Apostolovski v Total Risk Management

In the Federal Court of Australia, Apostolovski v Total Risk Management was a dispute involving a claim for total and permanent disablement benefit. The respondent, Total Risk Management, was the trustee of a superannuation fund, and the applicant, Apostolovski, was a member of that fund. The applicant filed a claim for a total and permanent disablement benefit on 9 March 2006, which was accepted on 12 November 2010, just days before the trial. The primary legal issue was determining from when interest should run on the accepted claim. Additionally, the court examined whether Apostolovski was entitled to equitable compensation for the breach of a fiduciary duty, specifically the failure to exercise due diligence, under the Superannuation Industry (Supervision) Act 1993 (Cth). The court also considered whether Apostolovski could recover loss or damage for a breach of the implied covenant under s 52(2)(b) to exercise due diligence. Furthermore, the court deliberated on whether the provision in s 310(1) should be read down and whether it applied to a corporate trustee, especially in cases of gross lack of diligence.

The court ruled that interest on the accepted claim should run from the date the claim was made, in line with the principles established in Finch v Telstra Super Pty Ltd. Regarding the equitable compensation, the court found that Apostolovski was entitled to compensation for the breach of fiduciary duty due to the lack of due diligence by the respondent. The court held that the provision in s 310(1) did not apply to a corporate trustee in cases of gross lack of diligence, and therefore, Apostolovski could seek compensation. The court rejected the argument that the provision should be read down, emphasizing that it did not apply to the circumstances of gross negligence exhibited by the respondent.

In conclusion, the court ordered that interest on the accepted claim should run from the date of the original claim, and that Apostolovski was entitled to equitable compensation for the breach of fiduciary duty due to the lack of due diligence by the respondent. The court did not apply the provision in s 310(1) to the corporate trustee in this instance and rejected the argument that the provision should be read down. The court's decision provided clarity on the application of interest and compensation in cases of fiduciary breaches within the superannuation industry.