The Court of Appeal has released its decision in RH & JY Trust v WorkSafe New Zealand [2026] NZCA 12, confirming that trusts, as well as trustees acting collectively, can be prosecuted as a “person” under the Health and Safety at Work Act 2015 (“HSWA”). This ruling provides clarity for businesses that operate through trust structures, including many farms, commercial operations, and family-run enterprises that rely on trusts for succession planning, asset protection, and day-to-day governance.
The case arose from a tragic incident in September 2020, when a six-year-old child died after his clothing became entangled in machinery on a dairy farm owned and operated through the RH & JY Trust. Following the incident, WorkSafe laid charges against the trust itself, and in the alternative, against the trustees acting together. Lower courts had reached conflicting conclusions about whether a trust, which does not have a separate legal personality, could be prosecuted under HSWA. The Court of Appeal has now resolved that question.
“Person” under HSWA
In its majority judgment, the Court held that HSWA’s definition of “person” is broad enough to include a “body of persons, whether corporate or unincorporate.” Trustees acting collectively fall within this definition, and the trust itself may also be identified as the responsible entity for the purposes of enforcement. The Court emphasised that the key question is one of substance: HSWA is concerned with who, in reality, makes the health and safety decisions for the business. When those decisions are made collectively by trustees, the trust or the trustees acting together may be prosecuted as the Person Conducting a Business or Undertaking (PCBU).
Policy considerations
The Court also identified strong policy reasons for recognising collective trustee liability. Under section 48(2)(c) of HSWA, the highest penalty tier, up to $1.5 million, is available against “any other person,” a category that includes unincorporated bodies. If WorkSafe was limited to prosecuting trustees individually, the more serious penalty levels would seldom apply. Further, section 29 of HSWA prohibits indemnification for fines, meaning individual trustees cannot rely on trust assets to meet any penalties. If only individual trustees could be prosecuted, trust assets would remain insulated from HSWA sanctions, undermining the legislation’s purpose of holding the real decision-making body financially accountable.
Naming defendants
The Court also clarified that deciding whether the defendant should be named as the trust or as the trustees acting collectively is largely a matter of correct labelling. What really matters is that the named defendant accurately reflects the group of individuals making the health and safety decisions. Importantly, naming trustees “as trustees” does not expose them to personal criminal liability unless WorkSafe separately alleges a breach of officer duties under section 44 of HSWA.
Practical implications
This decision carries practical consequences for trust-owned businesses and undertakings like farms, property operations, and family businesses. WorkSafe can now pursue enforcement action directly against the trust or the trustees acting together, significantly increasing the likelihood that trust assets may be exposed to HSWA penalties. At the same time, trustees must continue to meet their personal due-diligence obligations under section 44 of HSWA where they exercise significant influence over the business. The Court’s decision highlights the importance of maintaining clear governance records, defining decision-making authority, and ensuring that health and safety processes are properly documented and followed.
For trustees, agricultural operators, and family-run businesses, this case serves as a reminder to review governance frameworks, decision-making practices, and health and safety compliance systems to ensure they meet statutory requirements.
If you would like assistance or advice on how this judgment could impact your business structure or compliance responsibilities, please contact one of our commercial experts, Sarah Churstain or Jordan Todd.
FAQs: HSWA liability for trusts and trustees (NZ)
Can WorkSafe prosecute a trust under the HSWA?
Yes. The Court of Appeal held that HSWA’s definition of “person” is broad enough to capture a trust as the responsible entity for enforcement purposes, even though a trust does not have separate legal personality in the same way a company does. The focus is on substance: who is actually running the business and making health and safety decisions.
Can WorkSafe prosecute trustees acting together (collectively) under the HSWA?
Yes. Trustees acting collectively can fall within HSWA’s definition of a “body of persons, whether corporate or unincorporate”. Where trustees collectively make the decisions for the business or undertaking, WorkSafe can prosecute the trustees acting together as the PCBU.
Does this decision mean trustees have personal criminal liability automatically?
No. The Court indicated that naming trustees “as trustees” (or prosecuting trustees acting collectively) is primarily about correctly identifying the decision-making body for the PCBU duties. Personal criminal liability for trustees is a separate issue and would generally require WorkSafe to allege a breach of officer duties (for example, due diligence obligations under section 44 of HSWA).
Can HSWA fines be paid or indemnified from trust assets?
Trustees cannot be indemnified for HSWA fines, and HSWA limits indemnification arrangements for penalties. The Court also noted policy reasons for allowing prosecution of the trust or trustees collectively, because otherwise trust assets could remain insulated from HSWA sanctions and the highest penalty tiers would rarely apply. The practical takeaway is that trust-owned businesses should assume HSWA enforcement may have real financial consequences for the trust structure.
What should trust-owned businesses do now to reduce HSWA risk?
Review governance and decision-making arrangements so it’s clear who has authority and who is responsible for health and safety decisions, and keep good records showing how those decisions are made. Make sure health and safety systems are documented, implemented, and actively monitored (not just “on paper”). Trustees who have significant influence should also ensure they are meeting any officer due diligence obligations, including verifying that appropriate resources, processes, and reporting are in place.
——————————————————————-
Disclaimer
The information on this web page provides you with general information that is true and accurate to the best of Ford Sumner’s knowledge.
Ford Sumner may change, delete, add to, or otherwise amend the information contained on this webpage without notice.
Information on this webpage is not business, tax, or legal advice. You should take specific, professional advice before taking any action based on this information.
While Ford Sumner has taken all reasonable care in placing the correct information on this webpage, it cannot be liable for any inaccuracy, error, omission, or any other kind of inadequacy, deficiency, or flaw in, or in relation to the information contained on this webpage.
Ford Sumner fully excludes any and all liability of any kind to any person or entity that chooses to rely upon the information.