New Zealand Law Commission Fifth Issues Paper on Law of Trusts

The Law Commission of New Zealand has published its fifth issues paper in its review of the law of trusts. It is the final in a series of Issues Papers that have discussed particular issues and problems with trusts law in order to enable the development of law reform proposals to modernize trusts legislation in New Zealand:

"Part 1 of this Issues Paper examines the various powers the courts have in respect of trusts and trustees. There is a public interest in ensuring the effective, prudent and honest management of trusts. The courts have a crucial role in this context, and accordingly, exercise a number of powers, both facilitative and regulatory. The Commission has broken its discussion on the role of the courts down into three broad topics, addressed in separate chapters (...)"

"Part 2 discusses alternative methods to the courts for resolving trust disputes and making decisions. Chapter 4 outlines the argument for introducing a new mechanism for trust dispute resolution and decision-making. It examines the options of an ombudsman, tribunal and commission. Chapter 5 discusses how alternative dispute resolution methods can be put to greater use in the context of trusts."

"Part 3 focuses on a particular type of trust used in New Zealand – trading trusts (...)"

"Part 4 discusses placing greater regulatory requirements on trusts. Chapter 9 discusses possible problems with the current lack of regulation of trusts in New Zealand and looks at the ways in which trusts are regulated overseas. It raises several options for regulation of trusts, including registration and reporting requirements. Chapter 10 considers whether there is a need for additional regulation of those providing services to trusts. It examines existing regulation and also looks at the more comprehensive regulatory regimes some overseas jurisdictions have adopted in this area."

Earlier Library Boy posts about the New Zealand Law Commission's review of trust legislation include:

• New Zealand Law Reform Commission Introductory Issues Paper on Law of Trusts (November 17, 2010): "The first issues paper is primarily a background paper. It traces the development of the trust from its origins in England through to the present day uses of the trust both in New Zealand and internationally."
• Recent Reports by the Law Commission of New Zealand (December 30, 2010): "The second issues paper will cover issues with the use of trusts (especially family trusts) in New Zealand. This paper will look at the purposes for which family trusts are established, including reducing tax obligations, protection of assets from creditors and relationship property claims, and meeting eligibility thresholds for government assistance. The paper examines different legislative and judicial responses to the use of trusts to 'look through' or disregard a trust where a trust has been used to frustrate the underlying policies of particular statutes."
• New Zealand Law Reform Commission Third Issues Paper on Law of Trusts (May 4, 2011): "Part one of the paper examines the rules that limit the duration of a trust: the common law rule against perpetuities and the Perpetuities Act 1964. The Commission explores the underlying rationale for the rule against perpetuities and asks whether the rule continues to meet a relevant policy need or whether either the mechanism for achieving this policy or the policy basis itself should change. The paper canvasses different options, including retaining the statutory perpetuity rule, adjusting or extending the statutory rule and abolishing the rule altogether, as has been done in a number of overseas jurisdictions. Part two of the paper looks at the rules that allow trusts to be altered. "
• New Zealand Law Reform Commission Fourth Issues Paper on Law of Trusts (June 30, 2011): "Part one of the paper examines the duties that a trustee owes to beneficiaries of a trust. It gives particular attention to the duty to inform beneficiaries about matters relating to the trust (...) Part two of the paper discusses the appointment, retirement and removal of trustees. It also addresses the powers given to a trustee."