Plaintiff v Defendants

Plaintiff v Defendants - [2010] VSC 54 - VSC 2010 case summary — Zoe

[18]

15 By the terms of the 1984 agreement, as alleged in paragraph 4, Bernard and Grant agreed that Grant would restructure the Robertson Group; and he would do so in a manner that ensured 11 things. First, that the assets of the Robertson family would remain under the control of blood relatives. Secondly, that those assets would be protected even in the event that litigation against Anihidi, or Anikau, or both, were to be successful. Thirdly, that Grant would continue to work for the Robertson Group. Fourthly, that Bernard would "retain control of the Robertson Group until his death". Fifthly, that "Bernard and Grant would be the executive directors of Anikau and Anihidi and any further companies that became part of the Robertson Group". Sixthly, that Grant would continue to be executive director of all the existing members of the Group. Seventhly, that he "would be given an interest in ... the Robertson Family Trust that included separate funds attributed to Neil, Grant, Vicki, Bradley and Rosemary ... which in the case of Grant and Neil would reflect the amount of work that they had done and were expected to do for the Robertson Group ... and which in Grant's case reflected the matters referred to in paragraph 4(b)" (namely, the benefits which, by being guarantor for the Group, Grant conferred on the Group and therefore on the family). Eighthly, that "the Robertson Family Trust would have an unallocated fund [being an additional, and therefore the sixth, fund within the Trust] that could be allocated to each of the [five separate] funds referred to ... [above] having regard to future contributions made by Grant, Neil, Vicki and Rosemary to future growth in wealth of the Robertson Group". (The absence of any reference to Bradley at this point - paragraph 4(A)(viii) of the statement of claim - is unexplained). Ninthly, that "Grant and Bernard would determine how the assets contained in the unallocated fund referred to ... [above] would be allocated and would cause the trustee of the Robertson Family Trust to give effect to that determination". Tenthly, "that as Bernard reduced his involvement with the day to day affairs of the Robertson Group ... Grant would take over the day to day control of the ... Group". And, finally, that the trustee of the Robertson Family Trust would control any further companies that became part of the Robertson Group.

[70]

61 The final breach alleged in paragraph 6 is to be found in sub-paragraph (e). It is there said that, in breach of the 1984 agreement, "Bernard has failed or refused to cause Anahaw (as trustee of the Robertson Family Trust) to allocate part of the unallocated fund to Grant's Fund so that Grant's Fund comprises 40 parts of the Robertson Family Trust". This, of course, is said to be a breach of that provision of the 1984 agreement which provided that "Grant would restructure the Robertson group in a manner that ensured ... (viii) the Robertson Family Trust would have an unallocated fund that could be allocated ... having regard to future contributions made by Grant, Neil, Vicki and Rosemary to future growth in wealth of the Robertson Group [and] (ix) Grant and Bernard would determine how the assets contained in the unallocated fund ... would be allocated and would cause the trustee of the Robertson Family Trust to give effect to that determination". It too must confront the difficulty that this provision does not place any responsibility upon Bernard to do anything. There is also the point that any attempt by Grant to ensure the two outcomes in question would almost certainly require the creation of a document embodying terms appropriate to effect that purpose. After all, the unallocated fund is likely to consist of both income and capital. One may assume, at least for the present, that income can without difficulty be distributed at intervals, and in accordance with such merit as is displayed by the individual family member/contributors over the interval in question. The allocation of capital in accordance with merit cannot so readily be managed. So when one speaks of an allocation made in, for example, 1995 or 2005, one has to wonder - until further information is known - whether that allocation was of capital or income and, if the former, how Grant should be entitled to retain it in circumstances where his contribution to the family's fortunes might wither to nothing (as, whether through his fault or not, it has) while that of others was increasing exponentially. Why, it might be asked, should Grant retain 40 of the 100 parts of the assets of the family trust when all the contributions to its wealth are now made by others?

[160]

To the best of my knowledge, the first conversation was: "We have to fix up the structure between Anikau and Anihidi ...". What then occurred was that [my father] said words to the effect: "What I want is a new trust fund to be established", that the control of that trust fund would rest with him during his lifetime, [and] that there would be reward for the effort that each of the members of the family, including Rosemary, would put in to date at that time, and subsequently. That he and I would still continue to be the directors of the companies, and that he wanted to make sure that the bloodline retained control of the group.

Now, that's the first conversation that I recall. ... I said "Fine, I can start looking at how we can structure the whole arrangement". He said words to the effect: "Well, is there anything wrong with the Anikau sub trust structure?" And I said: "Well, that's what I was going to be looking at as the mirror image of the new trust structure". And then subsequent discussions occurred. So what I have just indicated was the first one.

Subsequent discussions after I had sufficient time to take into account what he had said, I went back and said to him words to the effect that: "What we should do is establish a new family trust", that that new family trust would have six funds similar to the structure that we had for the Robertson Family Settlement, which had four funds. But the six funds would be for, one for each child, one for Rosemary, and one be an unallocated fund, and that unallocated fund would be used by he and I to distribute to those who were considered to have increased the net wealth of the family. Further, as part of that same or similar circumstances around that discussion, he indicated that he wanted to have a new will to take into account that revised structure. He also wanted to ensure that he and I retained the directorships, and that he and I would have a hand-over, take-over procedure, whereby in due course he would reduce his involvement in the business and that I would eventually take over those activities that he was doing.

In one of the subsequent 20 or 30 conversations, I raised the point concerning what is going to be the allocation of the funds. In the Robertson Family Settlement, whether it is 25, 25, 25 for each of the children? I asked my father specifically: "What allocation do you want?" And he said to me words to the effect: "You and Neil have done most of the work, so you should get 18% each. Vicki, she's done nothing, but she is still a member of the family and she is still my daughter. She will get 9". My brother being Brad had caused problems, he would get 7. Rosemary would get 6, and the unallocated fund which was 42%, had been set aside, and that would be allocated pursuant to an agreement between he and I when the time came.[58]

At a glance

Court

Decision date

Before

Source

Judgment (258 paragraphs)

Parties