Trusts, Wills & Estates

Mackenzie Elvin estates

We can help you to ensure successive generations in your family benefit from your “hard yards” and in so doing avoid some of the pitfalls in this area. Working in conjunction with our experienced governance and succession team, your planning and forethought will help avoid conflict and ensure a smooth transition for everyone concerned.

Services
Our Team
  • Wills
  • Powers of Attorney
  • Trust establishment
  • Trust management
  • Asset structuring
  • Estate administration
  • Succession Planning
Graeme Elvin 2017
Marcus Wilkins 2017
Clare Murphy 2017
Shona 2017

FAQs

Gifting

Gift duty was abolished in October 2011. This means that you can now gift an unlimited amount each
year, free from any duty payable to IRD. If you are currently engaged in a gifting programme, or if you were thinking of making any gifts in the future, you will need to be aware that this change only concerns the IRD and taxation. You should seek further advice before changing your gifting plans.

For further information and commentary see: Gift duty bonus comes at a high price (stuff.co.nz)

Do I need a trust?

What is a Trust and why would I need one?

A Trust is a recognised legal entity often used for passing assets to the next generation and protecting the assets from ‘predators’ or people or entities you don’t want to have access to them.

We can help you ensure the next generation in your family benefits from succession planning, where your forethought will help avoid conflict and ensure a smooth transition for everyone concerned.

Might you need a trust?

If your answer is “Yes” to any of the following questions, then a trust may be worth discussing with us: 

  • Are you in a relationship where you have a blended family?·
  • Are you in a second marriage and have children from a first marriage?·
  • Are you expecting an inheritance shortly?·
  • Do you wish to protect and keep separate any personal assets from business assets?
  • Do you wish to protect your children’s inheritance from those who you don’t intend to benefit?·
  • Do you have any children or grandchildren who have a disability?
  • Do you have any children or grandchildren who currently have or have had a problem with the following: their relationship, finances, drugs, alcohol or mental health?

NOTE: Trusts are not necessarily the only solution.

Trust Management

Trusts are a management structure that may be utilised for asset and estate planning and protection.

Trusts are widely used, but are often not that well understood, nor particularly well managed. In order to avoid problems, a trust needs to be tailored to your situation. Initial set up is only part of the process. After that the trust will need professional and independent review, management and investment strategies. Trusts need to be well run in order for the beneficiaries to get the most benefit, and to ensure that the trustees are not vulnerable to their actions or the entire trust being challenged.

If you think you may need a trust or if your current one is accumulating dust, get in touch with us so we can ensure your assets are well protected now, and for the future.

Trust Meetings

Why are regular trustee meetings important? 

To ensure that all the trustees are up to date with any changes relating to Trust property or relevant relationships.

If you are a Trustee and wish to delegate your powers, authorities and directions, you can only do so by way of a Power of Attorney, executed as a Deed, in the following circumstances:

  • You are, for the time being, out of New Zealand or about to depart from New Zealand;
  • You expect that you may be absent from New Zealand, from time to time, during the administration of the trust (please note that this does not apply if you are absent from your place of work or residence but still in New Zealand);
  • You are, or may be about to become temporarily incapable, by reason of physical infirmity, (such as being hospital bound with illness or injury) of performing all of your duties under a Trust; or
  • You expect that you may be, from time to time, temporarily incapable, by reason of physical infirmity, or performing all of your duties as trustee.

Note:  You can delegate to any ‘person’ including a company, although this excludes a trustee corporation.

What happens when a trustee loses mental capacity and needs to be replaced?

The circumstance may arise whereby a trustee loses mental capacity, and needs to be replaced and for the trustee’s assets to be transferred to a new trustee.

The best way to avoid this circumstance is to ensure that trustees are holding regular meetings to ensure that all trustees are able to continue acting and any trustees with deteriorating health (such as an early diagnosis of dementia) can be retired.

If a trustee is mentally incapable, often the trust deed will set out the procedure for the appointment and removal of trustees. If the trust deed does not do this the Trustee Act 1956 sets out the procedure for appointing and retiring. In some circumstances, the High Court may be required to assist with this procedure which can be costly.

The problem does not end there however. Even if a mentally incapable trustee has been removed and a new trustee has been appointed, an outstanding matter is often the removal of the trustee’s name from titles to land owned by the trust.  Despite a trustee having an enduring power of attorney, an attorney acting under an enduring power of attorney cannot sign an Authority and Instruction form to transfer title to land in NZ on behalf of a mentally incapable trustee. In that circumstance an application to the High Court for a vesting order would have to be made to vest the land in the continuing trustees and the new trustee’s names. This situation is widely regarded as unsatisfactory but seems to need legislation to correct.

Having a corporate trustee, such as a lawyers’ or accountants’ trustee company where a few of the principals of the firm are directors and shareholders of the trustee company, can avoid these issues which arise with having individuals as independent trustees. The problem still remains where, as is often the case, the settlors of the trust are trustees and one of them becomes mentally incapable. The only way around this would be to set up a trustee company for the settlors of the trust in which they were both directors and shareholders and make sure that they both had enduring powers of attorney. That might be seen as an unnecessarily complicated solution to deal with the possibility of a trustee becoming mentally incapable which is a situation that might never arise and is best managed by regular meetings as we have noted above.