Trusts Act 2019

Court powers and dispute resolution

127: Procedure for court’s review of trustee’s act, omission, or decision

You could also call this:

"How a court checks if a trustee made a fair decision"

If you want a court to review something a trustee has done or decided, you must show the court that there is a real dispute about whether the trustee's action was reasonable. The court will look at the evidence you provide and decide if there is a genuine dispute. If the court agrees that there is a dispute, the trustee must then show that their action was reasonable.

If the court thinks the trustee's action was not reasonable, it can make some decisions, such as cancelling the action or telling the trustee what to do instead. The court can also stop the trustee from doing something or make other orders it thinks are necessary. You can find out more about how to ask for a review under section 126.

The court must be careful not to make decisions that affect people who have already received trust property or people who have bought something from the trust without knowing about the dispute. This means the court will not make orders that change things that have already happened fairly. It will only make decisions that are fair and necessary.

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This page was last updated on 18 July 2025

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM7383054.

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126: Court may review trustee's act, omission, or decision, or

"The court can check if a trustee is being fair and making good decisions."

128: Court may take into account investment strategy in action for breach of trust, or

"Courts consider a trustee's investment plan when deciding if they broke trust rules"

Part 7Court powers and dispute resolution

127Procedure for court’s review of trustee’s act, omission, or decision

An applicant for a review under section 126 must produce evidence that raises a genuine and substantial dispute as to whether the act, omission, or decision in question was or is reasonably open to the trustee in the circumstances.
If the court is satisfied that the applicant has established a genuine and substantial dispute, the onus is on the trustee to establish that the act, omission, or decision was or is reasonably open to the trustee in the circumstances.
If the court is satisfied on the balance of probabilities that the act, omission, or decision was not or is not reasonably open to the trustee in the circumstances, the court may (but subject to subsection (4))—
set aside the act or decision, or direct the trustee to act in the case of an omission:
restrain the trustee from acting or deciding in the case of a proposed act or decision, and direct the trustee to act in the case of a proposed omission:
make any other orders that the court considers necessary.

The court must not make an order that affects—
a valid distribution of the trust property that was made before the trustee had notice of the application; or
any right or title acquired by a person in good faith and for value.