No remedy for abuse?
In November 2021, the High Court of New Zealand (the Court) issued a judgment in A v D,[1] which broke new legal ground as it introduced a new tort: breaching a fiduciary duty to an adult child.
The plaintiffs were the three children of Z, a violent man who abused his children when they were young. The harm he inflicted, in various ways, affected each child for life. Z repeatedly sexually abused one of his children and physically abused his other two children. After the children left home, they had no contact with their father until he died.
Z did not leave the children anything in his will and gifted most of his assets to a trust to prevent the children from making a claim against those assets. The children sought orders that the transfer of assets to the trust should be set aside so that the assets could fall into their father’s estate and, therefore, an award could be made to them.
The judgment
The Court held that although the relationship between an infant and a parent is inherently fiduciary, the relationship of an adult child to their parent is of a non‑fiduciary kind. However, it ruled that, in the present case, the fiduciary relationship continued into the children’s adulthood because the father’s abuse left the children vulnerable. The Court held that the transfer of the assets to the trust in these circumstances was in breach of the fiduciary duties that Z owed to his children. It held that Z’s knowledge was imputed onto the trustees and that the trustees held the assets on constructive trust for Z’s estate, therefore exposing the assets to a claim under the Family Protection Act 1955 (the Act).
The Court effectively distinguished this case from other cases where a child may wish to sue a parent. The judge was cautious in confining the ambit of the claim to extreme circumstances.
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