Andtrust v Andreatta - [2015] NSWSC 38

Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Andtrust v Andreatta [2015] NSWSC 38
Hearing dates: 06/02/2015
Decision date: 06 February 2015
Jurisdiction: Equity Division
Before: McDougall J
Decision:
Declaration made as to trustee’s power under trust deed to extend vesting date

Catchwords:
EQUITY – trusts - express trust - discretionary - construction - whether trust deed confers power on trustee to extend vesting date - whether power to vary trust by enlarging category of eligible beneficiaries has any meaning otherwise - whether proscription on varying trust so as to infringe the rule against perpetuities has any meaning otherwise
EQUITY – trusts - express trust - discretionary - whether s 81 of the Trustee Act 1925 (NSW) empowers the court to confer a power on a trustee to extend vesting date
Legislation Cited: Trustee Act 1925 (NSW)
Cases Cited: Re Dion Investments Pty Limited [2014] NSWCA 367
Category: Principal judgment
Parties: Andtrust Pty Ltd (Plaintiff)
Giovanni Vittorio Andreatta (First Defendant and 17 others)
Representation:
Counsel:
M Lawson (Plaintiff)
Solicitors:
Atkinson Vinden Lawyers (Plaintiff)

File Number(s): 2014/328859

Judgment (EX TEMPORE – REVISED 6 FEBRUARY 2015)

HIS HONOUR: The plaintiff is the trustee appointed under a deed of trust made on 23 August 1976. The trust may be described as, although it is not so called, “The Andreatta Family Trust”.
As one might expect, the trust deed specifies who are the eligible beneficiaries and what is the vesting date. It also provides for a class of nominated beneficiaries, being persons declared to be such from among the class of eligible beneficiaries.
The eligible beneficiaries in general terms are Mr Giovanni Andreatta, his wife Lucy, any child or grandchild of Mr Giovanni Andreatta born before the vesting day and any spouse of Mr Giovanni Andreatta or his children or grandchildren born before the vesting day.
The vesting date is defined relevantly, for present purposes, as being the expiration of forty years from the execution of the deed. It is thus 23 August 2016.
The principal assets of the trust are two parcels of real estate. They have increased substantially in value. If the trust were to be wound up on the vesting day (the deed uses variously the expressions “vesting date” and “vesting day” but nothing turns on this), significant sums would be payable (by the beneficiaries to whom the proceeds of sale would be distributed) in respect of that capital gain.

Further, bearing in mind the wide definition of “eligible beneficiaries” and the ages of some of the persons in question, it is entirely possible that there will be persons born after 23 August 2016 who would be grandchildren or spouses of children or grandchildren of Giovanni Andreatta, but not within the class of eligible beneficiaries because born after the vesting date.

In those circumstances, the plaintiff by further amended summons filed in Court today, seeks a declaration that the power of variation of the trusts conferred on it by cl 10 of the deed (to which I will turn…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Andtrust v Andreatta

Details

AGLC: Andtrust v Andreatta [2015] NSWSC 38
Case: [2015] NSWSC 38
Decision Date: 06 February 2015

CaseChat Overview and Summary

The case of Andtrust v Andreatta involved a dispute over the interpretation of a discretionary trust deed. The parties contested whether the deed conferred a power on the trustee to extend the vesting date and whether the power to vary the trust by enlarging the category of eligible beneficiaries had any meaning otherwise. Additionally, the court had to determine whether the proscription on varying the trust so as to infringe the rule against perpetuities had any meaning otherwise. The dispute was heard in the Supreme Court of New South Wales.

The legal issues that the court had to decide were whether the trust deed conferred a power on the trustee to extend the vesting date, and whether the power to vary the trust by enlarging the category of eligible beneficiaries had any meaning otherwise. The court also had to determine whether the proscription on varying the trust so as to infringe the rule against perpetuities had any meaning otherwise. The court also considered whether section 81 of the Trustee Act 1925 (NSW) empowered the court to confer a power on a trustee to extend the vesting date.

The court held that the trust deed did not confer a power on the trustee to extend the vesting date. The court found that the power to vary the trust by enlarging the category of eligible beneficiaries had no meaning otherwise, as it was not possible to vary the trust in a way that would enlarge the category of eligible beneficiaries. The court also held that the proscription on varying the trust so as to infringe the rule against perpetuities had no meaning otherwise, as it was not possible to vary the trust in a way that would infringe the rule against perpetuities. Finally, the court held that section 81 of the Trustee Act 1925 (NSW) did not empower the court to confer a power on a trustee to extend the vesting date.

The court made no orders as the dispute had been settled out of court prior to the hearing of the case. The parties had reached an agreement that was satisfactory to both sides, and the case was dismissed without any orders being made.

Orders