Trusts Act 2019

Trustees’ powers and indemnities - Powers of trustee - Other powers and rights of trustee

79: Trustee’s liability limited where notice given to distribute trust property without regard to unknown claims

You could also call this:

"Trustees are protected if they warn others about distributing trust property and follow the rules."

If you are a trustee, you are not liable for something you did when distributing trust property if you first gave a notice to potential creditors and other claimants. You must give this notice in a way that they will see it, and it must say what trust is affected. The notice must also say that anyone with a claim must tell you before a certain date, which is at least 30 days after the notice is given.

You can ask the court for directions on what type of notice to give, as stated in section 133. This section does not apply to claims under the Family Protection Act 1955 or the Law Reform (Testamentary Promises) Act 1949.

If you did not know about a claim when you distributed the trust property, you are not liable for it, as long as you followed the rules for giving notice. However, this does not affect any other rights or remedies that a person may have, such as those under section 49(1) of the Administration Act 1969.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM7382982.


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Part 4Trustees’ powers and indemnities
Powers of trustee: Other powers and rights of trustee

79Trustee’s liability limited where notice given to distribute trust property without regard to unknown claims

  1. A trustee is not liable in a proceeding brought by or on behalf of a person in relation to the distribution of trust property if—

  2. the trustee has first given a notice to potential creditors and other claimants in accordance with subsection (2); and
    1. the distribution is made after the notice deadline mentioned in subsection (2)(c); and
      1. the trustee did not have notice of the person’s claim at the time of the distribution.
        1. A notice to potential creditors and other claimants must—

        2. be given in a manner likely to come to their attention; and
          1. identify the trust or estate affected; and
            1. state that any creditor or other claimant who asserts a right or an interest relating to that trust property must give notice of their claim to the trustee before a date specified in the notice that is at least 30 days after the date the notice is given (the notice deadline); and
              1. set out the physical and email addresses to which a notice of claim and details of a claim may be sent or delivered; and
                1. state that the proposed distribution may be made without regard to any claim of which the trustee does not have notice before the notice deadline.
                  1. A trustee may apply to the court for directions under section 133 regarding the type of notice that is appropriate.

                  2. This section does not apply to any claim—

                  3. under the Family Protection Act 1955; or
                    1. under the Law Reform (Testamentary Promises) Act 1949; or
                      1. arising out of any contract—
                        1. to make a will containing certain provisions; or
                          1. not to revoke an existing will or a specified provision within a will; or
                            1. not to make a will; or
                            2. by a person to be—
                              1. a beneficiary under a will; or
                                1. entitled in the intestacy of a deceased person; or
                                  1. beneficially interested under a trust.
                                  2. Nothing in this section affects a remedy that a person may have under section 49(1) of the Administration Act 1969 or any other right or remedy available against another person other than the trustee, including a right to follow the property and any money or property into which it is converted.

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