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Trusts Act 2019

Court powers and dispute resolution - Alternative dispute resolution

145: Power of court to order ADR process for internal matter

You could also call this:

"Courts can make you use a special process to solve trust problems in a fair way."

Illustration for Trusts Act 2019

The court can ask you to use an Alternative Dispute Resolution (ADR) process to solve a problem with a trust. You can be a trustee or a beneficiary and ask the court to do this, or the court can decide to do it on its own. The court can make you follow the rules in the trust that say you must use an ADR process.

When the court decides to use an ADR process, it can make some orders. The court can order you to take part in the ADR process in person or with a representative. It can also order that the costs of the ADR process come from the trust property. The court can even choose a mediator, arbitrator, or facilitator to help with the ADR process.

This only applies to problems inside the trust, not to problems with people outside the trust.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM7383088.

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144: ADR process for internal matter if trust has beneficiaries who are unascertained or lack capacity, or

"Helping unknown or vulnerable beneficiaries in a trust dispute"

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146: Trustee may give undertakings for purposes of ADR settlement or arbitration agreement and any arbitral award, or

"Trustees can promise to do something in the future if it's for a dispute settlement or arbitration."

Part 7Court powers and dispute resolution
Alternative dispute resolution

145Power of court to order ADR process for internal matter

  1. The court may, at the request of a trustee or a beneficiary or on its own motion,—

  2. enforce any provision in the terms of a trust that requires a matter to be subject to an ADR process; or
    1. otherwise submit any matter to an ADR process (except if the terms of the trust indicate a contrary intention).

      1. In exercising the power, the court may make any of the following orders:

      2. an order requiring each party to the matter, or specified parties, to participate in the ADR process in person or by a representative:
        1. an order that the costs of the ADR process, or a specified portion of those costs, be paid out of the trust property:
          1. an order appointing a particular person to act as a mediator, an arbitrator, or any other facilitator of the ADR process.

            1. This section applies in relation to internal matters only.