IN THE MAORI LAND COURT OF NEW ZEALAND TAIRAWHITI DISTRICT 10 TAIRAWHITI MB 137 (10 TRW 137) A

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1 IN THE MAORI LAND COURT OF NEW ZEALAND TAIRAWHITI DISTRICT UNDER IN THE MATTER OF BETWEEN AND 10 TAIRAWHITI MB 137 (10 TRW 137) A Sections 238 and 244, Te Ture Whenua Maori Act 1993 Te Rimu Trust REG AKUHATA RANGIHUNA AND WIREMU AKUHATA EVANS Applicants THE TRUSTEES OF THE TE RIMU TRUST Respondents Hearing: 2 November 2009 (90 Rua 4-13)(Heard at Ruatoria) 5 February 2010 (4 TRW 7-44)(Heard at Gisborne) 3 June 2010 (6 TRW 81-82)(Heard at Gisborne) 5 July 2010 (7 TRW )(Heard at Ruatoria) Appearances: Linda Thornton - Counsel for the Applicants Dr John Bunbury - Counsel for the Respondents Judgment: 23 November 2010 RESERVED DECISION OF DEPUTY CHIEF JUDGE C L FOX Introduction [1] Ostensibly this is a case about how the Te Rimu Trust has been managed but there are deep issues underpinning it concerning the economic and housing needs of whanau and hapu owners and how they should be accommodated in the day to day operations of the Trust. RANGIHUNA V THE TRUSTEES OF THE TE RIMU TRUST MLC A November 2010

2 Applications [2] There are three applications before the Court concerning Te Rimu Trust. The first application was brought by Reg Akuhata Rangihuna and Wiremu Evans pursuant to s 238 of Te Ture Whenua Maori Act 1993 to enforce the obligations of the Te Rimu Trust. The second application is for the appointment of trustees. The third application was made by the current trustees of Te Rimu Trust to vary the Trust Order under s 244 of Te Ture Whenua Maori Act Te Rimu Trust [3] Te Rimu Trust is an ahu whenua trust that was constituted over Tokata A14 and other blocks on the 3 February 1994 at 38 Ruatoria MB The total area of the blocks is hectares and there are 268 owners. [4] The original trustees were Leroy Evans, Hori Evans, Miki Clarke, Thomas Akuhata, Richard Clarke, Joseph Akuhata-Brown and Trevor Evans. On 14 February 1997 at 46 Ruatoria MB 225 the trustees were replaced and Wahiao Gray was appointed as an independent trustee. [5] On 19 December 1997, the Court appointed Richard Clarke and Richard Coates as responsible trustees for one year in place of Wahiao Gray. 1 Five advisory trustees were also appointed. Those trustees being Robert Kaa, Wiremu Evans, Poihipi (Busby) Akuhata, Pius Hepi and Alberta Evans. [6] The Court confirmed the appointment of the two responsible trustees on 16 February On 5 April 2007, the Court appointed Robert Akuhata to act alongside Richard Clarke and Richard Coates as a responsible trustee. 3 The Court also reduced the number of advisory trustees to three. The three advisory trustees remaining were Pohipi (Busby) Akuhata, Wiremu Evans and John Akuhata-Brown Ruatoria MB 30 (50 RUA 30) 2 57 Ruatoria MB 11 (57 RUA 11) Gisborne MB 133 (171 GIS 133) 10 Tairawhiti MB 138

3 Procedural History [7] On 2 November 2009, a conference was held pursuant to section 67 of the 1993 Act. 4 The conference was held in order to determine the legal issues that would go to hearing, to resolve any issues and to determine whether there were any issues which were outside the Court s jurisdiction. An application for discovery was also discussed. [8] Counsel for the trustees informed the Court, that they would be seeking to make an application to vary the Trust Order to accommodate the lease. Timetabling directions were given for the filing of briefs of evidence. Discussion was held regarding an AGM to be held in December and the issues to be raised at that meeting. [9] On 5 February 2010, the Court heard the applications. 5 Reg Akuhata Rangihuna gave evidence on that day and submissions were made. There was a lengthy discussion about the voting process adopted at the 2009 AGM of the Te Rimu Trust. Issues concerning alleged conflicts of interest and leases were also discussed. The hearing was adjourned to a later date and for the filing of further briefs of evidence. [10] For various reasons the scheduled hearing set for 3 June 2010 was adjourned. 6 On 18 June 2010, a further conference was needed to determine timetabling matters and the issues to be heard at the next hearing. 7 [11] On 5 July 2010, the hearing was finally held. 8 Evidence was given by Wiremu Evans, Poihipi Akuhata, Trevor Evans, Te Rohaparae Ratapu. The Court also heard submissions of counsel and evidence for the trustees. Finally, Wiremu Evans gave evidence in reply. [12] Issues relating to housing, kaumatua grants, the voting process at the AGM and a lease were all discussed Ruatoria MB 4 (90 RUA 4) 5 4 Tairawhiti MB 7 (4 TRW 7) 6 6 Tairawhiti MB 199 (6 TRW 199) 7 6 Tairawhiti MB 199 (6 TRW 199) 8 7 Tairawhiti MB 244 (7 TRW 244) 10 Tairawhiti MB 139

4 [13] After hearing from all parties, I reserved my decision but the file was only referred to me on 5 October 2010 by the case manager. Due to this delay, the determination of the issues before this Court has also been delayed. The Relief Sought by the Applicant [14] I note that the applicants seek the following from this Court: 1. The appointment of the two trustees that were elected by individual votes at the 2009 election and the replacement of Richard Coates by Wiremu Evans; 2. To decline the application to vary the Trust Order of the Trust; 3. To direct the trustees to commence compliance with paragraph 3-8 of the Trust Order to investigate and begin the implementation of the housing development provisions therein set out; 4. To direct the trustees to minimise the Trust s liability to third parties by ceasing the use of the land not belonging to the Trust and without the authority of the owners; 5. To establish a policy for making kaumatua and other grants and comply with it, or in the alternative, cease making adhoc grants at AGMs; 6. To direct the trustees to continue to utilise one-man, one vote unless and until change is made following full consultation with beneficiaries and to recognise legitimate voting trusts, and to change this process only upon order of the Court; and 7. To allow access to Maori graves on Trust land to whanau members. 10 Tairawhiti MB 140

5 Relevant Law [15] I begin my analysis of the law by noting that the Maori Land Court has all the powers of the High Court either under its inherent jurisdiction or pursuant to the Trustee Act In cases concerning the enforcement of obligations of the trust, this Court usually refers to the provisions of that statute and Te Ture Whenua Maori Act 1993 to ascertain whether the trustees have complied with their duties and obligations. Those general duties include: A duty to acquaint themselves with the terms of trust; A duty to adhere rigidly to the terms of trust; A duty to transfer property only to beneficiaries or to the objects of a power of appointment or to persons authorised under a trust order or the general law to receive property such as a custodian trustee; A duty to act fairly by all beneficiaries; A duty of trustees to invest the trust funds in accordance with the trust instrument or as the law provides; A duty to keep and render accounts and provide information; A duty of diligence and prudence as an ordinary prudent person of business would exercise and conduct in that business if it were his or her own; A duty not to delegate his or her powers not even to co-trustees; and A duty not to make a profit for themselves out of the trust property or out of the office of trust. 9 9 Garrow and Kelly Law of Trusts and Trustees (Sixth Edition), pp inclusive 10 Tairawhiti MB 141

6 Issues [16] In order to ascertain whether the trustees in this case have exercised their duties in accordance with their obligations under law and with their duties as listed above, I will discuss each issue identified by the parties. These are listed below and in summary are: 1. The number of trustees; 2. The voting process undertaken at the 2009 AGM; 3. The criteria for kaumatua grants; 4. Variation of Trust - Lease with Marphona Farms; 5. Housing development; 6. The Employment of a Trustee to be the Trust Accountant; 7. Burial grounds; and 8. Variation of the Trust Order. Issue 1 - The Number of Trustees [17] Both parties agreed that the number of trustees should be increased from 3 to 5. This number of 5 is in fact a requirement under Clause 13(a) of the Trust Order. The election held during the 2009 AGM was held to nominate 2 additional trustees, but the parties disagree over who those trustees should be. 10 Tairawhiti MB 142

7 Issue 2 - The Voting Process Undertaken at the 2009 AGM [18] I note that the applicants were represented by Ms Thornton. The applicants had supporters, but Ms Thornton s role was limited to representing Mr Reg Akuhata Rangihuna and Mr Wiremu Evans. Ms Thornton, submitted that the voting process undertaken at the 2009 AGM was flawed. She argued that traditionally the beneficiaries have always voted on a show of hands basis and that the trustees changed the process without notice to the beneficiaries. Rather the trustees opted for a secret ballot in order to obtain a result in the trustees favour. [19] Counsel submitted that any change in the voting process should have been discussed at wananga before the AGM in line with earlier comments and directions issued by the Court. The issue of proxy votes was also not discussed. The applicants and their supporters complain that beneficiaries, as defined in the Trust Order, were excluded from voting contrary to past practise. It was contended that these alleged unilateral changes were designed to achieve the election result sought by the incumbent trustees. [20] Counsel for the trustees, Dr Bunbury, submitted in response that the issue for the Court to determine is how to calculate the votes from the 2009 AGM. The trustees decided that only people on the list of owners could vote. However, people who were not on the list of owners also voted. It was counsel s submission that being a potential beneficiary under the Trust Order is not a basis which entitles you to vote. [21] Dr Bunbury also contended that there was an issue concerning how to count the proxy votes represented at the meeting. However, those votes do not change the overall outcome. In other cases, the administrators voted but had no idea if they had authority to do so. [22] He noted that there were some issues concerning the manner in which kaitiaki trustee votes were cast. Those votes created a major distortion, as 26 votes were cast but in reality they added up to only a small shareholding. Counsel asked the Court to note that the final result varied depending on whether the kaitiaki votes are counted. These kaitiaki trustee votes represent 1/25 th or a 1% interest in the trust. He pointed out that 10 Tairawhiti MB 143

8 Judge Harvey commented on the matter in 2007 to the effect that it s technically correct to count the votes but the Court does not have to follow the vote. [23] Dr Bunbury s final submission was that the law is clear and it favours, one person one vote. Thus, he argued, it seems improper that one person can have 26 votes even if technically correct. [24] Votes on all matters at the AGM followed the process by show of hands. 10 The voting during the election was merely recorded differently to ensure a record for the benefit of the Court. Discussion, Direction and Order [25] The issue of the relevance of voting at an AGM of a trust has been considered in the Maori Appellate Court in a number of cases under Te Ture Whenua Maori Act These include Parish of Katikati (1995) 11 and Wall v The Maori Land Court - Tauhara Middle 15 Trust and Tauhara Middle 4A2A Trust (2010). 12 In the latter case, the Maori Appellate Court stated: The outcome of any meeting of owners is not binding on the Court: Short & Ors v Mitchell Pukeroa Oruawhata Trust (2006) 11 Waiariki Appellate MB 66 (11 AP 66). Voting in this context is simply a device for making the views and strength of those views known to the Court: Hemi v The Proprietors of Mangakino Township Inc Pouakani No 2 (1999) 73 Taupō MB 30 (73 TPO 30). [49] Taking into account s 222, the Court has a wide discretion as to whom to appoint: Thomson & Ors v Newton & Ors Pokuru 1A1B2 (1997) 19 Waikato-Maniapoto Appellate MB 66 (19 APWM 66). [26] Thus the law is clear that the Maori Land Court has a discretion whether to appoint persons voted at an AGM as trustees. In determining whether to do so, the Court can and should look at the conduct of the meeting where the election took place. In this regard the discussion on voting by show of hands or by proxies in the Tauhara 10 See In Re Whakapaupakihi 139 Gis 260 where the one man and one vote rule was followed 11 (1995) 18 Waikato Maniapoto Appellate MB 262 (18 APWM 262) 12 (2010) 2010 Maori Appellate Court MB 55 (2010 APPEAL 55) 10 Tairawhiti MB 144

9 Middle 4A2A Trust (2010) case is instructive and adopted for this case. It is reproduced below:... At common law a vote on a show of hands means that each person present and entitled to vote, has one vote and only one vote and those that wish to vote do so by show of hands: Ernest v Loma Gold Mines [1897] 1 Ch 1. Under this method the voting does not take into account variations and sizes of shareholdings or other entitlements, nor the presence of representatives of absent persons entitled to vote. A proxy cannot vote on a show of hands unless the rules or articles, or relevant statute expressly provides otherwise. However, even when rules permit a proxy to vote on a show of hands, a member who holds a proxy for another member may exercise only one vote on a show of hands. This is on the same principle that the person exercising a vote on a show of hands must be personally present and can exercise only one vote: Horsley s Meetings Procedure, Law & Practice (4th ed) Butterworths, paragraph 14.12; A proxy is a person who is a lawfully constituted agent of another person: re English, Scottish & Australian Bank [1893] 3 Ch 385. The appointment of a proxy may be effected by a power of attorney instead of by a proxy instrument. The term power of attorney is used in two ways: i) An authority which one person confers on another person with power to act in his or her name; ii) The formal document, that is the legal instrument by which that authority is conferred. At common law there is no right to appoint another person to vote by proxy: Harben v Phillips [1883] 23 Ch 14. Therefore in order that such a right is available, the rules of the body or a relevant statute need to contain an express provision which gives members a right to appoint proxies to act for them at meetings and vote on their behalf and to set out the specific requirements regarding proxies (Horsley paragraphs and 16.2); d) A poll by its nature has two main characteristics: i) Votes are cast in writing; and ii) The reasons for a poll being demanded are to enable votes to be cast in proportion to varying voting power (for example according to the number of shares held in a company), on behalf of absent members who have appointed proxies and by absent members presenting themselves and voting where the poll is held at a date later 10 Tairawhiti MB 145

10 than the meeting at which it was demanded (Horsley, paragraph 14.6); At common law any voter has a right to demand a poll unless rules which apply to the meeting specifically exclude that right: Campbell v Maund (1836) 5 AD & E 864. The right to demand a poll exists by the common law and those entitled to vote cannot be deprived of this right except by express provision: R v Wimbledon Local Board (1882) 8 QB 459 (Horsley, paragraph 15.2); It is usual that a vote by show of hands is taken before a poll is demanded. However, unless rules provide otherwise it is not essential that a demand for a poll should await a vote by show of hands. A poll may be demanded prior to a vote being taken by show of hands: Holmes v Keyes [1958] 1 Ch 670 (Horsley, paragraph 15.3); A proxy may not demand or join in demanding a poll unless expressly permitted to do so in the rules: In re Haven Gold Mining Co (1882) 20 Ch 151 (Horsley, paragraph 15.2); Members desiring to vote on a poll must attend personally, or by proxy, where the rules provide for proxies: McMillan v Leroi Mining Co [1906] 1 Ch 331 (Horsley, paragraph 15.9); When a poll is properly demanded the earlier vote by show of hands is superseded. The decision of the meeting will depend entirely on the result of the poll: Anthony v Seger (1789) 1 HAG CON 13 (Horsley, paragraph 15.4); On a poll, the number of votes recorded by each voter depends on the number to which that person is entitled under the rules of the body. For instance, such an entitlement may be one vote for each member or one vote for each share held (Horsley, paragraphs 14.6 and 15.1). [27] As can be seen above, the general rule is that there should be one person, one vote. But Te Ture Whenua Maori Act 1993 in the Preamble, sections 2 and 17, also require that this Court take into account a range of factors when exercising its powers, duties and discretions. Under section 17 these factors include: 17 General objectives (1) In exercising its jurisdiction and powers under this Act, the primary objective of the Court shall be to promote and assist in (a) The retention of Maori land and General land owned by Maori in the hands of the owners; and (b) The effective use, management, and development, by or on behalf of the owners, of Maori land and General land owned by Maori. 10 Tairawhiti MB 146

11 (2) In applying subsection (1) of this section, the Court shall seek to achieve the following further objectives: (a) To ascertain and give effect to the wishes of the owners of any land to which the proceedings relate: (b) To provide a means whereby the owners may be kept informed of any proposals relating to any land, and a forum in which the owners might discuss any such proposal: (c) To determine or facilitate the settlement of disputes and other matters among the owners of any land: (d) To protect minority interests in any land against an oppressive majority, and to protect majority interests in the land against an unreasonable minority: (e) To ensure fairness in dealings with the owners of any land in multiple ownership: (f) To promote practical solutions to problems arising in the use or management of any land. [28] As can be seen by section 17, it is my role to weigh up all those factors therein listed when considering the facts of this case. These factors include protecting, ascertaining and giving effect to the views of the owners, to determine or facilitate the settlement of disputes among the owners, to protect minority interest owners from an oppressive majority or majority interest owners from an unreasonable minority. [29] In this case the Trust Order has no explicit provision that could provide guidance on how to conduct a meeting. Thus the conduct of the meeting could be varied in the manner pursued by the trustees. In my view, customary practice in the conduct of elections cannot be the basis for raising legitimate expectations as to process for elections. The Trust Order by not explicitly providing for a set process is designed to provide flexibility to accommodate the changing circumstances of the Trust. [30] Thus in the circumstances of this Trust with litigation pending before this Court, the change in procedure cannot be determinative of either bad faith or practice on the part of the trustees. In fact the evidence is that the trustees have left the decision of deciding who to appoint for the Maori Land Court, based on their record of owner votes and share value votes. [31] Thus I arrive at my decision on this issue, by taking into account the actual number of owners and share value to ensure fairness. 10 Tairawhiti MB 147

12 [32] Before doing so I note the issue of the kaitiaki trustee. I consider that this is not a case where the views of twenty six owners represented by the kaitiaki trustee can be ascertained. Rather, this is a case where one person s views, through his office as a kaitiaki trustee for people too young to vote, are being expressed. [33] On that basis, I consider where the balance of justice in this case falls and I find, taking into account all the evidence, that the following people should be appointed trustees to act with Richard Clark. I make an order under section 239 appointing: a) John Clarke to replace Richard Coates b) Horimatua Evans c) Ngarangi Bidois d) Hohepa Akuhata I direct the new trustees to conduct an AGM for the Trust within the next three months. Voting will be recorded on all issues based on one person, one vote and on share value. I decline to appoint Mr Wiremu Evans because I do not know whether he is broadly acceptable to the beneficiaries as required by section 222(2) of Te Ture Whenua Maori Act I note that he remains an advisory trustee. Issue 3 - The Criteria for Kaumatua Grants [34] The applicants and their supporters have agreed in substance with the conditions imposed by the trustees for the kaumatua grants but take issue with how these were introduced. They also took issue with how the grant provision determined at the 2008 AGM did not include the features required by Clause 12 of the Trust Order. It was acknowledged that the minutes of the 2007 AGM show that a review was to be held 10 Tairawhiti MB 148

13 annually. But the set age of 70 was, Ms Thornton contended, ignored in 2009 when it was announced at the AGM that there would be a $300 payment to all kaumatua over 65. This announcement, counsel contended constituted electioneering. [35] Dr Bunbury, on the other hand, argued that the grants to kaumatua age 65 and over were approved. The AGM minutes 2007 record the ability for annual reviews. All that was done at the 2009 AGM was to implement a change in policy. As none of the existing trustees were standing for election, what they did could hardly be described as electioneering. Discussion and Direction [36] Under Clause 12 of the Trust Order there is nothing to stop the trustees from making payments to individual owners who satisfy certain conditions which should remain unchanged for a specified period of years. A kaumatua grant to 70 year olds with annual reviews is entirely in keeping with this provision, especially where approved at meetings of owners. The review and change of policy in favour of 65 year olds, is not inconsistent with this provision so long as the change was approved at an AGM. However, to put the matter beyond doubt, I direct the trustees to have the age of 65 approved at the next AGM of the Trust. There is to be no further reduction in age to qualify for a kaumatua grant. Issue 4: Variation of Trust - Lease with Marphona Farms [37] Ms Thornton submitted that the trustees breached Clause 1 of the Te Rimu Trust Order by entering into a long term lease with Marphona Farms over 193.7(ha) of the block. It was argued that the 2008 AGM minutes do not show that there was a discussion of the terms of the lease. There is also no record of any resolution to approve the lease. [38] Counsel argued that the application for variation of the Trust Order should be declined as the trustees proposed amendments seek to justify their actions. In other 10 Tairawhiti MB 149

14 words, it is an attempt to retrospectively correct their mistakes. Counsel then pointed out some of the technical flaws with the lease, namely: the lease document does not have an execution date; it was not submitted to the Court until June 2009; and it has no signatures of guarantors. [39] The applicants and their supporters contended that the lease should have been signed at a comparable rate, in favour of whanau who have an interest in the land. They took issue with the manner in which a rent valuation was used to justify the rejection of the offer they supported from Eastland Pacific Holdings. [40] Ms Thornton submitted that the lease was entered into contrary to the Te Rimu Trust Order. There were no robust discussions held on the issue and the lease was not signed by guarantors. She contended this is a fundamental breach of trustee duties. The trustees have specific obligations to comply with the Trust Order and the duties they owe to the beneficiaries. Compliance with the Trust Order should be required before any variation is granted by this Court. [41] In reply, Dr Bunbury argued that the application to vary the terms of the Trust Order was discussed at 2009 AGM. The AGM provided sufficient opportunity to discuss and consider the variations and there was a sufficient degree of support for those amendments. This was indicated when there was a majority vote by show of hands in favour of the variation. The trustees accepted that entering the Marphona Farms lease was a technical breach of the Te Rimu Trust Order. However, counsel submitted that the lease was a golden opportunity with limited business risks due to the protection mechanisms in the lease. The trustees also went through due process by obtaining valuations and calling for expressions of interest. [42] Dr Bunbury contended that the trustees were endeavouring to improve the position of the beneficial owners and now seek a variation of the Trust Order. Discussion, Direction and Order [43] I begin by pointing out that as the elected representatives of the beneficial owners, the trustees are responsible for the governance and management of the Trust. It 10 Tairawhiti MB 150

15 is not for the owners or the Maori Land Court to micro-manage the affairs of the Trust. That role is for the trustees. If the owners do not like what they do, they may exercise their vote at the next election in favour of alternative representatives or they may initiate proceedings for breach of trust. [44] The trustees must comply with the law including Te Ture Whenua Maori Act Section 2 requires that all persons exercising... powers, duties and discretions under that Act must do so, as far as possible, in a manner that facilitates and promotes the retention, use, development, and control of Maori land as a taonga tuku iho by Maori owners, their whanau, their hapu, and their descendents, and that protects wahi tapu. [45] I note that the owners at the 2009 AGM voted in favour of the variation to the Trust Order, thus is it consistent with their duties, including section 2, for these trustees to pursue the variation. [46] Taking that fact, the Preamble and sections 2 and 17 into account, I am prepared to grant the order under section 244 of Ture Whenua Maori Act 1993, for the variation of the Trust as sought. However, only the lease to Marphona Farms should be confirmed. The company has invested significant sums in the property and there have been benefits that have accrued to all the owners as a result. They are entitled to a new lease as a result. There is an order under section 244 varying the Trust Order in the manner sought pursuant to the application. The trustees are directed, however, to work with their legal advisor to execute a new long term lease consistent with their obligations under the Trust Order, including as to house sites and urupa as discussed below. The Registrar is directed to send an amended copy of the Trust Order to all trustees and advisory trustees. 10 Tairawhiti MB 151

16 Issue 5 - Housing Development [47] Ms Thornton submitted that Clauses 3 to 8 of the Te Rimu Trust Order provide for housing on Trust lands. The Trust Order requires notice be given to the owners of Tokata C2, C5, C6, C7 and C8 to determine whether they wish to maintain a separate title to those housing sections. It contemplates development of a housing scheme and creation of new titles for the occupants thereof. It is the applicants view that these obligations on the trustees, as provided for in the Trust Order, have not been sufficiently progressed. [48] Dr Bunbury, in response, relied on the evidence of Mr Richard Clarke who gave evidence that at a kaumatua meeting in 2005, it was decided that there were housing sites available in Te Araroa, outside of Te Rimu Trust land. It was considered that these sites would be preferable to the lands of the Trust, which should be kept for pastoral farming. However, Mr Clarke pointed out, should the Court take a different view, there was still some land available for housing. He referred to the Ratapu land. He also pointed out that the current Marphona Farm lease (Clause 26) contains special provision for the surrender of up to 3 hectares of land for house sites. In defence of the trustees, he noted the numerous attempts to get housing development under way. Discussion and Direction [49] Clauses 3 to 8 of the Trust Order make quite explicit provision for the creation of new housing site titles. While the trustees should respect the views of their kaumatua as a matter of tikanga, there is no way of being certain that the same kaumatua who approved the scheme of house sites as listed in the Trust Order, are the same referred to in this evidence. Whose view should prevail? Conversely, the trustees are required to comply with their Trust Order. In that vein, they have indicated that they have no issue with land being available for house sites. I direct that the trustees comply with the actual words of the Trust Order and take legal advice as to how to progress the issues as therein raised within six months of the date of this decision. This direction includes ensuring that during 10 Tairawhiti MB 152

17 the negotiation of the new Marphona Farm lease, the trustees obligations [in terms of the house sites] under the Trust Order are complied with. Issue 6 - The Employment of a Trustee as the Trust Accountant [50] Ms Thornton argued that Richard Coates, although a trustee, is also employed as the trust accountant in breach of paragraph 2(1) of the Trust Order. At the 2009 AGM, Mr Coates declined to resign as trustee. Ms Thornton contended that the Court did not approve Mr Coates serving as both trustee and accountant it was only an incidental matter in previous hearings. The accounts of the Trust, she argued, have been drawn up in a manner that avoids full disclosure of the nature of Mr Coates work. The form adopted, she alleged, was a deliberate attempt to avoid full scrutiny by the beneficial owners. To avoid the appearance of impropriety, Mr Coates should resign as trustee and continue as the Trust s accountant. [51] In response, Mr Bunbury submitted that Mr Coates was appointed by the Court in 1997, because he was an accountant and had an intimate knowledge of the trusts accounts. The issue of a potential conflict with the provisions of the Trust Order does not seem to have been on His Honour Chief Judge Isaac s mind when making the decision to appoint him in In 2007, when the issue of the Trust s management was before Judge Harvey, he never fully dealt with the issue either. Mr Coates is prepared to step aside to stop the fighting between the beneficial owners but he doesn t want to leave a gap. [52] Dr Bunbury submitted that the Court has acquiesced in Mr Coates being both a trustee and the accountant since December Discussion and Order [53] Mr Coates has offered to resign to assist progress issues for the Trust and the Court accepts his resignation. I note the long and diligent service he has provided to the Trust and the order to replace him is not to be interpreted as a sanction against him. 10 Tairawhiti MB 153

18 I have made an order above, under section 239 replacing Mr Coates with Mr John Clarke. Issue 7 Urupa [54] Both parties agree that there shouldn t be improper maintenance of the graves and that people should not be prevented from accessing those graves. Dr Bunbury for the trustees advised that where there are instances when people have been prevented from accessing the urupa, these need to be brought to the trustees attention so they can deal with it. Discussion and Direction [55] Clause 2(n) of the Trust Order requires that the trustees work to safeguard, to their best of their ability, any graves of the Maori people or places of special significance to them on Trust lands. I direct the new trustees to work with their legal counsel to ensure that Clause 2(n) of the Trust Order is taken into account while negotiating a new lease with Marphona Farms. Costs, Order and Directions [56] The final application I must deal with is the applicants application for special aid (A ). There can be no doubt that there were serious issues to be tried in this case requiring the assistance of counsel. Taking into account all matters that I am required to under the guidelines, special aid is granted in favour of the applicants counsel pursuant to section 98. The amount to be paid will be in accordance with her fee as specified in her memorandum dated 29 June Order under section 98 in accordance with the terms above; and 10 Tairawhiti MB 154

19 There is no further order as to costs, but I direct that the legal fees for Dr Bunbury must be paid by Te Rimu Trust. Pronounced at pm in Gisborne on Tuesday this 23 rd day of November C L Fox DEPUTY CHIEF JUDGE Solicitors: 10 Tairawhiti MB 155