Reprint as at 1 July 2015

Coat of Arms of New Zealand

Trustee Act 1956

Public Act
 
1956 No 61
Date of assent
 
25 October 1956
Commencement
 
see section 1(2)
Note

Changes authorised by subpart 2 of Part 2 of the Legislation Act 2012 have been made in this official reprint.

Note 4 at the end of this reprint provides a list of the amendments incorporated.

This Act is administered by the Ministry of Justice.

Contents

Title
1Short Title and commencement
2Interpretation and application
3Act to bind Crown
4Authorised investments [Repealed]
4AInvestments, loans, and advances [Repealed]
5Purchase of redeemable stock at a premium or discount [Repealed]
6Trustee carrying on business may invest in shares in co-operative enterprises [Repealed]
7Discretion of trustees [Repealed]
8Power to retain investment which has ceased to be authorised [Repealed]
9Investment in bearer securities [Repealed]
10Loans and investments by trustees not chargeable as breaches of trust [Repealed]
11Liability for loss by reason of improper investment [Repealed]
11ARelease of part of security [Repealed]
12Powers in relation to company securities [Repealed]
13Power to pay calls [Repealed]
13APower to invest
13BDuty of trustee to invest prudently
13CDuty of certain persons to exercise special skill
13DProvisions in trust instrument relating to duty of investing trustees
13EMatters to which trustee may have regard in exercising power of investment
13FTrustee’s duties at law preserved
13GDuty to comply with requirements of trust instrument or statute as to consents or directions
13HPower to retain investments
13IInvestment in bearer securities
13JPurchase of redeemable securities at a premium or discount
13KPowers in relation to company securities
13LPower to pay calls
13MCourt may take into account investment strategy in action for breach of trust
13NCertain loans and investments by trustees not chargeable as breaches of trust
13OLiability for loss by reason of improper secured investment
13PRelease of part of security
13QPower of court to set off gains and losses arising from investment
14Powers to sell, exchange, partition, postpone, lease, purchase, etc
15Miscellaneous powers in respect of property
16Power of trustee for sale to sell by auction, etc, or before date specified
17Power to sell property on terms
18Power to sell subject to depreciatory conditions
19Power of trustees to give receipts
20Power to compound liabilities
21Power to raise money by sale or mortgage
22Protection of purchasers, etc, dealing with trustee
23Devolution of powers or trusts
24Power to insure
25Application of insurance money where policy kept up under any trust, power, or obligation
25APower to treat share premium account distributions as income [Repealed]
26Deposit of documents for safe custody
27Reversionary interest
28Valuations
29Power to employ agents
30Power to concur with others
31Power to delegate trusts
32Power to carry on business
32APower of trustee carrying on trust business to acquire shares in co-operative enterprises
33Power to convert business into a company
33ATrustee may sue himself in a different capacity
34Protection against liability in respect of rents and covenants
34ATrustee to have lien on policy money for premiums
35Protection against creditors and others by means of advertisements
36Protection in regard to notice
37Exoneration of trustees in respect of certain powers of attorney
38Implied indemnity of trustees
39Protection of trustee who pays trust money to bankrupt in good faith and without knowledge of bankruptcy
39AProtection of trustee in handing over chattels to life tenant
39BProtection of trustee in handing over chattels to infant
40Power to apply income for maintenance, etc, and to accumulate surplus income during a minority
41Power to apply capital for maintenance, etc
41AConditional advances for maintenance, etc
42Protective trusts
42APower to set aside reserves out of income or profits of business
42BPower to apply capital of business for maintenance
42CMatters to be taken into consideration when exercising powers
42DApportionment of income
42EPower to adjust interests in trust property of portfolio investment entity
43Power of appointing new trustees
44Evidence as to a vacancy in a trust
45Retirement of trustee
46Discharge of trustee with assistance of court or Registrar
47Vesting of trust property in new or continuing trustees
48Corporations acting as trustees
49Advisory trustees
50Remuneration of custodian trustees
51Power of court to appoint new trustees
52Vesting orders of land
53Orders as to contingent rights of unborn persons
54Vesting order in place of conveyance by infant mortgagee
55Vesting order consequential on order for sale or mortgage of land
56Vesting order consequential on judgment for specific performance
57Effect of vesting order
58Power to appoint person to convey
59Vesting orders as to stock and things in action
60Vesting orders in respect of shares in ships and industrial property
61Vesting orders of charity property
62Orders made upon certain allegations to be conclusive evidence
63Orders liable to stamp duty [Repealed]
64Power of court to authorise dealings with trust property
64APower of court to authorise variations of trust
64BPowers of court in respect of capital dividends
65Power of court to direct sale or lease [Repealed]
66Right of trustee to apply to court for directions
67Persons entitled to apply to court
68Applications to court to review acts and decisions of trustee
69Protection of trustee while acting under direction of court
70Powers of court to give judgment in absence of a trustee
71Power of court to charge costs on trust estate
72Commission
73Power to relieve trustee from personal liability
74Power to make beneficiary indemnify for breach of trust
75Barring of claims
76Distribution of shares of missing beneficiaries
76AService of notices, etc, under sections 75 and 76
77Payment by trustees to Crown
78Disposal of funds paid to Crown
79Orders in respect of funds paid to Crown
80Indemnity to banks and others
81Operation on bank account of trustees
82Inclusion of non-charitable and invalid purposes not to invalidate a trust [Repealed]
83Special rules as to apportionment on purchase, sale, or transfer in certain cases
83AExamination of accounts of trust estates administered by trustee corporations
83BAudit of other trust estates
84Costs and testamentary expenses to be payable out of capital of settled residuary estate of deceased
85Application of income of settled property pending conversion
86Fees and commission deemed a testamentary expense
87Costs of inquiring regarding beneficiaries
88Life tenant to have powers of a trustee in certain cases
89Repeals, amendments, and savings
[Repealed]
Reprint notes

An Act to consolidate and amend certain enactments of the Parliament of New Zealand relating to trusts and trustees

Title: amended, on 1 January 1987, pursuant to section 29(2) of the Constitution Act 1986 (1986 No 114).

 
1 Short Title and commencement

(1)

This Act may be cited as the Trustee Act 1956.

(2)

This Act shall come into force on 1 January 1957.

Part 1 Preliminary

2 Interpretation and application

(1)

In this Act, unless the context otherwise requires,—

bank means a person carrying on in New Zealand the business of banking

benefit, in relation to any person, includes insurance on the life of that person

contingent right as applied to land includes a contingent or executory interest, a possibility coupled with an interest, whether the object of the gift or limitation of the interest or possibility is or is not ascertained, also a right of entry, whether immediate or future, and whether vested or contingent

conveyance, as applied to any person, includes the execution by that person of every necessary or suitable assurance for conveying, transferring, assigning, appointing, surrendering, or otherwise disposing of land whereof he is seised or possessed, or wherein he is entitled to a contingent right, either for his whole estate, or for any less estate, together with the performance of all formalities required by law for the validity of the conveyance; and to convey has a corresponding meaning

court means the High Court

income includes rents and profits other than profits which under any rule of law are in the nature of capital

instrument includes an Act of Parliament

land includes land of any tenure, and mines and minerals, whether or not severed from the surface, buildings or parts of buildings, whether the division is horizontal, vertical, or made in any other way, and any other corporeal hereditament; and also includes a rent and other incorporeal hereditaments, and an easement, right, privilege, share, interest, or benefit in, over, or derived from land; and in this definition mines and minerals includes any strata or seams of minerals or substances in or under any land, and powers of working and getting the same; and in this definition hereditaments means real property which under an intestacy might at common law have devolved on an heir

lease includes a bailment

mortgagee includes every person having an estate or interest regarded at law or in equity as merely a security for money; and also includes every person deriving title to the mortgage under the original mortgagee; and mortgage has a corresponding meaning

payment, in relation to stocks and securities, includes the deposit or transfer of the same; and to pay has a corresponding meaning

person includes a trustee corporation, and a corporation sole, and also a body of persons, whether corporate or unincorporate

personal representative means the executor, original or by representation, or an administrator for the time being of a deceased person

portfolio investment entity means a portfolio investment entity within the meaning of the Income Tax Act 2007

possession includes receipt of income or the right to receive the same, if any; and possessed applies to receipt of income of and to any vested estate less than a life interest, at law or in equity, in possession or in expectancy in any land

property includes real and personal property, and any estate, share, and interest in any property, real or personal, and any debt, and any thing in action, and any other right or interest, whether in possession or not

Registrar means the Registrar of the court for the district in which any proceeding is taken or anything is done under this Act, and includes a Deputy Registrar where there is no Registrar, or in any case where the Deputy may lawfully act for and on behalf of the Registrar

rent includes a rent service or a rent charge, or other rent, toll, duty, royalty, or annual or periodical payment in money or money’s worth reserved or issuing out of or charged upon land, but does not include mortgage interest

right includes an estate or interest

sale includes an exchange; and to sell has a corresponding meaning

securities includes stock, funds, shares, and convertible notes; and securities payable to bearer includes securities transferable by delivery or by delivery and endorsement

stock

(a)

includes—

(i)

securities issued by or under the authority of the Government by virtue of any Act, and secured upon the public revenues of New Zealand; and

(ii)

shares; and

(b)

so far as relates to vesting orders made by the court under this Act, includes any fund, money, annuity, or security transferable in books kept by any corporation or society, or by instrument of transfer either alone or accompanied by other formalities, and any share or interest therein

transfer, in relation to stock or securities, includes the performance and execution of every deed, power of attorney, act, and thing on the part of the transferor to effect and complete the title in the transferee

trust does not include the duties incidental to an estate conveyed by way of mortgage, but with this exception it extends to implied and constructive trusts, and to cases where the trustee has a beneficial interest in the trust property, and to the duties incidental to the office of an administrator within the meaning of the Administration Act 1969, or a manager or person authorised to administer the estate of any person under the Protection of Personal and Property Rights Act 1988, or a manager of a protected estate appointed under the Protection of Personal and Property Rights Act 1988; and trustee has a corresponding meaning and includes a trustee corporation and every other corporation in which property subject to a trust is vested and every person who immediately before the commencement of this Act was a trustee of the settlement or in any way a trustee under the Settled Land Act 1908; and new trustee includes an additional trustee:

provided that in sections 14, 15, 16, 21, 23, 31, 32, 40, 41, 42, 43, 44, 45, 46, 47, 51, 65, 66, and 67 the term trust does not include the duties incident to the office of a manager or person authorised to administer the estate of any person under the Protection of Personal and Property Rights Act 1988 or a manager of a protected estate appointed under the Protection of Personal and Property Rights Act 1988; and the term trustee is modified accordingly

trust for sale, in relation to land, means an immediate binding trust for sale, whether or not exercisable at the request or with the consent of any person, and with or without power at discretion to postpone the sale; and trustee for sale means the person (including a personal representative) holding land on trust for sale

trustee corporation means Public Trust or the Māori Trustee or any corporation authorised by any Act of the Parliament of New Zealand to administer the estates of deceased persons and other trust estates.

(2)

For the purposes of this Act a person shall be deemed to be under a disability while he is not of full age or full mental capacity.

(3)

This Act, except where otherwise expressly provided, applies to trusts (as hereinbefore defined) constituted or created either before or after the commencement of this Act.

(4)

The powers conferred by or under this Act on a trustee who is not a corporation are in addition to the powers given by any other Act and by the instrument, if any, creating the trust; but the powers conferred on the trustee by this Act, unless otherwise stated, apply if and so far only as a contrary intention is not expressed in the instrument, if any, creating the trust, and have effect subject to the terms of that instrument.

(5)

The powers conferred by or under this Act on a trustee that is a corporation are in addition to the powers given by the instrument, if any, creating the trust and to the powers given by or under the Act or any instrument by or under which the corporation is constituted and any other Act: but the powers conferred on the trustee by this Act, unless otherwise stated,—

(a)

apply if and so far only as a contrary intention is not expressed in the instrument, if any, creating the trust, and have effect subject to the terms of that instrument:

(b)

apply if and so far only as a contrary intention is not expressed in the Act or any instrument by or under which the corporation is constituted and any other Act and have effect subject to the terms of every such Act and instrument:

provided that nothing in this paragraph shall affect any Act which applies to all trustees, whether corporations or not.

(5A)

Without limiting the generality of subsections (4) and (5), any power or direction in any instrument creating a trust to invest trust funds in any specified property or classes of property shall not, for the purposes of those subsections, be deemed to be a contrary intention preventing the exercise by a trustee of the power of investment conferred by Part 2.

(6)

This Act does not affect the legality or validity of anything done before the commencement of this Act, except as otherwise in this Act expressly provided.

Compare: 1908 No 200 ss 2, 78(5), 79(3), 96(2), 98(3), 102(5), 107, 112(2); 1924 No 33 s 2(3), (4); 1933 No 32 s 5(3); 1938 No 20 s 57(5), (6); 1952 No 51 s 53(2); Trustee Act 1925 ss 68, 69 (UK)

Section 2(1) authorised investments: repealed, on 1 October 1988, by section 2(1) of the Trustee Amendment Act 1988 (1988 No 119).

Section 2(1) bank: replaced, on 1 October 1988, by section 2(2) of the Trustee Amendment Act 1988 (1988 No 119).

Section 2(1) bank: amended, on 30 June 1995, pursuant to section 2(2) of the Banking Act Repeal Act 1995 (1995 No 32).

Section 2(1) court: amended, on 1 April 1980, pursuant to section 12 of the Judicature Amendment Act 1979 (1979 No 124).

Section 2(1) Government securities or New Zealand Government Securities: repealed, on 1 October 1988, by section 2(1) of the Trustee Amendment Act 1988 (1988 No 119).

Section 2(1) portfolio investment entity: inserted, on 1 October 2007, by section 240 of the Taxation (Savings Investment and Miscellaneous Provisions) Act 2006 (2006 No 81).

Section 2(1) portfolio investment entity: amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), pursuant to section ZA 1(1) of the Income Tax Act 2007 (2007 No 97).

Section 2(1) securities: replaced, on 1 October 1988, by section 2(3) of the Trustee Amendment Act 1988 (1988 No 119).

Section 2(1) stock: replaced, on 1 October 1988, by section 2(4) of the Trustee Amendment Act 1988 (1988 No 119).

Section 2(1) trust: amended, on 1 October 1988, pursuant to section 113 of the Protection of Personal and Property Rights Act 1988 (1988 No 4).

Section 2(1) trust: amended, on 1 January 1971, pursuant to section 84(1) of the Administration Act 1969 (1969 No 52).

Section 2(1) trust: amended, on 1 April 1970, pursuant to section 129(7) of the Mental Health Act 1969 (1969 No 16).

Section 2(1) trust: amended, on 15 November 1968, by section 2 of the Trustee Amendment Act 1968 (1968 No 24).

Section 2(1) trust proviso: amended, on 1 October 1988, pursuant to section 113 of the Protection of Personal and Property Rights Act 1988 (1988 No 4).

Section 2(1) trust proviso: amended, on 1 April 1970, pursuant to section 129(7) of the Mental Health Act 1969 (1969 No 16).

Section 2(1) trustee corporation: amended, on 1 July 2009, pursuant to section 30(2)(a) of the Maori Trustee Amendment Act 2009 (2009 No 12).

Section 2(1) trustee corporation: amended, on 1 March 2002, by section 170(1) of the Public Trust Act 2001 (2001 No 100).

Section 2(1) trustee corporation: amended, on 1 January 1987, pursuant to section 29(2) of the Constitution Act 1986 (1986 No 114).

Section 2(4): amended, on 25 October 1960, by section 8(1)(a) of the Trustee Amendment Act 1960 (1960 No 101).

Section 2(4): amended, on 25 October 1960, by section 8(1)(b) of the Trustee Amendment Act 1960 (1960 No 101).

Section 2(5): amended, on 25 October 1960, by section 8(1)(b) of the Trustee Amendment Act 1960 (1960 No 101).

Section 2(5A): inserted, on 1 October 1988, by section 2(5) of the Trustee Amendment Act 1988 (1988 No 119).

3 Act to bind Crown

This Act shall bind the Crown.

Part 2 Investment

Part 2 heading: replaced, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

4 Authorised investments
[Repealed]

Section 4: repealed, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

4A Investments, loans, and advances
[Repealed]

Section 4A: repealed, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

5 Purchase of redeemable stock at a premium or discount
[Repealed]

Section 5: repealed, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

6 Trustee carrying on business may invest in shares in co-operative enterprises
[Repealed]

Section 6: repealed, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

7 Discretion of trustees
[Repealed]

Section 7: repealed, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

8 Power to retain investment which has ceased to be authorised
[Repealed]

Section 8: repealed, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

9 Investment in bearer securities
[Repealed]

Section 9: repealed, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

10 Loans and investments by trustees not chargeable as breaches of trust
[Repealed]

Section 10: repealed, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

11 Liability for loss by reason of improper investment
[Repealed]

Section 11: repealed, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

11A Release of part of security
[Repealed]

Section 11A: repealed, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

12 Powers in relation to company securities
[Repealed]

Section 12: repealed, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13 Power to pay calls
[Repealed]

Section 13: repealed, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13A Power to invest

(1)

A trustee may invest any trust funds, whether at the time in a state of investment or not, in any property.

(2)

Any such investment may be varied from time to time.

Section 13A: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13B Duty of trustee to invest prudently

Subject to sections 13C and 13D, a trustee exercising any power of investment shall exercise the care, diligence, and skill that a prudent person of business would exercise in managing the affairs of others.

Section 13B: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13C Duty of certain persons to exercise special skill

Subject to section 13D, where a trustee’s profession, employment, or business is or includes acting as a trustee or investing money on behalf of others, the trustee, in exercising any power of investment, shall exercise the care, diligence, and skill that a prudent person engaged in that profession, employment, or business would exercise in managing the affairs of others.

Section 13C: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13D Provisions in trust instrument relating to duty of investing trustees

(1)

The duty imposed on a trustee by section 13B or section 13C shall apply to a trustee if and so far only as a contrary intention is not expressed in the instrument, if any, creating the trust or any Act, and shall have effect subject to the terms of that instrument or Act.

(2)

Any rules and principles of law relating to any provision in an instrument that purports to exempt or limit the liability of a trustee in respect of any breach of trust, or to indemnify a trustee in respect of any breach of trust, shall remain in force and apply in respect of any provision in a trust instrument that expresses a contrary intention for the purposes of subsection (1).

Section 13D: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13E Matters to which trustee may have regard in exercising power of investment

Without limiting the matters that a trustee may take into account, a trustee exercising any power of investment may have regard to the following matters so far as they are appropriate to the circumstances of the trust:

(a)

the desirability of diversifying trust investments:

(b)

the nature of existing trust investments and other trust property:

(c)

the need to maintain the real value of the capital or income of the trust:

(d)

the risk of capital loss or depreciation:

(e)

the potential for capital appreciation:

(f)

the likely income return:

(g)

the length of the term of the proposed investment:

(h)

the probable duration of the trust:

(i)

the marketability of the proposed investment during, and on the determination of, the term of the proposed investment:

(j)

the aggregate value of the trust estate:

(k)

the effect of the proposed investment in relation to the tax liability of the trust:

(l)

the likelihood of inflation affecting the value of the proposed investment or other trust property.

Section 13E: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13F Trustee’s duties at law preserved

All rules and principles of law which impose any duty on a trustee exercising a power of investment, including, without limiting the generality of the foregoing, all rules and principles which impose—

(a)

any duty to exercise the powers of a trustee in the best interests of all present and future beneficiaries of the trust:

(b)

any duty to act impartially towards beneficiaries and between different classes of beneficiaries:

(c)

any duty to take advice,—

shall remain in force and apply in respect of any exercise of any power of investment, except so far as they are altered by or are inconsistent with this Act or any other enactment or the instrument, if any, creating the trust.

Section 13F: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13G Duty to comply with requirements of trust instrument or statute as to consents or directions

A trustee exercising any power of investment shall comply with any requirements of the instrument, if any, creating the trust or of statute that are binding on the trustee and that relate to the obtaining of any consent or compliance with any direction with respect to the investment of trust funds.

Section 13G: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13H Power to retain investments

A trustee shall not be liable for breach of trust by reason only of continuing to hold an investment which has ceased to be—

(a)

an investment authorised by the trust instrument; or

(b)

an investment that a trustee could properly make in exercising any power of investment; or

(c)

an investment authorised by section 4 before the repeal of that section by section 3 of the Trustee Amendment Act 1988; or

(d)

an investment authorised by any other Act.

Section 13H: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13I Investment in bearer securities

(1)

Unless expressly prohibited by the instrument creating the trust, a trustee shall not be liable for breach of trust by reason only of retaining or investing in securities that are payable to bearer.

(2)

Any direction in an instrument creating a trust that investments shall be retained or made in the name of a trustee shall not, for the purposes of subsection (1), be deemed to be an express prohibition.

(3)

In any case where a trustee (not being a trustee corporation) retains or invests in securities payable to bearer, that trustee shall, until those securities are sold, deposit them for safe custody and collection of income with a bank.

(4)

A trustee shall not be responsible for any loss incurred by reason of any such deposit, and any sum payable in respect of any such deposit and collection shall be paid out of the income of the trust property.

Section 13I: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13J Purchase of redeemable securities at a premium or discount

(1)

A trustee shall not be liable for breach of trust by reason only of investing in securities that are redeemable and paying a price that is greater or less than the redemption value.

(2)

A trustee may retain until redemption any redeemable security that may have been purchased in accordance with the powers conferred by this Act.

(3)

In any case where a redeemable security is purchased by a trustee at a price greater or less than its redemption value, and in terms of the trust the beneficial interest in the income from the security is not vested in the same persons as the beneficial interest in the capital of the security, then, subject to the provisions of section 83,—

(a)

if the purchase price exceeds the redemption value, the trustee shall recoup to the capital out of which the purchase was made, by rateable instalments from the income derived from the security over the period between the date of purchase and the earliest date on which the security can be repaid or redeemed, the amount of the difference; and the amount so recouped to capital from time to time shall be deemed to be received as capital repaid:

(b)

if the redemption value exceeds the purchase price, the amount of the difference shall be distributable as if it were income accruing from day to day over the period between the date of the purchase and the latest date on which the security can be repaid or redeemed, and the trustee may by rateable instalments over the period appropriate or raise out of the capital of the security or out of the capital of other assets subject to the same trusts the amounts required from time to time to be distributed as income; and, if the security is repaid or redeemed before the latest date on which the same can be repaid or redeemed, any remaining balance of the difference shall on the repayment or redemption immediately become distributable as if it were income then due and payable.

(4)

Where the amount to be recouped to or deducted from capital in any year in accordance with paragraph (a) or paragraph (b) of subsection (3) is less than $50, it shall not be necessary for the trustee to comply with the provisions of that subsection.

Section 13J: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13K Powers in relation to company securities

(1)

Where any securities of a company are subject to a trust, the trustee may concur in any scheme or arrangement—

(a)

for the reconstruction of the company; or

(b)

for the sale of all or any part of the property and undertaking of the company to another company; or

(c)

for the acquisition of the securities of the company, or of control of the company, by another company; or

(d)

for the amalgamation of the company with another company; or

(e)

for the release, modification, or variation of any rights, privileges, or liabilities attached to the securities or any of them—

in like manner as if the trustee were entitled to the securities beneficially, with power to accept any securities of any denomination or description of the reconstructed company or purchasing company or new company instead of or in exchange for all or any of the first-mentioned securities.

(2)

If any conditional or preferential right to subscribe for any securities in any company is offered to a trustee in respect of any holding in that company or any other company, the trustee may, as to all or any of the securities, either—

(a)

exercise the right and apply capital money subject to the trust in payment of the consideration; or

(b)

assign, for the best consideration that can reasonably be obtained, the benefit of the right or the title to the right to any person, including any beneficiary under the trust; or

(c)

if the right cannot be assigned for a reasonable consideration, renounce the right.

(3)

A trustee accepting or subscribing for securities pursuant to this section is, for the purposes of any provision of this Part, exercising a power of investment.

(4)

A trustee may retain any securities accepted or subscribed for pursuant to this section for any period for which the trustee could properly have retained the original securities.

(5)

The consideration for any assignment made under subsection (2)(b) shall be held as capital money of the trust.

Section 13K: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13L Power to pay calls

A trustee may apply capital money subject to a trust in payment of the calls on any shares subject to the same trust.

Section 13L: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13M Court may take into account investment strategy in action for breach of trust

In considering whether a trustee is liable, in respect of any investment made by that trustee, for any breach of trust in respect of any duty—

(a)

to exercise the care, diligence, and skill that a prudent person of business would exercise in managing the affairs of others; or

(b)

to exercise the care, diligence, and skill that a prudent person engaged in a profession, employment, or business that is or includes acting as a trustee or investing money on behalf of others would exercise in managing the affairs of others,—

the court may, if it thinks it appropriate, take into account—

(c)

whether the trust investments have been diversified, so far as is appropriate to the circumstances of the trust; and

(d)

whether the investment was made pursuant to any investment strategy formulated in accordance with the duty referred to in paragraph (a) or paragraph (b), as may be applicable.

Section 13M: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13N Certain loans and investments by trustees not chargeable as breaches of trust

(1)

A trustee lending money on the security of any property on which the trustee can properly lend shall not be chargeable with breach of trust by reason only of the proportion borne by the amount of the loan to the value of the property at the time when the loan was made, if it appears to the court—

(a)

that in making the loan the trustee was acting upon a report as to the value of the property made by a person whom the trustee reasonably believed to be competent to value the property by reason of his or her profession or occupation and his or her personal expertise and experience, being a person instructed and employed independently of any owner of the property; and

(b)

that the amount of the loan does not exceed the proportion of the value of the property stated in the report as the maximum proportion that the valuer considers that it would be prudent to lend on that property; and

(c)

that the loan was made on the advice of the valuer as expressed in the report.

(2)

A trustee lending money on the security of any leasehold property shall not be chargeable with breach of trust only upon the ground that in making the loan the trustee dispensed either wholly or partly with the production or investigation of the lessor’s title.

Section 13N: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13O Liability for loss by reason of improper secured investment

Where—

(a)

a trustee improperly advances trust money on the security of any property; and

(b)

the security would, at the time of the investment, be a proper investment in all respects for a smaller sum than the sum actually advanced—

the security shall be deemed to be an investment that could properly be made in respect of the smaller sum, and the trustee shall be liable to make good only the sum advanced in excess of the smaller sum, with interest.

Section 13O: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13P Release of part of security

(1)

Where any trust funds are invested and secured on any property, the trustee may release any part of the property from the security, whether part of the debt is repaid or not, if the unreleased part of the property would at the time be a proper security in all respects for the amount remaining unpaid.

(2)

Where trust funds are invested and secured on any land under the Land Transfer Act 1952, a subsequent purchaser of the released part of the property, or the District Land Registrar, shall not be concerned to inquire whether the requirements of subsection (1) were fulfilled.

Section 13P: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

13Q Power of court to set off gains and losses arising from investment

(1)

In considering any action for breach of trust arising in respect of or in relation to any investment by a trustee as a result of which any loss or losses have been, or are expected to be, sustained by the trust, the court may set off, as it thinks just, all or any part of the loss or losses resulting from that investment against all or any part of the gain or gains resulting from any other investment, whether in breach of trust or not.

(2)

The power of set off conferred by subsection (1) shall be without prejudice to any other power or entitlement to set off all or any part of any loss or losses against any property.

Section 13Q: inserted, on 1 October 1988, by section 3 of the Trustee Amendment Act 1988 (1988 No 119).

Part 3 General powers and indemnities of trustees

General powers

14 Powers to sell, exchange, partition, postpone, lease, purchase, etc

(1)

Subject to the provisions of this section, every trustee may exercise the following powers in respect of any property for the time being vested in him:

(a)

sell the property:

(b)

dispose of the property by way of exchange for other property in New Zealand of a like nature and a like or better tenure, or, where the property vested in him consists of an undivided share, concur in the partition of the property in which the share is held, and give or take any property by way of equality of exchange or partition:

(c)

postpone the sale, calling in, and conversion of the property, whether or not it is of a wasting, speculative, or reversionary nature:

provided that nothing in this paragraph shall permit a trustee to postpone the sale, calling in, or conversion of any property of a wasting or speculative nature for longer than is reasonably necessary to permit its prudent realisation:

(d)

let or sublet the property at a reasonable rent for any term not exceeding 1 year, or from year to year, or for a weekly, monthly, or other like tenancy, or at will:

(e)

grant a lease or sublease of the property for any term not exceeding 21 years to take effect in possession within 1 year next after the date of the grant of the lease or sublease at a reasonable rent, with or without a fine, premium, or foregift:

provided that where a fine, premium, or foregift is taken, the amount thereof shall be deemed to be part of and an accretion to the rental, and shall, as between the persons beneficially entitled to the rental, be considered as accruing from day to day and be apportioned over the term of the lease or sublease:

(f)

at any time during the currency of a lease of the property, reduce the rent or otherwise vary or modify the terms thereof:

(g)

in the case of property subject to a lease, grant to a sublessee (with the consent of the lessee) a lease direct from the trustee of the whole or any part of the land comprised in the original lease for the residue of the original term thereof.

(2)

Any trustee may purchase land in New Zealand in any of the following cases:

(a)

if the land being purchased adjoins other land that the trustee has power to retain and that is held by the trustee on the same trusts as the money expended in respect of the purchase of the land, and the land is being purchased for either or both of the following purposes—

(i)

for better development or use of the said other land; or

(ii)

to facilitate or improve the carrying on of a business on the said other land, being a business that the trustee is empowered to carry on:

(b)

if the land being purchased has a dwellinghouse thereon and is required exclusively or principally as a home for the person entitled to the income of the money being expended in respect of the purchase.

(2A)

Any trustee may erect a dwellinghouse on land that is subject to the same trusts as the money being expended in respect of the erection, or may purchase land in New Zealand and erect a dwellinghouse thereon, if the dwellinghouse and land are required exclusively or principally as a home for the person entitled to the income of the money being expended in respect of the erection or the purchase and erection, as the case may be.

(2B)

In any case where a trustee is authorised by or under this Act or any other enactment, or by the instrument creating the trust, to provide or acquire a home for any person, he shall have power, in addition to any authority so conferred,—

(a)

to acquire a flat or apartment or the right to occupy a flat or apartment by any means which he may consider appropriate (whether by acquiring shares in a limited liability company or an undivided share or interest in the land on which the premises are erected or in any other way); and

(b)

to enter into any lease, licence, agreement, or other arrangement under which he or his nominee or the beneficiary who is to occupy the flat or apartment has the right to occupy it (including an arrangement whereby any shares in a limited liability company and the benefit of any such lease, licence, or agreement may be held by that beneficiary or by some other nominee of the trustee upon trust for him).

(3)

Any trustee may accept or concur or join with any other person in accepting a lease or sublease of any property on such terms and subject to such covenants and conditions as he thinks fit; and may surrender or concur or join with any other person in surrendering any lease or sublease; and, if lessor or sublessor, may accept or concur or join with any other person in the acceptance of the surrender of any lease or sublease.

(4)

Any trustee may, on such conditions as he thinks proper, rescind or cancel or modify or vary any contract or agreement for the sale and purchase of any land, or agree to do so, or compromise with or make allowances to any person with whom such contract or agreement has been made, or who is the assignee thereof in respect of any unpaid purchase money secured on mortgage or otherwise.

(5)

In exercising any power of leasing or subleasing conferred by this section or by the instrument (if any) creating the trust, a trustee may—

(a)

grant to the lessee or sublessee a right of renewal for 1 or more terms at a rent to be fixed or made ascertainable in a manner specified in the original lease or the original sublease, but so that the aggregate duration of the original and of the renewed terms shall not exceed the maximum single term that could be granted in exercise of the power:

(b)

subject to the provisions of this section, grant a lease with an optional or compulsory purchasing clause:

provided that this power shall not apply to the exercise of any power of sale conferred by any mortgage unless the mortgage confers authority to do so:

(c)

grant to the lessee or sublessee a right to claim compensation for improvements made or to be made by him in, upon, or about the property which is leased or subleased.

(6)

A trustee who, in accordance with any power conferred on him by or under this Act or otherwise, sells any land, or exchanges any land for any other land, or grants a lease of any land with an optional or compulsory purchasing clause, shall not be guilty of a breach of trust by reason only of any alleged inadequacy of the amount or value of the sale price or other consideration (exclusive of rent) that he received in respect of the transaction, if, before making the sale or exchange or granting the lease, he has ascertained the value of the land involved in accordance with section 28, and—

(a)

in the case of a sale of the land or a lease thereof with an optional or compulsory purchasing clause, the sale price for the land is not less than the value thereof as so ascertained:

(b)

in the case of an exchange, it is prudent for the trustee to make the exchange, having regard to the respective values (as so ascertained) of the pieces of land being exchanged, the interests of the beneficiaries to whom he is responsible, and all the circumstances of the case.

(6A)

Where a person dies intestate as to any personal chattels within the meaning of the Administration Act 1969 and leaves a husband or wife, or civil union partner, or a surviving de facto partner (as defined in section 2(1) of that Act) entitled to succeed on the intestacy, the trustee of the intestate’s estate must not, without the consent of the court or of the husband or wife, civil union partner, or surviving de facto partner, sell those chattels, unless a sale is required for purposes of administration owing to want of other assets.

(6AA)

If there is more than 1 person whose consent would be required under subsection (6A), the consent of each of them is required.

(6AB)

If, under a marriage settlement of land, there is a tenant for life in possession, a trustee may exercise a power conferred by subsection (1)(a) or (b) only at the request in writing of the tenant for life.

(6B)

Where upon inquiry the court is satisfied that a partition of the real estate of a deceased person would be advantageous to the parties interested therein, the court may order a partition or may appoint 1 or more arbitrators to effect a partition, and to exercise in regard thereto, under its directions and control, such powers as it thinks fit; and if the report and final award of the arbitrator are approved by the court, the trustee shall, by conveyance or transfer, give effect to the same accordingly.

(7)

Where there is a power (statutory or otherwise) to postpone the sale of any land or investment that a trustee has a duty to sell by reason only of a trust or direction for sale, then (subject to any express direction to the contrary in the instrument, if any, creating the trust) the trustee shall not be liable in any way merely for postponing the sale, in the exercise of his discretion, for an indefinite and unlimited period, whether or not that period exceeds the period during which the trust or direction for sale remains valid; nor shall a purchaser of the land or investment be concerned in any case with any directions respecting the postponement of a sale:

provided that this subsection shall not apply to any property of a wasting or speculative nature.

Compare: 1908 No 159 s 29; 1921–22 No 48 s 20

Section 14(2)(a): replaced, on 28 August 1977, by section 2(1) of the Trustee Amendment Act 1977 (1977 No 21).

Section 14(2)(b): amended, on 15 November 1968, by section 5(1) of the Trustee Amendment Act 1968 (1968 No 24).

Section 14(2A): inserted, on 18 October 1957, by section 4 of the Trustee Amendment Act 1957 (1957 No 37).

Section 14(2A): amended, on 15 November 1968, by section 5(2) of the Trustee Amendment Act 1968 (1968 No 24).

Section 14(2B): inserted, on 15 November 1968, by section 5(3) of the Trustee Amendment Act 1968 (1968 No 24).

Section 14(6): replaced, on 28 August 1977, by section 2(2) of the Trustee Amendment Act 1977 (1977 No 21).

Section 14(6A): replaced, on 1 February 2002, by section 12(2) of the Administration Amendment Act 2001 (2001 No 6).

Section 14(6A): amended, on 1 January 2008, by section 364(1) of the Property Law Act 2007 (2007 No 91).

Section 14(6AA): inserted, on 1 February 2002, by section 12(2) of the Administration Amendment Act 2001 (2001 No 6).

Section 14(6AB): inserted, on 1 January 2008, by section 364(1) of the Property Law Act 2007 (2007 No 91).

Section 14(6B): inserted, on 15 November 1968, by section 6(2) of the Trustee Amendment Act 1968 (1968 No 24).

Section 14(7): inserted, on 18 October 1957, by section 5 of the Trustee Amendment Act 1957 (1957 No 37).

Section 14(7): amended, on 1 October 1988, by section 4 of the Trustee Amendment Act 1988 (1988 No 119).

15 Miscellaneous powers in respect of property

(1)

Every trustee may exercise the following powers in respect of any property for the time being vested in him:

(a)

expend money subject to the same trusts for the repair, maintenance, upkeep, or renovation of the property, whether or not the work is necessary for the purpose of the salvage of the property; and (subject to the rules of law applicable in such cases and to any direction of the court to the contrary) apportion the cost of the work between capital and income or otherwise among the persons entitled thereto in such manner as he considers equitable, with power, in any case where the whole or part of the cost of the work is charged to capital, to recoup capital from subsequent income if such a course would be equitable having regard to all the circumstances of the case:

(b)

expend money subject to the same trusts in the improvement or development of the property or in improving his title to the property or his tenure thereof, whether by the acquisition of an interest in reversion or otherwise:

(c)

where the property is land and the land may be sold or let or leased or otherwise disposed of under any power or trust vested in the trustee, subdivide the land into sections and for that purpose construct and dedicate all such roads, streets, access ways, service lanes, and footpaths and make all such reserves, and do all such other things, and pay all such money, as he thinks necessary or as are required by any law or bylaw relating to subdivisions:

(d)

contribute out of money subject to the same trusts such sum as he thinks reasonable towards the construction and maintenance of such roads, streets, access ways, service lanes, and footpaths, and such sewerage, water, electricity, drainage and other works as are in the opinion of the trustee likely to be beneficial to the property, notwithstanding that they are intended to be constructed wholly or in part on land not subject to the same trusts:

(e)

grant easements and profits à prendre and enter into party wall agreements and agreements which relate to fencing or to which section 4 of the Fencing Act 1978 applies, and execute all necessary documents to give effect thereto:

(f)

pay rates, taxes, assessments, insurance premiums, and other outgoings in respect of the property out of money subject to the same trusts:

(g)

as mortgagor or mortgagee, agree to the renewal, extension, or variation of the mortgage for such period and on such terms and conditions as he thinks fit:

provided that the powers conferred by this paragraph may be exercised by a trustee as mortgagor for the purpose of raising additional money on the security of a mortgage of any property in any case where the trustee would have power under section 21 to raise money by a mortgage of the property, but not otherwise:

provided also that nothing in this paragraph shall authorise any trustee to advance any money on the security of any mortgage if the trustee could not properly advance that money on that security:

(h)

make such inquiries, by way of advertisement or otherwise, as he deems necessary for the purpose of ascertaining the next-of-kin or beneficiaries entitled to the property, and charge the cost of the inquiries and advertisements against the property:

(i)

where the property includes a life policy and there is no money or insufficient money available for the payment of premiums on the policy, surrender the policy for money, or accept instead of the policy a fully paid up policy, or vary the terms of the policy in such manner as the trustee thinks fit:

(j)

appropriate any part of the property in or towards satisfaction of any legacy payable thereout or any share thereof (whether settled, contingent, or absolute) to which any person is entitled, and for that purpose value the whole or any part of the property in accordance with section 28:

provided that before any such appropriation is effectual notice thereof shall be given to all persons who are interested in the appropriation, and any such person may within 1 calendar month after receipt of the notice apply to the court to vary the same, and the appropriation shall be conclusive save as otherwise directed by the court:

provided also that where the person interested is out of the jurisdiction the said period of 1 month may be extended by the court for such period as the court thinks fit, on the application of the trustee or of any person interested:

(k)

where provision is made in any instrument creating a trust for payment of an annuity or other periodical payment, and notwithstanding that the annuity or payment may by the instrument be charged upon the trust property or upon any part thereof, set aside and appropriate out of property available for payment of the annuity and invest a sum sufficient in the opinion of the trustee at the time of the appropriation to provide out of the income thereof the amount required to pay the annuity or periodical payment, and, after the appropriation shall have been made, the residue of the trust property and the income thereof shall no longer be liable for the annuity, and may be distributed forthwith in accordance with the trusts declared of and concerning the same:

(l)

do or omit all acts and things, and execute all instruments necessary to carry into effect the powers and authorities given by this Act or by or under the instrument creating the trust.

(2)

Where in the administration of any property employed in the production of income or from which income is derived a trustee considers that in the interests of the persons entitled or who may become entitled to the capital of the property it is equitable to set up a depreciation or replacement fund in respect of the property or in respect of any asset comprised therein, then, notwithstanding any rule of law to the contrary, it shall be lawful for but not obligatory upon him to do so, and to credit from time to time to the fund and accumulate by way of compound interest such part of the income so produced or derived as he considers equitable and also the resulting income therefrom. In any such case the fund shall follow the destination of the capital of the property and shall be subject to all the trusts, powers, and provisions applicable thereto; with further power to the trustee to apply as he thinks fit the fund and accumulations of income in or towards the replacement, repair, maintenance, upkeep, or renovation of the property or asset, or in or towards the acquisition by purchase or otherwise of property or assets of a like nature or which otherwise may advantageously be employed in conjunction with the property in producing or deriving the income as aforesaid.

Compare: 1908 No 159 s 29; 1921–22 No 48 s 20

Section 15(1)(b): amended, on 15 November 1968, by section 7 of the Trustee Amendment Act 1968 (1968 No 24).

Section 15(1)(b) proviso: repealed, on 28 August 1977, by section 3 of the Trustee Amendment Act 1977 (1977 No 21).

Section 15(1)(e): amended, on 1 April 1979, pursuant to section 28(1) of the Fencing Act 1978 (1978 No 50).

Section 15(1)(j) first proviso: amended, on 10 September 2008, by section 22(2) of the Disability (United Nations Convention on the Rights of Persons with Disabilities) Act 2008 (2008 No 64).

Section 15(1)(g) second proviso: replaced, on 1 October 1988, by section 5 of the Trustee Amendment Act 1988 (1988 No 119).

16 Power of trustee for sale to sell by auction, etc, or before date specified

(1)

Where a trust for sale or a power of sale of property is vested in a trustee, he may sell or concur with any other person in selling all or any part of the property, either subject to prior encumbrances or not, and either together or in lots, by public auction or by public tender or by private contract, subject to any such conditions respecting title or evidence of title or other matters as the trustee thinks fit, with power to vary any contract for sale, and to buy in at any auction, or to rescind any contract for sale and to resell, without being answerable for any loss.

(2)

A trust or power to sell or dispose of land includes a trust or power to sell or dispose of part thereof, whether the division is horizontal, vertical, or made in any other way; and also includes a trust or power to sell or dispose of any buildings, fixtures, timber, or other things affixed to the soil apart and separately from the land itself.

(3)

In exercise of any power of sale in respect of several properties held under 1 lease, the trustee may sell the properties separately on the terms that one of the purchasers shall take an assignment of the lease and grant subleases to the other purchasers, and that if any part of the property is not sold the trustee shall retain the lease and grant subleases of the portions sold.

(4)

Where a trustee may sell any property at a fixed or specified time pursuant to any trust or power vested in him, the trustee may, with the consent of the persons (if any) entitled to the possession thereof pending the sale of the property, sell the property at any time before the date originally appointed.

Compare: 1921–22 No 48 s 20(1), (4); 1952 No 51 s 53; Trustee Act 1925 s 12 (UK)

17 Power to sell property on terms

(1)

A sale of property by a trustee in exercise of any power vested in him in that behalf by the instrument creating the trust or by or under this Act or any other enactment may be on terms of deferred payment or otherwise.

(2)

The terms of deferred payment shall be such as a person acting with prudence would, if the property were his own, have accepted in the circumstances in order to sell the property to the best advantage, and, subject thereto, may provide for the payment of the purchase money or any part thereof under an agreement for sale or for the conveyance of the property sold and the securing of the unpaid purchase money by mortgage of the property sold.

(3)

Whether the sale is made under the order of the court or otherwise, the court may make such order as it thinks fit as to the terms of deferred payment.

(4)

A trustee selling property on terms authorised by this section or by any order of the court—

(a)

is not, for the purposes of any provision of Part 2, or for the purposes of any consent or direction required by the instrument, if any, creating the trust, lending money or investing trust funds; and

(b)

shall not be liable for any loss that may be incurred by reason only of the security being insufficient at the date of the agreement or mortgage.

(5)

[Repealed]

Compare: 1925 No 14 s 28 (NSW); Trustee Act 1925 s 10(2) (UK)

Section 17 heading: amended, on 18 October 1957, by section 6 of the Trustee Amendment Act 1957 (1957 No 37).

Section 17(1): amended, on 18 October 1957, by section 6 of the Trustee Amendment Act 1957 (1957 No 37).

Section 17(2): amended, on 18 October 1957, by section 6 of the Trustee Amendment Act 1957 (1957 No 37).

Section 17(4): replaced, on 1 October 1988, by section 6 of the Trustee Amendment Act 1988 (1988 No 119).

Section 17(5): repealed, on 1 October 1988, by section 6 of the Trustee Amendment Act 1988 (1988 No 119).

18 Power to sell subject to depreciatory conditions

(1)

No sale made by a trustee shall be impeached by any beneficiary upon the ground that any of the conditions subject to which the sale was made may have been unnecessarily depreciatory, unless it also appears that the consideration for the sale was thereby rendered inadequate.

(2)

No sale made by a trustee shall, after the execution of the conveyance or transfer, be impeached as against the purchaser upon the ground that any of the conditions subject to which the sale was made may have been unnecessarily depreciatory, unless it appears that the purchaser was acting in collusion with the trustee at the time when the contract for sale was made.

(3)

No purchaser, upon any sale made by a trustee, shall be at liberty to make any objection against the title upon any of the grounds aforesaid.

(4)

This section applies to sales made before or after the commencement of this Act.

Compare: 1908 No 200 s 85; Trustee Act 1925 s 13 (UK)

19 Power of trustees to give receipts

(1)

The receipt in writing of a trustee for any money, securities, or other personal property or effects payable, transferable, or deliverable to him under any trust or power shall be a sufficient discharge to the person paying, transferring, or delivering the same, and shall effectually exonerate that person from seeing to the application or being answerable for any loss or misapplication thereof.

(2)

This section applies notwithstanding anything to the contrary in the instrument, if any, creating the trust.

Compare: 1908 No 200 s 81; Trustee Act 1925 s 14(1), (3) (UK)

20 Power to compound liabilities

A trustee may, if and as he thinks fit,—

(a)

accept any property, real or personal, before the time at which it is made transferable or payable; or

(b)

sever and apportion any blended trust funds or property; or

(c)

pay or allow any debt or claim on any evidence that he thinks sufficient; or

(d)

accept any composition or any security, real or personal, for any debt or for any property, real or personal, claimed; or

(dd)
[Repealed]

(e)

allow any time for payment of any debt; or

(f)

surrender any leasehold property subject to onerous covenants of such a nature that it would not be to the advantage of the person beneficially interested to retain the property; or

(g)

compromise, compound, abandon, submit to arbitration, or otherwise settle any debt, account, claim, or thing whatever relating to the trust or to the trust property,—

and for any of those purposes may enter into, give, execute, and do such agreements, instruments of composition or arrangement, releases, and other things as to him seem expedient, without being responsible for any loss occasioned by any act or things so done by him in good faith.

Compare: 1908 No 200 s 110; 1924 No 33 s 2(2); 1925 No 14 s 35 (NSW); Trustee Act 1925 s 15 (UK)

Section 20(dd): repealed, on 6 April 1974, by section 8(2)(a) of the Trustee Amendment Act 1974 (1974 No 15).

21 Power to raise money by sale or mortgage

(1)

Where a trustee is authorised by the instrument, if any, creating the trust or by this Act or any other Act or by law to pay or apply capital money subject to the trust for any purpose or in any manner, he shall have and shall be deemed always to have had power to raise the money required by sale, conversion, calling in, or mortgage of all or any part of the trust property for the time being in possession.

(2)

Without restricting the generality of the foregoing provisions of this section, the power conferred on the trustee by this section to raise any money that is required as aforesaid by the sale, conversion, calling in, or mortgage of all or any part of the trust property for the time being in possession shall extend and be deemed always to have extended so as to confer on the trustee power so to raise money required for the purpose of meeting any debt or other liability of the trustee, whether secured or unsecured and whether owing or incurred at or before the commencement of the trust or subsequently.

Compare: 1933 No 32 s 3; Trustee Act 1925 s 16 (UK)

Section 21(2): inserted, on 15 November 1968, by section 9 of the Trustee Amendment Act 1968 (1968 No 24).

22 Protection of purchasers, etc, dealing with trustee

(1)

Where an instrument is made or executed in professed exercise of the power to sell, exchange, lease, or mortgage conferred by the instrument (if any) creating the trust or by this Act or any other Act, the title of the purchaser, transferee, lessee, or mortgagee shall not be impeachable except on the ground of fraud, or be affected on the ground that no case has arisen to authorise the sale, exchange, lease, or mortgage, or that the power was otherwise improperly or irregularly exercised; but any person damnified by an unauthorised or improper or irregular exercise of the power shall have his remedy in damages against the person exercising the power, and no purchaser, transferee, lessee, or mortgagee shall be concerned to see to the application of the money paid by him, or be responsible for the misapplication thereof.

(2)

Nothing in this section shall restrict the provisions of the Land Transfer Act 1952.

Section 22: replaced, on 15 November 1968, by section 10(1) of the Trustee Amendment Act 1968 (1968 No 24).

23 Devolution of powers or trusts

(1)

Where a power or trust is given to or imposed on 2 or more trustees jointly, the same may be exercised or performed by the survivors or survivor of them for the time being.

(2)

Until the appointment of a new trustee, the personal representative for the time being of a sole trustee or (where there were 2 or more trustees) of the last surviving or continuing trustee shall be capable of exercising or performing any power or trust which was given to, or capable of being exercised by, the sole or last surviving or continuing trustee, or other the trustees for the time being of the trust:

provided that in this subsection the term trustee does not include a personal representative as such.

(3)

This section does not authorise the exercise or performance of any power or trust by an executor who has renounced or has not proved.

Compare: 1908 No 200 s 112(1); Trustee Act 1925 s 18(1), (2), (4) (UK)

24 Power to insure

(1)

A trustee may insure against loss or damage, whether by fire or earthquake or otherwise, any building or other insurable property to any amount, including the amount of any insurance already on foot, not exceeding the full insurable value of the building or property, or (with the consent of the person entitled to the income or of the court) the full replacement value of the building or property; and may also insure against any risk or liability against which it would be prudent for a person to insure if he were acting for himself; and may pay the premiums for the insurance out of the income of the building or property concerned or out of the income of any other property subject to the same trusts without obtaining the consent of any person who may be entitled wholly or partly to that income.

(2)

The trustee may recover the costs of any premiums paid in respect of any such insurance from the life tenant or other person entitled to or in receipt of the rents and profits of the building or property concerned.

(3)

Nothing in this section shall impose any obligation on a trustee to insure.

Compare: 1908 No 200 s 90; 1921–22 No 48 s 21(2); 1925 No 14 s 41 (NSW); Trustee Act 1925 s 19(1) (UK)

25 Application of insurance money where policy kept up under any trust, power, or obligation

(1)

Money receivable by a trustee or any beneficiary under a policy of insurance against the loss of or damage to any property subject to a trust, whether by fire or otherwise, shall, where the policy has been kept up under any trust in that behalf or under any power, statutory or otherwise, or in performance of any covenant or of any obligation, statutory or otherwise, or by a tenant for life impeachable for waste, be capital for the purposes of the trust, except so far as it would be regarded as income under any rule of law.

(2)

If any such money is receivable by any person other than the trustee of the trust, that person shall use his best endeavours to recover and receive the money, and shall pay the net residue thereof, after discharging any costs of recovering and receiving it, to the trustee of the trust, or, if there is no trustee capable of giving a discharge therefor, to the Crown under section 77.

(3)

Any such money,—

(a)

if it was receivable in respect of property held upon trust for sale, shall be held upon the trusts and subject to the powers and provisions applicable to money arising by a sale under the trust:

(b)

in any other case, shall be held upon trusts corresponding as nearly as may be with the trusts affecting the property in respect of which it was payable.

(4)

Any such money, or any part thereof, may also be applied by the trustee, or, if held by the Crown, under the direction of the court, in rebuilding, reinstating, replacing, or repairing the property lost or damaged, but any such application by the trustee shall be subject to the consent of any person whose consent is required by the instrument, if any, creating the trust to the investment of money subject to the trust.

(5)

Nothing in this section shall prejudice or affect the right of any person to require any such money or any part thereof to be applied in rebuilding, reinstating, or repairing the property lost or damaged, or the rights of any mortgagee, lessor, or lessee, whether under any statute or otherwise.

(6)

This section applies to policies effected either before or after the commencement of this Act, but only to money received after the commencement thereof.

Compare: Trustee Act 1925 s 20 (UK)

25A Power to treat share premium account distributions as income
[Repealed]

Section 25A: repealed, on 5 December 2013, by section 14 of the Companies Amendment Act 2013 (2013 No 111).

26 Deposit of documents for safe custody

Subject to the provisions of section 13I, a trustee may deposit any documents held by him relating to the trust, or to the trust property, with any bank or corporation whose business includes the undertaking of the safe custody of documents, and any sum payable in respect of any such deposit shall be paid out of the income of the trust property, and so far as there is no available income out of the capital of the trust property.

Compare: Trustee Act 1925 s 21 (UK)

Section 26: amended, on 1 October 1988, by section 7 of the Trustee Amendment Act 1988 (1988 No 119).

27 Reversionary interest

(1)

Where trust property includes any share or interest in property not vested in the trustee, or the proceeds of the sale of any such property, or any other thing in action, the trustee, on the same falling into possession or becoming payable or transferable, may—

(a)

agree or ascertain the amount or value thereof or any part thereof in such manner as he may think fit:

(b)

accept in or towards satisfaction thereof, at the market or current value, or upon any valuation or estimate of value which he may think fit, any property in which the trustee may properly invest trust funds:

(c)

allow any deductions for duties, costs, charges, and expenses which he may think proper or reasonable:

(d)

execute any release in respect of the premises so as effectually to discharge all accountable parties from all liability in respect of any matters coming within the scope of the release—

without being responsible in any such case for any loss occasioned by any act or thing so done by him in good faith.

(2)

The trustee shall not be under any obligation and shall not be chargeable with any breach of trust by reason of any omission—

(a)

to give any notice in respect of or apply for any charging or other like order upon any securities or other property out of or in which such share or interest or other thing in action as aforesaid is derived, payable, or charged; or

(b)

to take any proceedings on account of any act, default, or neglect on the part of the persons in whom the securities or other property or any of them or any part thereof are for the time being, or had at any time been, vested—

unless and until required in writing so to do by some person, or the guardian of some person, beneficially interested under the trust, and unless also due provision is made to his satisfaction for payment of the costs of any proceedings required to be taken:

provided that nothing in this subsection shall relieve the trustee of the obligation to get in and obtain payment or transfer of the share or interest or other thing in action on the same falling into possession.

Compare: Trustee Act 1925 s 22(1), (2) (UK)

Section 27(1)(b): amended, on 1 October 1988, by section 8 of the Trustee Amendment Act 1988 (1988 No 119).

28 Valuations

A trustee may, for the purpose of giving effect to the trust, or any of the provisions of the instrument, if any, creating the trust or of this Act or any other Act, from time to time ascertain and fix the value of any trust property, or of any property which he is authorised to purchase or otherwise acquire, in such manner as he thinks proper; and where the trustee is not personally qualified to ascertain the value of any property he shall consult a duly qualified person (whether employed by him or not) as to that value; but the trustee shall not be bound to accept any valuation made by any person whom the trustee may consult. Any valuation made by the trustee in good faith under this subsection shall be binding on all persons beneficially interested under the trust.

Compare: Trustee Act 1925 s 22(3) (UK)

29 Power to employ agents

(1)

A trustee may, instead of acting personally, employ and pay an agent, whether a solicitor, accountant, bank, trustee corporation, stockbroker, or other person, to transact any business or do any act required to be transacted or done in the execution of the trust or the administration of the trust property, including the receipt and payment of money, and the keeping and audit of trust accounts, and shall be entitled to be allowed and paid all charges and expenses so incurred, and shall not be responsible for the default of any such agent if employed in good faith.

(2)

A trustee may appoint any person to act as his agent or attorney for the purpose of selling, converting, collecting, getting in, and executing and perfecting assurances of, or managing or cultivating, or otherwise administering any property, real or personal, movable or immovable, subject to the trust in any place outside New Zealand, or executing or exercising any discretion or trust or power vested in him in relation to any such property, with such ancillary powers and with and subject to such provisions and restrictions as he may think fit, including a power to appoint substitutes, and shall not, by reason only of his having made any such appointment, be responsible for any loss arising thereby.

(2A)

Without restricting the other powers conferred by this section, a trustee may—

(a)

employ a trustee corporation to be his agent for the purpose of investing any trust funds in his possession, whether at the commencement of the employment in a state of investment or not, whether they came into his possession before or after the commencement of this section, and whether they comprise the whole or any part of the trust estate to which they belong; and

(b)

pay or transfer any such trust funds to the trustee corporation so employed.

(3)

Without prejudice to such general power of appointing agents as aforesaid—

(a)

a trustee may appoint a solicitor to be his agent to receive and give a discharge for any money or valuable consideration or property receivable by the trustee under the trust by permitting the solicitor to have the custody of, and to produce, a deed or instrument having in the body thereof or endorsed thereon a receipt for the money or valuable consideration or property, the deed or instrument being executed, or the endorsed receipt being signed, by the person entitled to give a receipt for that consideration:

(b)

a trustee shall not be chargeable with breach of trust by reason only of his having made or concurred in making any such appointment; and the production of any such deed or instrument by the solicitor shall have the same validity and effect as if the person appointing the solicitor had not been a trustee:

(c)

a trustee may appoint a bank or solicitor to be his agent to receive and give a discharge for any money payable to the trustee under or by virtue of a policy of insurance, by permitting the bank or solicitor to have the custody of and to produce the policy of insurance with a receipt signed by the trustee, and a trustee shall not be chargeable with a breach of trust by reason only of his having made or concurred in making any such appointment:

provided that nothing in this subsection shall exempt a trustee from any liability which he would have incurred if this Act and any enactment replaced by this Act had not been passed, in case he permits any such money, valuable consideration, or property to remain in the hands or under the control of the bank or solicitor for a period longer than is reasonably necessary to enable the bank or solicitor, as the case may be, to pay or transfer the same to the trustee.

(4)

Subsection (3) shall apply whether the money or valuable consideration or property was or is received before or after the commencement of this Act.

Compare: 1908 No 200 s 84; Trustee Act 1925 s 23 (UK)

Section 29(2A): inserted (with effect on 26 October 1967), on 15 November 1968, by section 11 of the Trustee Amendment Act 1968 (1968 No 24).

Section 29(2A)(b): amended, on 6 April 1974, by section 11 of the Trustee Amendment Act 1974 (1974 No 15).

30 Power to concur with others

Where an undivided share in any property is subject to a trust, the trustee may (without prejudice to any trust or power in relation to the entirety of the property) execute or exercise any trust or power vested in him in relation to that share in conjunction with the persons entitled to or having power in that behalf over the other share or shares, and notwithstanding that the trustee or any 1 or more of several trustees may be entitled to or interested in any such other share, either in his or their own right or in a fiduciary capacity.

Compare: Trustee Act 1925 s 24 (UK)

31 Power to delegate trusts

(1)

A trustee who—

(a)

is for the time being out of New Zealand or is about to depart therefrom; or

(b)

expects that he may be absent from New Zealand from time to time during the administration of the trust; or

(c)

is or may be about to become temporarily incapable, by reason of physical infirmity, of performing all his duties as a trustee; or

(d)

expects that he may be from time to time temporarily incapable, by reason of physical infirmity, of performing all his duties as a trustee,—

may, notwithstanding any rule of law or equity to the contrary, by power of attorney executed as a deed, delegate to any person the execution or exercise, during any period for which the trustee may be absent from New Zealand or incapable of performing all his duties as a trustee, of all or any trusts, powers, authorities, and discretions vested in him as such trustee, whether alone or jointly with any other person or persons:

provided that a person being the only other co-trustee and not being a trustee corporation shall not be appointed to be an attorney under this subsection.

(2)

Where any such delegation has been duly made to and accepted by any person and is for the time being in operation, that person shall have, within the scope of the delegation, the same trusts, powers, authorities, discretions, liabilities, and responsibilities as he would have if he were then the trustee.

(3)

In any proceedings brought by any person beneficially interested under the trust against the donor of a power of attorney given under this section in respect of any act or default of the donee of the power it shall be a defence for the donor to prove that the donee was appointed by him in good faith and without negligence.

(4)

All jurisdiction and powers of any court shall apply to the donee of the power of attorney in the same manner, so far as respects the execution of the trust or the administration of the estate to which the power of attorney relates, as if the donee were acting in relation to the trust or estate in the same capacity as the donor of the power.

(5)

The power of attorney shall not come into operation unless and until the donor is out of New Zealand or is incapable of performing all his duties as a trustee, and unless the deed otherwise provides shall be deemed to be revoked by his return or by his recovery of that capacity, as the case may be.

(6)

In favour of any person dealing with the donee of a power of attorney given under this section, any act done or instrument executed by the donee shall, notwithstanding that the power has never come into operation or has been revoked, whether by the act of the donor of the power or by operation of law, be as valid and effectual as if the power had come into operation and remained unrevoked at the time when the act was done or the instrument executed, unless that person had at that time actual notice that the power had never come into operation or of the revocation of the power.

(7)

Where the donee of any power of attorney relating to any trust or estate is not a corporation aggregate, a certificate in form 1 of Schedule 4, or to the like effect, shall, if given by the donee of the power of attorney, be taken to be conclusive evidence that the power of attorney has come into operation and that in any particular transaction the donee is acting in the execution of the trust or the administration of the estate.

(7A)

Where the donee of any power of attorney relating to any trust or estate is a corporation aggregate, a certificate in form 2 of Schedule 4, or to the like effect, if given by a director, manager, secretary, or other officer duly authorised in that behalf by the corporation, shall be taken to be conclusive evidence that the power of attorney has come into operation and that in any particular transaction the donee is acting in the execution of the trust or the administration of the estate.

(7B)

Where any such certificate relates to the execution of any instrument, it shall be sufficient if the certificate is endorsed on the instrument and signed by the donee of the power or by any of the persons specified in subsection (7A), as the case may be.

(7C)

Every person commits an offence and is liable on conviction to a fine not exceeding $100 who wilfully or negligently signs any certificate for the purposes of subsection (7) or subsection (7A) if the certificate is false in any material respect.

(8)

The fact that it appears from any power of attorney given under this section, or from any evidence required for the purposes of any power of attorney or otherwise, that in any transaction the donee of the power is acting in the execution of a trust shall not be deemed for any purpose to affect any person dealing in good faith with the donee with any notice of the trust.

(9)

For the purpose of executing or exercising the trusts, powers, authorities, and discretions delegated to him the donee may exercise any of the powers, authorities, and discretions conferred on the donor as trustee by statute or by the instrument creating the trust, except the power of delegation conferred by this section.

Compare: 1908 No 200 ss 103–105; 1925 No 14 ss 64(1), (4), 66 (NSW); Trustee Act 1925 s 25 (UK)

Section 31(1): replaced, on 6 April 1974, by section 12(1) of the Trustee Amendment Act 1974 (1974 No 15).

Section 31(5): amended, on 6 April 1974, by section 12(2) of the Trustee Amendment Act 1974 (1974 No 15).

Section 31(7): replaced, on 1 October 1988, by section 9(1) of the Trustee Amendment Act 1988 (1988 No 119).

Section 31(7A): inserted, on 1 October 1988, by section 9(1) of the Trustee Amendment Act 1988 (1988 No 119).

Section 31(7B): inserted, on 1 October 1988, by section 9(1) of the Trustee Amendment Act 1988 (1988 No 119).

Section 31(7C): inserted, on 1 October 1988, by section 9(1) of the Trustee Amendment Act 1988 (1988 No 119).

Section 31(7C): amended, on 1 July 2013, by section 413 of the Criminal Procedure Act 2011 (2011 No 81).

32 Power to carry on business

(1)

Subject to the provisions of any other Act, if at the time of his death any person (whether alone or in partnership) is engaged in carrying on a business, trade, or occupation, it shall be lawful for his trustee to continue to carry on the same in the same manner for any 1 or more of the following periods:

(a)

2 years from the death of that person:

(b)

such period as may be necessary or desirable for the winding up of the business:

(c)

such further period or periods as the court may approve.

(2)

In exercise of the powers conferred by this section or by the instrument creating the trust, a trustee may employ any part of the deceased’s estate which is subject to the same trusts; and may from time to time increase or diminish the part of the estate so employed; and may purchase stock, machinery, implements, and chattels for the purposes of the business; and may employ such managers, agents, servants, clerks, workmen, and others as he thinks fit; and may at any time enter into a partnership agreement to take the place of any partnership agreement subsisting immediately before the death of the deceased or at any time thereafter.

(3)

Application to the court for leave to carry on a business may be made by the trustee or any person beneficially interested in the estate at any time, whether or not any previous authority to carry on the business has expired; and the court may make such an order, or may order that the business be not carried on, or be carried on subject to conditions, or may make such other order as in the circumstances seems proper.

(4)

Nothing in this section shall prejudice any other authority to do the acts thereby authorised to be done.

(5)

Where a trustee is in any manner interested or concerned in a trade or business, he may make such subscription as it would be prudent for him to make if he were acting for himself out of the income of the assets affected to any fund created for objects or purposes in support of trades or businesses of a like nature and subscribed to by other persons engaged in the like trade or business.

Compare: 1908 No 200 s 98; 1921–22 No 48 s 20

32A Power of trustee carrying on trust business to acquire shares in co-operative enterprises

(1)

Unless expressly forbidden by the instrument, if any, creating the trust, a trustee who is empowered to carry on any business forming part of the assets of the trust property may, so long as the trustee continues lawfully to carry on that business,—

(a)

take up and subscribe for or otherwise acquire, out of such of the trust funds as the trustee may lawfully use in the carrying on of that business, shares in any co-operative company registered under any Act or in any other co-operative enterprise:

(b)

subject to the provisions of any other enactment relating to the compulsory surrender of shares, retain as part of the trust property any shares held in any such company or co-operative enterprise and, out of such of the trust funds as the trustee may lawfully use in the carrying on of that business, pay calls on any shares held in any such company or co-operative enterprise—

if membership of the company or enterprise is essential or highly advantageous to the carrying on of that business or the marketing of the products of that business.

(2)

A trustee exercising the powers conferred by subsection (1) is not, for the purposes of any provision of Part 2, exercising a power of investment.

Section 32A: inserted, on 1 October 1988, by section 10 of the Trustee Amendment Act 1988 (1988 No 119).

33 Power to convert business into a company

A trustee may at any time, at the expense of the trust property, convert or join in converting any business into a company limited by shares in such manner as he may think fit; and may, at the like expense, promote and assist in promoting a company for taking over the business; and may sell or transfer the business and the capital and assets and goodwill thereof, or any part thereof, to the company, or to any company having for its objects the purchase of such a business, in consideration, in either case, wholly or in part of ordinary or preference shares wholly or partially paid up of any such company, or wholly or in part of debentures, debenture stock, or bonds of any such company, and as to the balance (if any) in cash payable immediately, or by any instalments with or without security.

Compare: 1921–22 No 48 s 20(1)(s)

33A Trustee may sue himself in a different capacity

Notwithstanding any rule of law or practice to the contrary, a trustee of any property in that capacity may sue, and be sued by, himself in any other capacity whatsoever, including his personal capacity:

provided that in every such case the trustee shall obtain the directions of the court in which the proceedings are taken as to the manner in which the opposing interests are to be represented.

Section 33A: inserted, on 25 October 1960, by section 3 of the Trustee Amendment Act 1960 (1960 No 101).

Indemnities

34 Protection against liability in respect of rents and covenants

(1)

Where a trustee liable as such for—

(a)

any rent, covenant, or agreement reserved by or contained in any lease; or

(b)

any rent, covenant, or agreement payable under or contained in any grant made in consideration of a rent charge; or

(c)

any indemnity given in respect of any rent, covenant, or agreement referred to in either of the foregoing paragraphs—

satisfies all liabilities under the lease or grant which may have accrued and been claimed up to the date of the conveyance hereinafter mentioned, and, where necessary, sets apart a sufficient fund to answer any future claim that may be made in respect of any fixed and ascertained sum which the lessee or grantee agreed to lay out on the property demised or granted, although the period for laying out the same may not have arrived, then and in any such case the trustee may convey the property demised or granted to a purchaser, legatee, devisee, or other person entitled to call for a conveyance thereof, and thereafter—

(i)

he may distribute the trust estate (other than the fund, if any, set apart as aforesaid) to or amongst the persons entitled thereto, without appropriating any part, or any further part, as the case may be, of the trust estate to meet any future liability under the said lease or grant:

(ii)

notwithstanding the distribution, he shall not be personally liable in respect of any subsequent claim under the said lease or grant.

(2)

For the purposes of this section a trustee shall be deemed to be liable as such for any liabilities arising from privity of estate which he may incur under the obligations contained in a lease or grant if he is entitled to reimburse himself out of the trust property for all expenses he may incur in respect of the liabilities.

(3)

This section operates without prejudice to the right of the lessor or grantor, or the persons deriving title under the lessor or grantor, to follow the trust property or any part thereof or any property representing the same into the hands of the persons amongst whom the same may have been respectively distributed, and applies notwithstanding anything to the contrary in the instrument, if any, creating the trust.

(4)

In this section lease includes a sublease and an agreement for a lease or sublease and any instrument giving any such indemnity as aforesaid or varying the liabilities under the lease; grant applies to a grant whether the rent is created by limitation, grant, reservation, or otherwise, and includes an agreement for a grant and any instrument giving any such indemnity as aforesaid or varying the liabilities under the grant; and lessee and grantee include persons respectively deriving title under them.

Compare: 1936 No 58 s 82; Trustee Act 1925 s 26 (UK)

34A Trustee to have lien on policy money for premiums

Where a trustee pays any premiums in respect of any policy of insurance he shall have a lien on the policy money for the amount of the premiums so paid, together with interest thereon at the rate of 6% or such other rate as the Governor-General may for the time being by Order in Council prescribe.

Section 34A: inserted, on 15 November 1968, by section 12(1) of the Trustee Amendment Act 1968 (1968 No 24).

Section 34A: 5.0% prescribed as the rate for the purposes of section 34A, on 1 July 2011, by clause 4 of the Trustee (Prescribed Rate of Interest) Order 2011 (SR 2011/178).

35 Protection against creditors and others by means of advertisements

(1)

Where a trustee has given notice by advertisement published at least once in a newspaper circulating in each locality in which in the opinion of the trustee claims are likely to arise requiring persons having claims to which this section applies to send to the trustee, within the time fixed in the notice, particulars of their claims and warning them of the consequences of their failure to do so, then, at the expiration of that time or at any time thereafter the trustee may administer or distribute the property or any part thereof to which the notice relates to or among the persons entitled thereto having regard only to the claims, whether formal or not, of which the trustee then has notice; and he shall not, as respects the property so administered or distributed, be liable to any person of whose claim he has not had notice at the time of the administration or distribution:

provided that nothing in this section shall prejudice any remedy which the person may have under subsection (1) of section 49 of the Administration Act 1969 or any other right or remedy available to him against any person other than the trustee, including any right which he may have to follow the property and any money or property into which it is converted.

(2)

The time to be fixed as aforesaid by any such notice shall not be less than 1 month from the date on which the notice is given:

provided that where the notice is given in a newspaper circulating mainly outside New Zealand the time to be fixed as aforesaid shall be not less than 2 months.

(3)

In any case where the personal representative of a deceased person gives any such notice, the localities specified in subsection (1) shall include each locality in which the deceased resided or carried on business at any time during the year immediately preceding his death.

(4)

Where the trustee is in doubt as to what advertisements should be published under this section he may apply to the court for directions.

(5)

Any advertisement published under this section may relate to more than 1 estate or trust property.

(6)

This section shall apply notwithstanding anything to the contrary in the instrument, if any, creating the trust.

(7)

Except as provided in subsection (8), this section shall apply to the following claims, whether present or future, certain or contingent, against a trustee:

(a)

claims against or in respect of the estate of the deceased person or the trust property, including (without limiting the generality of the foregoing provisions of this paragraph) claims that survive or lie against or in respect of the estate or property under Part 1 of the Law Reform Act 1936:

(b)

claims against the trustee personally by reason of his being under any liability in respect of which he is entitled to reimburse himself out of the estate or property that he is administering.

(8)

This section shall not apply to—

(a)

any claim under the Family Protection Act 1955 or the Law Reform (Testamentary Promises) Act 1949, or arising out of any contract to make a will containing certain provisions or not to revoke an existing will or a specified provision therein or not to make a will; or

(b)

any claim by a person to be a beneficiary under the will or to be entitled on the intestacy of the deceased person, or to be beneficially interested under the trust.

Compare: 1908 No 159 s 50; 1952 No 56 s 25(1), (2); Trustee Act 1925 s 27 (UK)

Section 35 heading: amended, on 25 October 1960, by section 4 of the Trustee Amendment Act 1960 (1960 No 101).

Section 35(1): replaced, on 25 October 1960, by section 4(1) of the Trustee Amendment Act 1960 (1960 No 101).

Section 35(1): amended, on 1 January 1971, pursuant to section 84(1) of the Administration Act 1969 (1969 No 52).

Section 35(7): replaced, on 25 October 1960, by section 4(2) of the Trustee Amendment Act 1960 (1960 No 101).

Section 35(8): inserted, on 25 October 1960, by section 4(2) of the Trustee Amendment Act 1960 (1960 No 101).

36 Protection in regard to notice

A trustee acting for the purposes of more than 1 trust shall not, in the absence of fraud, be affected by notice of any instrument, matter, fact, or thing in relation to any particular trust if he has obtained notice thereof merely by reason of his acting or having acted for the purposes of another trust.

Compare: Trustee Act 1925 s 28 (UK)

37 Exoneration of trustees in respect of certain powers of attorney

A trustee acting or paying money in good faith in reliance on any power of attorney and on a statutory declaration or other sufficient evidence that the power of attorney has not been revoked shall not be liable for any such act or payment by reason of the fact that at the time of the act or payment the person who gave the power of attorney was subject to any disability, or bankrupt, or dead, or had done or suffered some act or thing to avoid the power, if this fact was not known to the trustee at the time of his so acting or paying:

provided that—

(a)

nothing in this section shall affect the right of any person entitled to the money against the person to whom the payment is made:

(b)

the person so entitled shall have the same remedy against the person to whom the payment is made as he would have had against the trustee.

Compare: Trustee Act 1925 s 29 (UK)

38 Implied indemnity of trustees

(1)

A trustee shall be chargeable only for money and securities actually received by him, notwithstanding his signing any receipt for the sake of conformity, and shall be answerable and accountable only for his own acts, receipts, neglects, or defaults, and not for those of any other trustee, nor for any bank, broker, or other person with whom any trust money or securities may be deposited, nor for the insufficiency or deficiency of any securities, nor for any other loss, unless the same happens through his own wilful default.

(2)

A trustee may reimburse himself or pay or discharge out of the trust property all expenses reasonably incurred in or about the execution of the trusts or powers; but, except as provided in this Act or any other Act or as agreed by the persons beneficially interested under the trust, no trustee shall be allowed the costs of any professional services performed by him in the execution of the trusts or powers unless the contrary is expressly declared by the instrument creating the trust:

provided that the court may on the application of the trustee allow such costs as in the circumstances seem just.

Compare: 1908 No 200 ss 82, 83; Trustee Act 1925 s 30 (UK)

39 Protection of trustee who pays trust money to bankrupt in good faith and without knowledge of bankruptcy

(1)

If a trustee in good faith, without negligence, and without actual knowledge of the bankruptcy of any person, pays or transfers to or to the order of that person any trust money or trust property which he would have been entitled to receive (whether as a beneficiary or otherwise) if he had not been adjudged bankrupt, the trustee shall not be liable to the assignee in bankruptcy of the estate of the bankrupt for any money so paid or any property so transferred:

provided that nothing in this section shall prejudice the right of the assignee in bankruptcy to follow the money or property or any part thereof into the hands of the persons who have received the same.

(2)

For the purposes of this section a trustee shall not be deemed to have actual knowledge of the bankruptcy of any person by reason merely of the fact that notice of the adjudication has been published in any newspaper or in the Gazette.

(3)

This section applies with respect to payments of money or transfers of property made by a trustee before or after the commencement of this Act.

Compare: 1933 No 32 s 5

39A Protection of trustee in handing over chattels to life tenant

(1)

Where any chattels are, under the provisions of any will, bequeathed to any person including an infant for life or for any limited interest, the trustee may cause an inventory to be made of the chattels, which inventory shall be signed by that person and retained by the trustee, and a copy of the inventory shall be delivered to that person.

(2)

The trustee may thereupon deliver the chattels to that person on such terms and conditions as the trustee thinks fit, and shall not thereafter be bound to see to the repair or insurance of the chattels, and shall not be subject to any liability whatsoever by reason of the loss or destruction of the chattels or the neglect of that person to effect any such repairs or insurance.

(3)

A copy of any such inventory, signed by that person and by the trustee, is deemed to be a security interest within the meaning of the Personal Property Securities Act 1999, and a financing statement may be registered accordingly.

Section 39A: inserted, on 18 October 1957, by section 7(1) of the Trustee Amendment Act 1957 (1957 No 37).

Section 39A(1): amended, on 25 October 1960, by section 5(2) of the Trustee Amendment Act 1960 (1960 No 101).

Section 39A(3): replaced, on 1 May 2002, by section 191(1) of the Personal Property Securities Act 1999 (1999 No 126).

39B Protection of trustee in handing over chattels to infant

(1)

A trustee may in his discretion deliver to an infant, or to the guardian or any of the guardians of an infant, any chattels absolutely vested in the infant, and the receipt of the infant or guardian shall be a complete discharge to the trustee for any chattels so delivered.

(2)

The powers conferred by this section are in addition to the powers conferred by section 41 and, for the purposes of paragraph (a) of the proviso to that section, the value of the chattels delivered pursuant to this section shall not be taken into account in any way.

Section 39B: inserted, on 25 October 1960, by section 5(1) of the Trustee Amendment Act 1960 (1960 No 101).

Maintenance, advancement, and protective trusts

40 Power to apply income for maintenance, etc, and to accumulate surplus income during a minority

(1)

Where any property is held by a trustee in trust for any person for any interest whatsoever, whether vested or contingent, then, subject to any prior interests or charges affecting that property,—

(a)

during the infancy of any such person, if his interest so long continues, the trustee may, at his sole discretion, pay to his parent or guardian, if any, or otherwise apply for or towards his maintenance or education (including past maintenance or education) or his advancement or benefit, the whole or such part, if any, of the income of that property as may, in all the circumstances, be reasonable, whether or not there is—

(i)

any other fund applicable to the same purpose; or

(ii)

any person bound by law to provide for his maintenance, education, advancement, or benefit; and

(b)

if the person on attaining the age of 20 years has not a vested interest in that income, the trustee shall thenceforth pay the income of that property and of any accretion thereto under subsection (2) to him until he either attains a vested interest therein or dies, or until failure of his interest:

provided that, in deciding whether the whole or any part of the income of the property is during a minority to be paid or applied for the purposes aforesaid, the trustee shall have regard to the age of the infant and his requirements and generally to the circumstances of the case, and in particular to what other income, if any, is applicable for the same purposes; and where the trustee has notice that the income of more than 1 fund is applicable for those purposes, then, so far as practicable, unless the entire income of the funds is paid or applied as aforesaid or the court otherwise directs, a proportionate part only of the income of each fund shall be so paid or applied.

(2)

During the infancy of any such person, if his interest so long continues, the trustee shall accumulate all the residue of that income in the way of compound interest by investing the same and the resulting income thereof from time to time in accordance with the trust instrument or the provisions of this Act as to the investment of trust funds, and shall hold those accumulations as follows:

(a)

if any such person—

(i)

attains the age of 20 years, or marries or enters into a civil union under that age, and his interest in the income during his infancy or until he or she marries or enters into a civil union is a vested interest; or

(ii)

on attaining the age of 20 years or on marrying or entering into a civil union under that age becomes entitled to the property from which the income arose in fee simple absolute or determinable, or absolutely—

the trustee shall hold the accumulations in trust for that person absolutely, but without prejudice to any provision with respect thereto contained in any settlement by him made under any statutory powers during his infancy, and so that the receipt of that person after marrying or entering into a civil union, and though still an infant, shall be a good discharge; and

(b)

in any other case the trustee shall, notwithstanding that that person had a vested interest in the income, hold the accumulations as an accretion to the capital of the property from which the accumulations arose and as 1 fund with that capital for all purposes,—

but the trustee may, at any time during the infancy of that person if his interest so long continues, apply those accumulations, or any part thereof, as if they were income arising in the then current year.

(3)

This section applies in the case of a contingent interest only if the limitation or trust carries the intermediate income of the property, but it applies to a future or contingent legacy by the parent of, or a person standing in the place of a parent to, the legatee, if and for such period as, under the general law, the legacy carries interest for the maintenance of the legatee, and in any such case as last aforesaid the rate of interest shall (if the income available is sufficient and subject to any rules of court to the contrary) be that for the time being prescribed by or under section 39 of the Administration Act 1969.

(4)

This section applies to a vested annuity in like manner as if the annuity were the income of property held by a trustee in trust to pay the income thereof to the annuitant for the same period for which the annuity is payable, save that in any case accumulations made during the infancy of the annuitant shall be held in trust for the annuitant or his personal representatives absolutely.

Compare: 1946 No 14 s 4; Trustee Act 1925 s 31 (UK)

Section 40(1)(b): amended, on 1 January 1971, by section 6 of the Age of Majority Act 1970 (1970 No 137).

Section 40(2): amended, on 1 October 1988, by section 11 of the Trustee Amendment Act 1988 (1988 No 119).

Section 40(2)(a): amended, on 26 April 2005, by section 4(3) of the Trustee Amendment Act 2005 (2005 No 23).

Section 40(2)(a)(i): amended, on 26 April 2005, by section 4(1) of the Trustee Amendment Act 2005 (2005 No 23).

Section 40(2)(a)(i): amended, on 26 April 2005, by section 4(2) of the Trustee Amendment Act 2005 (2005 No 23).

Section 40(2)(a)(i): amended, on 1 January 1971, by section 6 of the Age of Majority Act 1970 (1970 No 137).

Section 40(2)(a)(ii): amended, on 26 April 2005, by section 4(3) of the Trustee Amendment Act 2005 (2005 No 23).

Section 40(2)(a)(ii): amended, on 1 January 1971, by section 6 of the Age of Majority Act 1970 (1970 No 137).

Section 40(3): amended, on 1 January 1971, by section 83 of the Administration Act 1969 (1969 No 52).

41 Power to apply capital for maintenance, etc

A trustee may at any time or times pay or apply any capital money or other capital asset subject to a trust, for the maintenance or education (including past maintenance or education), or the advancement or benefit, in such manner as he may in his absolute discretion think fit, of any person entitled to the capital of the trust property or of any share thereof, whether absolutely or contingently on his attaining any specified age or on the occurrence of any other event, or subject to a gift over on his death under any specified age or on the occurrence of any other event, and whether in possession or in remainder or reversion, and any such payment or application may be made notwithstanding that the interest of that person is liable to be defeated by the exercise of a power of appointment or revocation, or to be diminished by the increase of the class to which he belongs:

provided that—

(a)

except with the consent of the court, the money or asset so paid or applied for the maintenance, education, advancement, or benefit of any person shall not exceed altogether in amount or value—

(i)

half of the presumptive or vested share or interest of that person in the trust property where the value of that share or interest exceeds $15,000 or such other amount as the Governor-General, by Order in Council, may for the time being prescribe in place of that amount; or

(ii)

in any other case $7,500, or such other amount as the Governor-General, by Order in Council, may for the time being prescribe in place of that amount; and

(b)

where that person or any other person is or becomes absolutely and indefeasibly entitled to the share of the trust property in which that person had a presumptive or vested interest when the money or asset was so paid or applied, that money or asset shall be brought into account as part of that share in the trust property; and

(c)

no such payment or application shall be made so as to prejudice any person entitled to any prior life or other interest, whether vested or contingent, in the money or asset paid or applied unless that person is in existence and of full age and consents in writing to the payment or application, or unless the court, on the application of the trustee, so orders.

Compare: 1946 No 14 s 5; Trustee Act 1925 s 32 (UK)

Section 41 proviso paragraph (a): replaced, on 28 August 1977, by section 4 of the Trustee Amendment Act 1977 (1977 No 21).

Section 41 proviso paragraph (b): replaced, on 25 October 1960, by section 6 of the Trustee Amendment Act 1960 (1960 No 101).

41A Conditional advances for maintenance, etc

(1)

Where a power to pay or apply any property for the maintenance, education, advancement, or benefit of any person, or for any 1 or more of those purposes, is vested in a trustee, the trustee when exercising the power shall have, and be deemed always to have had, authority to impose on the person any condition, whether as to repayment, payment of interest, giving security, or otherwise. At any time after imposing any such condition, the trustee may, either wholly or in part, waive the condition or release any obligation undertaken or any security given by reason of the condition.

(2)

In determining the amount or value of the property which a trustee who has imposed such a condition may pay or apply in exercise of the power, any money repaid to the trustee or recovered by him shall be deemed not to have been so paid or applied by the trustee.

(3)

Nothing in this section shall impose upon a trustee any obligation to impose any such condition; and a trustee, when imposing any condition as to giving security as aforesaid, shall not be affected by any restrictions upon the investment of trust funds, whether imposed by this Act or by any rule of law or by the trust instrument (if any).

(4)

A trustee shall not be liable for any loss which may be incurred in respect of any money that is paid or applied as aforesaid, whether the loss arises through failure to take security, or through the security being insufficient, or through failure to take action for its protection, or through the release or abandonment of the security without payment, or from any other cause.

Section 41A: inserted, on 25 October 1960, by section 7 of the Trustee Amendment Act 1960 (1960 No 101).

42 Protective trusts

(1)

Where any income, including an annuity or other periodical income payment, is directed to be held on protective trusts for the benefit of any person (in this section called the principal beneficiary) for the period of his life or for any less period, then during that period (in this section called the trust period) the said income shall, without prejudice to any prior interest, be held on the following trusts, namely:

(a)

upon trust for the principal beneficiary during the trust period or until he, whether before or after the termination of any prior interest, does or attempts to do or suffers any act or thing, or until any event happens, other than an advance under any statutory or express power, whereby, if the said income were payable during the trust period to the principal beneficiary absolutely during that period, he would be deprived of the right to receive the same or any part thereof, in any of which cases, as well as on the termination of the trust period, whichever first happens, this trust of the said income shall fail or determine;

(b)

if the trust aforesaid fails or determines during the subsistence of the trust period, then, during the residue of that period, the said income shall be held upon trust for the application thereof for the maintenance or support, or otherwise for the benefit, of all or any 1 or more exclusively of the other or others of the following persons, that is to say:

(i)

the principal beneficiary and his or her wife, husband, civil union partner, or de facto partner, if any, and his or her children or more remote issue, if any; or

(ii)

if there is no wife or husband or civil union partner or de facto partner or issue of the principal beneficiary in existence, the principal beneficiary and the persons who would, if he were actually dead, be entitled to the trust property or the income thereof or to the annuity fund, if any, or arrears of the annuity, as the case may be;

as the trustee in his absolute discretion, without being liable to account for the exercise of such discretion, thinks fit.

(2)

This section shall not apply to trusts coming into operation before the commencement of this Act, and has effect subject to any variation of the implied trusts aforesaid contained in the instrument creating the trust.

(3)

Nothing in this section shall operate to validate any trust which would, if contained in the instrument creating the trust, be liable to be set aside.

Compare: Trustee Act 1925 s 33 (UK)

Section 42(1)(b)(i): amended, on 26 April 2005, by section 5(1) of the Trustee Amendment Act 2005 (2005 No 23).

Section 42(1)(b)(ii): amended, on 26 April 2005, by section 5(2) of the Trustee Amendment Act 2005 (2005 No 23).

Special powers in respect of businesses

Heading: inserted, on 11 December 1982, by section 2 of the Trustee Amendment Act 1982 (1982 No 50).

42A Power to set aside reserves out of income or profits of business

(1)

Where any property settled by way of succession is employed in a business that the trustee is empowered or authorised to carry on, and the trustee considers that in the interests of the persons entitled to the income or capital of the property, and in accordance with good business practice, it is expedient to set aside and retain as a capital reserve part of the income or profits arising therefrom in any period, then, notwithstanding any rule of law to the contrary, and without in any way affecting any other power conferred on him by this Act or any other enactment (including, without limiting the generality of the foregoing, the power to set up a depreciation or replacement fund under section 15(2)), or by the instrument creating the trust, it shall be lawful for but not obligatory upon the trustee to direct that such part of the income or profits arising from the property in that period as he determines shall cease to be income and shall become a capital reserve of the business.

(2)

Any income or profits reserved by the trustee under this section may be applied by him in his discretion either immediately or at any time or times thereafter in, for, or towards all or any of the following purposes:

(a)

the payment or discharge of any debts or liabilities of the business that are properly payable out of capital:

(b)

the improvement or development of any of the assets of the business, including the acquisition of trading stock or livestock:

(c)

the replacement, repair, maintenance, upkeep, or renovation of any of the assets of the trust used in the business, whether the cost of such replacement, repair, maintenance, upkeep, or renovation would otherwise have to be paid out of capital or out of income or partly out of capital and partly out of income:

(d)

the acquisition by purchase or otherwise of property or assets of like nature to any of the assets used in the business or that may advantageously be employed in conjunction therewith:

(e)

the provision of additional capital for the more efficient working of the business and a fund to enable the business to be developed:

(f)

meeting any losses notwithstanding that under any rule of law or enactment or provision in the trust instrument to the contrary such losses should be borne or partly borne by income:

(g)

any purpose or other purpose to which or for which in the exercise of any power, trust, or authority conferred upon him by this Act or any other enactment, or rule of law or by the trust instrument creating the trust, or court order the trustee may pay or apply the income or capital of the property or of any other assets held by him upon the same trusts.

(3)

All income or profits reserved by the trustee under this section shall, subject to the provisions of this section, follow the destination of the capital of the property and shall be subject to all the trusts, powers, and provisions applicable thereto.

Section 42A: inserted, on 11 December 1982, by section 2 of the Trustee Amendment Act 1982 (1982 No 50).

42B Power to apply capital of business for maintenance

(1)

Where any property settled by way of succession is employed in a business that the trustee is empowered or authorised to carry on, and the trustee considers in any period that the income arising from the business and available for distribution to the person entitled to receive it (in this section referred to as the income beneficiary) is insufficient for the proper maintenance of the income beneficiary, having regard to any other income received or to be received during that period by the income beneficiary from whatever source and to all the other circumstances of the case, then, notwithstanding any rule of law to the contrary, and without in any way affecting any other power conferred on him by this Act or any other enactment (including, without limiting the generality of the foregoing, the power to make advances out of income and capital under sections 40 and 41) or by the instrument creating the trust, it shall be lawful for but not obligatory upon the trustee to pay or apply any capital money or other capital asset subject to the trust and employed in the business (including any money for the time being standing to the credit of any fund established by the trustee under section 15(2) or section 42A) for the maintenance or benefit, in such manner as he may in his absolute discretion think fit, of the income beneficiary.

(2)

If, in any such case, the trustee pays or applies any capital money or capital asset for the maintenance or benefit of the income beneficiary in accordance with subsection (1), and, in any subsequent period, the trustee considers that the income available from the business for distribution to the income beneficiary is more than sufficient for the proper maintenance of the income beneficiary, having regard to any other income received or to be received during that subsequent period by the income beneficiary from whatever source and to all the other circumstances of the case, then the trustee may recoup the whole or such part as he thinks fit of the sum so paid (or of a sum equivalent to the value of the capital asset so applied) from the income arising from the business during that period and available for distribution to the income beneficiary.

Section 42B: inserted, on 11 December 1982, by section 2 of the Trustee Amendment Act 1982 (1982 No 50).

42C Matters to be taken into consideration when exercising powers

In considering whether or not to exercise, or in what manner he should exercise, any power conferred on him by section 42A or section 42B, the trustee shall have regard to the desirability of ensuring both—

(a)

the proper maintenance and support of the beneficiary entitled to the income arising from the business; and

(b)

the preservation and improvement of the business enterprise in the interests of the beneficiaries entitled to the capital thereof.

Section 42C: inserted, on 11 December 1982, by section 2 of the Trustee Amendment Act 1982 (1982 No 50).

42D Apportionment of income

Where any property settled by way of succession is employed in a business that the trustee is empowered or authorised to carry on, and the trustee considers that, in order better to determine the net income of the business that is available in any period for appropriation and distribution to the person or persons entitled under the trust to the income therefrom, it is expedient to do so, he may—

(a)

instead of commencing the accounting period to determine such income with the date of the commencement of the trust, adopt the accounting period employed in respect of the business immediately before the commencement of the trust, continue the accounting period so employed and current immediately before the commencement of the trust, and apportion the income so determined on such basis as if it had accrued evenly during that accounting period:

(b)

instead of preparing final accounts, in respect of any interest in the whole or any part of the income arising from the business, as at the date of the termination of that interest, prepare such accounts at the end of the accounting period employed in respect of the business immediately before the date of the termination of the interest and current at that date, and apportion the income so determined on such basis as if it had accrued evenly during that accounting period.

Section 42D: inserted, on 11 December 1982, by section 2 of the Trustee Amendment Act 1982 (1982 No 50).

Special powers in respect of portfolio investment entities

Heading: inserted, on 1 October 2007, by section 241 of the Taxation (Savings Investment and Miscellaneous Provisions) Act 2006 (2006 No 81).

42E Power to adjust interests in trust property of portfolio investment entity

Where any property is employed in an activity that the trustee is empowered or authorised to carry on as a portfolio investment entity, the trustee may adjust the interests of the beneficiaries in the property in the way required by section HL 7 of the Income Tax Act 2007 despite any other provision in this Act, in the Financial Markets Conduct Act 2013, or in any instrument creating the trust under which the property is held.

Section 42E: inserted, on 1 October 2007, by section 241 of the Taxation (Savings Investment and Miscellaneous Provisions) Act 2006 (2006 No 81).

Section 42E: amended, on 1 December 2014, by section 150 of the Financial Markets (Repeals and Amendments) Act 2013 (2013 No 70).

Section 42E: amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), pursuant to section ZA 1(1) of the Income Tax Act 2007 (2007 No 97).

Part 4 Appointment and discharge of trustees

43 Power of appointing new trustees

(1)

Where a trustee (whether original or substituted, and whether appointed by the court or otherwise)—

(a)

is dead; or

(b)

remains out of New Zealand for the space of 12 months during which no delegation of any trusts, powers, or discretions vested in him as such trustee remains in operation under section 31; or

(c)

desires to be discharged from all or any of the trusts or powers reposed in or conferred on him; or

(d)

refuses to act therein; or

(e)

is unfit to act therein; or

(f)

is incapable of so acting; or

(g)

being a corporation, has ceased to carry on business, is in liquidation, or is dissolved, then—

the person nominated for the purpose of appointing new trustees by the instrument (if any) creating the trust, or if there is no such person or no such person able and willing to act, then the surviving or continuing trustees for the time being, or the personal representatives of the last surviving or continuing trustee, may by deed appoint a person or persons (whether or not being the person or persons exercising the power) to be a trustee or trustees in the place of the first-mentioned trustee.

(2)

On the appointment of a trustee or trustees for the whole or any part of trust property—

(a)

the number of trustees may be increased; and

(b)

a separate set of trustees may be appointed for any part of the trust property held on trusts distinct from those relating to any other part, and whether or not new trustees are or are to be appointed for other parts of the trust property; and any existing trustee may be appointed or remain one of the separate set of trustees; or if only 1 trustee was originally appointed, then 1 separate trustee may be so appointed for the first-mentioned part; and

(c)

it shall not be obligatory to appoint more than 1 new trustee where only 1 trustee was originally appointed, or to fill up the original number of trustees where more than 2 trustees were originally appointed; but, except where only 1 trustee was originally appointed, a trustee shall not be discharged under this section unless there will be either a trustee corporation or at least 2 individuals to act as trustees to perform the trust; and

(d)

any assurance or thing requisite for vesting the trust property, or any part thereof, jointly in the persons who are the trustees shall be executed or done.

(3)

Where a trustee has been removed under a power contained in the instrument creating the trust, a new trustee or new trustees may be appointed in the place of the trustee who is removed, as if he were dead, or, in the case of a corporation, as if the corporation had been dissolved, and the provisions of this section shall apply accordingly.

(4)

The power of appointment given by subsection (1) or any similar previous enactment to the personal representatives of a last surviving or continuing trustee shall be and shall be deemed always to have been exercisable by the executors for the time being (whether original or by representation) of that surviving or continuing trustee who have proved the will of their testator or by the administrators for the time being of that trustee without the concurrence of any executor who has renounced or has not proved:

provided that a sole or last surviving executor intending to renounce, or all the executors where they all intend to renounce, shall have and shall be deemed always to have had power, at any time before renouncing probate, to exercise the power of appointment given by this section, or by any similar previous enactment, if willing to act for that purpose and without thereby accepting the office of executor.

(5)

Where a sole trustee is or has been originally appointed to act in a trust, or where, in the case of any trust, there are not more than 3 trustees either original or substituted and whether appointed by the court or otherwise, then and in any such case—

(a)

the person or persons nominated for the purpose of appointing new trustees by the instrument, if any, creating the trust; or

(b)

if there is no such person, or no such person able and willing to act, then the trustee or trustees for the time being—

may, by writing, appoint a person or persons (whether or not being the person or persons exercising the power) to be an additional trustee or additional trustees, but it shall not be obligatory to appoint any additional trustee, unless the instrument, if any, creating the trust, or any statutory enactment provides to the contrary:

provided that an additional trustee or additional trustees shall not be appointed under this subsection without the consent of—

(a)

the trustee or trustees for the time being; or

(b)

the court.

(6)

Every new trustee appointed under this section as well before as after all the trust property becomes by law, or by assurance, or otherwise, vested in him, shall have the same powers, authorities, and discretions, and may in all respects act as if he had been originally appointed a trustee by the instrument, if any, creating the trust.

(7)

The provisions of this section relative to a trustee who is dead include the case of a person nominated trustee whether sole or otherwise in a will, and who dies before the testator; and those relative to a continuing trustee include a refusing or retiring trustee, if willing to act in the execution of the provisions of this section.

(8)

The provisions of this section relative to a person nominated for the purpose of appointing new trustees apply whether the appointment is made in a case specified in this section or in a case specified in the instrument, if any, creating the trust, but where a new trustee is appointed under this section in a case specified in that instrument, the appointment shall be subject to the terms applicable to an appointment in that case under the provisions of that instrument.

(9)

In this section the term trustee does not include a personal representative as such.

Compare: 1908 No 200 s 78; 1925 No 14 s 6(10) (NSW); Trustee Act 1925 ss 36, 37 (UK)

Section 43(5): amended, on 15 November 1968, by section 13(a) of the Trustee Amendment Act 1968 (1968 No 24).

Section 43(5): amended, on 15 November 1968, by section 13(b) of the Trustee Amendment Act 1968 (1968 No 24).

Section 43(5) proviso: inserted, on 15 November 1968, by section 13(c) of the Trustee Amendment Act 1968 (1968 No 24).

Section 43(9): inserted, on 18 October 1957, by section 8 of the Trustee Amendment Act 1957 (1957 No 37).

44 Evidence as to a vacancy in a trust

(1)

A statement contained in any instrument coming into operation after the commencement of this Act by which a new trustee is appointed for any purpose connected with land as to how a vacancy in the office of trustee occurred shall, in favour of a purchaser of the land, be conclusive evidence of the matter stated.

(2)

In favour of any such purchaser any appointment of a new trustee depending on that statement, and any vesting declaration, express or implied, consequent on the appointment, shall be valid.

Compare: Trustee Act 1925 s 38 (UK)

45 Retirement of trustee

(1)

Where there are 2 or more trustees—

(a)

if one of them by deed declares that he is desirous of being discharged from the trust, and

(b)

if his co-trustees and such other person (if any) as is empowered to appoint trustees by deed consent to the discharge of the trustee, and to the vesting of the trust property in the co-trustees alone—

then, subject to the provisions of subsection (3), the trustee desirous of being discharged shall be deemed to have retired from the trust, and shall by the deed be discharged therefrom under this Act without any new trustee being appointed in his place.

(2)

Any assurance or thing requisite for vesting the trust property in the continuing trustees alone shall be executed and done.

(3)

Except where only 1 trustee was originally appointed, a trustee shall not be discharged under subsection (1) unless there will be either a trustee corporation or at least 2 individuals to act as trustees to perform the trust.

Compare: 1908 No 200 s 79; Trustee Act 1925 s 39 (UK)

46 Discharge of trustee with assistance of court or Registrar

(1)

Where any trustee is desirous of being discharged from his trust he shall be entitled to retire therefrom on passing his accounts before the Registrar, and giving notice of his retirement to his co-trustees (if any), and to such other person (if any) as is empowered to appoint new trustees.

(2)

If such co-trustees, or such other person as aforesaid empowered to appoint new trustees, or any of them, refuse or neglect to appoint a new trustee or to consent to such appointment in place of the trustee so retiring, or if the retiring trustee is the sole trustee having power to appoint a new trustee, but the exercise of that power is impracticable or difficult without the assistance of the court, it shall be lawful for the retiring trustee to apply to the court for the appointment of a new trustee in his place.

(3)

The court may, upon any such application, make an order appointing some proper person as trustee in place of the trustee so desirous of being discharged from his trust, and direct any accounts and inquiries to be made, and make an order discharging the trustee from the trust and from all liability in respect thereof, and may make such order as to costs or otherwise as it thinks fit, and may exercise any of the powers contained in Part 5; and the person who upon the making of the order becomes trustee shall have the same rights and powers as he would have had if appointed by judgment in an action duly instituted.

(4)

If the court, on an application under subsection (2) by a trustee other than a supervisor, appoints Public Trust as the replacement trustee, Public Trust must accept the appointment.

(5)

In subsection (4), supervisor means a person appointed as a supervisor within the meaning of section 6(1) of the Financial Markets Conduct Act 2013.

(6)

[Repealed]

(7)

[Repealed]

Compare: 1908 No 200 s 102

Section 46(4): replaced, on 1 December 2014, by section 150 of the Financial Markets (Repeals and Amendments) Act 2013 (2013 No 70).

Section 46(5): replaced, on 1 December 2014, by section 150 of the Financial Markets (Repeals and Amendments) Act 2013 (2013 No 70).

Section 46(6): repealed, on 1 December 2014, by section 150 of the Financial Markets (Repeals and Amendments) Act 2013 (2013 No 70).

Section 46(7): repealed, on 1 December 2014, by section 150 of the Financial Markets (Repeals and Amendments) Act 2013 (2013 No 70).

47 Vesting of trust property in new or continuing trustees

(1)

Where by a deed a new trustee is appointed to perform any trust, then—

(a)

if the deed contains a declaration by the appointor to the effect that any estate or interest in any land that is subject to the trust and is not under the Land Transfer Act 1952 or excluded from the operation of this section by subsection (4) thereof or in any chattel so subject, or the right to recover or receive any debt or other thing in action so subject, shall vest in the persons who by virtue of the deed become or are the trustees for performing the trust, the deed shall operate, without any conveyance or assignment, to vest in those persons as joint tenants and for the purposes of the trust the estate or interest or right to which the declaration relates; and

(b)

if the deed is made after the commencement of this Act and does not contain such a declaration, the deed shall, subject to any express provision to the contrary therein contained, operate as if it had contained such a declaration by the appointor extending to all the estates, interests, and rights with respect to which a declaration could have been made.

(2)

Where by a deed a retiring trustee is discharged under the statutory power without a new trustee being appointed, then—

(a)

if the deed contains such a declaration as aforesaid by the retiring and continuing trustees, and by the other person (if any) empowered to appoint trustees, the deed shall, without any conveyance or assignment, operate to vest in the continuing trustees alone, as joint tenants, and for the purposes of the trust, the estate or interest or right to which the declaration relates; and

(b)

if the deed is made after the commencement of this Act and does not contain such a declaration, the deed shall, subject to any express provision to the contrary therein contained, operate as if it had contained such a declaration by such persons as aforesaid extending to all the estates, interests, and rights with respect to which a declaration could have been made.

(3)

An express vesting declaration, whether made before or after the commencement of this Act, shall, notwithstanding that the estate or interest or right to be vested is not expressly referred to, and provided that the other statutory requirements were or are complied with, operate and be deemed always to have operated (but without prejudice to any express provision to the contrary contained in the deed of appointment or discharge) to vest in the persons respectively referred to in subsections (1) and (2), as the case may require, such estates, interests, and rights as are capable of being and ought to be vested in those persons.

(4)

This section does not extend—

(a)

to land conveyed by way of mortgage for securing money subject to the trust, except land conveyed on trust for securing debentures or debenture stock:

(b)

to land held under a lease (including a sublease and an agreement for a lease or sublease) which contained any covenant, condition, or agreement against assignment or disposing of the land without licence or consent, unless (before the execution of the deed containing expressly or impliedly the vesting declaration) the requisite licence or consent has been obtained, or unless (by virtue of any statute or rule of law) the vesting declaration, express or implied, would not operate as a breach of covenant or give rise to a forfeiture:

(c)

to any share, stock, annuity, or property which is transferable only in books kept by a company or other body, or in manner directed by or under any Act.

(5)

For purposes of registration of the deed in any registry, the person or persons making the declaration expressly or impliedly shall be deemed the conveying party or parties, and the conveyance shall be deemed to be made by him or them under a power conferred by this Act.

Compare: 1908 No 200 s 80; Trustee Act 1925 s 40 (UK)

48 Corporations acting as trustees

(1)

Any trustee corporation may be appointed and may lawfully act as the sole trustee in respect of any trust, notwithstanding that the instrument creating the trust may provide for or direct the appointment of 2 or more trustees. Nothing in this subsection shall prevent any other corporation from acting as a trustee in accordance with any authority vested in it in that behalf, whether by its memorandum of association or otherwise:

provided that no corporation shall administer the estate of any deceased person unless expressly authorised to do so by any Act.

(2)

This section shall not permit the appointment of a corporation as trustee if the instrument creating the trust forbids the appointment of the corporation.

(3)

This section shall extend to all trusts and instruments, and to all appointments of trustees, whether created or made before or after the commencement of this Act.

Compare: 1908 No 200 s 100

49 Advisory trustees

(1)

In the administration of any trust property any trustee may act, to the extent hereinafter provided, with an advisory trustee, which term includes, in its application to the estate of a mentally disordered person, an advisory manager or advisory administrator of the estate; and also includes, in its application to the estate or any part of the estate of any person in respect of whom a property order is made under the Protection of Personal and Property Rights Act 1988, an advisory manager of the estate, or any part thereof.

(2)

An advisory trustee may be appointed in respect of all or any part of the trust property—

(a)

by the testator, settlor, or other creator of the trust, in the instrument creating the trust; or

(b)

by order of the court made on the application of any beneficiary or trustee or of any person on whose application the court would have power to appoint a new trustee; or

(c)

by the responsible trustee or any person having power to appoint a new trustee; or

(d)

in respect of the estate of a mentally disordered person, by order of the court made on the application of the manager or person authorised to administer the estate or of any person on whose application the court would have power under the Protection of Personal and Property Rights Act 1988 to appoint a manager of that estate; or

(e)

in respect of the estate or any part of the estate of any person in respect of whom a property order is made under the Protection of Personal and Property Rights Act 1988, by order of the court made on the application of the manager of the protected estate or of any person on whose application the court would have power to make the protection order.

(3)

Where a trustee acts with an advisory trustee the trust property shall be vested in the first-mentioned trustee (in this section referred to as the responsible trustee), who shall have the sole management and administration of the estate and its trusts as fully and effectually as if he were the sole trustee:

provided that—

(a)

the responsible trustee may consult the advisory trustee on any matter relating to the trusts or the estate:

(b)

the advisory trustee may advise the responsible trustee on any matter relating to the trusts or the estate, but shall not be a trustee in respect of the trust:

(c)

where any advice or direction is tendered or given by the advisory trustee, the responsible trustee may follow the same and act thereon, and shall not be liable for anything done or omitted by him by reason of his following that advice or direction:

(d)

in any case where the responsible trustee is of opinion that such advice or direction conflicts with the trusts or any rule of law, or exposes him to any liability, or is otherwise objectionable, he may apply to the court for directions in the matter, and the decision and order therein shall be final and shall bind the responsible trustee and the advisory trustee, and the court may make such order as to costs as appears proper:

provided that nothing in this paragraph shall make it necessary for the responsible trustee to apply to the court for any such directions:

(e)

where advisory trustees are not unanimous, and tender to the responsible trustee conflicting advice or directions, the responsible trustee may similarly apply to the court for directions.

(4)

No person dealing with the responsible trustee in relation to any trust property shall be concerned to inquire as to the concurrence or otherwise of the advisory trustee, or be affected by notice of the fact that the advisory trustee has not concurred.

(5)

Subject to the provisions of the instrument (if any) creating the trust and to any order made by the court, in any case where remuneration is payable to the trustee of any trust property, remuneration or commission may be paid to both the responsible trustee and the advisory trustee, and subject as aforesaid the amount thereof shall be determined,—

(a)

where the responsible trustee is the Māori Trustee, by or under regulations made under the Maori Trustee Act 1953:

(aa)

where the responsible trustee is Public Trust, in accordance with Public Trust’s scale of charges:

(b)

in any other case, by the responsible trustee if he is entitled to fix his own remuneration, or by the court.

(6)

[Repealed]

Compare: 1924 No 33 s 7

Section 49 heading: amended, on 15 November 1968, by section 14 of the Trustee Amendment Act 1968 (1968 No 24).

Section 49(1): amended, on 1 October 1988, pursuant to section 113 of the Protection of Personal and Property Rights Act 1988 (1988 No 4).

Section 49(1): amended, on 1 October 1988, pursuant to section 117(3) of the Protection of Personal and Property Rights Act 1988 (1988 No 4).

Section 49(1): amended, on 1 April 1970, pursuant to section 129(4) of the Mental Health Act 1969 (1969 No 16).

Section 49(1): amended, on 1 April 1970, pursuant to section 129(7) of the Mental Health Act 1969 (1969 No 16).

Section 49(2)(c): amended, on 15 November 1968, by section 14(a) of the Trustee Amendment Act 1968 (1968 No 24).

Section 49(2)(d): amended, on 1 October 1988, pursuant to section 113 of the Protection of Personal and Property Rights Act 1988 (1988 No 4).

Section 49(2)(d): amended, on 1 April 1970, pursuant to section 129(4) of the Mental Health Act 1969 (1969 No 16).

Section 49(2)(d): amended, on 1 April 1970, pursuant to section 129(7) of the Mental Health Act 1969 (1969 No 16).

Section 49(2)(e): amended, on 1 October 1988, pursuant to section 113 of the Protection of Personal and Property Rights Act 1988 (1988 No 4).

Section 49(2)(e): amended, on 1 October 1988, pursuant to section 117(3) of the Protection of Personal and Property Rights Act 1988 (1988 No 4).

Section 49(3): amended, on 15 November 1968, by section 14(b) of the Trustee Amendment Act 1968 (1968 No 24).

Section 49(5)(a): replaced, on 1 March 2002, by section 170(1) of the Public Trust Act 2001 (2001 No 100).

Section 49(5)(a): amended, on 1 July 2009, by section 30(1) of the Māori Trustee Amendment Act 2009 (2009 No 12).

Section 49(5)(aa): inserted, on 1 March 2002, by section 170(1) of the Public Trust Act 2001 (2001 No 100).

Section 49(6): repealed, on 4 December 1968, by section 11(a) of the Public Trust Office Amendment Act 1968 (1968 No 43).

50 Remuneration of custodian trustees

(1)

Subject to the provisions of this section and to the instrument (if any) creating the trust, any corporation may be appointed to be custodian trustee of any trust in any case where it could be appointed to be trustee, in the same manner as it could be so appointed.

(2)

Subject to the provisions of the instrument (if any) creating the trust, where a custodian trustee is appointed of any trust—

(a)

the trust property shall be vested in the custodian trustee as if the custodian trustee were sole trustee, and for that purpose vesting orders may, where necessary, be made under this Act:

(b)

the management of the trust property and the exercise of all powers and discretions exercisable by the trustee under the trust shall remain vested in the managing trustees as fully and effectually as if there were no custodian trustee:

(c)

the sole function of the custodian trustee shall be to get in and hold the trust property, and invest its funds, and dispose of the assets, as the managing trustees in writing direct, for which purpose the custodian trustee shall execute all such documents and perform all such acts as the managing trustees in writing direct:

(d)

for the purposes of paragraph (c) a direction given by the majority of the managing trustees where there are more than 1, shall be deemed to be given by all the managing trustees:

(e)

the custodian trustee shall not be liable for acting on any such direction:

provided that if the custodian trustee is of opinion that any such direction conflicts with the trusts or the law, or exposes the custodian trustee to any liability, or is otherwise objectionable, the custodian trustee may apply to the court for directions under section 66; and any order giving any such directions shall bind both the custodian trustee and the managing trustees; and the court may make such order as to costs as it thinks proper:

(f)

the custodian trustee shall not be liable for any act or default on the part of any of the managing trustees:

(g)

all actions and proceedings touching or concerning the trust property shall be brought or defended in the name of the custodian trustee at the written direction of the managing trustees, and the custodian trustee shall not be liable for the costs thereof apart from the trust property:

(h)

no person dealing with the custodian trustee shall be concerned to inquire as to the concurrence or otherwise of the managing trustees, or be affected by notice of the fact that the managing trustees have not concurred:

(i)

the power of appointing new trustees, when exercisable by the trustee, shall be exercisable by the managing trustees alone, but the custodian trustee shall have the same power as any other trustee of applying to the court for the appointment of a new trustee.

(3)

On the application of the custodian trustee, or of any of the managing trustees, or of any beneficiary, and on satisfactory proof that it is the general wish of the beneficiaries, or that on other grounds it is expedient to terminate the custodian trusteeship, the court may make an order for that purpose, and may also make such vesting orders and give such directions as in the circumstances seem to the court to be necessary or expedient.

(4)

Subject to the provisions of the instrument (if any) creating the trust and to any order made by the court, in any case where remuneration or commission is payable to the trustee of any trust property, remuneration may be paid to both the custodian trustee and the managing trustees, and subject as aforesaid the amount thereof shall be determined,—

(a)

as regards the custodian trustee in any case where the custodian trustee is the Māori Trustee, by or under regulations made under the Maori Trustee Act 1953:

(aa)

as regards the custodian trustee in any case where the custodian trustee is Public Trust, in accordance with Public Trust’s scale of charges:

(b)

as regards the custodian trustee in any case where the custodian trustee is a trustee company within the meaning of the Trustee Companies Act 1967, in accordance with the scale of charges for the time being of the trustee company:

(c)

except as provided in paragraphs (a) and (b), by the managing trustees if they are entitled to fix their own remuneration, or by the court.

(5)

[Repealed]

Compare: 1913 No 19 ss 5–9

Section 50 heading: amended, on 15 November 1968, by section 15 of the Trustee Amendment Act 1968 (1968 No 24).

Section 50(4)(a): replaced, on 1 March 2002, by section 170(1) of the Public Trust Act 2001 (2001 No 100).

Section 50(4)(a): amended, on 1 July 2009, by section 30(1) of the Māori Trustee Amendment Act 2009 (2009 No 12).

Section 50(4)(aa): inserted, on 1 March 2002, by section 170(1) of the Public Trust Act 2001 (2001 No 100).

Section 50(4)(b): replaced, on 15 November 1968, by section 15 of the Trustee Amendment Act 1968 (1968 No 24).

Section 50(4)(c): inserted, on 15 November 1968, by section 15 of the Trustee Amendment Act 1968 (1968 No 24).

Section 50(5): repealed, on 4 December 1968, by section 11(a) of the Public Trust Office Amendment Act 1968 (1968 No 43).

Part 5 Powers of the court

Appointment of new trustees

51 Power of court to appoint new trustees

(1)

The court may, whenever it is expedient to appoint a new trustee or new trustees, and it is found inexpedient, difficult, or impracticable so to do without the assistance of the court, make an order appointing a new trustee or new trustees, either in substitution for or in addition to any existing trustee or trustees, or although there is no existing trustee.

(2)

In particular and without prejudice to the generality of the foregoing provision, the court may make an order appointing a new trustee in substitution for a trustee who—

(a)

has been held by the court to have misconducted himself in the administration of the trust; or

(b)

is convicted of a crime involving dishonesty as defined by section 2 of the Crimes Act 1961; or

(c)

is a mentally disordered person within the meaning of the Mental Health (Compulsory Assessment and Treatment) Act 1992, or whose estate or any part thereof is subject to a property order made under the Protection of Personal and Property Rights Act 1988; or

(d)

is a bankrupt; or

(e)

is a corporation which has ceased to carry on business, or is in liquidation, or has been dissolved.

(3)

An order under this section, and any consequential vesting order or conveyance, shall not operate further or otherwise as a discharge to any former or continuing trustee than an appointment of new trustees under any power for that purpose contained in any instrument would have operated.

(4)

Nothing in this section shall give power to appoint an executor or administrator.

(5)

Every trustee appointed by the court shall, as well before as after the trust property becomes by law, or by assurance, or otherwise, vested in him, have the same powers, authorities, and discretions, and may in all respects act as if he had been originally appointed a trustee by the instrument, if any, creating the trust.

Compare: 1908 No 200 ss 41, 42; Trustee Act 1925 ss 41, 43 (UK)

Section 51(2)(b): amended, on 1 July 2013, by section 413 of the Criminal Procedure Act 2011 (2011 No 81).

Section 51(2)(b): amended, on 1 January 1962, pursuant to section 412(2) of the Crimes Act 1961 (1961 No 43).

Section 51(2)(c): amended, on 1 November 1992, pursuant to section 137(1) of the Mental Health (Compulsory Assessment and Treatment) Act 1992 (1992 No 46).

Section 51(2)(c): amended, on 1 October 1988, pursuant to section 113 of the Protection of Personal and Property Rights Act 1988 (1988 No 4).

Section 51(2)(c): amended, on 1 October 1988, pursuant to section 117(3) of the Protection of Personal and Property Rights Act 1988 (1988 No 4).

Section 51(2)(c): amended, on 1 April 1970, pursuant to section 129(4) of the Mental Health Act 1969 (1969 No 16).

Vesting orders

52 Vesting orders of land

(1)

Subject to the provisions of subsections (2) and (3), in any of the following cases, namely—

(a)

where the court appoints or has appointed a trustee of any land or interest therein, or where a trustee of any land or interest therein has been appointed out of court under any statutory or express power:

(b)

where a trustee entitled to or possessed of any land or interest therein, whether by way of mortgage or otherwise, or entitled to a contingent right therein, either solely or jointly with any other person—

(i)

is under disability; or

(ii)

is out of the jurisdiction of the court; or

(iii)

cannot be found; or

(iv)

being a corporation, has ceased to carry on business or is in liquidation or has been dissolved:

(c)

where it is uncertain who was the survivor of 2 or more trustees jointly entitled to or possessed of any interest in land:

(d)

where it is uncertain whether the last trustee known to have been entitled to or possessed of any interest in land is alive or dead:

(e)

where there is no personal representative of a deceased trustee who was entitled to or possessed of any interest in land, or where it is uncertain who is the personal representative of a deceased trustee who was entitled to or possessed of any interest in land:

(f)

where a deceased person was entitled to or possessed of any interest in land and his personal representative is under disability:

(g)

where a trustee jointly or solely entitled to or possessed of any interest in land, or entitled to a contingent right therein, has been required, by or on behalf of a person entitled to require a conveyance of the land or interest or a release of the right, to convey the land or interest or to release the right, and has wilfully refused or neglected to convey the land or interest or release the right for 28 days after the date of the requirement:

(h)

where land or any interest therein is vested in a trustee whether by way of mortgage or otherwise, and it appears to the court to be expedient—

the court may make an order (in this Act called a vesting order) vesting the land or interest therein in any such person in any such manner and for any such estate or interest as the court may direct, or releasing or disposing of the contingent right to such person as the court may direct.

(2)

Where any such order is consequential on the appointment of a trustee, the land or interest therein shall be vested for such estate as the court may direct in the persons who on the appointment are the trustees.

(3)

Where any such order relates to a trustee entitled or formerly entitled jointly with another person, and that trustee is under disability or out of the jurisdiction of the court or cannot be found, or (being a corporation) has ceased to carry on business or is in liquidation or has been dissolved, the land, interest, or right shall be vested in the other person who remains entitled, either alone or with any other person that the court may appoint.

Compare: 1908 No 200 ss 3, 4, 8, 9, 11, 12, 13, 15, 16, 17, 19; Trustee Act 1925 s 44 (UK)

53 Orders as to contingent rights of unborn persons

Where any interest in land is subject to a contingent right in an unborn person or class of unborn persons, who, on coming into existence would, in respect thereof, become entitled to or possessed of that interest on any trust, the court may make an order releasing the land or interest therein from the contingent right, or may make an order vesting in any person the estate or interest to or of which the unborn person or class of unborn persons would, on coming into existence, be entitled or possessed in the land.

Compare: 1908 No 200 s 18; Trustee Act 1925 s 45 (UK)

54 Vesting order in place of conveyance by infant mortgagee

Where any person entitled to or possessed of any interest in land, or entitled to a contingent right in land, by way of security for money, is an infant, the court may make an order vesting or releasing or disposing of the interest in the land or the right in like manner as in the case of a trustee under disability.

Compare: 1908 No 200 ss 8, 9; Trustee Act 1925 s 46 (UK)

55 Vesting order consequential on order for sale or mortgage of land

Where the court gives a judgment or makes an order directing the sale or mortgage of any land, every person who is entitled to or possessed of any interest in the land, or entitled to a contingent right therein, and is a party to the action or proceeding in which the judgment or order is given or made or is otherwise bound by the judgment or order, shall be deemed to be so entitled or possessed, as the case may be, as a trustee for the purposes of this Act, and the court may, if it thinks expedient, make an order vesting the land or any part thereof for such estate or interest as the court thinks fit in the purchaser or mortgagee or in any other person.

Compare: 1908 No 200 ss 37, 38; Trustee Act 1925 s 47 (UK)

56 Vesting order consequential on judgment for specific performance

Where a judgment is given for the specific performance of a contract concerning any interest in land, or for sale or exchange of any interest in land, or generally where any judgment is given for the conveyance of any interest in land, either in cases arising out of the doctrine of election or otherwise, the court may declare—

(a)

that any of the parties to the action are trustees of any interest in the land or any part thereof within the meaning of this Act; or

(b)

that the interests of unborn persons who might claim under any party to the action, or under the will or voluntary settlement of any deceased person who was during his lifetime a party to the contract or transaction concerning which the judgment is given, are the interests of persons who, on coming into existence, would be trustees within the meaning of this Act—

and thereupon the court may make a vesting order relating to the rights of those persons, born and unborn, as if they had been trustees.

Compare: 1908 No 200 s 39; Trustee Act 1925 s 48 (UK)

57 Effect of vesting order

(1)

A vesting order under any of the foregoing provisions shall, in the case of a vesting order consequential on the appointment of a trustee, have the same effect—

(a)

as if the persons who before the appointment were the trustees, if any, had duly executed all proper conveyances of the land for such estate or interest as the court directs; or

(b)

if there is no such person or no such person of full age and full mental capacity, as if such person had existed and been of full age and full mental capacity and had duly executed all proper conveyances of the land for such estate or interest as the court directs;

and shall in every other case have the same effect as if the trustee or other person or description or class of persons to whose rights or supposed rights the said provisions respectively relate had been an ascertained and existing person of full age and full mental capacity and had executed a conveyance or release to the effect intended by the order.

(2)

This section shall, as regards land under the Land Transfer Act 1952, be read and construed subject to section 99 of that Act.

Compare: 1908 No 200 ss 22, 43; Trustee Act 1925 s 49 (UK)

58 Power to appoint person to convey

In all cases where a vesting order can be made under any of the foregoing provisions, the court may, if it is more convenient, appoint a person to convey the land or any interest therein or release the contingent right, and a conveyance, or release by that person in conformity with the order shall have the same effect as an order under the appropriate provision.

Compare: 1908 No 200 s 23; Trustee Act 1925 s 50 (UK)

59 Vesting orders as to stock and things in action

(1)

Subject to the provisions of subsections (2), (3), and (4), in any of the following cases, namely—

(a)

where the court appoints or has appointed a trustee, or where a trustee has been appointed out of court under any statutory or express power:

(b)

where a trustee entitled, whether by way of mortgage or otherwise, alone or jointly with another person to stock or to a thing in action—

(i)

is under disability; or

(ii)

is out of the jurisdiction of the court; or

(iii)

cannot be found; or

(iv)

being a corporation, has ceased to carry on business or is in liquidation or has been dissolved; or

(v)

neglects or refuses to transfer stock or receive the dividends or income thereof, or to sue for or recover a thing in action, according to the direction of the person absolutely entitled thereto for 28 days next after a request in writing has been made to him by the person so entitled; or

(vi)

neglects or refuses to transfer stock or receive the dividends or income thereof, or to sue for or recover a thing in action for 28 days next after an order of the court for that purpose has been served on him:

(c)

where it is uncertain who was the survivor of 2 or more trustees entitled to stock or to a thing in action:

(d)

where it is uncertain whether a trustee entitled alone or jointly with another person to stock or to a thing in action is alive or dead:

(e)

where there is no personal representative of a deceased person entitled to stock or to a thing in action or where it is uncertain who is the personal representative of a deceased person who is entitled to stock or to a thing in action:

(f)

where stock is standing in the name of a deceased person whose personal representative is under disability:

(g)

where stock or a thing in action is vested in a trustee whether by way of mortgage or otherwise and it appears to the court to be expedient—

the court may make an order vesting the right to transfer or call for a transfer of stock, or to receive the dividends or income thereof, or to sue for or recover the thing in action in any person as the court may appoint.

(2)

Where any such order is consequential on the appointment of a trustee, the right shall be vested in the persons who, on the appointment, are the trustees.

(3)

Where the person whose right is dealt with by any such order was entitled jointly with another person, the right shall be vested in that last-mentioned person either alone or jointly with any other person whom the court may appoint.

(4)

No such order shall be made vesting shares that are not fully paid up in any person unless he applies for the order or consents to the making of the order.

(5)

In all cases where a vesting order can be made under this section, the court may, if it is more convenient, appoint some proper person to make or join in making the transfer; and without restricting the powers of the court under this subsection it is hereby declared that the person appointed to make or join in making a transfer of stock may be some proper officer of the bank or company or society or association in whose books the stock is to be transferred.

(6)

The person in whom the right to transfer or call for the transfer of any stock is vested by an order of the court under this Act may transfer the stock to himself or any other person, according to the order, and all banks, societies, associations, companies, and persons shall obey every order under this section according to its tenor.

(7)

After notice in writing of an order made under this section it shall not be lawful for any bank, society, association, company, or person to transfer any stock to which the order relates or to pay any dividends thereon except in accordance with the order.

(8)

The court may make declarations and give directions concerning the manner in which the right to transfer any stock or thing in action vested under the provisions of this Act is to be exercised.

Compare: 1908 No 200 ss 5, 6, 7, 10, 24, 26, 27, 28, 29, 30, 31, 32, 33, 34, 40, 44; Trustee Act 1925 s 51 (UK)

60 Vesting orders in respect of shares in ships and industrial property

The provisions of this Act as to vesting orders shall apply to shares in ships registered in New Zealand under the Shipping and Seamen Act 1952, and to patents, designs, trade marks, and copyright, as if they were stock.

61 Vesting orders of charity property

The powers conferred by this Act as to vesting orders may be exercised for vesting any interest in any land, stock, or thing in action in any trustee of a charity or society over which the court would have jurisdiction upon action duly instituted, whether the appointment of the trustee was made by instrument under a power or by the court under its general or statutory jurisdiction.

Compare: 1908 No 200 s 55; Trustee Act 1925 s 52 (UK)

62 Orders made upon certain allegations to be conclusive evidence

Where a vesting order is made as to any land under this Act or under any other Act founded on an allegation of any of the following matters namely—

(a)

the personal incapacity of a trustee or mortgagee; or

(b)

that a trustee or mortgagee or the personal representative of or other person deriving title under a trustee or mortgagee is out of the jurisdiction of the court or cannot be found, or (being a corporation) has ceased to carry on business or is in liquidation or has been dissolved; or

(c)

that it is uncertain which of 2 or more trustees, or which of 2 or more persons interested in a mortgage, was the survivor; or

(d)

that it is uncertain whether the last trustee or the personal representative of or other person deriving title under a trustee or mortgagee, or the last surviving person interested in a mortgage is living or dead; or

(e)

that any trustee or mortgagee has died intestate without leaving a person beneficially interested under the intestacy or has died and it is not known who is his personal representative or the person interested—

the fact that the order has been so made shall be conclusive evidence of the matter so alleged in any court upon any question as to the validity of the order; but this section shall not prevent the court from directing a reconveyance or surrender or the payment of costs occasioned by any such order if improperly obtained.

Compare: 1908 No 200 s 54; Trustee Act 1925 s 55 (UK)

63 Orders liable to stamp duty
[Repealed]

Section 63: repealed, on 1 January 1972, by section 101(1) of the Stamp and Cheque Duties Act 1971 (1971 No 51).

Jurisdiction to make other orders

64 Power of court to authorise dealings with trust property

(1)

Subject to any contrary intention expressed in the instrument (if any) creating the trust, where in the opinion of the court any sale, lease, mortgage, surrender, release, or other disposition, or any purchase, investment, acquisition, retention, expenditure, or other transaction is expedient in the management or administration of any property vested in a trustee, or would be in the best interests of the persons beneficially interested under the trust, but it is inexpedient or difficult or impracticable to effect the same without the assistance of the court, or the same cannot be effected by reason of the absence of any power for that purpose vested in the trustee by the trust instrument (if any) or by law, the court may by order confer upon the trustee, either generally or in any particular instance, the necessary power for the purpose, on such terms, and subject to such provisions and conditions (if any) as the court may think fit, and may direct in what manner any money authorised to be expended, and the costs of any transaction, are to be paid or borne, and as to the incidence thereof between capital and income:

provided that, notwithstanding anything to the contrary in the instrument (if any) creating the trust, the court, in proceedings in which all trustees and persons who are or may be interested are parties or are represented or consent to the order, may make such an order and may give such directions as it thinks fit to the trustee in respect of the exercise of any power conferred by the order.

(2)

[Repealed]

(3)

The court may from time to time rescind or vary any order made under this section, or may make any new or further order:

provided that no such rescission or variation of any order shall affect any act or thing done in reliance on the order before the person doing the act or thing became aware of the application to the court to rescind or vary the order.

(4)

An application to the court under this section may be made by the trustees, or by any of them, or by any person beneficially interested under the trust.

Compare: 1936 No 58 s 81; Trustee Act 1925 s 57 (UK)

Section 64 heading: amended, on 25 October 1960, by section 8 of the Trustee Amendment Act 1960 (1960 No 101).

Section 64(1): replaced, on 25 October 1960, by section 8(2) of the Trustee Amendment Act 1960 (1960 No 101).

Section 64(2): repealed, on 25 October 1960, by section 9(2) of the Trustee Amendment Act 1960 (1960 No 101).

64A Power of court to authorise variations of trust

(1)

Without limiting any other powers of the court, it is hereby declared that where any property is held on trusts arising under any will, settlement, or other disposition, or on the intestacy or partial intestacy of any person, or under any order of the court, the court may if it thinks fit by order approve on behalf of—

(a)

any person having, directly or indirectly, an interest, whether vested or contingent, under the trusts who by reason of infancy or other incapacity is incapable of assenting; or

(b)

any person (whether ascertained or not) who may become entitled, directly or indirectly, to an interest under the trusts as being at a future date or on the happening of a future event a person of any specified description or a member of any specified class of persons, so however that this paragraph shall not include any person who would be of that description, or a member of that class, as the case may be, if the said date had fallen or the said event had happened at the date of the application to the court; or

(c)

any unborn or unknown person; or

(d)

any person in respect of any discretionary interest of his under protective trusts where the interest of the principal beneficiary has not failed or determined—

any arrangement (by whomsoever proposed, and whether or not there is any other person beneficially interested who is capable of assenting thereto) varying or revoking all or any of the trusts, or enlarging the powers of the trustees of managing or administering any of the property subject to the trusts:

provided that, except by virtue of paragraph (d), the court shall not approve an arrangement on behalf of any person if the arrangement is to his detriment; and in determining whether any such arrangement is to the detriment of any person the court may have regard to all benefits which may accrue to him directly or indirectly in consequence of the arrangement, including the welfare and honour of the family to which he belongs:

provided also that this subsection shall not apply to any trust affecting property settled by any Act other than the Administration Act 1969.

(2)

Any rearrangement approved by the court under subsection (1) shall be binding on all persons on whose behalf it is so approved, and thereafter the trusts as so rearranged shall take effect accordingly.

(3)

In this section—

discretionary interest means an interest arising under the trust specified in paragraph (b) of subsection (1) of section 42 or any like trust

principal beneficiary has the same meaning as in the said subsection (1)

protective trusts means the trusts specified in paragraphs (a) and (b) of the said subsection (1) or any like trusts.

Section 64A: inserted, on 25 October 1960, by section 9(1) of the Trustee Amendment Act 1960 (1960 No 101).

Section 64A(1) second proviso: amended, on 1 January 1971, pursuant to section 84(1) of the Administration Act 1969 (1969 No 52).

64B Powers of court in respect of capital dividends

(1)

In this section—

capital dividend, in relation to a company, means a sum distributed by the company by way of dividend to its shareholders out of a capital profit or a capital reserve

capital profit, in relation to a company, means a profit calculated on the basis of a sale or revaluation of the capital assets of the company or any of them

capital reserve, in relation to a company, means a sum derived from a capital profit made by the company and set aside in the books of the company as a capital reserve.

(2)

Where any sum is paid to the trustee by a company by way of a capital dividend, the court may if it thinks fit, by order, empower or direct the trustee to treat the whole or any part of that sum as capital for the purposes of the trust.

(3)

In considering any application for an order under this section, the court shall not be limited to a determination of the intentions of the testator or settlor in regard to the matter, but may be guided by what is fair and just as between those persons who are entitled to the income and those who are entitled to the capital of the trust, having particular regard to the present and likely future needs of those persons, the history of the administration of the trust to date, and all such other circumstances of the case as the court considers relevant.

(4)

No action shall lie against the trustee for having distributed as income the whole or any part of the amount received by the trustee by way of capital dividend if the distribution was properly made by the trustee before service on the trustee of any application under this section that could affect that amount and without notice in writing of any such application or intention to make such an application; but nothing in this subsection shall prevent the court from making an order pursuant to subsection (6) disturbing the distribution made by the trustee.

(5)

For the purposes of subsection (4), section 48 of the Administration Act 1969 shall apply with all necessary modifications.

(6)

Where the court makes an order under subsection (2) after the trustee has distributed as income the whole or any part of the amount received by the trustee by way of capital dividend, the court may also make any order of a kind authorised by subsection (1) of section 49 of the Administration Act 1969 (which relates to the following of assets); and the provisions of that section and sections 50 and 51 of that Act shall apply with any necessary modifications.

Section 64B: inserted, on 6 November 1986, by section 2 of the Trustee Amendment Act 1986 (1986 No 112).

65 Power of court to direct sale or lease
[Repealed]

Section 65: repealed, on 25 October 1960, by section 8(3) of the Trustee Amendment Act 1960 (1960 No 101).

66 Right of trustee to apply to court for directions

(1)

Any trustee may apply to the court for directions concerning any property subject to a trust, or respecting the management or administration of any such property, or respecting the exercise of any power of discretion vested in the trustee.

(2)

Every such application shall be served upon, and the hearing may be attended by, all persons interested in the application or such of them as the court thinks expedient.

Compare: 1908 No 200 s 75

67 Persons entitled to apply to court

(1)

An order under this Act for the appointment of a new trustee or concerning any property subject to a trust may be made on the application of any person beneficially interested in the property, whether under disability or not, or on the application of any person duly appointed trustee thereof or intended to be so appointed.

(2)

An order under this Act concerning any interest in any property subject to a mortgage may be made on the application of any person beneficially interested in the property, whether under disability or not, or of any person interested in the money secured by the mortgage.

Compare: 1908 No 200 ss 46, 47; Trustee Act 1925 s 58 (UK)

68 Applications to court to review acts and decisions of trustee

(1)

Any person who is beneficially interested in any trust property, and who is aggrieved by any act or omission or decision of a trustee in the exercise of any power conferred by this Act, or who has reasonable grounds to anticipate any such act or omission or decision of a trustee by which he will be aggrieved, may apply to the court to review the act or omission or decision or to give directions in respect of the anticipated act or omission or decision; and the court may require the trustee to appear before it, and to substantiate and uphold the grounds of the act or omission or decision that is being reviewed, and may make such order in the premises as the circumstances of the case may require:

provided that no such order shall—

(a)

disturb any distribution of the trust property made without breach of trust before the trustee became aware of the making of the application to the court:

(b)

affect any right acquired by any person in good faith and for valuable consideration.

(2)

Where any such application is made, the court may,—

(a)

if any question of fact is involved, direct how the question shall be determined:

(b)

if the court is being asked to make an order that may prejudicially affect the rights of any person who is not a party to the proceedings, direct that any such person shall be made a party to the proceedings.

69 Protection of trustee while acting under direction of court

Any trustee acting under any direction of the court shall be deemed, so far as regards his own responsibility, to have discharged his duty as such trustee in the subject matter of the direction, notwithstanding that the order giving the direction is subsequently invalidated, overruled, set aside, or otherwise rendered of no effect:

provided that this subsection shall not extend to indemnify any trustee in respect of any act done in accordance with any such direction if he has been guilty of any fraud or wilful concealment or misrepresentation in obtaining the direction or in acquiescing in the court making the order giving the direction.

Section 69: amended, on 15 November 1968, by section 16 of the Trustee Amendment 1968 (1968 No 24).

70 Powers of court to give judgment in absence of a trustee

Where in any proceedings the court is satisfied that diligent search has been made for any person who, in the character of trustee, is made a defendant in any action, to serve him with a process of the court, and that he cannot be found, the court may hear and determine the proceedings and give judgment therein against that person in his character of a trustee as if he had been duly served, or had entered an appearance in the action, and had also appeared by his counsel and solicitor at the hearing, but without prejudice to any interest he may have in the matters in question in the proceedings in any other character.

Compare: 1908 No 200 s 58; Trustee Act 1925 s 59 (UK)

71 Power of court to charge costs on trust estate

The court may order the costs and expenses of and incidental to any application for any order under this Act, or of and incidental to any such order, or any conveyance or assignment in pursuance thereof, to be raised and paid out of the property in respect whereof the same is made, or out of the income thereof, or to be borne and paid in such manner and by such persons as to the court may seem just.

Compare: 1908 No 200 s 61; Trustee Act 1925 s 60 (UK)

72 Commission

(1)

The court may, out of the property subject to any trust, allow to any person who is or has been a trustee thereof or to that person’s personal representative such commission or percentage for that person’s services as is just and reasonable.

(1A)

In considering under subsection (1) what commission or percentage is just and reasonable the court shall have regard to the following circumstances, namely:

(a)

the total amount that has already been paid to any trustee of the trust, whether pursuant to the trust instrument or to any earlier order of the court or to any agreement or otherwise;

(b)

the amount and difficulty of the services rendered by the trustee;

(c)

the liabilities to which the trustee is or has been exposed, and the responsibilities imposed on him;

(d)

the skill and success of the trustee in administering the trust;

(e)

the value of the trust property;

(f)

the time and services reasonably required of the trustee;

(g)

whether any commission or percentage that might otherwise have been allowed should be refused or reduced by reason of delays in the administration of the trust that were occasioned, or that could reasonably have been prevented, by the trustee; and

(h)

all other circumstances that the court considers relevant.

(2)

The court may make any such allowance at any time, and from time to time, before or during the administration of the trust, or on the termination of the trust, and may, subject to such terms and conditions as the court thinks fit, make any such allowance in respect of services to be rendered by the trustee during any specified period subsequent to the date of the order.

(3)

Where the court allows a commission or percentage under this section in any case in which 2 or more persons are or have been the trustees, whether acting at the same time or at different times, the amount so allowed shall be apportioned among the trustees as they mutually agree; and if there is no such agreement the court may, in its discretion, apportion the total amount allowed among the trustees in such manner as it thinks fit, and, in particular, may divide the amount in unequal shares or may make the allowance to 1 or more of the trustees to the exclusion of the other or others.

(4)

Rules may from time to time be made in the manner prescribed by the Judicature Act 1908 for carrying the provisions of this section into effect. The Executors Commission Rules 1935 and the Executors Commission Rules 1935, Amendment No 1, so far as they were in force on 31 December 1956, shall continue and have effect as if they had been made under this subsection and as if this section had been in force when they were made, and may be amended or revoked accordingly.

Section 72: replaced, on 25 October 1960, by section 10 of the Trustee Amendment Act 1960 (1960 No 101).

Section 72(1) proviso: repealed, on 6 April 1974, by section 13(2)(a) of the Trustee Amendment Act 1974 (1974 No 15).

Section 72(1A): inserted, on 6 April 1974, by section 13(1) of the Trustee Amendment Act 1974 (1974 No 15).

Section 72(2): replaced, on 6 April 1974, by section 13(1) of the Trustee Amendment Act 1974 (1974 No 15).

Section 72(3): amended, on 6 April 1974, by section 13(2)(b) of the Trustee Amendment Act 1974 (1974 No 15).

73 Power to relieve trustee from personal liability

If it appears to the court that a trustee, whether appointed by the court or otherwise, is or may be personally liable for any breach of trust, whether the transaction alleged to be a breach of trust occurred before or after the commencement of this Act, but has acted honestly and reasonably, and ought fairly to be excused for the breach of trust and for omitting to obtain the directions of the court in the matter in which he committed the breach, then the court may relieve him either wholly or partly from personal liability for the same.

Compare: 1908 No 200 s 89; Trustee Act 1925 s 61 (UK)

74 Power to make beneficiary indemnify for breach of trust

(1)

Where a trustee commits a breach of trust at the instigation or request or with the consent in writing of a beneficiary, the court may, if it thinks fit, and notwithstanding that the beneficiary may be a married woman restrained from anticipation, make such order as to the court seems just for impounding all or any part of the interest of the beneficiary in the trust estate by way of indemnity to the trustee or persons claiming through him.

(2)

This section applies to breaches of trust committed as well before as after the commencement of this Act.

Compare: 1908 No 200 s 88; Trustee Act 1925 s 62 (UK)

75 Barring of claims

(1)

Where a trustee desires to reject a claim that has been made, or that he has reason to believe may be made,—

(a)

to or against the estate or property that he is administering; or

(b)

against the trustee personally by reason of his being under any liability in respect of which he is entitled to reimburse himself out of the estate or property that he is administering—

the trustee may serve upon the claimant or the person who may become a claimant as aforesaid a notice calling upon him, within a period of 3 months from the date of service of the notice, to take legal proceedings to enforce the claim and also to prosecute the proceedings with all due diligence.

(2)

At the expiration of that period the trustee may apply to the court for an order under subsection (3), and shall serve a copy of the application on the person concerned.

(3)

If on the hearing of that application that person does not satisfy the court that he has commenced the proceedings and is prosecuting them with all due diligence, the court may make an order—

(a)

extending the period, or barring the claim, or enabling the trust property to be dealt with without regard to the claim; and

(b)

imposing such conditions and giving such directions, including a direction as to the payment of the costs of or incidental to the application, as to the court seems just.

(3A)

Where a trustee has served any such notices in respect of claims on 2 or more persons and the period specified in each of the said notices has expired, he may, if he thinks fit, apply for an order in respect of the claims of those persons in a single application, and the court may on that application make an order accordingly.

(4)

This section shall apply to every such claim as aforesaid, whether the claim is or may be made under the Law Reform (Testamentary Promises) Act 1949 or as creditor or next of kin or beneficiary under the trust or otherwise:

provided that nothing in this section shall apply to any claim under the Family Protection Act 1955, and no order made under this section shall affect any application for revocation of any grant of administration, whether that application is made before or after the order.

(5)

[Repealed]

(6)

On an application by a trustee under this section, the persons beneficially entitled to the estate or property need not be made parties to the proceedings, and no order made by the court on the application shall prejudice their right to contest the claim of the trustee to be entitled to indemnify himself out of the estate or property that he is administering if they have not been parties to the proceedings in which the order was made.

Compare: 1952 No 56 s 25(3), (4)

Section 75(1): replaced, on 25 October 1960, by section 11(1) of the Trustee Amendment Act 1960 (1960 No 101).

Section 75(3A): inserted, on 25 October 1960, by section 11(2) of the Trustee Amendment Act 1960 (1960 No 101).

Section 75(5): repealed, on 25 October 1960, by section 11(3) of the Trustee Amendment Act 1960 (1960 No 101).

76 Distribution of shares of missing beneficiaries

(1)

Where any property is held by a trustee and the property or any part thereof cannot be distributed because the trustee does not know whether any person who is or may be entitled thereto is or at any material date was in existence, or whether all or any of the persons who are members of any class who are or may be entitled thereto are or at any material date were in existence, or because the trustee does not know whether any such person is alive or dead or where he is, the trustee may publish such advertisements (whether in New Zealand or elsewhere) as are appropriate in the circumstances calling upon every such person and every person claiming through any such person to send in his claim within a time to be specified in the advertisements, not being less than 2 months in any case from the date on which the advertisement is published. Where the trustee is in doubt as to what advertisements should be published under this subsection, he may apply to the court for directions in that regard.

(2)

Where the trustee has received (whether as a result of the advertisements or not) any claim to be a person to whom any such advertisement relates, or any notice that any person may claim to be such a person, but the trustee is not satisfied that the claim is or would be valid, the trustee may serve upon the claimant or the person of whom the trustee has notice as aforesaid, a notice calling upon him, within a period of 3 months from the date of service of the notice, to take legal proceedings to enforce the claim, if he wishes to pursue it, and to prosecute the proceedings with all due diligence; and advising him that, if he fails to do so, his claim may be disregarded and application may be made to the court without further notice for an order authorising the distribution of the property. Nothing in this subsection shall make it necessary for the trustee to serve such a notice on any such person; and the court may make an order under this section, whether or not such a notice has been served on any such person, if it is satisfied that the information supplied to the trustee by that person or otherwise in the possession of the trustee indicates either that the person is not one of the persons specified in the advertisements or that he is not likely to be one of those persons.

(3)

Upon proof by affidavit of the circumstances, and of the inquiries that have been made, and of the results of inquiries and advertisements, and of the claims of which the trustee has received notice, and of the notices that the trustee has given to claimants under subsection (2), and of the action (if any) which the claimants have taken to enforce their claims, the court may order that the trustee may distribute the property or part thereof, subject to such conditions as the court may impose,—

(a)

as if every person and every member of any class of persons specified in the order (being all or any of the persons specified in the advertisements) is not in existence or never existed or has died before a date or event specified in the order; and

(b)

where as a consequence of the order it is not possible or practicable to determine whether or not any condition or requirement affecting a beneficial interest in the property or any part thereof has been complied with or fulfilled, as if that condition or requirement had or had not been complied with or fulfilled (as the court may determine).

(4)

In making any order under subsection (3), the court may—

(a)

disregard (without express reference thereto in the order) the claims of any persons who do not appear to the court to be, or to be likely to be, any of the persons specified in the advertisements:

(b)

disregard (without express reference thereto in the order) the claim of any person to whom the trustee has given notice under subsection (2) and who has failed to take legal proceedings to enforce the claim or to prosecute any such proceedings with all due diligence:

(c)

exclude from the operation of the order any person to whom the trustee has not given notice under subsection (2) and who in the opinion of the court may be one of the persons specified in the advertisements, or any person whom the court considers should for any reason be excluded from the operation of the order:

(d)

provide that the order shall not be acted on for such period or except on such conditions as may be specified in the order or that the effect of the order shall during a period so specified be advertised in such manner and form as may be specified in the order, or that the order be served upon such person or persons as are specified therein; and in the event of the court exercising the jurisdiction conferred by this paragraph it may in the order direct that the same shall be of no effect in respect of any person specified therein in the event of that person instituting proceedings in New Zealand to enforce his claim and serving the proceedings upon the trustee within such period as is specified in the order.

(5)

Any such order may be made notwithstanding that there has not been strict compliance with any directions as to advertisements previously given by the court, or that an error has been made in any advertisement (whether or not any directions have previously been given by the court) if the court considers that the error would not be likely to have prejudiced or misled the persons to whom the advertisement relates.

(6)

Where the court makes an order under this section that the trustee may distribute any property or part thereof as if every person and every member of any class of persons specified in the order (not being a person expressly excluded from the operation of the order) is not in existence or never existed or has died before a date or event specified in the order, and the trustee distributes in accordance with the order, the trustee shall be exonerated from any further liability to any such person or to any member of any such class:

provided that nothing in this subsection shall prejudice any remedy which any person may have against any person other than the trustee, including any right which he may have to follow the property and any money or property into which it is converted.

(7)

The court may make 1 or more orders under this section in respect of the same property.

(8)

Any order made under this section may direct how the costs of the order and of advertising under or for the purposes of the order shall be borne.

(9)

It shall not be necessary to serve notice of an application for an order under this section upon any person, unless the court otherwise orders.

(10)

Nothing in this section shall prejudice the right of the trustee (if he so desires) to distribute under any other law or statutory provision or prejudice the protection thereby afforded when he makes distribution pursuant to any such law or provision.

Section 76: replaced, on 25 October 1960, by section 12 of the Trustee Amendment Act 1960 (1960 No 101).

76A Service of notices, etc, under sections 75 and 76

(1)

Any notice, application, or order that is to be served in accordance with section 75 or section 76, or in accordance with any order made pursuant to section 76, may be served—

(a)

either by delivering it to the person for whom it is intended or by sending it by post in a registered letter addressed to that person at his usual or last known place of abode or business; or

(b)

in such other manner as may be directed by an order of the court.

(2)

Where a notice is sent by post as aforesaid it shall be deemed to be served at the time at which the letter would have been delivered in the ordinary course of post.

Section 76A: inserted, on 25 October 1960, by section 13 of the Trustee Amendment Act 1960 (1960 No 101).

Payment to Crown

77 Payment by trustees to Crown

(1)

Trustees, or the majority of trustees, having in their hands or under their control money or securities belonging to a trust, may, on filing in the court nearest to which they or the majority of them reside an affidavit describing the instrument creating the trust and giving particulars of the persons beneficially entitled under the trust according to the best of their knowledge and belief, and on serving a copy of the affidavit on the Secretary to the Treasury, pay the money or transfer the securities (if they can legally be so transferred) to the Crown in the matter of the particular trust, which shall be described in the affidavit by the names of the parties as accurately as may be for the purpose of distinguishing it. All money and securities so paid or transferred shall be administered in the Treasury. All such money and all money derived from securities which have been transferred to or vested in the Crown under this section shall be credited by the Secretary to the Treasury to the Trust Account established under section 42 of the Public Finance Act 1977 to be dealt with as hereafter provided in this Act.

(2)

The receipt of the Secretary to the Treasury shall be a sufficient discharge to the trustees for the money or securities paid or transferred to the Crown under this section.

(3)

Where money or securities are vested in any persons as trustees, and the majority are desirous of paying or transferring the same to the Crown as aforesaid, but the concurrence of the other or others cannot be obtained, the court may order the payment or transfer to the Crown to be made by the majority without the concurrence of the other or others.

(4)

Where any such money or securities are deposited with any banker, broker, or other depositary, the court may order payment or delivery of the money or securities to the majority of the trustees for the purpose of payment or transfer to the Crown.

(5)

Every transfer, payment, and delivery made in pursuance of any such order shall be valid and take effect as if the same had been made on the authority or by the act of all the persons entitled to the money and securities so transferred, paid, or delivered.

(6)

The Secretary to the Treasury may at any time sell any securities held by the Crown under this section.

(7)

Where any securities have been transferred to or deposited with any Registrar under section 67 of the Trustee Act 1908 or under the corresponding provisions of any former enactment and are held by him at the commencement of this Act, those securities shall thereupon vest without transfer or assignment in the Crown.

(8)

Where any trustee has obtained or is seeking a discharge in respect of any money or securities under this section or has obtained such a discharge under the corresponding provisions of any former section, the Secretary to the Treasury may at any time require that trustee to give such information in his possession or control as he may require in relation to the persons beneficially entitled to the money or securities, including information as to the steps taken to trace those persons; and if any person refuses or wilfully neglects to give any such information that is in his possession or control when so required, or wilfully gives any false information in answer to any such requisition, he or she commits an offence and is liable on conviction to a fine not exceeding $200.

Compare: 1908 No 200 ss 66, 67, 68, 71; Trustee Act 1925 s 63 (UK)

Section 77(1): amended, on 1 April 1978, pursuant to section 163(1) of the Public Finance Act 1977 (1977 No 65).

Section 77(1): amended, on 1 April 1964, pursuant to section 7(3) of the Public Revenues Amendment Act 1963 (1963 No 46).

Section 77(8): amended, on 1 July 2013, by section 413 of the Criminal Procedure Act 2011 (2011 No 81).

78 Disposal of funds paid to Crown

(1)

At the end of each financial year the Secretary to the Treasury shall publish in the Gazette a statement of all money and securities then held by the Crown under section 77, being—

(a)

money which has not previously been credited to a Crown Bank Account under subsection (4); and

(b)

securities which were transferred to the Crown within the immediately preceding 6 years or which were transferred or deposited into or in the name of any Registrar under section 67 of the Trustee Act 1908 within the immediately preceding 6 years.

(2)

Every statement so published in the Gazette shall contain sufficient particulars to show the matters in which the money and securities are held by the Crown and the amount held in respect of each matter.

(3)

All money and securities for the time being held by the Crown under section 77 (whether or not they are held in a Crown Bank Account) shall be so held to attend the order of the court:

provided that any such money or securities may be paid or transferred by the Secretary to the Treasury to the person entitled thereto upon his establishing a claim thereto or may be paid or transferred to the person from whom they were received to be held by him as trustee if that person so requests:

provided also that all costs and expenses reasonably incurred by the Crown or the Secretary to the Treasury in connection with any such money or securities may be deducted out of the money or securities or out of any other money and securities which are for the time being held by the Crown and are subject to the same trusts.

(4)

The Secretary to the Treasury shall from time to time transfer to a Crown Bank Account all money held under section 77, being money which was—

(a)

paid to the Crown more than 6 years previously; or

(b)

derived from securities which were transferred to the Crown, or transferred or deposited in the name of any Registrar, more than 6 years previously.

(5)

Any money previously transferred to a Crown Bank Account under subsection (4) which is paid or required to be paid under subsection (3) may be paid out of a Crown Bank Account without further appropriation than this subsection.

(6)

Under no circumstances shall the liability of the Crown or the Secretary to the Treasury in respect of any securities which are transferred to or vested in the Crown under section 77 exceed the value of those securities and of any other securities and money which are held by the Crown and subject to the same trusts at the time when demand is made for satisfaction of the liability. If the said securities and money are insufficient to meet any such liability, the claimant shall, in respect of any unpaid balance of the liability, have the same rights and remedies against the person beneficially entitled to the securities in respect of which the liability arose as he would if those securities were transferred to that person.

(7)

Neither the Crown nor the Secretary to the Treasury shall have the duties or liabilities of a trustee in respect of any money or securities for the time being held by the Crown under section 77 (whether in a Crown Bank Account or not); and no interest shall be payable by the Crown or the Secretary to the Treasury in respect of any money so held.

(8)

Where any money or securities paid or transferred to any claimant under this section are afterwards claimed by any other person, the Crown and the Secretary to the Treasury shall not be responsible for the payment or transfer thereof, but that person shall have recourse against the claimant to whom the money was paid or the securities were transferred.

Compare: 1908 No 200 ss 72, 73

Section 78(1)(a): amended, on 25 January 2005, pursuant to section 83(7) of the Public Finance Act 1989 (1989 No 44).

Section 78(3): amended, on 25 January 2005, pursuant to section 83(7) of the Public Finance Act 1989 (1989 No 44).

Section 78(4): amended, on 25 January 2005, pursuant to section 83(7) of the Public Finance Act 1989 (1989 No 44).

Section 78(5): amended, on 25 January 2005, pursuant to section 83(7) of the Public Finance Act 1989 (1989 No 44).

Section 78(7): amended, on 25 January 2005, pursuant to section 83(7) of the Public Finance Act 1989 (1989 No 44).

79 Orders in respect of funds paid to Crown

(1)

Upon application made ex parte by such person or persons as are competent or necessary in that behalf, the court may from time to time make such order as it thinks fit in respect of any money or securities for the time being held by the Crown under section 77 (whether in a Crown Bank Account or not), and for the payment, transfer, and administration thereof:

provided that the court may direct service of the application on such persons as it thinks fit.

(2)

Every such order shall have the same authority and effect and shall be subject to rehearing and appeal in the same manner as if it had been made in any action regularly instituted in the court; and if it appears that any such money or securities cannot be safely distributed without the institution of 1 or more actions, the court may direct any such action to be instituted.

Compare: 1908 No 200 ss 69, 70

Section 79: amended, on 25 January 2005, pursuant to section 83(7) of the Public Finance Act 1989 (1989 No 44).

Part 6 General provisions

80 Indemnity to banks and others

This Act, and every order purporting to be made under this Act, shall be a complete indemnity to all banks, companies, societies, associations, and persons for any acts done pursuant thereto, and it shall not be necessary for any bank, company, society, association, or person to inquire concerning the propriety of the order, or whether the court had jurisdiction to make it.

Compare: 1908 No 200 s 34; Trustee Act 1925 s 66 (UK)

81 Operation on bank account of trustees

(1)

Where there are more trustees than 1, and the trustees, by writing under their hands communicated to a bank at which their account is kept, arrange that the account may be operated upon by cheques or drafts signed by 1 or more of them, or by 1 of them and a delegate or delegates named in the writing of another or others of them, the bank shall be entitled to honour and pay the cheques or drafts as if they had been signed by all the trustees, until the bank receives notice in writing of the revocation, by death or otherwise, of the arrangement.

(2)

Nothing in this section or in any rule of law shall prevent trustees from opening a bank account named as an imprest account and from authorising any 1 or more of their number or any other person or persons to operate upon the imprest account.

Compare: 1908 No 200 s 101

82 Inclusion of non-charitable and invalid purposes not to invalidate a trust
[Repealed]

Section 82: repealed, on 2 October 1963, by section 4(2) of the Charitable Trusts Amendment Act 1963 (1963 No 21).

83 Special rules as to apportionment on purchase, sale, or transfer in certain cases

(1)

For the purposes of this section—

(a)

the term fixed-income asset means any asset bearing interest or carrying the right to a dividend if—

(i)

the interest or dividend is payable at a fixed rate; and

(ii)

the trustee has no reason to believe that the interest or dividend payable in respect of the period to which the apportionment relates will not be paid reasonably promptly after the interest or dividend falls due:

(b)

the term shares means shares or stock of any company, whether incorporated in or outside New Zealand, except any such shares or stock which constitutes a fixed-income asset in accordance with paragraph (a):

(c)

an appropriation of shares (whether pursuant to the power conferred by paragraph (j) of subsection (1) of section 15 or otherwise) shall be deemed to be a transfer of those shares to which subsection (4) applies.

(2)

Where any payment received by a trustee in respect of a sale of any fixed-income asset is or includes payment for the right to receive income accrued from that asset at the time of sale, though the income may not then be due, the amount of the accrued income shall, for the purposes of the trust, be deemed to have been received as income in respect of the period during which it so accrued.

(3)

Where any payment made by a trustee in respect of a purchase of any fixed-income asset is or includes payment for the right to receive any income accrued from that asset at the time of the purchase, though the income may not then be due, the amount of the accrued income when received shall, for the purposes of the trust, be deemed to have been received as purchase money repaid.

(4)

Where a trustee transfers any shares (not being a fixed-income asset) to the person entitled thereto under the trust, then, unless the trustee in his absolute discretion having regard to all the circumstances of the case thinks that it is equitable, practicable, and convenient to make an apportionment, there shall be no apportionment of any dividends which have accrued at the date of transfer but have not then been declared, and no person who would have been beneficially interested in any such dividends if they had been declared and paid to the trustee shall have any claim in respect thereof against the trustee or against the transferee of the shares.

(5)

Where a trustee sells any shares that are not a fixed-income asset, no part of the proceeds of the sale shall, for the purposes of the trust, be deemed to have been paid for the right to receive dividends which have accrued in respect of the shares at the time of the sale, but have not then been declared, and there shall accordingly be no apportionment of the proceeds as between capital and income.

(6)

Where a trustee purchases any shares that are not a fixed-income asset, no part of the purchase price shall, for the purposes of the trust, be deemed to be paid for the right to receive any dividends which have accrued in respect of the shares at the time of the purchase but have not then been declared, and there shall accordingly be no apportionment of the purchase price as between capital and income, nor shall any part of the dividends received by the trustee be deemed to have been received as purchase money repaid.

(7)

Except as herein expressly provided, nothing in this section shall affect the rights and obligations of the trustee or of any other person in respect of apportionment of income on the sale or purchase of any asset or the transfer thereof to any person beneficially entitled thereto.

(8)

Anything done by a trustee before the commencement of this section which would have been authorised by this section if then in force shall be deemed to have been authorised by this section.

(9)

The provisions of this section shall apply if and so far only as a contrary intention is not expressed in the instrument, if any, creating the trust, and shall have effect subject to the terms of that instrument.

Section 83: replaced, on 18 October 1957, by section 9 of the Trustee Amendment Act 1957 (1957 No 37).

Section 83(1)(a): replaced, on 1 October 1988, by section 12(1) of the Trustee Amendment Act 1988 (1988 No 119).

Section 83(1)(b): amended, on 1 October 1988, by section 12(2) of the Trustee Amendment Act 1988 (1988 No 119).

83A Examination of accounts of trust estates administered by trustee corporations

In the case of any trust estate administered by a trustee corporation, a solicitor or accountant authorised in writing by a beneficiary shall be entitled as of right to examine at any reasonable time the accounts of that estate, and for that purpose shall have access to the trustee corporation’s books and vouchers (but not the file) relating to that estate, and to the securities and documents of title held by the trustee corporation on account of that estate.

Section 83A: inserted, on 18 October 1957 by section 10(1) of the Trustee Amendment Act 1957 (1957 No 37).

83B Audit of other trust estates

(1)

Subject to the provisions of any regulations made under this Act, and unless the court otherwise orders, the condition and accounts of any trust estate (being an estate which is not being administered by a trustee corporation) shall, on an application being made and notice thereof being given in the prescribed manner by or on behalf of any trustee or beneficiary in that estate, be investigated and audited by such solicitor or such qualified statutory accountant as may be agreed on between the applicant trustee and his co-trustees and Public Trust, or between the applicant beneficiary and the trustees and Public Trust, as the case may be, or, in default of any such agreement, by a solicitor or a qualified statutory accountant appointed by Public Trust:

provided that—

(a)

except with the leave of the court, such an investigation or audit shall not be required within 12 months after any such previous investigation or audit; and

(b)

a beneficiary shall not be appointed under this section to make an investigation or audit; and

(c)

Public Trust may require the applicant to deposit a sum of money covering the costs of the investigation and audit, as estimated by Public Trust, or to secure the same to Public Trust’s satisfaction before proceeding with the application.

(1A)

In subsection (1), qualified statutory accountant has the same meaning as in section 5(1) of the Financial Reporting Act 2013.

(2)

The person making the investigation or audit (in this section called the auditor) shall have a right of access to the books, accounts, and vouchers of the trustees, and to any securities and documents of title held by them on account of the estate, and may require from them such information and explanations as may be necessary for the performance of his duties.

(3)

Upon the completion of the investigation and audit, the auditor shall forward to the applicant, and to every trustee, and to Public Trust, a copy of the accounts of the estate, together with a report thereon, and a certificate signed by him to the effect that the accounts correctly show the state of the affairs of the estate, and that he has had the securities of the trust fund investments (if any) produced to and verified by him, or (as the case may be) that such accounts are deficient in such respects as may be specified in that certificate.

(4)

Every beneficiary shall, subject to the provisions of any regulations made under this section, be entitled at all reasonable times to inspect and take copies of the accounts, report, and certificate, and, at his own expense, to be furnished with copies thereof or extracts therefrom.

(5)

The auditor may be removed by order of the court; and if any auditor is removed, or resigns, or dies, or becomes bankrupt or incapable of acting before the investigation and audit are completed, a new auditor may be appointed in his place in like manner as the original auditor was appointed.

(6)

The remuneration of the auditor and the other expenses of the investigation and audit (including Public Trust’s charges) shall be such as may be prescribed by regulations under this section or (in the absence of any such prescription) as may be determined by the court, and shall, unless the court otherwise orders, be borne by the estate; and, in the event of the court so ordering, such expenses shall be borne by the trustees personally or any of them, or by the applicant, or be apportioned between them or any of them, or between them and any of them and the estate, in such proportions as the court thinks just.

(7)

If any person having the custody of any books, accounts, vouchers, securities, or documents to which the auditor has a right of access under this section fails or refuses to allow him to have access thereto, or in anywise obstructs the investigation or audit, the auditor may apply to the court, and thereupon the court shall make such order as it thinks just.

(8)

Subject to any rules of court, applications under or for the purposes of this section to the court shall be made to a Judge in Chambers.

(9)

If any person in any statement of accounts, report, or certificate required for the purposes of this section wilfully makes a statement that is false in any material particular, he or she is liable on conviction to imprisonment for a term not exceeding 2 years or a fine not exceeding $200, or both.

(10)

Public Trust shall not be liable for any expenses or costs under this section.

(11)

All expenses and costs for which the estate is liable under this section shall be a charge on the assets of the estate, and that charge may be enforced in such manner as the court directs.

(12)

The Governor-General may from time to time, by Order in Council, make all such regulations as may in his opinion be necessary or expedient for specifying the procedure and regulating the remuneration, expenses, charges, and other matters in regard to the investigation and audit of trust estates.

(13)

All regulations made under this section shall be laid before Parliament within 28 days after the date of the making thereof if Parliament is then in session and, if not, shall be laid before Parliament within 28 days after the date of the commencement of the next ensuing session.

Compare: 1913 No 19 s 11

Section 83B: inserted, on 18 October 1957, by section 10(1) of the Trustee Amendment Act 1957 (1957 No 37).

Section 83B(1): amended, on 1 July 2015, by section 17 of the Financial Reporting Amendment Act 2014 (2014 No 64).

Section 83B(1): amended, on 7 July 2010, by section 10 of the New Zealand Institute of Chartered Accountants Amendment Act 2010 (2010 No 74).

Section 83B(1): amended, on 1 March 2002, by section 170(1) of the Public Trust Act 2001 (2001 No 100).

Section 83B(1) proviso paragraph (c): amended, on 1 March 2002, by section 170(1) of the Public Trust Act 2001 (2001 No 100).

Section 83B(1A): inserted, on 1 July 2015, by section 17 of the Financial Reporting Amendment Act 2014 (2014 No 64).

Section 83B(3): amended, on 1 March 2002, by section 170(1) of the Public Trust Act 2001 (2001 No 100).

Section 83B(6): amended, on 1 March 2002, by section 170(1) of the Public Trust Act 2001 (2001 No 100).

Section 83B(9): replaced, on 1 July 2013, by section 413 of the Criminal Procedure Act 2011 (2011 No 81).

Section 83B(10): amended, on 1 March 2002, by section 170(1) of the Public Trust Act 2001 (2001 No 100).

Section 83B(12): amended, on 1 March 2002, by section 170(1) of the Public Trust Act 2001 (2001 No 100).

84 Costs and testamentary expenses to be payable out of capital of settled residuary estate of deceased

(1)

Where, under the provisions of the will of a person dying after the commencement of this Act (in this section referred to as the deceased) any real or personal property included either by specific or general description in a residuary gift is settled by way of succession, no part of the income of that property shall be applicable in or towards the payment of the funeral, testamentary, and administration expenses, death duties, debts, legacies, and liabilities, or of the interest (if any) thereon up to the date of the death of the deceased:

provided that this subsection shall not apply to any commission which is payable to the trustee in respect of any such income or to any testamentary or administration expense which, apart from this subsection, would be payable wholly out of income.

(2)

The income of the settled property shall be applicable in priority to any other assets in payment of the interest (if any) accruing due on the funeral, testamentary, and administration expenses, debts, legacies, and liabilities, after the date of the death of the deceased and up to the payment thereof, and the balance of that income shall be payable to the person for the time being entitled to the income of the property.

(3)

Where, after the death of the deceased, income of assets comprised in the settled property which are ultimately applied in or towards payment of the funeral, testamentary, and administration expenses, death duties, debts, legacies, and liabilities arises pending that application, that income shall, for the purposes of this section, be deemed income of the residuary estate of the deceased.

(4)

This section shall only affect the rights of beneficiaries under the will as between themselves, and shall not affect the rights of creditors of the deceased or limit any other powers of the trustee.

(5)

The provisions of this section shall apply if and so far only as a contrary intention is not expressed in the will, and shall have effect subject to the terms of the will and of any Act as to charges on property of the deceased.

(6)

Nothing in this section shall apply to any annuity which is payable out of the estate of the deceased.

Compare: 1930 No 44 s 43 (NSW)

Section 84(2): amended, on 24 May 1999, by section 15(1) of the Estate Duty Repeal Act 1999 (1999 No 64).

Section 84(6): inserted, on 25 October 1960, by section 14 of the Trustee Amendment Act 1960 (1960 No 101).

85 Application of income of settled property pending conversion

(1)

Subject to the provisions of this section, where under the will of any person any real or personal property included (either by specific or general description) in a residuary gift is settled by way of succession, then, notwithstanding that the property may be of a wasting, speculative, or reversionary nature,—

(a)

pending any sale, calling in, or conversion of the settled property, the whole of the net income of property actually producing income shall be applied as income and no part thereof shall be appropriated to capital; and

(b)

on any such sale, calling in, or conversion, or on the falling in of any reversionary property, no part of the proceeds of the sale, calling in, conversion, or falling in, shall be applied as past income.

(2)

This section shall apply only in respect of the wills of—

(a)

persons who die after the date of the commencement of this Act:

(b)

other persons so far as their estates were administered by the Public Trustee at the date of the commencement of this Act and were subject to corresponding provisions immediately prior thereto.

(3)

The provisions of this section shall apply if and so far only as a contrary intention is not expressed in the will of the deceased, and shall have effect subject to the terms of that will.

Compare: 1921–22 No 48 s 20(3)

86 Fees and commission deemed a testamentary expense

The fees, commission, remuneration, and other charges payable to a trustee in respect of the administration of the estate of a deceased person shall be deemed to be testamentary expenses.

Compare: 1921–22 No 48 s 74

87 Costs of inquiring regarding beneficiaries

The costs, expenses, and charges of the trustee of any property in respect of any inquiries made by him to ascertain the existence and identity of any person or persons entitled to any legacy, money, or distributive share in the property or otherwise incurred in relation thereto shall be borne by and paid out of the legacy, money, or distributive share of the person or persons in respect of whom the inquiries were made.

Compare: 1921–22 No 48 s 94

88 Life tenant to have powers of a trustee in certain cases

In any case where there is no trustee of any land, but the land is for the time being lawfully vested in any person entitled to the possession thereof or to the receipt of the rents and profits therefrom for an estate for life, or for a term of years determinable with his life, or for any greater estate, that person may exercise all the powers conferred on a trustee by this Act, and the court may confer on that person all the powers which it could confer on a trustee under this Act; and anything done by any such person in exercise of any such power shall have the same force and effect as if it had been done by a trustee:

provided that nothing in this section shall authorise any such person to sell any such land, or to raise any capital money by a mortgage thereof or other dealing therewith, unless the money paid on the sale or the capital money so raised is paid to a trustee who is duly appointed and entitled to receive it.

89 Repeals, amendments, and savings

(1)

The enactments specified in Schedule 2 are hereby repealed.

(2)

The enactments specified in Schedule 3 are hereby amended in the manner indicated in that schedule.

(3)

Regulation 30 of the regulations under the Public Trust Office Act 1908 made on 20 August 1923 (Gazette 1923, Vol II, page 2257) shall continue in force until it is otherwise revoked, notwithstanding the repeal of section 4 of the Public Trust Office Amendment Act 1913.

(4)

Without limiting the provisions of the Interpretation Act 1999, it is hereby declared that the repeal of any provision by this Act shall not affect any document made or any thing whatsoever done under the provision so repealed or under any corresponding former provision, and every such document or thing, so far as it is subsisting or in force at the time of the repeal and could have been made or done under this Act, shall continue and have effect as if it had been made or done under the corresponding provision of this Act and as if that provision had been in force when the document was made or the thing was done.

Section 89(4): amended, on 1 November 1999, pursuant to section 38 of the Interpretation Act 1999 (1999 No 85).

Schedule 1 Other Acts authorising trustee investments

[Repealed]

s 4(1)(j)

Schedule 1: repealed, on 1 October 1988, by section 13 of the Trustee Amendment Act 1988 (1988 No 119).

Schedule 2 Enactments repealed

s 89(1)

Administration Act 1952 (1952 No 56)

Amendment(s) incorporated in the Act(s).

Aged and Infirm Persons Protection Act 1912 (1912 No 26) (1931 Reprint, Vol II, p 890)

Amendment(s) incorporated in the Act(s).

Auckland Electric Power Board Act 1921–22 (1921–22 No 17 (L))

Amendment(s) incorporated in the Act(s).

Auckland Harbour Board Loan and Empowering Act 1951 (1951 No 17 (L))

Amendment(s) incorporated in the Act(s).

Auckland Harbour Bridge Amendment Act 1956 (1956 No 58)

Amendment(s) incorporated in the Act(s).

Auckland Metropolitan Drainage Act 1944 (1944 No 8 (L))

Amendment(s) incorporated in the Act(s).

Auckland Transport Board Act 1928 (1928 No 44)

Amendment(s) incorporated in the Act(s).

Bay of Islands Harbour Board Empowering Amendment Act 1953 (1953 No 12 (L))
Bluff Harbour Board Empowering Act 1913 (1913 No 6 (L))

Amendment(s) incorporated in the Act(s).

Christchurch District Drainage Act 1951 (1951 No 21 (L))

Amendment(s) incorporated in the Act(s).

Christchurch–Lyttelton Road Tunnel Act 1956 (1956 No 16)

Amendment(s) incorporated in the Act(s).

Dunedin District Drainage and Sewerage Amendment Act 1921 (1921 No 2 (L))

Amendment(s) incorporated in the Act(s).

Electric Power Boards Act 1925 (1925 No 38) (1931 Reprint, Vol III, p 53)

Amendment(s) incorporated in the Act(s).

Finance Act (No 2) 1952 (1952 No 81)

Amendment(s) incorporated in the Act(s).

Gisborne Harbour Board Empowering Amendment Act 1953 (1953 No 3 (L))

Amendment(s) incorporated in the Act(s).

Hospitals Amendment Act 1953 (1953 No 17)

Amendment(s) incorporated in the Act(s).

Hutt Valley Drainage Act 1948 (1948 No 11 (L))

Amendment(s) incorporated in the Act(s).

Lyttelton Harbour Board Loan and Empowering Act 1952 (1952 No 21 (L))

Amendment(s) incorporated in the Act(s).

Maori Affairs Act 1953 (1953 No 94)

Amendment(s) incorporated in the Act(s).

Mortgagors and Lessees Rehabilitation Act 1936 (1936 No 33)

Amendment(s) incorporated in the Act(s).

Napier Harbour Board Empowering and Loan Act 1914 (1914 No 14 (L))

Amendment(s) incorporated in the Act(s).

National Savings Act 1940 (1940 No 7)

Amendment(s) incorporated in the Act(s).

North Shore Drainage Act 1951 (1951 No 19 (L)

Amendment(s) incorporated in the Act(s).

Otago Harbour Board Empowering Act 1913 (1913 No 8 (L))

Amendment(s) incorporated in the Act(s).

Penal Institutions Act 1954 (1954 No 51)

Amendment(s) incorporated in the Act(s).

Property Law Act 1952 (1952 No 51)

Amendment(s) incorporated in the Act(s).

Public Trust Office Act 1908 (1908 No 159) (1931 Reprint, Vol VIII, p 922)

Amendment(s) incorporated in the Act(s).

Public Trust Office Amendment Act 1913 (1913 No 19) (1931 Reprint, Vol VIII, p 972)

Amendment(s) incorporated in the Act(s).

Public Trust Office Amendment Act 1921–22 (1921–22 No 48) (1931 Reprint, Vol VIII, p 997)

Amendment(s) incorporated in the Act(s).

Settled Land Act 1908 (1908 No 175) (1931 Reprint, Vol VIII, p 200)
Settled Land Amendment Act 1915 (1915 No 23) (1931 Reprint, Vol VIII, p 231)
Settled Land Amendment Act 1922 (1922 No 44) (1931 Reprint, Vol VIII, p 232)
State Advances Corporation Act 1934–35 (1934–35 No 42)

Amendment(s) incorporated in the Act(s).

Statutes Amendment Act 1936 (1936 No 58)

Amendment(s) incorporated in the Act(s).

Statutes Amendment Act 1938 (1938 No 20)

Amendment(s) incorporated in the Act(s).

Taranaki Harbour Board Empowering Amendment Act 1952 (1952 No 23 (L))

Amendment(s) incorporated in the Act(s).

Tauranga Harbour Board Loan and Empowering Act 1956 (1956 No 7 (L))

Amendment(s) incorporated in the Act(s).

Timaru Harbour District and Harbour Board Act 1903 (1903 No 17 (L))

Amendment(s) incorporated in the Act(s).

Trustee Act 1908 (1908 No 200) (1931 Reprint, Vol VIII, p 873)
Trustee Amendment Act 1924 (1924 No 33) (1931 Reprint, Vol VIII, p 917)
Trustee Amendment Act 1933 (1933 No 32)
Trustee Amendment Act 1935 (1935 No 37)
Trustee Amendment Act 1946 (1946 No 14)
Trustee Amendment Act 1955 (1955 No 80)
Wanganui Harbour District and Empowering Amendment Act 1954 (1954 No 15 (L))

Amendment(s) incorporated in the Act(s).

Wellington Harbour Board Loan and Empowering Act 1952 (1952 No 17 (L))

Amendment(s) incorporated in the Act(s).

Whangarei Harbour Board Vesting and Empowering Amendment Act 1954 (1954 No 6 (L))

Schedule 2: amended, on 1 January 2011, by section 58 of the Limitation Act 2010 (2010 No 110).

Schedule 3 Enactments amended

s 89(2)

Christchurch Tramway District Act 1920 (1920 No 15 (L))

Amendment(s) incorporated in the Act(s).

Estate and Gift Duties Act 1955 (1955 No 105)

Amendment(s) incorporated in the Act(s).

Government Life Insurance Act 1953 (1953 No 58)

Amendment(s) incorporated in the Act(s).

Limitation Act 1950 (1950 No 65)

Amendment(s) incorporated in the Act(s).

Property Law Act 1952 (1952 No 51)

Amendment(s) incorporated in the Act(s).

Public Trust Office Act 1908 (1908 No 159) (1931 Reprint, Vol VIII, p 941)

Amendment(s) incorporated in the Act(s).

Schedule 4 Forms

Schedule 4: inserted, on 1 October 1988, by section 9(2) of the Trustee Amendment Act 1988 (1988 No 119).

*Form 1 Certificate that power of attorney has come into operation and that the donee is acting in the execution of the trust or the administration of the estate

I, [full name], of [place of residence] in New Zealand, [occupation], hereby certify:

1

That by deed dated [date of instrument creating the power of attorney] [full name of donor of power of attorney], of [place of residence of donor], in New Zealand, [occupation of donor] delegated to me the execution or exercise, during any period for which [full name of donor] may be absent from New Zealand (or incapable of performing all of his (or her) duties as a trustee), of all (or some) of the trusts, powers, authorities, and discretions vested in the said [full name of donor] in accordance with the terms and conditions set out in the said deed.

2

That the power of attorney set out in the said deed has come into operation.

3

That in [describe particular transaction] I am acting in the execution of the trust (or the administration of the estate).

Signed at: [place, date]

Note
*This form should not be used if the person holding the power of attorney is a corporation aggregate.

*Form 2 Certificate that power of attorney has come into operation and that the donee is acting in the execution of the trust or the administration of the estate

I, [full name], of [place of residence] in New Zealand, [occupation], hereby certify:

1

That I am a[n] director (or manager or secretary or officer) of the [full name of corporation holding power of attorney], a duly incorporated company (or society or association) having its registered office (or principal place of business) at [address of registered office or principal place of business], and as such am authorised to give this certificate.

2

That by deed dated [date of instrument creating the power of attorney], [full name of donor of power of attorney], of [place of residence of donor], in New Zealand, [occupation of donor] delegated to the said [full name of corporation] the execution or exercise, during any period for which [full name of donor] may be absent from New Zealand (or incapable of performing all of his (or her) duties as a trustee), of all (or some) of the trusts, powers, authorities, and discretions vested in the said [full name of donor] in accordance with the terms and conditions set out in the said deed.

3

That to the best of my knowledge and belief the power of attorney set out in the said deed has come into operation.

4

That in [describe particular transaction] the [full name of corporation] is acting in the execution of the trust (or the administration of the estate).

Signed at: [place, date]

Note
*This form should be used only if the person holding the power of attorney is a corporation aggregate.

Trustee Amendment Act 1988

Public Act
 
1988 No 119
Date of assent
 
28 July 1988
Commencement
 
see section 1(1)
1 Short Title and commencement

(1)

This Act may be cited as the Trustee Amendment Act 1988, and shall be read together with and deemed part of the Trustee Act 1956 (hereinafter referred to as “the principal Act”).

(2)

This Act shall come into force on 1 October 1988.

15 Certain provisions deemed to empower investment in accordance with Trustee Act 1956 as amended

(1)

Except as expressly provided in this Act, any provision in any Act, or in any instrument creating a trust, that empowers or requires any person to invest any money in the investments authorised under the Trustee Act 1956 or otherwise in accordance with section 4 of the Trustee Act 1956 shall be read and construed as if it empowered or required that person to invest that money in accordance with the provisions of the Trustee Act 1956 as to the investment of trust funds, as those provisions are amended by this Act.

(2)

Except as expressly provided in this Act, any provision in any Act, or in any instrument creating a trust, that empowers or requires any person to invest any money in any specified class or classes of investment, 1 or more of which is defined by reference to section 4 of the Trustee Act 1956, shall be read and construed as if—

(a)

it empowered or required that person to invest that money in accordance with the provisions of the Trustee Act 1956 as to the investment of trust funds, as those provisions are amended by this Act; and

(b)

the reference to every specified class or classes of investment had been omitted.

(3)

Except as expressly provided in this Act, any provision in any Act that—

(a)

is, by virtue of subsection (1) or subsection (2) to be read and construed as if it empowered or required any person to invest any money in accordance with the provisions of the Trustee Act 1956 as to the investment of trust funds, as those provisions are amended by this Act; and

(b)

empowers that person to invest that money in any other manner if the consent, approval, or authorisation of any Minister of the Crown is obtained,—

shall be read and construed as if the power or requirement referred to paragraph (b) had been repealed.

Trustee Amendment Act 2005

Public Act
 
2005 No 23
Date of assent
 
24 March 2005
Commencement
 
see section 2
1 Title

(1)

(2)

In this Act, the Trustee Act 1956 is called “the principal Act”.

2 Commencement

This Act comes into force on 26 April 2005.

3 Application

(1)

The amendments made to section 40(2) of the principal Act by section 4 apply in respect of any accumulated residue referred to in section 40 of the principal Act, even if the accumulation was made before the commencement of this Act.

(2)

The amendments made to section 42(1)(b) of the principal Act by section 5 apply in respect of any trust coming into operation under section 42 of the principal Act, even if the trust came into operation before the commencement of this Act.

Reprints notes
1 General

This is a reprint of the Trustee Act 1956 that incorporates all the amendments to that Act as at the date of the last amendment to it.

2 Legal status

Reprints are presumed to correctly state, as at the date of the reprint, the law enacted by the principal enactment and by any amendments to that enactment. Section 18 of the Legislation Act 2012 provides that this reprint, published in electronic form, has the status of an official version under section 17 of that Act. A printed version of the reprint produced directly from this official electronic version also has official status.

3 Editorial and format changes

Editorial and format changes to reprints are made using the powers under sections 24 to 26 of the Legislation Act 2012. See also http://www.pco.parliament.govt.nz/editorial-conventions/.

4 Amendments incorporated in this reprint

Financial Reporting Amendment Act 2014 (2014 No 64): section 17

Companies Amendment Act 2013 (2013 No 111): section 14

Financial Markets (Repeals and Amendments) Act 2013 (2013 No 70): section 150

Criminal Procedure Act 2011 (2011 No 81): section 413

Trustee (Prescribed Rate of Interest) Order 2011 (SR 2011/178): clause 4

Limitation Act 2010 (2010 No 110): section 58

New Zealand Institute of Chartered Accountants Amendment Act 2010 (2010 No 74): section 10

Māori Trustee Amendment Act 2009 (2009 No 12): section 30(1), (2)(a)

Disability (United Nations Convention on the Rights of Persons with Disabilities) Act 2008 (2008 No 64): section 22(2)

Income Tax Act 2007 (2007 No 97): section ZA 1(1)

Property Law Act 2007 (2007 No 91): section 364(1)

Taxation (Savings Investment and Miscellaneous Provisions) Act 2006 (2006 No 81): sections 240, 241

Trustee Amendment Act 2005 (2005 No 23)

Public Trust Act 2001 (2001 No 100): section 170(1)

Administration Amendment Act 2001 (2001 No 6): section 12(2)

Personal Property Securities Act 1999 (1999 No 126): section 191(1)

Interpretation Act 1999 (1999 No 85): section 38

Estate Duty Repeal Act 1999 (1999 No 64): section 15(1)

Banking Act Repeal Act 1995 (1995 No 32): section 2(2)

Mental Health (Compulsory Assessment and Treatment) Act 1992 (1992 No 46): section 137(1)

Public Finance Act 1989 (1989 No 44): section 83(7)

Trustee Amendment Act 1988 (1988 No 119)

Protection of Personal and Property Rights Act 1988 (1988 No 4): sections 113, 117(3)

Constitution Act 1986 (1986 No 114): section 29(2)

Trustee Amendment Act 1986 (1986 No 112)

Trustee Amendment Act 1982 (1982 No 50)

Judicature Amendment Act 1979 (1979 No 124): section 12

Fencing Act 1978 (1978 No 50): section 28(1)

Public Finance Act 1977 (1977 No 65): section 163(1)

Trustee Amendment Act 1977 (1977 No 21)

Trustee Amendment Act 1974 (1974 No 15)

Stamp and Cheque Duties Act 1971 (1971 No 51): section 101(1)

Age of Majority Act 1970 (1970 No 137): section 6

Administration Act 1969 (1969 No 52): sections 83, 84(1)

Mental Health Act 1969 (1969 No 16): section 129(4), (7)

Public Trust Office Amendment Act 1968 (1968 No 43): section 11(a)

Trustee Amendment Act 1968 (1968 No 24)

Public Revenues Amendment Act 1963 (1963 No 46): section 7(3)

Charitable Trusts Amendment Act 1963 (1963 No 21): section 4(2)

Crimes Act 1961 (1961 No 43): section 412(2)

Trustee Amendment Act 1960 (1960 No 101)

Trustee Amendment Act 1957 (1957 No 37)