AMP Capital Investors Limited as Responsible Entity for the KSC Trust
[2012] NSWSC 67
•14 February 2012
Supreme Court
New South Wales
Medium Neutral Citation: AMP Capital Investors Limited as Responsible Entity for the KSC Trust [2012] NSWSC 67 Hearing dates: 8 February 2012 Decision date: 14 February 2012 Jurisdiction: Equity Division Before: Slattery J Decision: Applicant justified in defending proceedings using the resources of the trust.
Catchwords: Trusts - Trustees - Earlier successful application for judicial advice that trustee is justified in defending certain proceedings and using the resources of the trust for that purpose up to the close of evidence - Application for further judicial advice to cover the period until the conclusion of the proceedings. Legislation Cited: Trustee Act 1925, s 63 Cases Cited: AMP Captital Investors Ltd as Responsible Entity for KSC Trust, Re [2010] NSWSC 1259
Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar The Diocesan Bishop of Macedonian Orthodox Diocese of Australia and New Zealand (2008) 237 CLR 66Category: Principal judgment Parties: AMP Capital Investors Limited as Responsible Entity for the KSC Trust Representation: Applicant:-M.J. O'Meara
Applicant:- L. Hulmes, Clayton Utz
File Number(s): 2010/356969 Publication restriction: No
EX TEMPORE Judgment
The plaintiff, AMP Capital Investors Limited, ("AMPCI"), the responsible entity of the KSC Trust ("the Trust"), comes to the Court again for Trustee Act, s 63 judicial advice consequent upon advice the Court previously gave on 2 November 2010: AMP Capital Investors Limited as responsible entity for the KSC Trust [2010] NSWSC 1259.
AMPCI now seeks the Court's judicial advice as to whether (a) it would be justified in defending the proceedings in the commercial list of this Court identified in the previous judgment ("the principal proceedings") until their conclusion and (b) would be justified in using the resources of the trust to do so.
The circumstances and the assumed facts upon which, and reasons for which, the Court gave judicial advice on 2 November 2010 are set out in the previous judicial advice. These reasons should be read with that previous judicial advice. In November 2010, AMPCI was being required, to file a defence in the principal proceedings. It came to Court seeking judicial advice in conformity with the principles of Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar The Diocesan Bishop of Macedonian Orthodox Diocese of Australia and New Zealand (2008) 237 CLR 66.
The judicial advice that the Court gave on 2 November 2010 was that AMPCI would be justified in defending the principal proceedings and in using the resources of the Trust to do so, until the completion of the filing of evidence and the setting down of the proceedings for trial. The principal proceedings have now advanced to the point that the evidence is close to being finalised and they are listed for hearing for fifteen days before Pembroke J, the expedition Judge, commencing on 27 February 2012.
The Court has in evidence an updated statement of facts (Exhibit D) which includes a summary of the evidence filed on both sides in the principal proceedings and a summary of the course of those proceedings. The opinion of counsel for AMPCI, AJ Payne SC, MJ O'Meara and JB Beaumont, as to the arguments and defences to be deployed on behalf of AMPCI in the principal proceedings is Exhibit F. The Court has made orders for exhibit F to remain confidential.
Since the November 2010 judicial advice, the following events have occurred in the principal proceedings. Pleadings have closed. AMP filed its defence on 21 December 2010. In March 2011 the claims that Westfield brought against the second defendant, AMP Capital Property Nominees ("ACPN") and UniSuper Limited were resolved. In June 2011, Westfield's application for expedition was granted and the proceedings listed for hearing, commencing later this month. Discovery has now taken place. Westfield's evidence in chief, lay and expert, has been filed and served. AMPCI and the fourth defendant, David Jones Limited ("David Jones") have served their evidence in defence, except for certain evidence responding to Westfield's expert evidence on damages.
On 3 February 2012 Westfield served some evidence in reply and foreshadowed further evidence in reply. At the time of this hearing in this matter last week there were a number of relatively minor procedural steps still to take place, as commonly occurs shortly before trial in large scale litigation such as this.
Having reviewed these updated materials, I am of the view that the basis for the Court's previous judicial advice that AMPCI would be justified in defending the proceedings and would be justified in using the resources of the Trust to do so, still holds good.
The Court gave three principal reasons for reaching the view in November 2010 that AMPCI would be justified in defending the proceeding: AMP Capital Investors Limited as responsible entity for the KSC Trust [2010] NSWSC 1259 [13], [14] and [15]. Each of those reasons remain valid.
As to the first of those reasons, I have reviewed the current opinion of counsel, which is again an important factor inclining the Court to the conclusion that AMPCI would be justified in defending the principal proceedings. Of course, that opinion remains confidential. But it fully and clearly articulates the arguments that AMPCI anticipates it will deploy in the principal proceedings, sufficiently to give the Court confidence in the legal reasoning involved for the position AMPCI is taking.
The second reason flows from the first. The Court concluded in the November 2010 judicial advice that AMPCI's case was not unarguable and that AMPCI could contend that the relief sought by Westfield was not made out. It is apparent from the updated statement of facts and the opinion of counsel that that contention can still be put against Westfield with at least the same strength as before.
The third reason was that AMPCI was the proper contradictor to Westfield's claims and that no other party could readily answer some of the allegations made against AMPCI, especially those involving AMPCI's corporate state of mind. This consideration has been sharpened since November 2010 by the fact that at least two of the other parties who might perhaps have taken up a position contradicting Westfield, UniSuper and ACPN, are now no longer parties to the proceedings. In my view it can be said, a fortiori , that the AMPCI is the proper contradictor of these allegations.
That deals with the question of whether or not AMPCI would be justified in defending the proceedings.
The remaining question is whether AMPCI should be permitted to utilise the Trust's assets for its defence. In my view, consideration of this question follows closely upon the question of whether AMPCI is the proper contradictor and has an arguable case. I have concluded that it is and that it does. A relevant consideration here is the question of whether, should it be required, AMPCI is in a position to reimburse the Trust in respect of the costs of defending the proceedings. That has not changed since November 2010.
The other relevant matter is the ratio of the costs of these proceedings to total Trust assets, which has only improved since November 2010. The Trust assets, I am told, have increased from about $541 million in 2010 to about $560 million by recent valuation. I am therefore also of the view that AMPCI would be justified in using the resources of the Trust for the conduct of its defence.
Accordingly, the Court advises that until completion of the proceedings numbered 2010/330642 (Proceedings):
1. The plaintiff would be justified in defending the Proceedings.
2. The plaintiff would be justified in using the resources of the trust to defend the Proceedings.
3. Costs of the application are payable out of the trust estate.
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Decision last updated: 14 February 2012
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