Advancing $50,000 to one daughter to help purchase a home created confusion after father Ian Cameron died, leading to a dispute between sisters over whether this was a gift or a loan.
In 2003, parents put $50,000 towards daughter Brenda’s purchase of a Masterton home. The transaction was not documented.
The High Court was told that her father Ian Cameron died in May 2019, ten days after the death of his spouse. Ian’s will stated that the $50,000 given Brenda was a loan to be set off against her share of the estate. If a loan, this would increase the amount going to Brenda’s sister, Sheryl; both were to share the estate balance 50/50. Brenda denied there had ever been a loan; it was a gift, she said.
The High Court was told statements made by Ian some three years after the Masterton purchase indicated repayment was not required. There had never been a demand for interest, or for repayment of the money. In contrast, Ian’s earlier 2010 will and final 2016 will both stated the $50,000 was a loan.
Justice Mallon ruled this evidence indicated Ian’s intention was to make a $50,000 interest-free loan, not repayable in his lifetime. Specific wording in his 2016 will applied; the $50,000 loan fell due on his death and was to be taken into account when dividing up his estate.
This ruling increased the value of assets in Ian’s estate by $50,000 to about $227,000.
Comins v. Public Trust – High Court (25.05.21)
21.087