Family Court Busts Family Trusts
This article will be of interest.
Family trusts can be a great way to lose control of property in a divorce. But a landmark Supreme Court decision may help change that.
The full text of this article appears in the NZ Listener
(April 10-16 2010).
Seven years ago, Hawke’s Bay couple Chris and Danny (Diana) Ward’s marriage fell apart. Danny left their family home and the $2 million farm they had worked together. “I just wanted to get out of the relationship,” she says.Â
She rebuilt a life. She found work as a shepherd, rented a cottage and shared the care of her two school-age children. But all these years later, she remains relatively impoverished as her husband has the farm and the house.Â
Why? The culprit was the family trust, like those set up by tens of thousands of New Zealand families to protect their assets. The farm and home are owned by the family trust she and her husband set up nine years into their marriage.Â
The full text will be available online on 24/04/2010.
Link to the judgement
Ward v Ward
(09) 271 3020
I’d be interested to know how they acquired the farm to begin with. Don’t be surprised if it was inherited by him from his own parents. They are almost always passed from father to son(s). I know of very few farms which have been bought outright by the existing operator.
I deal with many tax clients who are farmers and who structure their businesses in this manner. It’s advantageous from a tax standpoint as it distributes income across all participants, including dependents, and therefore lowers the overall tax burden.
Seems it belonged to his family to begin with. However he didn’t have complete proprietorship prior to the marriage.
Now I’ve got more bloody reading to do.
At the very least the children should be beneficiaries of the trust.
i know of a man whos wife ran off with the truck driver who was working on the farm,she made 4 mil after hubby sold the farm. got to love this country and its laws.
What complete drivel. How biased can a report be?
She decided she wanted out of the relationship for no good reason. She was unable to ruin the father and bancurpt the family business. Apparently this makes the trust a culprit. Only in NZ!
I’ll ask once again, Why would I get married or have a defacto wife? Is there no one who can answer my question?
What the court can do is order that one party compensate the other party in a cash or private asset agreement,
The Property (Relationships)Act & Trusts.
The changed wording in section 10(1)(a)(iv) in what was the Matrimonial Property Act ensures that the mere fact that property held by one or both spouses or de facto partners is conferred by an inter vivos trust, it will not affect the status of the property except where the trust has been created by a third party.
Opps! quote- unquote
great question. I’d like an answer to that too.
Hello, anybody out there got an answer for Dave and I?