Edmonds Judd

NZLaw

Life Stage – First Home

Economy & Finance, Employment, Estate, House, Media, News, Online, Uncategorized
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It felt like Bob’s life had been turned upside down. Not only had his father, Steve, passed away recently leaving him upset and overwhelmed, but his burger bar business was also struggling. Bob had put all his life savings into his burger bar, which he opened 6 months prior. Further adding to the stress, Bob currently did not have a home. He had been couch-surfing at friends places while he saved up enough to rent a place of his own.

 

After a few difficult months, Steve’s estate was finally settled. As one of the beneficiaries, Bob received a substantial inheritance. Though the money offered some relief, Bob knew he needed to use it wisely. His first step: finding a home. He realised that in order to take care of his business and himself, he needed a stable place to live and rest, putting him in a better frame of mind to make smart business decisions.

 

As Bob now had more funds than he had expected to receive from years of working, he decided this was the right time to buy a property rather than rent. He browsed listings on local real estate websites and soon found a small, tidy place in a quiet neighbourhood—within his budget and close to his burger bar.

 

He decided to call his lawyer and ask for the things he should consider before making an offer. His lawyer guided him through several key considerations:

 

  1. Conditions in the Sale and Purchase Agreement: He needed to decide whether he wanted to include conditions in the agreement. He already had the funds available for the purchase so he did not need to make it conditional on finance. Bob did not realise that he could also include other conditions such as a LIM report, builders report, and toxicology report. Bob decided to include each of these as it was better to make sure there were no big issues before being locked in a deal.

 

  1. KiwiSaver: If Bob has KiwiSaver funds, he would need to fill out an application to withdraw the funds from his provider. He would need a solicitor to witness him signing this as it could not be left until the last minute.

 

  1. Insurance: The lawyer stressed to Bob the importance of checking he could obtain insurance cover for the property prior to going unconditional. Also, if there were any issues under the builders report / LIM report / toxicology report, he would need to disclose said issues with his insurer.

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  1. Relationship Property: Bob had not had the time to date with everything going on but was made aware to obtain advice in this regard once he had a partner in the future.

 

Bob took all the advice into consideration and obtained all recommended reports. Within weeks, his purchase when unconditional, and weeks after, settled.

 

Bob was beyond happy, he now felt as though he had the stability he had been searching for. This feeling lasted only a few minutes though as Bob was about to receive a call in relation to his business that would change everything…

 

 

Macayla Brdanovic 

 

 

📢 Supreme Court Decision: Fiduciary Duties and Parent-Child Relationships

House, Kids, Media, News, Online, Property, Relationships
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The Supreme Court recently issued its much-anticipated ruling in A, B and C v D and E Limited as Trustees of the Z Trust known as the Alphabet case. It concerns the extent of fiduciary duties owed by a parent to an adult child. ⚖️

The case involves a father, who transferred most of his assets to a trust during his lifetime, leaving his adult children without any entitlement to those assets. The children argued that due to past abuse they suffered at their father’s hands, including physical, emotional abuse and sexual abuse, their father owed them fiduciary duties that extended into adulthood. They believed his actions in transferring assets breached those duties, and the assets should revert to his estate to satisfy their Family Protection Act claims to be provided for from his estate.

While the Court agreed that fiduciary duties exist between a parent and minor child, it ruled that those duties generally end once the child reaches adulthood or the caregiving responsibility ends. The Court rejected the notion that such duties continued into adulthood, despite the children’s vulnerability due to the abuse they suffered during childhood. Importantly, the Court noted that imposing fiduciary duties in this case would create legal uncertainty and “reverse engineer” a remedy for past wrongdoing.

The Court also ruled against treating the trust assets as part of the father’s estate. However, it acknowledged the need for legal reform in this area and pointed to the Law Commission’s 2022 proposal to allow courts to unwind property transactions that intentionally defeat claims under succession law.

While the Court was sympathetic to the appellants, it ultimately found that the law could not support their claim in this case. The ruling highlights the need for further reform in this area of law, which the Law Commission’s proposals may address in the future.

Kerry Bowler, Solicitor Kerry Bowler