Abstract:
With the recent work of the Law Commission, succession law has come to the forefront of legal discussion in New Zealand. Succession law refers to the body of law that determines how our property is distributed upon our death. New Zealand succession law attempts to balance two fundamentally inconsistent policy concerns. On one hand, we have the property rights of the deceased, the freedom they should have to determine how their property is distributed upon death.On the other hand, we have the rights of family members to receive a share of the deceased’s property. Succession law in New Zealand attempts to strike a middle ground, allowing the deceased to exercise testamentary freedom but subject to specific statutory exceptions. In response to these statutory limitations on testamentary freedom, trusts have emerged as an effective way of realising absolute testamentary freedom. The Law Commission has recently considered the subversive role of trusts in succession law, proposing limited clawback mechanisms. However, trusts also play an essential role in facilitating property arrangements that continue beyond death and that are not otherwise possible. While condemning the use of trusts to avoid succession law, it must also be recognised that trusts can play a beneficial role in structuring arrangements beyond death. Clawback mechanisms must be carefully structured to realise this tension.
