have included a review of Sir George's, own methods. The parties are hostile and their feelings have not been mollified by the results of previous litigation. ..." Sir George Hunter died in August, 1930, said the judgment. Cyril.Hunter administered the assets as executor until July 12, 1934, when by formal deed of that date he^showed that he regarded his executorship as completed and that he then held the assets as trustee for the beneficiaries; and he appointed his brother Percy to act jointly with him as trustee, and he vested the assets in both upon the trusts of the .will. Since July, 1934, both had held and .administered the assets as trustees upon the trusts of the will. His Honour dealt at length with the evidence and argument submitted. The findings of his judgment were partly in favour of the trustees.but slightly more against them concerning the numerous details of alleged mismanagement of the farm, and the judgment also went against the trustees on the remaining three causes of action. "STATE OF HOSTILITY." "I must find also," said his Honour, "as relevant to the present inquiry, that the life tenant and the trustees are in a state of hostility. They all seem to have reasonable prospects of long life, but there is no immediate prospect that the hostility will change to mutual respect and forbearance. "The facts ' which I have found cle_arly justify, in my opinion, an order for the removal of the defendants as trustees. There has been slackness in management, unnecessary loss, a failure to investigate a claim which particularly tested the capacity.of the defendants to act correctly when their ■interest conflicted with their duty, and there exists a state of hostility which prevents the life tenant from working harmoniously with the trustees. In my opinion, these grounds are amply sufficient. ... ' HONESTY OF TRUSTEES. "I desire to make it very clear," continued his Honour, "that I make no ■reflection whatever upon the honesty of the trustees. They have many ottter interests, and they have not been able, in my opinion, to-ensure,- on those matters on which I have found against them, the necessary standard of management which a reasonably prudent and circumspect man would have ensured when dealing with his own property. On the second cause of action they are so enmeshed in fiduciary relationships that it is not surprising that they have not taken; the steps'which an ordinary prudent and circumspect man, untrammelled by conflicting claims, would have taken in dealing with a claim of his own. I think that the state of hostility which exists between the parties has consciously influenced the trustees and Bethune and Hunter to take no risk whatever with their accounting, but it has not induced the trustees to take the steps which they, ought to have taken, as reasonably prudent and vigilant men, on the matters on which I have found against them.' In my judgment, therefore, the welfare of the beneficiaries and of the trust estate will be best secured by removing the defendants as trustees and appointing some independent person or persons or corporation in their place. :■..■:, ' * . ORDER DEFERRED. "Mr. Willis' has suggested that a New Zealand trustee company should be appointed. I see no reason why that should not be done, but the consent of the particular company will be required, arid the company may desire to satisfy itself in advance that the accounts are in order. Accordingly I defer the making of the order until the trustee' company proposed has appeared and consented' to undertake the trusteeship.". ' ; Mr. Justice Smith said he thought it expedient that the .executor, Cyril Hunter, should be removed, but before he made any order he thought the proposed trustee should intimate to the Court whether, in the present circumstances of the executorship, it consented to be appointed executor as well as trustee. To enable the proposed trustee to state to the Court its attitude both with regard to the trusteeship and the executorship, no orders were made immediately. The, action was adjourned sine die for further consideration, to be brought on at three days' : notice by either party. In the meantime costs were reserved.