Mr and Mrs C were married in 1989, had two daughters who were born in 1990 and 1994, separated in 2000 and were divorced in 2009. By the time of the separation Mr C had built up a significant saw milling and timber processing business, which operated from land and buildings in Vaughan Road, Rotorua. Mr C settled the land and buildings, with himself as sole trustee, on discretionary trusts for the benefit of a class of beneficiaries that included himself as principal beneficiary, his wife or former wife and their daughters as potential beneficiaries. The two daughters were named as ultimate beneficiaries. The question arose as to whether Mr C’s power as principal beneficiary to appoint and remove members of the class of beneficiaries was property.
The Court held that the definition of property, when interpreted in the context of social legislation, was sufficiently broad as potentially to include rights and interests that may not, in other contexts, be regarded as property rights or interests. Whilst Mr C's power to remove members of the class of beneficiaries was not in itself property, the bundle of rights and powers which he held, not constrained by any fiduciary duty towards the ultimate beneficiaries, gave him such a degree of control that he could appoint the entire trust capital and income to himself freed and discharged from the trusts. In effect, they gave him a general power of appointment in relation to the assets of the trust and, as those were rights which gave him an interest in the assets of the trust, they therefore fell within the statutory definition of property for the purposes of the legislation in question.