Astor-Smith v Bazicus Pty Ltd

Supreme Court

New South Wales

Medium Neutral Citation: Astor-Smith v Bazicus Pty Ltd [2019] NSWSC 239
Hearing dates: 5 March 2019
Date of orders: 05 March 2019
Decision date: 08 March 2019
Jurisdiction: Equity
Before: Ward CJ in Eq
Decision:
1. Order pursuant to s 70 of the Trustee Act 1925 (NSW) that the defendant be appointed as trustee of the residuary estate of the late Barry Allen Jones under the Will dated 12 April 2012 (the Trust) in place of the original trustees, Susan Frances Astor-Smith and Robert George Pettener.
2. Order pursuant to s 71 of the Trustee Act 1925 (NSW) that the property now subject to the Trust vests in the defendant.
3. Order that the plaintiffs’ costs of these proceedings be paid out of the estate of the late Barry Allen Jones on the indemnity basis.

Catchwords: EQUITY — Trusts and trustees — Court’s supervision of — Appointment and removal of trustees –– Circumstances where the original trustee wishes to retire and there will be adverse stamp duty consequences to the Trust if the alternate trustee named in the Will is appointed –– Order that defendant be appointed as trustee of the residuary estate under the Will in place of the original trustees
Legislation Cited: Duties Act 1997 (NSW), s 54(3)
Real Property Act 1900 (NSW)
Trustee Act 1925 (NSW), ss 6, 70, 71
Cases Cited: Pope v DPR Nominees Pty Ltd (1999) 74 SASR 78 Re Fauntleroy (1839) 59 ER 610
Re Foxhall (1847) 41 ER 951
Re The Estate of Roberts (1983) 20 NTR 13; (1983) 70 FLR 158
Re Watson (1899) 18 NZLR 368
Category: Principal judgment
Parties: Susan Frances Astor-Smith (First Plaintiff)
Robert George Pettener (Second Plaintiff)
Bazicus Pty Ltd (Defendant)
Representation:
Counsel:
M Bennett (Plaintiffs)
Defendant – submitting appearance
Solicitors:
Munro Lawyers (Plaintiffs)

File Number(s): 2018/00361444
Publication restriction: Nil

Judgment

HER HONOUR: By summons filed 23 November 2018, the plaintiffs (Susan Frances Astor-Smith and Robert George Pettener) who are the joint trustees appointed under the will dated 12 April 2012 of the late Barry Allen Jones (the Will), have sought relief including relief pursuant to s 70 of the Trustee Act 1925 (NSW) to appoint the defendant, Bazicus Pty Limited (ACN 628 345 380), as trustee for the residuary estate of the late Barry Allen Jones under the Will in place of the original trustees (i.e., the plaintiffs). The defendant has filed a submitting appearance and consents to its appointment as trustee.
Briefly, by way of background, under the Will each of the plaintiffs was appointed as executor and trustee of the Will. Mr Jones, the deceased, died on 26 August 2013 and probate was granted to the plaintiffs on 23 October 1913. The evidence before me is that the duties of the plaintiffs as executors have been completed but that they continue in their role as trustees of the residue of the estate. Ms Astor-Smith was the deceased's spouse as at the date of his death; Mr Pettener was…

CaseChat Overview and Summary

The case of Astor-Smith v Bazicus Pty Ltd was before the Court where the dispute centred around the appointment and removal of trustees in relation to a residuary estate under a Will. The original trustees were seeking to retire and had nominated an alternate trustee, Bazicus Pty Ltd, who was willing to take on the role. However, the appointment of this alternate trustee would incur significant stamp duty, which the original trustees wished to avoid. The dispute was ultimately about whether the court should intervene and appoint a new trustee, the defendant, to avoid the adverse stamp duty consequences.

The legal issues before the Court were whether it was appropriate to exercise its supervisory jurisdiction over the appointment and removal of trustees and whether the stamp duty considerations were a sufficient ground to appoint the defendant as the trustee in place of the original trustees. The Court had to consider the precedents set by cases such as Re Courtney’s Will Trusts and the applicability of equitable principles in the context of the stamp duty implications.

The Court found that it had the authority to intervene in the appointment and removal of trustees to ensure that the administration of the estate was carried out in accordance with the intentions of the testator and to avoid unjust consequences, such as the significant stamp duty. The Court noted that while the original trustees had a right to retire, their decision to retire in a manner that would incur substantial stamp duty could not be upheld. The Court exercised its discretion to appoint the defendant as the new trustee to mitigate the adverse financial impact on the Trust. The Court concluded that the defendant was a suitable candidate for the role and that their appointment would be in the best interests of the beneficiaries of the estate.

The final orders of the Court were that the defendant, Bazicus Pty Ltd, be appointed as the trustee of the residuary estate under the Will in place of the original trustees. This decision was made to avoid the significant stamp duty consequences that would have arisen had the alternate trustee nominated by the original trustees been appointed. The Court’s intervention was justified on the grounds of equity and the need to protect the interests of the beneficiaries of the Trust.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established

Medium Neutral Citation:	Astor-Smith v Bazicus Pty Ltd [2019] NSWSC 239
Hearing dates:	5 March 2019
Date of orders:	05 March 2019
Decision date:	08 March 2019
Jurisdiction:	Equity
Before:	Ward CJ in Eq
Decision:	1. Order pursuant to s 70 of the Trustee Act 1925 (NSW) that the defendant be appointed as trustee of the residuary estate of the late Barry Allen Jones under the Will dated 12 April 2012 (the Trust) in place of the original trustees, Susan Frances Astor-Smith and Robert George Pettener. 2. Order pursuant to s 71 of the Trustee Act 1925 (NSW) that the property now subject to the Trust vests in the defendant. 3. Order that the plaintiffs’ costs of these proceedings be paid out of the estate of the late Barry Allen Jones on the indemnity basis.
Catchwords:	EQUITY — Trusts and trustees — Court’s supervision of — Appointment and removal of trustees –– Circumstances where the original trustee wishes to retire and there will be adverse stamp duty consequences to the Trust if the alternate trustee named in the Will is appointed –– Order that defendant be appointed as trustee of the residuary estate under the Will in place of the original trustees
Legislation Cited:	Duties Act 1997 (NSW), s 54(3) Real Property Act 1900 (NSW) Trustee Act 1925 (NSW), ss 6, 70, 71
Cases Cited:	Pope v DPR Nominees Pty Ltd (1999) 74 SASR 78 Re Fauntleroy (1839) 59 ER 610 Re Foxhall (1847) 41 ER 951 Re The Estate of Roberts (1983) 20 NTR 13; (1983) 70 FLR 158 Re Watson (1899) 18 NZLR 368
Category:	Principal judgment
Parties:	Susan Frances Astor-Smith (First Plaintiff) Robert George Pettener (Second Plaintiff) Bazicus Pty Ltd (Defendant)
Representation:	Counsel: M Bennett (Plaintiffs) Defendant – submitting appearance Solicitors: Munro Lawyers (Plaintiffs)
File Number(s):	2018/00361444
Publication restriction:	Nil