Australian Conservation Services v Liladel Holdings - [2017] ACTSC 162

SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

Case Title:	Australian Conservation Services v Liladel Holdings
Citation:	[2017] ACTSC 162
Hearing Date(s):	18 April 2017
DecisionDate:	21 April 2017
Before:	Mossop J
Decision:	1. The proceedings are dismissed. 2. Any party seeking a costs order must file and serve written submissions not longer than three pages and any evidence in relation to costs by 27 April 2017. Any party may file and serve submissions in reply not longer than two pages and any evidence in reply by 3 May 2017.
Catchwords:	EQUITY – TRUSTS – Powers of Appointment – fraud on a power – whether the decision in Re Skeats’ Settlement (1889) 42 Ch D 522 prevents the donee of a power of appointment from exercising that power to appoint the donee or a company controlled by the donee – it does not – whether appointment of company controlled by appointor as trustee involved a fraud on the power of appointment in the circumstances – it did not
Legislation Cited:	Trustee Act 1925 (ACT) Trustee Act 1925 (UK)
Cases Cited:	Austec Wagga Wagga Pty Ltd v Rarebreed Wagga Pty Ltd [2012] NSWSC 343 Australian Securities and Investments Commission v Carey (No 6) [2006] FCA 814; 153 FCR 509 Berger v Lysteron Pty Ltd [2012] VSC 95 El Sayed v El Hawach [2015] NSWCA 26; 88 NSWLR 214 Fitzwood Pty Ltd v Unique Goal Pty Ltd (in liq) [2001] FCA 1628; (2001) 188 ALR 566 Hancock v Rinehart [2015] NSWSC 646; 106 ACSR 207 Hillcrest (Ilford) Pty Ltd v Kingsford (Ilford) Pty Ltd (No 2) [2010] NSWSC 285 Mercanti v Mercanti [2016] WASCA 206; 50 WAR 495 Montefiore v Guedalla [1903] 2 Ch 723 Pope v DRP Nominees Pty Ltd [1999] SASC 337; (1999) 74 SASR 78 Rayner v NJ Sheaffe Pty Ltd [2010] NSWSC 810 Re Burton; Wily v Burton (1994) 126 ALR 557 Re Christina Brown (1921) 22 SR (NSW) 90 Re Newen; Newen v Barnes [1894] 2 Ch 297 Re Skeats' Settlement; Skeats v Evans (1889) 42 Ch D 522 Scaffidi v Montevento Holdings Pty Ltd [2011] WASCA 146 Schuhmacher v Emmerson [2013] QSC 205
Texts Cited:	Halsbury’s Laws of England, 3rd edition volume, volume 38 Trusts [1568] Halsbury’s Laws of England, 4th edition 2007 reissue, Volume 48 Trusts [831] P D Finn, Fiduciary Obligations (The Law Book Company, 1977) Young, Croft and Smith, On Equity (2009, Lawbook Co)
Parties:	Australian Conservation Services Pty Ltd (Plaintiff) Liladel Holdings Pty Ltd (Defendant)
Representation:	Counsel W D B Buckland (Plaintiff) M A Karam (Defendant)
Solicitors R D Silverstein (Plaintiff) McInnes Wilson Lawyers (Defendant)
File Number(s):	SC 90 of 2017

MOSSOP J:

Introduction

This case involves a dispute as to who is the trustee of a small discretionary trust. The sole asset of the discretionary trust is a residential property in McGregor in the Australian Capital Territory which is subject to a mortgage to the Commonwealth Bank. The defendant, Liladel Holdings Pty Ltd,…

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.

Keep reading for free

Create a free CaseChat account to read Australian Conservation Services v Liladel Holdings and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2017] ACTSC 162
Decision Date: 21 April 2017

CaseChat Overview and Summary

Australian Conservation Services brought an action against Liladel Holdings, seeking to challenge certain decisions made in relation to a discretionary trust. The dispute centred around the interpretation and application of a power of appointment within the trust deed. The case was heard and determined in the Federal Court of Australia.

The central legal issues revolved around whether the decision in Re Skeats’ Settlement prevented the donee of a power of appointment from exercising that power to appoint themselves or a company they controlled, and whether the appointment of a company controlled by the appointor as trustee constituted a fraud on the power of appointment. The Court had to determine if the precedent in Re Skeats’ Settlement precluded the donee from making an appointment in their own favour or in favour of a company they controlled, and if the appointment of a company controlled by the appointor was considered a fraud on the power of appointment.

The Court found that the precedent in Re Skeats’ Settlement did not prevent the donee from exercising the power of appointment in their own favour or in favour of a company they controlled. The Court further concluded that the appointment of the company did not constitute a fraud on the power of appointment in the given circumstances. The Court dismissed the proceedings, and outlined specific procedures for any party seeking a costs order, including the timeframes and length of submissions.

The proceedings were dismissed, and any party seeking a costs order had to follow the outlined procedures for filing and serving written submissions and evidence, as well as any reply submissions.

Orders

Orders of the court

1. The proceedings are dismissed.

2. Any party seeking a costs order must file and serve written submissions not longer than three pages and any evidence in relation to costs by 27 April 2017. Any party may file and serve submissions in reply not longer than two pages and any evidence in reply by 3 May 2017.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.