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Māori Land Trusts – When can the Court remove a Trustee?
For a Trust to operate effectively it is important to ensure that Trustees are committed to their duties, and actively participating in Trust matters. The Māori Land Court has published a number of recent decisions on when it may be appropriate to remove a Trustee from a Māori Land Trust.
Te Ture Whenua Māori Act 1993 gives the Court the power to make an order to remove a Trustee where they have either lost capacity to perform as a Trustee, or the Trustee’s removal is desirable for the proper execution, or function, of the Trust and one of the following criteria can be met:
a) The Trustee repeatedly refuses or fails to act as a Trustee; or
b) The Trustee becomes an undischarged bankrupt; or
c) The Trustee is a corporate Trustee that is subject to an insolvency event; or
d) The Trustee is no longer suitable to hold office because of the Trustee’s conduct or circumstances.
Where the Trustee does meet one of the above criteria, the Court needs to consider whether the actions of the Trustee are significant enough that removal is necessary. The Māori Land Court has found that removal is a serious action to take, and as such breaches of Trustee duty which are merely technical may not be sufficient grounds for the Court to remove the Trustee.
However, the Māori Land Court has also pointed out that when a person agrees to become a Trustee, they are also agreeing to actively participate in Trust business. As such, where a Trustee is frequently missing Trust meetings, for good reason or otherwise, or not participating in votes regarding Trust matters, this may be sufficient grounds for removal.
The Trustee’s commitment to the Trust needs to be maintained to a high standard, meaning that a Trustee should resign from their position where they are unable to commit the necesary time to their duties.
If you are concerned about a dispute involving a Māori Land Trust, it is helpful to seek legal advice to get the best outcome for you and your whānau.
Leading law firms committed to helping clients cost-effectively will have a range of fixed-price Initial Consultations to suit most people’s needs in quickly learning what their options are. At Rainey Collins we have an experienced team who can answer your questions and put you on the right track.
Peter Johnson & Alexandra McCracken