This seems to be the same problem (bug?) as mentioned in [this comment](https://mathematica.stackexchange.com/questions/134290/2d-nonlinear-pde-describing-leveling-process-of-fluid/134336#comment362434_134336). Add `SolveDelayed->True` to `NDSolve` will resolve the problem. (This option is red, but don't worry. ) 

BTW, when `n >= 10`, `NDSolve` spits out `ndsz` warning and stops before `t` reaches `5`, and it seems to be the nature of the equation set. If the singularity isn't expected, probably there's something wrong with the definition of `equations`.