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1 385 Aotea MB 20 IN THE MĀORI LAND COURT OF NEW ZEALAND AOTEA DISTRICT A UNDER Sections 239 and 244, Te Ture Whenua Māori Act 1993 IN THE MATTER OF Whitianga Papa Tupu Ora Ahu Whenua Trust NOVENA MCGUCKIN Applicant Hearing: 16 May 2018, 384 Aotea MB (Heard at Whanganui) Appearances: Novena McGuckin, Hayden Turoa, Paora Haitana, Geraldine Taurerewa in person Judgment: 6 June 2018 JUDGMENT OF JUDGE L R HARVEY Introduction [1] Novena McGuckin, a trustee of Whitianga Papa Tupu Ora Trust, applies to have Hayden Turoa and Norman Bradley Jnr appointed as replacement trustees. She has also made application to vary the trust order to amend the provisions regarding the quorum for meetings, number of trustees and the payment of trustee fees and expenses as well as changes to clause seven regarding notice of general meetings. [2] Geraldine Taurerewa, another current trustee, opposes the application to appoint Mr Turoa as she says he is not an owner. She supports the appointment of Norman Bradley Jnr. Ms Taurerewa is also concerned about the variations to the trust order and opposes that application. [3] Advice received by the trust from their solicitors, Kensington Swan, and the subsequent cancellation of their attendance at the recent general meeting has also been raised during the proceedings.
2 385 Aotea MB 21 [4] After the hearing, I confirmed that a decision addressing the applications would issue within two weeks. On 17 May 2018 Mr Turoa stated that he no longer wishes to be appointed. Mrs McGuckin also advised on 19 May 2018 that she is considering resigning and requested that the decision be deferred for two weeks. On 21 May 2018, I granted Mrs McGuckin s request to defer the decision. [5] Robert Cribb, a current trustee, has since filed a letter, on 30 May 2018, setting out his views on the matters before the Court. On reflection, I consider that there is no need to await any further submissions since the respective positions of the affected parties have been made clear. Issues [6] The issues for determination are: (a) Should replacement trustees be appointed? (b) Should the variations to the trust order be granted? Background [7] The Whitianga Papa Tupu Ora Trust was constituted on 29 June The trust administers several Māori freehold land blocks (the Whitianga blocks). The original responsible trustees were Paora Haitana, Eugene Topine, Robert Cribb, Anahera Hose, Nik Turanga, Raemoana Taiaroa, Dennis Herewini, also known as Dennis Roy Herewini, and Geraldine Taurerewa. Graham Bell and Teresa Brider were also appointed as advisory trustees. [8] The current trustees are Paora Haitana, Robert Cribb, Anahera Hose, Nik Turanga, Dennis Herewini, Geraldine Taurerewa, Gary Taiaroa and Novena McGuckin. 2 [9] Resignations have been filed by Paora Haitana, Anahera Hose, Nik Turanga, Gary Taiaroa and Dennis Herewini as responsible trustees and Graham Bell and Teresa Brider as advisory trustees Aotea MB (233 AOT ) Aotea MB (343 AOT )
3 385 Aotea MB 22 Novena McGuckin s submission [10] Mrs McGuckin states that at the annual general meeting held on 2 September 2017 Hayden Turoa and Norman Bradley Jnr were nominated as replacement trustees for those who have resigned. In addition, Mrs McGuckin says that at the hui those present approved several variations to the trust order aimed at reducing the quorum for meetings, reducing the number of responsible trustees and advisory trustees and the payment for travel or trustees costs in accordance with clause 3(viii) of the trust order. [11] Mrs McGuckin submits that the hui was properly notified in the Ruapehu Bulletin, Taumarunui Bulletin and in addition a notice was posted on Facebook. She says that there was a quorum present at the meeting and that minutes were provided. [12] Regarding advice sought from Kensington Swan, Mrs McGuckin submits that the decision not to require Kensington Swan s presence at the hui was made due to costs. Geraldine Taurerewa s submission [13] Geraldine Taurerewa objects to the appointment of Hayden Turoa as she says he is not a beneficiary of the trust. She does not object to Norman Bradley Jnr being appointed. [14] Ms Taurerewa opposes the variations to the trust order. She is concerned that the trustees did not have a meeting to validate the variations prior to those variations being put forward at the hui-a-tau. Ms Taurerewa says that she understood that the trustees had agreed to review the trust order alongside Kensington Swan before taking any proposed changes to the annual general meeting. She says that this did not occur and the arrangement to meet with Kensington Swan was cancelled without the prior knowledge of the Chairperson of the trust or herself. [15] In addition, Ms Taurerewa submits that a trust meeting should be convened to discuss the variations and to include a variation to provide that trustees must be owners in the land and nominees must be present at general meetings. [16] Ms Taurerewa has further concerns about the administration of the trust. She states that trustee meetings have been cancelled, the Chairperson has failed to attend on several occasions and payments have not been approved.
4 385 Aotea MB 23 Robert Cribb s submission [17] Mr Cribb submits that the trust has been operating well for the last nine years and he says he was gob-smacked when four trustees resigned. He believes those resignations have come about because the trustees have struggled with the behaviour of Mrs McGuckin and Gary Taiaroa. [18] Mr Cribb supports Ms Taurerewa s concern that the trustees had originally met to discuss the recommendations from Kensington Swan and had all agreed that Kensington Swan would attend the annual general meeting. He says he was floored to learn that Mrs McGuckin took it upon herself to cancel Kensington Swan s attendance. [19] Mr Cribb believes that the appointment of replacement trustees will only add fuel to the fire and is in favour of another general meeting being called to discuss matters afresh. The Law [20] Section 239 of Te Ture Whenua Māori Act 1993 states: 239 Addition, reduction, and replacement of trustees (1) The court may at any time, on application, in respect of any trust to which this Part applies, add to or reduce the number of trustees or replace 1 or more of the trustees. (2) The court may amend the court s records for a trust if a trustee dies and the court receives a death certificate for the deceased trustee. (3) In exercising the powers in subsections (1) and (2), the court may order the vesting of land or other assets of the trust in any person or persons (with the consent of that person or those persons) upon the terms of the trust, whether or not that person was previously a trustee. [21] Section 222(2) is also relevant: 222 Appointment of trustees (2) The court, in deciding whether to appoint any individual or body to be a trustee of a trust constituted under this Part, (a) shall have regard to the ability, experience, and knowledge of the individual or body; and (b) shall not appoint an individual or body unless it is satisfied that the appointment of that individual or body would be broadly acceptable to the beneficiaries.
5 385 Aotea MB 24 [22] The leading authority on the appointment of trustees is the Court of Appeal decision Clarke v Karaitiana. 3 The Court of Appeal has confirmed that in appointing a trustee, the Court is obliged to have regard to the ability, experience and knowledge of the individual concerned. In considering those issues, the Court will no doubt have regard to such matters as the nature and scale of the assets of the trust concerned and the issues the trust is facing. The importance of the views of the beneficial owners of the trust is underlined by s 222(2)(b) which prevents the Court from appointing a trustee unless it is satisfied that the appointment will be broadly acceptable to the beneficiaries. It is also important to note that the discretion of the Court is not broad and unfettered. It may consider such matters as it thinks fit but the exercise of its discretion will be primarily guided by s 222(2). 4 [23] The applicant also seeks to vary the trust order per s 244 of the Act: 244 Variation of trust (1) The trustees of a trust to which this Part applies may apply to the court to vary the trust. (2) The court may vary the trust by varying or replacing the order constituting the trust, or in any other manner the court considers appropriate. (3) The court may not exercise its powers under this section unless it is satisfied (a) that the beneficiaries of the trust have had sufficient notice of the application by the trustees to vary the trust and sufficient opportunity to discuss and consider it; and (b) that there is a sufficient degree of support for the variation among the beneficiaries. [24] Section 244 gives the Court discretion to vary the trust, however the Court must first be satisfied that the beneficiaries of the trust have had sufficient notice of the application and sufficient opportunity to discuss and consider it, and that there is a sufficient degree of support for the variation amongst the beneficiaries. Discussion Advice of Kensington Swan [25] As foreshadowed, there is a letter on the Court file from Kensington Swan, solicitors of Wellington, dated 10 October 2017, which provides some relevant background to the current proceedings. The solicitors stated that it was agreed during a teleconference with the trustees in 2017 that they would attend the annual general meeting to provide the 3 [2011] NZCA 154 at [51] 4 Ibid at [53]
6 385 Aotea MB 25 beneficiaries with an update on the 2015/2016 Māori Innovation Funding Project. It was also agreed that Kensington Swan would attend the trustees meeting before the annual general meeting and draft a report to present to the trustees hui and the annual general meeting. Discussion took place about how a report could be filed as part of an application to review the trust to ensure the Court is aware of the trustees progress regarding the funding project. [26] The solicitors also confirmed that Mrs McGuckin advised them on 31 August that their attendance was no longer required and this had been confirmed by Gary Taiaroa. Kensington Swan provided a report to the trustees to consider at a trustee meeting and table at the annual general meeting. That report was however not tabled. A separate report was presented which, contrary to Kensington Swan s wishes, contained the firm s logo when they had no input into that report. Kensington Swan also stated that they were unsure whether the annual general meeting notice contained details of the trust order amendments and did not know whether the notice contained sufficient details. [27] The solicitors also stated that, on the advice of Robert Cribb that as thirty three people attended the meeting there appears no problem with the quorum requirements of an annual general meeting. Even so, the solicitors record that the trustees failed to provide the financial accounts for the fiscal years ending 31 March 2015, 2016 and 2017 at the hui which is a breach of the trust order. Kensington Swan suggested that the trustees meet urgently to discuss their letter and that if the notice of the hui-a-tau was insufficient that a new meeting to be held which could also give the trustees an opportunity to update the beneficiaries on the funding project. Should replacement trustees be appointed? [28] As foreshadowed, Hayden Turoa and Victor Bradley Jnr were nominated as replacement trustee at the hui-a-tau held on 2 September Mr Turoa has confirmed his unavailability. So, the issue is whether Norman Bradley Jnr should be appointed. [29] The minutes of the hui-a-tau record that forty-eight people attended. The trust order provides for a quorum of thirty. I am satisfied that the quorum was met. On file is a copy of a notice placed in the Ruapehu and Taumarunui Bulletin of the meeting as well as Facebook post of the notice. The notice specifically states that there will be an election of trustees.
7 385 Aotea MB 26 [30] Ms Taurerewa argued that the notice was insufficient and complained that the hui was not advertised in the Whanganui Chronicle. I disagree. I am satisfied that the notice given was sufficient. In any event, Ms Taurerewa confirmed at the hearing that she does not oppose the appointment of Mr Bradley Jnr. No other objections have been received in respect to Mr Bradley s appointment. [31] I note Mr Cribb s concern that the addition of trustees may aggravate existing tensions. However, it appears that the underlying issue was that one of the proposed trustees, Mr Turoa, was not a beneficiary of the trust. I can see no reason why Mr Bradley should be denied appointment. Added to this is the fact that several of the trustees have now resigned. Mr Bradley s appointment will not disrupt the current operation of the trust and am also satisfied that it is broadly acceptable to the beneficiaries and that he has the necessary skills and abilities to be a trustee. [32] At the hearing Paora Haitana confirmed that he had resigned his position at the annual general meeting but now seeks to rescind that resignation. Mr Haitana said that at the time of his resignation he was very busy but says that has now changed and so he is available to remain a trustee. No objections were made to Mr Haitana continuing. I also record that Graham Bell and Teresa Brider have both resigned their positions as advisory trustees and orders reducing the advisory trustees will be made accordingly. Should the variations to the trust order be granted? [33] The applicant seeks the following variations to the trust order: (a) Clause 7(a)(iii) to provide that no general meeting shall be deemed to be constituted unless at least fifteen (15) beneficial owners be present at any time at a general meeting of owners; (b) Clause 7(e)(i) to provide that there will be no more than seven (7) Responsible Trustees; (c) Clause 7(e)(ii) to provide that there will be no more than three (3) Advisory Trustees;
8 385 Aotea MB 27 (d) Clause 7(e)(v) to provide that where there is no unanimous decision of Trustees at a meeting five (5) Trustees are required to vote together to achieve a majority decision; and (e) Clause 3(viii) to provide for the payment of trustee fees and reasonable expenses. [34] There was also a proposal that the trust order be varied to include more detailed provisions regarding notice of meetings of owners. However, this matter was not properly notified for the recent hui-a-tau and nor was it discussed. Accordingly, this proposed variation cannot proceed further at this time since it does not meet the tests set out in s244 of the Act. [35] The trust order currently provides for the appointment of up to three advisory trustees. So, there is no need to vary clause 7(e)(ii) of the trust order. The remaining variations, in effect, simply seek to reduce the existing thresholds around the number of trustees and the quorum for meetings. The proposed variation is also sought to align with more up to date clauses providing for the payment of fees and expenses. [36] Ms Taurerewa is concerned that the variations were not discussed at a trustee meeting prior to the hui-a-tau. She is also concerned that the advice of Kensington Swan was not considered as originally intended and agreed upon by the trustees. Even so, the public advertisements clearly state the proposed variations and the minutes record their discussion at the annual general meeting. I accept that the owners received prior notice of the variations. [37] At the hearing, much was made of the letter of advice from Kensington Swan. Even so, their main concerns were the notice, which they acknowledge they had not sighted, and the failure to provide accounts. The report that was to be provided at the hui-a-tau was to address a funding project. It was not specifically aimed at proposed variations which are the subject of this application. Moreover, any decisions regarding the funding project are reviewable by way of a review of trust, not the present application for variation. [38] The relevant considerations are the sufficiency of support for the proposed variations, notice and the opportunity to discuss the proposals. I am satisfied that this has occurred. Consequently, there is no reason why the variations should not be made. Regarding meeting fees, the following standard clause should also be adopted:
9 385 Aotea MB 28 The Trustees are entitled to be reimbursed for Trustee s legitimate expenses and disbursements in acting as a Trustee which includes their reasonable travel and accommodation expenses in attending trustee meetings, General and Special Meetings, and in attending other meetings to transact the business of the Trust. [39] Ms Taurerewa expressed concern that the variations did not include a provision that only owners can be trustees and must be present at the hui. There is no evidence of support for this variation. It will need to be properly discussed at a general meeting of owners. In addition, the owners may wish to discuss whether such a prohibition is in the best interests of the trust. Mr Turoa struck me as an individual of some ability with relevant skills that would likely assist the trust in achieving its objectives. It is one thing to belong to another tribe without connection to the land. But it is quite another to belong to the land through whakapapa. [40] A requirement that nominees must be owners and must attend a general meeting for nomination do not appear to be necessities but ultimately ought to be a matter for consideration by the owners. Given the difficulties many trusts face in attracting suitable nominees for these onerous roles, the idea of restricting appointments to owners and therefore excluding uri who whakapapa to the land has an inherent artificiality to it, and may ultimately prove counterproductive to the interests of the trust and the owners. In the end, however, that remains a matter for the owners to decide. [41] Similarly, while Mrs McGuckin may have a certain directness in her approach to the role, given her previous experience over many years with the Māori Trustee, it would also seem self-evident that she too possesses many of the skills required to discharge the office of trustee successfully. Unless evidence exists that confirms her unsuitability to remain as a trustee, which is a high threshold to attain, I see no reason for her to vacate the position. Moreover, I am aware that Mr Cribb is also an experienced trustee who should be able to ensure that the views of all trustees are properly expressed and considered during their deliberations. If it will assist the trustees to seek directions from time to time then they should avail themselves of that opportunity. [42] One final point. It is important that the trust continues to hold its meetings on a regular basis as and when the need arises. It is also essential that general meetings are held annually, ideally, so that the owners and the trustees can meet to discuss issues of common interest, present proposals for consideration and provide useful feedback to the trustees. Therefore, I direct the trustees to ensure that the next general meeting of owners is held on or before 30 September 2018.
10 385 Aotea MB 29 Decision [43] Norman Bradley Jnr is appointed as replacement trustee for Anahera Hose, Nik Turanga and Dennis Herewini who have resigned. The land and assets of the trust are vested in Norman Bradley Jnr, Paora Haitana, Robert Cribb, Novena McGuckin and Geraldine Taurerewa as responsible trustees. [44] The number of advisory trustees is reduced by two as Graham Evans Bell and Teresa Lulu Brider have resigned. There are no remaining advisory trustees. [45] The trust order is varied as set out in the application, with the exception of the proposed changes concerning notice for general meetings of owners. [46] There will be no order as to costs. [47] Leave is reserved for any party to seek directions at any time. Pronounced at 4.45pm in Hastings on Wednesday this 6 th day of June 2018 L R Harvey JUDGE
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