Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 


Review of the law of trusts

UNDER EMBARGO UNTIL 12 NOON 13 NOVEMBER 2012
1
MEDIA RELEASE

13 November 2012

Hon Sir Grant Hammond KNZM

President

Law Commission

REVIEW OF THE LAW OF TRUSTS – GENERAL RELEASE

LAW COMMISSION SEEKS FEEDBACK ON PROPOSALS TO MODERNISE AND CLARIFY TRUSTS LAW

The Law Commission is seeking feedback on a number of proposed reforms designed to make the law governing trusts clearer and more accessible to the tens of thousands of New Zealanders who use them.

Trusts provide an alternative way of managing property or other assets and are unusually common in this country. Trusts serve a wide variety of purposes including allowing self-employed persons to separate business from personal assets and providing a mechanism for the orderly control and transmission of wealth, such as a family farm. They are set up privately with no requirement to register or report.

Law Commission President Grant Hammond said:

“Trust law has evolved over hundreds of years and is largely the result of the English judge-made law of equity. In New Zealand this has been overlaid with a fifty-year old statute, the Trustee Act 1956.
“The key objective of our proposed reforms is to translate this mosaic of case and statute law into a clear, fit-for-purpose statute so that those entering into a trust relationship fully understand the legal implications.”

The Law Commission says it appears a large number of New Zealand’s trusts are simple family trusts with limited trust property – perhaps just the family home.

However it says there is evidence to suggest that some trusts have been settled without a clear purpose or solid understanding of what the trust relationship fully involves.

Consultation on earlier discussion papers suggests a proportion of trusts are not well-administered and some trustees do not adequately understand the obligations that their role entails.

Sir Grant said “given the prevalence of trusts in New Zealand it is vital that those settling trusts, and those responsible for their control and management clearly understand the purpose for which the trust was designed and their obligations to the trusts’ beneficiaries.”

Trusts are a legally binding relationship between parties: the settlor, who establishes the trust; the trustees, who are entrusted with the management and control of the trust’s assets; and the beneficiaries, who are entitled to benefit from the trust.

Sir Grant said it was not surprising that the nature of the trust relationship and its legal implication was not always well understood by the parties given the age, complexity and inaccessibility of the law. The Commission thinks it is in the public interest to have a modern statute which establishes benchmarks as to how a trust is to be managed and increases the accountability of trustees.

The Commission’s proposals have been published in a Preferred Approach paper which brings together the key findings and recommendations that have emerged during stage one of their comprehensive review.

The proposed new statute would:

• Provide a clear definition of what constitutes a trust and the essential requirements that must be met for a trust to come into existence;

• Provide a simplified summary of the duties of trustees;

• Set out which trustee duties would apply to all trusts and could not be over-ruled by individual trust deeds, including a minimum requirement for the records that a trustee must keep about the trust;

• Streamline the law and provide ways to reduce the reliance on the court to resolve administrative issues.

The Preferred Approach paper is available on the Commission’s website:
www.lawcom.govt.nz/project/review-law-trusts/publication/preferred-approach-paper

The Commission is seeking comments from submitters as to whether they consider the proposals would be beneficial or whether there are any issues with how they would work in practice. The submission period closes on 22 February 2013.

The Commission will release a final report with recommendations in 2013.

-ENDS-

Law_of_Trustsdetails.pdf

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

'Tea Break Bill' Passes: Gordon Campbell On Bad Labour Laws And Poor Safety

By co-incidence, one of the prime dangers of the government’s new employment relations law has been underlined by the release of the death and injury statistics among workers at New Zealand ports. These are highly profitable enterprises for the port owners.

The Port of Tauranga for instance, is expecting its current full-year profit to be between $78 million and $83 million and other ports are enjoying similar boom times – but they are also highly dangerous places for the people who work on or around the port premises. At the Port of Tauranga, there have been 26 serious accidents since 2011, and two deaths. More>>

 

Parliament Today:

No Charges: Outcome Of Operation Clover Investigation

Police have completed a multi-agency investigation, Operation Clover, into the activities of a group calling themselves “The Roast Busters”. The 12 month enquiry focused on incidents involving allegations of sexual offending against a number of girls in the Waitemata Police district and wider Auckland area... More>>

ALSO:

UNICEF Report: NZ Cautioned On "Stagnating" Child Poverty

An international report by UNICEF has found that child poverty rates in New Zealand have barely changed since 2008, despite similar sized countries significantly reducing child poverty during the recent recession. More>>

ALSO:

Funding Report: Two Pathways For Transport In Auckland

Commissioned by Auckland Council, the group was asked to investigate two possible pathways for raising $300 million per year ($12 billion over 30 years) to pay for the improvements needed to help fix Auckland’s transport system. More>>

ALSO:

Pay Equity: Equal Pay Win In Court Of Appeal

CTU: The Court of Appeal has made a historic decision paving the way for a substantial equal pay claim for aged care workers. More>>

ALSO:

Gordon Campbell: On The TPP Finishing Line, And Amazon’s Woes

If the Trans Pacific Partnership trade deal wasn’t such a serious matter, this would be pretty funny… More>>

ALSO:

TV3 Video: Three Die On Roads Over Labour Weekend

The official holiday period ended at 6am Tuesday, with three deaths on the roads during the Labour Day weekend. More>>

Employment Relations Bill: Govt Strains To Get Tea Break Law Through

The Government has been left with egg on its face - failing to get its much-vaunted, but hugely unpopular, meal break law passed in the first week of its new term, Labour spokesperson on Labour Issues Andrew Little says. More>>

ALSO:

Guns: Police Association Call To Arm Police Full Time

"The new minister gave his view, that Police do not need to be armed, while standing on the forecourt of parliament. The dark irony was that the interview followed immediately after breaking news of a gunman running amok in the Canadian parliament in Ottawa..." More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Politics
Search Scoop  
 
 
Powered by Vodafone
NZ independent news