July 2021 - McCaw Lewis

“Put Up or Shut Up” – A Valuable Trustee Tool

Posted on July 29, 2021March 19, 2026 by au_common_admin

Being a trustee is an onerous duty, particularly when someone is alleging they have a claim against you personally as a trustee or that they have a claim against the property of the trust/estate you are administering.

As a trustee, if you reject the claim, what can you do? If the claim is not pursued in any formal way, this unresolved claim can affect the administration of the trust/estate and place you at risk if you proceed.

Section 135 of the Trusts Act 2019, formerly section 75 of the Trustee Act 1956, provides an effective, but not often utilised, solution – it enables you to require the person making the allegation to “put up or shut up”.

The “Claim” and Associated Risk

If there is an unresolved claim against you personally as a trustee, or against the property of the trust/estate that you administer, choosing to proceed to administer/distribute the trust/estate property could have significant ramifications.

This is particularly so if the claim is eventually brought before the High Court and the property in question has been distributed or the trust/estate wound up:

You could be held personally liable;
You could find yourself in the position of having to defend against a High Court proceeding with no trust property to indemnify yourself from if you are successful.

To protect yourself once a claim has been made the process under section 135 of the Trusts Act 2019 should be initiated.

The Notice

The first step is to serve a notice on the person making the claim.

The notice must be served in accordance with the High Court Rules 2016 and set out, pursuant to section 135 of the Trusts Act 2019:

The general nature of the claim as you understand it to be; and
That if they do not commence legal proceedings within 90 days of receiving the notice, the High Court may bar their claim or authorise you to administer the trust/estate property without regard to their claim.

The effect of the notice is that time begins ticking. The person making the claim has 90 days after being served with the notice to commence a proceeding in the High Court to enforce their claim – case law refers to this as requiring them to “put up or shut up”.

The Application

If proceedings have not been commenced by the expiry of the 90-day period then you can make an application to the High Court to bar the claim.

As part of the application you can seek that the costs of the application are to be paid by the trust, if appropriate, or are to be paid by the person making the claim.

High Court Approach

The High Court’s approach to your application will in part be dependent on whether the person making the claim takes any steps following receipt of your application.

If they do nothing, then the High Court will proceed to make orders on your application, after following a particular process under the High Court Rules 2016 referred to as a formal proof hearing. If the High Court considers your application has merit, then it may bar the claim or authorise you to administer the trust/estate property without regard to the claim.

If the person making the claim does take steps, then case law, under section 75 of the former Trustee Act 1956 (such as Poulter v Poulter [2020] NZHC 3095), sets out various principles the High Court will apply, including:

There is no requirement for the High Court to undertake a substantive assessment of the merits of the claim, however whether the claim has any merit may be taken into account when considering if it should be barred;

A lack of action both before and after the notice being served will count against the person making the claim;
An explanation will be required as to why no steps were taken to initiate proceedings from the time the notice was served;
Evidence that a claim may not be progressed with all due diligence will count against the person making the claim;
Even where the claim is meritorious, and there is an explanation for the failure to initiate proceedings, the High Court would only extend the time for bringing a claim on conditions requiring proceedings to be initiated in a specified period of time, failing which it would be barred.

What the High Court will ensure is that the claim is either brought to a head within a reasonable time or is put to rest.

Conclusion

Unresolved claims against a trust/estate can have serious implications if, as a trustee, you proceed to administer a trust/estate.

Requiring the person making the claim to “put up or shut up” is a valuable tool which can be utilised to safeguard yourself.

The experienced team at McCaw Lewis can help you navigate the legal aspects of the process required under section 135 of the Trusts Act 2019 and the High Court Rules 2016 or answer any questions you may have.

Zane is an Associate in our Disputes Resolution Team and can be contacted on 07 958 7431.

How to Manage Your Role as an Executor and Beneficiary in a Civil Dispute

Posted on July 26, 2021April 21, 2026 by au_common_admin

If you are appointed as an executor under a Will, a large amount of trust is placed in you. An executor has duties towards the beneficiaries, and beneficiaries have their own rights. But what about when an executor is also a beneficiary under a Will? How do you balance those two roles and interests?

Executors have a number of duties:

Act in the best interests of the Estate;
Act impartially towards beneficiaries, and not be unfairly partial to one beneficiary or group of beneficiaries to the detriment of the others (although an executor is not required to treat all beneficiaries equally);
Act unanimously (if more than one executor is named in the Will);
Give basic information to beneficiaries when requested.

Executors have limits on their powers over and above the Will:

Not to exercise a power either directly or indirectly for the executor’s own benefit;
To actively and regularly consider whether the executor should be exercising one or more of the executor’s powers.

If you are the spouse, relative or close friend of a person making a Will, there is a good chance you will be appointed an executor, and possibly be named as a beneficiary under the Will. Should that occur you will have two roles. This can become difficult to manage when someone is challenging a Will such as a through a Family Protection Act claim (see Daniel Shore’s article Family Protection Act 1955 and the Concept of Moral Duty). An executor has a duty to the Estate, whereas a beneficiary has a right to receive from the Estate. In a Court proceeding, arbitration or mediation, an executor/beneficiary may have to switch between “hats”:

As an executor: To act in the Estate’s best interest;
As a beneficiary: To act in their personal interest.

The key distinction between the roles is that an executor will normally remain neutral (particularly if there are competing claims) and a beneficiary is an active participant. The two roles interact simultaneously, but separate legal advice must be obtained for each role:

As an executor: advised by the Estate’s lawyers;
As a beneficiary: take independent legal advice.

The following diagram summarises the two roles and how they interact in a Family Protection Act claim when a claim is brought and opposed by another party:

Reducing Rating Barriers for Māori Landowners

Posted on July 8, 2021March 19, 2026 by au_common_admin

Introduction

This article looks at the recently-enacted Local Government (Rating of Whenua Māori) Amendment Act 2021 (“the Act”), and what it means for owners and occupiers of Māori land.

In April 2021, the Government passed significant changes to how rates are charged for Māori land. Most of the changes outlined come into force on 1 July 2021, and make positive changes to overcome historical hurdles concerning the rating of Māori land.

The Changes

There are five key areas of the Act that support the development of Māori land, remove long-standing obstacles for engagement and partnership between local authorities and Māori, and equitably modernise the rating system for Māori Land.

1. Remission of Rates for Māori Land Development

Māori landowners who are developing, or intending to develop, their land can now apply to their local Council for a rates relief on that land (known as a remission of rates). The development could include developments that benefit the district by creating new employment opportunities, new homes, providing support for marae and facilitating the occupation development and utilisation of the land. It is up to the local Council whether to allow for a remission of rates, but the Council must consider the mutual benefits of the development to its district and to Māori.

2. Multiple Blocks of Māori Land

Māori landowners can now apply to have two or more blocks of Māori land treated ‘as one’ for rating purposes. This is beneficial for Māori landowners where a block of land has been subdivided over time into smaller blocks that are now too small for individual economic development.

3. Individual Houses

The Act now enables individual houses on Māori land to be rated as if they were one rating unit. This is positive for Māori landowners as it allows low-income homeowners on blocks with more than one home to access rates rebates.

If homeowners are interested, they should contact their local Council as soon as possible to apply to have the home to be set up as a separate rating area, so that the Council can calculate the new portion of the rates before the new rating year begins on 1 July 2021.

4. Rates Arrears

Local Councils now have the power to remove rates arrears. This means that Māori landowners can now apply to the Council to write off any outstanding rates that are unrecoverable. When a whānau member who is a landowner passes away and a member of their whānau inherit their land, that person can apply to the Council to write off the arrears existing at the time of the previous owner’s death.

5. Ngā Whenua Rāhui Kawenata

Māori landowners who have a kawenata agreement with the Department of Conservation in relation to the entirety or any part of their land, that land is non-rateable from 1 July 2021. Any rates arrears existing at that date will also be written off by the Council.

Māori freehold land that is unused will also be non-rateable from 1 July 2021, with any rates arrears on this land written off. But, if the unused land is in an urban area, it may still be liable for urban water supply and wastewater rates.

Other Changes

Minor changes have also been made to:

Remove the two-hectare land area limits from rates exemptions for marae and urupā;
Clarify the current exemptions for marae, meeting places, and meeting houses;
Require some Council funding and financing policies to support the principles of the Preamble to Te Ture Whenua Māori Act 1993; and
Provide protection to Māori land made general land under the Māori Affairs Amendment Act 1967 from abandoned land and rating sale provisions.

Carmen Mataira is a Law Clerk in our Māori Legal Team. Kylee Katipo is a Senior Associate and can be contacted on 07 958 7424.

Month: July 2021