After
a 91 year old war veteran died with only $1400 in the bank, the Public Trust
questioned what happened to assets amounting to $330,000 he owned five years
previously. The High Court ordered his
son and daughter-in-law return $280,000 they had wrongly taken.
Ashley Vernon was held liable for undue
influence, unconscionable conduct and breach of fiduciary duty in fleecing his elderly
father Kenneth at a time when he was supposedly looking after his father’s interests. Ashley’s wife Beverley was held liable for
knowingly assisting.
The High Court was told that father
Kenneth had managed hotels in the west coast of the North Island and in the Waikato
following his war service. After his
wife died, Kenneth came to live in the Wellington suburb of Tawa with Ashley,
his surviving child. A second son had
died just six months prior to his wife’s death.
There was medical evidence that Kenneth was in poor health: depressed
following the deaths of his son and then his wife; having difficulty with both
hearing and sight; and requiring some assistance with showering and dressing. He stayed with Ashley for 30 months before spending
the last three years of his life in a rest home. Ashley held an enduring power of attorney for
his father. There were two beneficiaries
of Kenneth’s estate, each to take one half: Ashley and his nephew Dante (the
son of his deceased brother). Solicitors
for Dante took action when Ashley became unhelpful and evasive about
Kenneth’s estate. The Public Trust was
appointed to take control. Its investigations
were met with similarly unhelpful and evasive replies about what had happened
to Ashley’s father’s assets. The High
Court was to later rule that Ashley’s evidence was untrustworthy, at times an
incomplete or adjusted version of the truth and that many answers were patently
self-serving. Justice Kos found evidence
of Ashley having forged cheques in his father's name, making false WINZ subsidy
applications and dipping into his father’s bank account with what were
described as a series of illogical and inexplicable bank transfers into Ashley’s
family joint bank account. There was
evidence of a motor vehicle supposedly purchased by Kenneth but used by Ashley
and his family, of money supposedly withdrawn for holidays taken by Kenneth
when no holiday was ever taken, of funds sourced from Kenneth’s account to
assist Ashley’s daughter in the purchase of a home and of excessive withdrawals
of cash to meet Kenneth’s living expenses.
Justice Kos ruled that Ashley
deliberately transferred nearly all his father’s assets to himself and his wife
during his father’s lifetime, being aware that his father’s will provided for
the estate to be split two ways, with Ashley getting half only. From the $340,000 taken, an allowance was made
for expenses actually incurred caring for his father with Ashley and his wife
ordered to repay $280,354.
Public
Trust v. Vernon – High Court (13.08.15)
15.088