Australian Executor Trustees v Currie - [2009] SASC 81

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
AUSTRALIAN EXECUTOR TRUSTEES v CURRIE & ORS
[2009] SASC 81
Judgment of The Honourable Justice Gray
30 March 2009
INTERPRETATION - GENERAL RULES OF CONSTRUCTION OF INSTRUMENTS - GENERAL MATTERS
DEEDS - OTHER MATTERS
Application by trustee for declaration and directions concerning construction of Deeds of Settlement establishing Trusts – the Deed of Settlement was one of six inter-related Deeds - Trustee sought directions as to whom it should distribute settled fund of one of the Deeds of Settlement following death of the beneficiary of that fund, Dawn Jackson.
Held: Joyce, Meryl and Daphne sisters of the beneficiary Dawn Jackson entitled to life interests, and, on their death – their children became entitled absolutely to both income and capital - upon Dawn Jackson dying without children, the settled fund of her trust became subject to the trusts of her sisters' Deeds - trusts have not failed or determined - the settled fund of the Dawn Jackson trust is held on trust by trustee, in three equal shares, on the terms of the Deeds of three.
Supreme Court (Civil) Rules 2006 (SA) r 84 and r 206, referred to.
In re Huntington’s Settlement Trusts [1949] 1 Ch 414; Duncan v Equity Trustees Executors & Agency Co Ltd (1958) 99 CLR 513; In Re Walpole’s Marriage Settlement [1903] 1 Ch 938; Hicking v Fair [1899] AC 15; Kenna v Connolly (1938) 60 CLR 583; Executor Trustee Australia Ltd v De Meyrick & Ors [2005] SASC 388, considered.

AUSTRALIAN EXECUTOR TRUSTEES v CURRIE & ORS
[2009] SASC 81
Civil
GRAY J.

This is an application by a trustee, the Australian Executor Trustees Limited, for a declaration and directions concerning the construction of a Deed of Settlement of 9 March 1929 establishing the Dawn Jackson Trust.
The Trustee has sought directions pursuant to Rule 206 of the Supreme Court Rules[1] as to whom it should distribute the settled fund of the Dawn Jackson Trust. The relevant facts as set out in these reasons were not the subject of any dispute.
[1]Rule 206 provides:
This application raises questions of construction arising within complex provisions of Deeds of Settlement. It has been necessary to consider a number of alternative constructions arising from the relevant provisions of the subject Deed. I propose to first trace the history of the application. I then propose to state my conclusions before providing my extended reasons.
Background
The Deeds of Settlement
Laura Emily Davidson acquired investments and securities from the estate of her late husband, Claude Stewart Jackson, who died intestate. Claude was one of the children of the Lady Dowager Jackson.
On 9 March 1929, the Trustee, as co-trustee, and Ms Davidson, as settlor and co-trustee, entered into five Deeds of Settlement. Ms Davidson intended, through the Deeds, to settle assets devolving to her from the estate of Claude on trust for the benefit, in the first instance, of the five children of Claude’s brother, George Julius Jackson, and then to the issue of each child, with further provision being made in the event of there being no such issue. The Deeds were similar, but not identical.
Ms Davidson died in 1964. The Trustee is the remaining trustee under each of the Deeds of Settlement.
George Julius’ five children were David Thomas Trelawny Jackson (“David”), Dawn Nesta Jackson (“Dawn”), Meryl Julian Currie (“Meryl”), Daphne Myddleton Gray (“Daphne”), and Joyce Katherine Walker (“Joyce”). Dawn was the last surviving child of George Julius, having been predeceased by her siblings.[2] Dawn died on 9 December 2005. She did not have any children.
[2] David died on 7 December 1943, Meryl died on 10 January 1998, Daphne died on 24 September 2002, and Joyce died on 5 January 2004.
At the time of these proceedings the Trustee held the settled fund of the Dawn Jackson Trust. The Trustee applied to this Court to settle the uncertainty that it says has arisen as to how the funds are to be applied under the Deed of Settlement for Dawn following her death.
As at the date of death of Dawn, the Trustee had completed administration of each of the trusts referred to as the David Jackson Trust, the Meryl Jackson Trust, the Daphne Jackson Trust and the Joyce Jackson Trust, and had distributed the then settled fund of each trust to the respective Beneficiaries. This process was finalised prior to Dawn’s death on 9 December 2005.
The Trustee took a neutral stance on the issues of construction arising under the subject Deed. However, the Trustee made detailed submissions outlining what possible arguments in relation to and factors affecting, the issues of construction.
The defendants Julian Currie and Caroline Joyce Currie are the children of Meryl. The defendants, Fiona Catherine Fairbairn[3] and Sarah Daphne James, are the children of Daphne. The defendants Susan Wildey and Julia Gale are two of the grandchildren of Joyce.
[3] Catherine Fairbairn has died. On 30 May 2008 pursuant to Rule 76(3)(b) an order was made appointing Sarah Daphne James as the representative of the estate of Fiona Catherine Fairbairn.
The Court appointed[4] Brian Leigh Carpenter, a solicitor, to represent a class of potential beneficiaries, the issue of the Dowager Lady Jackson, the class of persons referred to in the subject Deed. It is in this capacity that Mr Carpenter is a defendant to the action.[5] The membership of this class has not been ascertained by the Trustee.
[4] Pursuant to Rule 84 of the Supreme Court Rules 2006 (SA).
[5] Rule 84(3) of the Supreme Court Rules 2006 (SA).
The defendants either are, or represent, the persons whom the Trustee considers to be potential beneficiaries under the Dawn Jackson Trust following the death of Dawn. I am satisfied that the classes of person who may have an interest as potential beneficiaries under the subject Deed are represented in the proceedings.
Broad Intent of the Scheme
The broad intent of the scheme of Ms Davidson was to create separate trust funds for the children of her late husband’s brother with the object that the funds be kept “in the family” and appropriately protected and preserved to at least the next generation. The scheme included cascading provisions in an attempt to ensure that there would be no lapse of any settled fund.
Ms Davidson intended to provide a fund for David, which could be assigned to him absolutely on him attaining 25 years and otherwise for his issue who attained 21 years. Failing David or his issue becoming absolutely entitled, on failure of those trust provisions, the fund was to be held on trust in equal shares for any of Dawn, Meryl, Joyce and Daphne being described as the identified sisters and as well any other brother(s) or sister(s) then living and in the case of the identified sisters as an accretion to their respective identified settled funds with the proviso that any issue of a sibling who predeceased David would take per stirpes the share of the relevant deceased parent.
Ms Davidson further intended to provide separate funds for each of Dawn, Meryl, Joyce and Daphne with more detailed provisions, designed to protect those funds from unwise marriages or commercial ventures which could result in their income being diverted to the benefit of another party.
In the case of sisters Dawn, Meryl, Daphne and Joyce, the intention of Ms Davidson, expressed in an identical clause 2(a) of their respective Deeds, was that pending attainment of the age of 18 years, the income from the settlement would be payable for their education, maintenance and otherwise for their benefit. By clause 2(b), on the sisters attaining the age of 18 years, the income from their settlements was to be paid to them during their lifetime, but if an event occurred whereby that Beneficiary lost the benefit of the income, because it became payable to some other person or company – for example, by reason of bankruptcy – then during their lifetime in the exercise of the trustee’s discretion the income would go to the benefit of that Beneficiary, her husband, child or children or issue.
Consistent with the intention of Ms Davidson to keep the settled funds within the family for as long as possible the power of appointment contained in the identical clause 2(c) of each sisters’ Deeds - and similarly under clause 2(b) of David’s Deed - was a power of appointment effective on the death of the named Beneficiary limited to a class of appointees being the issue of the Beneficiary, and failing exercise of the power of appointment, to such child or children of the Beneficiary as attained the age of 21 (or being female, married prior to that age).
Clause 2(d) of each Deed was a first saving provision to prevent any lapse of the settled funds. That provision would only become operative if the Beneficiary died without children or issue. The primary intent of clause 2(d) was that the deceased sister’s settled fund would be shared equally by her sisters or their issue.
An identical Clause 2(e) in each sister’s Deed was a second saving provision whereby the settled fund would go to David and which would only become operative if the provisions for the benefit of the sisters had failed. Had this not been the intention, David would have been included in clause 2(d). It may reasonably be inferred that because of the substantially larger provision for David, more than five times the provision made for any of his sisters, Ms Davidson considered that more than sufficient provision had been made for David and his issue.
Finally, to ensure there was no reasonable likelihood of the settled funds lapsing, an identical clause 2(f) was included in each sister’s Deed as a third saving provision in favour of the issue of the Dowager Lady Jackson.
Summary Of Conclusions
It is convenient now to set out my conclusions on the questions arising for determination.
Under their respective settlements, Joyce, Meryl, Daphne and Dawn were in each case only entitled to life interests, and, on their death – subject to any appointment – their children became entitled absolutely to both income and capital.
Upon Dawn Jackson dying without children, the settled fund of her trust became subject to the trusts of her sisters’ Deeds. Those trusts have not failed or determined. As a consequence, the funds in the Dawn Jackson trust are held on trust by the trustee, in three equal shares, on the terms of the Deeds, of each of the three sisters.
In the case of Meryl and Daphne, both are no longer alive. Were their children alive, those children would take their mother’s share in equal shares, pursuant to clause 2(c) of their respective Deeds.
The effect of clause 2(c) of Joyce’s Deed is that the accreted funds are held upon trust for her male children who attain the age of 21 years and her female children who attain that age or marry under that age in equal shares. Insofar as Joyce’s only child, her daughter Gay, predeceased her after having attained the age of 21 years, or having married, the accreted funds fall into Gay’s estate.[6]
[6] I have proceeded on the basis that Gay attained the age of 21 years, although this is not clear on the papers.
Although my conclusions can be simply expressed, the reasoning that allows these conclusions is unavoidably complex. I now set out my reasons for my conclusions as to the construction of the subject Deeds.
The Settlement Deed With Respect To Dawn Jackson
Clause 2
It is first convenient to set out the text of clause 2 of the Deed before coming to an analysis of particular provisions. Later in the reasons, when convenient, I will repeat discrete parts of clause 2.
2.     THE Settlor hereby directs that the Trustees shall and the Trustees hereby declare that they will hold the Settled Fund upon and subject to the trusts and provisions hereinafter set forth concerning the same, that is to say:-
(a)     UPON TRUST until the Beneficiary shall attain the age of Eighteen years to pay or apply the whole or any part or parts of the income of the Settled Fund in or towards the education maintenance or otherwise for the benefit of the Beneficiary as the Trustees in their uncontrolled discretion may think fit with power to the Trustees during such period to pay the same to the legal guardian of the Beneficiary without being responsible for the application thereof.
(b)     UPON TRUST from and after the attainment by the Beneficiary of the said age of Eighteen years to pay to her during her life all the net income of the Settled Fund unless and until she shall have committed permitted or suffered any act default or process of law whereby or in consequence whereof such income or any part thereof would but for this provision have become payable to or charged in favor of any other person or persons or corporation AND the Trustees shall on the failure or determination during the lifetime of the Beneficiary of the trusts as to such income in her favor stand possessed of the income which would but for such failure or determination have been payable to the Beneficiary UPON TRUST to pay or apply the same or any part thereof respectively to or for the benefit maintenance or support of all or any one or more to the exclusion of the others or other of the following persons, namely:- the Beneficiary, her husband (if any), her child or children (if any), her issue (if any), in such shares and manner as the Trustees shall in their discretion think proper or if she shall be unmarried or a widow without issue or being married be without any issue living then to or for the benefit maintenance or support of all or any one or more to the exclusion of the others or other of her, her husband (if any) and the person or persons who would if she were actually dead be entitled to the Settled Fund or the income thereof as the Trustees shall in their discretion think proper AND the Trustees shall accumulate the balance (if any) thereof by investing the same and the resulting income thereof in any manner hereby authorised and so that such accumulations and the income thereof shall form part of the Settled Fund but with power to the Trustees in their discretion at any time or times during the life of the Beneficiary to resort to and apply such accumulation or any part thereof as if the same had not been accumulated and were income of the then current year.
(c)     AFTER the death of the Beneficiary UPON TRUST as to the capital as well as the income of the Settled Fund for such one or more of the issue of the Beneficiary born in her life-time or within Twenty one years after her death for such interest and in such manner consistent with the rule against perpetuities as she may be deed or deeds with or without power of revocation and new appointment or by Will appoint And in default of any such appointment and subject to any partial appointment UPON TRUST for all the children or any the child of the Beneficiary who being male shall attain the age of Twenty one years or being female shall attain that age or marry under that age in equal shares as tenants in common if more than one.
(d)     AND subject to the preceding trusts and provisions hereof then UPON TRUST as to the capital as well as the income of the Settled Fund for DAWN JACKSON, MERYL JACKSON and JOYCE JACKSON sisters of the beneficiary in equal shares, the share of each of them to be held by the Trustees upon the trusts and with and subject to the powers and provisions declared and contained respectively in certain Indentures of Settlement of even date herewith made between the same parties as are parties hereto whereby the Settlor settled certain investments for the benefit of each of the said Dawn Jackson, Meryl Jackson and Joyce Jackson respectively (such trusts powers and provisions being brevitatis causa deemed to be herein repeated) with power to the Trustees if they think fit so to do to transfer assign and made over any such share of the Settled Fund to the Trustees for the time being of any of the said Indentures of Settlement respectively to be held by such last mentioned Trustees as an accretion to the Settled Fund contained therein upon the trusts and with and subject to the powers and provisions respectively applicable thereto PROVIDED however that in the event of the trusts of any of the said respective Indentures of Settlement having failed or determined then the share of the Settled Fund which would have been held upon such trusts had the same not failed or determined shall be held as an accretion to the other share or shares of the Settled Fund equally if more than one upon the like trusts and with and subject to the like powers and provisions as are respectively applicable thereto as aforesaid.
(e)     AND subject to the preceding trusts and provisions hereto UPON TRUST for David Jackson brother of the Beneficiary upon the trusts and with and subject to the powers and provisions declared and contained in an Indenture of Settlement of even date herewith made between the same parties as are parties hereto whereby the Settlor settled certain investments for the benefit of the said David Jackson (such trusts powers and provisions being brevitatis causa deemed to be herein repeated) with power to the Trustees if they think fit so to do to transfer assign and make over the Settled Fund to the Trustees for the time being of the said Indenture of Settlement to be held by such last mentioned Trustees as an accretion to the Settled Fund therein contained upon the trusts and with and subject to the powers and provisions applicable thereto.
(f)     AND subject to the preceding trusts and provisions hereof then UPON TRUST as to the capital as well as the income of the Settled Fund for the issue of the mother of the Settlor’s late husband the Dowager Lady Jackson of 8 Sussex Square, London, England, as shall be living on the failure of the preceding trusts hereof in equal shares per stirpes as tenants in common if more than one.
[Emphasis in original]
Clause 2(a) regulated the position until Dawn was 18 years of age. Clause 2(b) applied from and after Dawn attained 18 years of age and during her lifetime. In both cases, she was given an entitlement only to income of the settled fund, and not to capital.
Under clause 2(b) the trustees were to pay Dawn “during her life all the net income of the settled fund”, unless and until any of certain events occurred having a specified effect, essentially involving alienation by process of law of the right to such income to a third party. If such an event occurred the trustees were instead to stand possessed of such income upon other trusts. The clause treats the happening of such an event having the specified effect therein described as amounting to “the failure or determination during the lifetime of the Beneficiary of the trusts as to such income in her favour”.
Clause 2(c) applies “after the death of the Beneficiary”. The trustees were to hold upon trust “the Capital as well as the income of the settled fund” for the issue of Dawn. Clause 2(c) is not capable of applying in the circumstances, as Dawn died without having children.
The questions which therefore have arisen for determination in these proceedings concern the possible application of clauses 2(d), 2(e) and 2(f) of the Settlement Deed for Dawn, in the circumstances that have occurred, and in particular the substantive meaning of clause 2(d).
It is convenient to first consider paragraph 2(f). The operation of this paragraph depends on “the failure of the preceding trusts” - the failure of the trusts under each of the preceding paragraphs of clause 2 - because the paragraph operates to benefit the issue of the Dowager Lady Jackson “as shall be living on the failure of the preceding trusts hereof”. For this reason paragraph 2(f) does not operate unless and until each of the trusts under the preceding paragraphs has “failed”.

Paragraph 2(e) does not contain an express statement of the circumstances in which its operation is enlivened. It does not, for example, expressly state that paragraph 2(e) operates on the failure of the preceding trusts or of those in paragraph 2(d). Paragraph 2(e) can be contrasted with paragraph 2(f) in that regard.
While both paragraphs 2(d) and 2(f) are qualified by the introductory phrase: “AND subject to the preceding trusts and provisions hereof then UPON TRUST”, paragraph 2(e) uses the same phrase except for the word “then”, which is not used in paragraph 2(e).
The Meaning of Clause 2(d)
As Dawn had attained 18 years of age and died without issue, clause 2(d) has application.
The first part of clause 2(d) provides that the capital and income of the settled fund is to be held on trust for Meryl, Joyce and Daphne in equal shares upon the same trusts as are contained in their respective Deeds. The trustees are provided with power to transfer to the trustees of those settlements the share to which each sister became entitled on the basis that the transferred share would become an accretion to each settled fund. That part of clause 2(d), to repeat the text, provides:
AND subject to the preceding trusts and provisions hereof then UPON TRUST as to the capital as well as the income of the Settled Fund for MERYL JACKSON, JOYCE JACKSON and DAPHNE JACKSON sisters of the Beneficiary in equal shares
It is important to note that clause 2(d) operates to vest the interest in both capital and income.
Although clause 2(d) speaks of the capital and income as being held by the trustees upon trust for Meryl, Joyce and Daphne, this is immediately qualified by further words providing that the share of each of them is to be held by the trustees upon the trusts and with and subject to the powers and provisions. contained respectively in the Deeds of Settlement for those sisters. The sisters however do not take directly. To repeat that part of clause 2(d):
[T]he share of each of them to be held by the Trustees upon the trusts and with and subject to the powers and provisions declared and contained respectively in certain Indentures of Settlement of even date herewith made between the same parties as are parties hereto whereby the Settlor settled certain investments for the benefit of each of the said MERYL JACKSON, JOYCE JACKSON and DAPHNE JACKSON respectively (such trusts powers and provisions being brevitatis causa deemed to be herein repeated ...)
Clause 2(d) provides the trustees of the Dawn Jackson Trust with two possible alternatives. First, that the trustees may themselves hold the share for the sister on the trusts declared by clause 2(d). The second is that the trustees may “transfer assign or make over” the particular sister’s share to the trustees “for the time being” under that sister’s Deed. The trustees appear to have an unfettered discretion in this regard as to which alternative to adopt. In the event that the trustees under the Dawn Jackson Trust elect to “transfer assign or make over” a sister’s share to the trustees of that sister’s Deed the share thus paid over becomes an accretion to that settled fund of the latter Deed:
[W]ith power to the Trustees if they think fit so to do to transfer assign and make over any such share of the Settled Fund to the Trustees for the time being of any of the said Indentures of Settlement respectively to be held by such last named Trustees as an accretion to the Settled Fund contained therein upon the trusts and with and subject to the powers and provisions respectively applicable thereto
Unless and until the trustees choose to assign or transfer a share in a settled fund created by the operation of clause 2(d) on Dawn’s death, it would appear that a new trust is established in respect of the share of each sister on the same terms as are set out in their respective Deeds.
The trustees are required to address clause 2(d) to ascertain their duties, assuming they choose not to transfer and assign the shares to the continuing settled funds of Meryl, Joyce and Daphne.
As earlier observed, Meryl, Daphne and Joyce predeceased Dawn. On Dawn’s death the trustees, pursuant to the provisions of clause 2(d), were obliged notionally to divide her settled fund into three equal parts. They then have to address their obligations arising from the fact that they held each part on the same trusts as were set out in the Deeds of Meryl, Joyce and Daphne.[7]
[7] It is possible that through retirement and appointment of new trustees the persons acting as trustees under each sibling’s deed of settlement could have changed over time such that the same persons were not trustees under each deed. That has not occurred.
Proviso to Clause 2(d)
Clause 2(d) of the subject Deed is qualified by a proviso. It is in the nature of an accruer clause. The proviso appears to qualify the whole of the preceding words of clause 2(d):
PROVIDED however that in the event of the trusts of any of the said Indentures of Settlement having failed or determined then the share of the Settled Fund which would have been held upon such trusts had the same not failed or determined shall be held as an accretion to the other share or shares of the Settled Fund equally if more than one upon the like trusts and with and subject to the like powers and provisions as are respectively applicable thereto as aforesaid.
The proviso is directed to prescribing what is to happen to the share in the Dawn Jackson Trust of each sister if it is the case that “the trusts” under a sister’s Deed have “failed or determined”. Seemingly this is to be assessed by establishing whether such an “event” occurred on or before the date of death of the Beneficiary. That appears to be the relevant date given that the application of clause 2(d) cannot be triggered until the death of the Beneficiary.
There are issues of interpretation, which arise from the terms of the proviso. The phrases “the trusts” and “failed or determined” appearing in the proviso, are susceptible to several possible meanings:
[I]n the event of the trusts of any of the said Indentures of Settlement having failed or determined.
The principal submissions of the parties addressed these issues.
A construction of either or both of the phrases “the trusts” and “failed or determined” which would enable the proviso in clause 2(d) of the subject Deed to have practical application should be favoured over another construction which would not have that effect - as it may be inferred that the proviso was intended to be capable of operating - so as to give effect to the intention which should be imputed to the parties to the Deed.
There is a general rule of construction that a deed should be construed as a whole, and that generally, the same expression in a deed should bear the same meaning in all parts of the instrument. However, this is only a general rule. The defendants called this rule of construction in aid in regard to the interpretation of the expressions “the trusts” and the expression “failed or determined”. Accordingly, a question arises as to whether the use of the phrase “failure or determination” in clause 2(b) colours the meaning to be given to the similar phrase “failed or determined”, which is used in clause 2(d) of the Deed. A similar question arises with respect to the use of the phrase “the trusts” elsewhere in clause 2(d).
Meaning of the Expression “The Trusts” in Clause 2(d)
There are several possible ways to interpret the direction in clause 2(d) that the trustees are to hold the settled fund of Dawn “for” Meryl, Joyce and Daphne “upon the trusts” contained in the respective Deeds. An immediate question is whether “the trusts” referred to means the whole of the trusts of only some of the trusts.
The proviso is intended to establish a mechanism whereby the equal share in the settled fund of Dawn, which would otherwise go to a specific sister of Dawn, if clause 2(d) is operational in the circumstances, instead be added to the other sister’s share or sisters’ shares.
Each of the trusts declared under clauses 2(a) to 2(f) of a sister’s Deed can only have “failed” in their entirety if the settled fund of that deed can no longer be applied under any of the clauses. As earlier observed, clause 2(f) is a “catch-all” provision providing for distribution of the settled fund amongst the issue of the Dowager Lady Jackson as shall be living on the failure of the preceding trusts declared in clauses 2(a) to 2(e) inclusive. Necessarily the failure of the trusts under clause 2(f) requires a situation in which each of the four sisters and David (they themselves being issue of the Dowager Lady Jackson) are not living, and their issue and further descendants are also not living. It requires a situation in which there are no such issue then living.
Evidently clause 2(d) of the subject Deed was intended to operate so as to apply both the capital and income of the share of the settled fund of Dawn “for” a sister on the terms of her Deed as the words “capital and income” are used in the introductory words of clause 2(d).
The trusts upon which the trustees are to hold the share of the settled fund of Dawn include clause 2(c) of a sister’s respective Deeds, which each provide for the application of capital and income of the relevant settled fund to the issue of the Beneficiary after her death.
The submission of the next of kin was that “the trusts” referred to in clause 2(d) only referred to or picked up the trusts in favour of the named sisters – the trusts created by clauses 2(a) and 2(b) of their respective Deeds. In other words, “the trusts” was a reference to some only and not all of the trusts in the subject Deed.
This submission confronts several difficulties. The Trustee has pointed out that clauses 2(a) and 2(b) only deal with the application of the income during the lifetime of the Beneficiary and do not deal with the application of the capital after the death of the Beneficiary. It was said that the next of kin failed to address the contradiction that arose with respect to their contention by reason of the opening words of clause 2(d), and, in particular, the vesting in the trustees of “the capital as well as the income” of the settled fund. This wording in clause 2(d) strongly supports a wider meaning being attributed to the phrase “the trusts”.
Further, the defendants submitted that the true effect of clause 2(d) is to create new trusts in favour of the named sisters on the same terms as are contained in their respective Deeds. It was said that to limit the trusts to only those trusts in respect of each respective sister would be to unduly narrow the effect of the establishment of the new trusts.
The defendants further submitted that the words appearing in clause 2(d) “upon the trusts and with them subject to the powers and provisions declared and contained respectively in certain Indentures of settlements” necessarily required any share of Dawn’s trust going to the sisters to be held upon the whole of the sequential trusts set out in the sisters’ Deeds.
The defendants also pointed out that there was nothing to suggest that it was Ms Davidson’s intention that a sister receiving the benefit of an accruing share would not be entitled to exercise the power of appointment contained in clause 2(c), or that it was Ms Davidson’s intention that the gift over in clause 2(c) would not apply if the power of appointment was not exercised.
It was further submitted by the defendants that there was no need for clause 2(d) specifically to declare a trust in favour of the issue of the sisters as by the operation of the Deeds as a whole, in particular, the clauses 2(c), clear provision was made for the children of each sister to take on their mother’s death prior to the accreting event occurring.
In my view, the submissions advanced by the Trustee and the defendants provide telling support for the wider construction of the phrase “the trusts”.
Having regard to the foregoing, the reference in clause 2(d) to the trustees holding the capital and income of the settled fund of Dawn in equal shares for Meryl, Joyce and Daphne “upon the trusts” contained in their respective Deeds should be read as a reference to all the trusts in clauses 2(a) to 2(f) inclusive of the relevant sister’s Deed in order to ensure that both the income and the capital in the share of the settled fund of Dawn passes in its entirety under clause 2(d) of the subject Deed.
The reference in clause 2(d) of the Deed, to the trustees being directed to hold “for” Meryl, Joyce and Daphne “upon the trusts” in the respective Deeds should be read as meaning “for” each of them directly and for them or their issue so as to “pick up” the trusts in clause 2(c) of the Deed. This construction does not do undue violence to the wording or structure of clause 2(d) of the subject Deed, and does not prevent the proviso to clause 2(d) from having a scope for practical application.
This construction also lessens the circumstances in which the conclusion could be reached that the trusts under a sister’s Deed had “failed” for want of beneficiaries, and therefore would, in practical terms, reduce the scope of the circumstances in which the proviso to clause 2(d) of the Deed would be operative.
Meaning of the Expression “Failed or Determined” in the Proviso to Clause 2(d)
It is necessary to determine whether “the trusts”, of any of Meryl, Joyce or Daphne’s Deeds have “failed or determined” for the purposes of the proviso to clause 2(d) of the subject Deed. The phrase “failed and determined” has been said to be “rather difficult to define”[8].
[8] In re Huntington’s Settlement Trusts [1949] 1 Ch 414 at 422.
One possibility is that the phrase “failed or determined” is not necessarily a composite phrase denoting a single concept, and that the situation where “the trusts” of a sister’s Deed have “failed” may differ from the situations where those trusts have “determined”.
In ordinary language it is possible to refer to trusts “failing” or having “failed” if some essential element necessary to constitute a trust is missing: for example, a trust failing for want of trust objects or beneficiaries, or through illegality. A trust may fail at the outset on creation, or at any later time.
The term “determined” may, on one view, mean simply terminated or brought to an end and need not be synonymous with the expression failed. Trusts may be said to have failed if, for example, they are incapable of taking effect.[9] It was submitted that it may also follow that trusts can only be said to have “determined” in circumstances where at some earlier point the trusts had commenced to operate, and that where the phrase failed or determined is used, the reference to trusts having determined should be construed as addressing the situation where the trusts had commenced operation but had subsequently been brought to an end.[10] There may be an overlap in meaning of the terms “failed” and “determined” – they are not necessarily dealing with separate subject matters.
[9] Duncan v Equity Trustees Executors & Agency Co Ltd (1958) 99 CLR 513 at 518.
[10] Duncan v Equity Trustees Executors & Agency Co Ltd (1958) 99 CLR 513 at 518.
Halsbury notes:[11]
The terms of the trust itself can provide that it is to end on a certain date or on the occurrence of a prescribed event. In the absence of such a prescription a trust generally terminates upon the distribution of the trust property to the beneficiaries pursuant to the terms of the trust. Private trusts, unlike charitable trusts, cannot continue in perpetuity.
The Deeds do not contain any express provisions providing for the termination of the trusts which they create.
[11] Halsbury’s Laws of Australia ‘Trusts’ at [430]-[2500] (footnotes omitted).
The evidence in the within proceedings is that each of the Deeds of Meryl, Joyce and Daphne had been fully administered and the settled fund of each fully distributed to the beneficiaries entitled thereto prior to the date of death of Dawn.
In the case of In re Huntington’s Settlement Trusts[12] the Court was concerned with a series of separate settlements of funds for the benefit of three daughters and a son. The fund was settled on each daughter for life and then in remainder to her issue. The son obtained an absolute interest on attaining a certain age, and was paid that interest by the trustees. The son later died. A daughter subsequently died without leaving issue. The daughter’s settlement contained an accruer cluse providing that if the trusts in her settlement “shall fail or determine”, her trust fund shall accrue to the other trust funds, which “shall not then have failed or determined”.
[12] In re Huntington’s Settlement Trusts [1949] 1 Ch 414.
The issue was whether the settlement for the son could participate under the accruer clause in receiving a share of the deceased sister’s fund. It was argued that the son’s settlement should be regarded as having “determined” prior to the daughter’s death because he had been paid his interest. If so, the son’s fund could not take a share in the deceased daughter’s fund under the accruer clause in the deceased daughter’s settlement.
Jenkins J held that the son’s fund was entitled to share under the accruer clause together with the two surviving daughters. Jenkins J reasoned that in the context of the settlements there in question, it should not be said that the trusts of the son’s settlement had “determined” by payment to him. The Judge reasoned, in part, that the settlor’s intention cannot have been: [13]
[T]hat when somebody became absolutely entitled the accruer clause should operate to take the share away from him or her.
[13] In re Huntington’s Settlement Trusts [1949] 1 Ch 414 at 420-421.
As earlier observed, ordinarily a phrase which occurs more than once in the same clause of an indenture or other document should be given the same meaning wherever it occurs. Failure or determination in clause 2(b) can only occur during the lifetime of the Beneficiary after she has attained 18 years. Further it can only occur by reason of a disentitling event. It was submitted by the defendants that in the proviso to clause 2(d) the phrase “failed or determined” in the passage “the said Indentures of settlement having failed or determined” should be given the same meaning as in clause 2(b) – that is, failed or determined during the Beneficiary’s lifetime on the occurrence of a disentitling event set out in clause 2(b).
The defendant submitted that given the intention of Ms Davidson was to keep the sisters’ settled fund within the family, and primarily for the benefit of the sisters, then the words “failed or determined” in the proviso to clause 2(d) should be construed as having the same meaning as that phrase in clause 2(b). The defendants submitted that the proviso should be construed in the same way as Jenkins J construed the words “fail or determine” in Huntington’s.:[14]
… it might be truly said that the trust of a settled share have determined when somebody has become absolutely entitled and the fund has been paid over to him; but it does not follow that in all contexts the words have that meaning.
…
The precise meaning of the words “fail or determine” is rather difficult to define, but I think the words “or determine” are added to this quite common conveyancing phrase so as to meet the case of what may in a sense be termed a partial failure.
…
I think that in this case the use of the double expression “fail or determine” can be accounted for in that way without pressing the meaning of the words “determine” so as to make it include a share, such as Lionel’s share, which had become absolutely vested and had been paid out. … any such conclusion would be the wrong one, as the result which it would produce would, so far as I can see, be in the highest degree capricious in that it would or might exclude from participation in the accruer persons whom one would think the settlor would have intended most to benefit.
[14] In re Huntington’s Settlement Trusts [1949] 1 Ch 414 at 420-422.

The defendant’s submitted that to read the proviso otherwise would capriciously exclude from participation a Beneficiary and branch of the family Ms Davidson clearly intended to benefit.
The format or structure of the Deeds in the present proceeding is similar to that considered in Huntington’s. The accruer clause 2(d) identifies each of the settled funds, provides for accretion in the event only that earlier provisions have failed and provides what is to occur in the event that one, or more, of the funds entitled to the benefit of accretion has failed or determined by reason of the occurrence of a disentitling event mentioned in clause 2(b).
Ms Davidson’s intention appears to be that the settled funds should, on the death of a sister without issue, be equally divided amongst the remaining sisters and their issue and held upon the same trusts as are contained in the Deeds of those sisters with power to transfer those new shares as an accretion to the original settled funds.
The desire of Ms Davidson to benefit the sisters and their family line in priority to David or other potential beneficiaries is given added weight by the inclusion in the discretionary powers of the trustees exercisable on determination of the entitlement to income under clause 2(b). That power includes the power to pay the income of the settled fund to that person or those persons who would, if the Beneficiary were “actually dead”, be entitled to the settled fund or the income thereof. While that provision could refer to children or issue who satisfied clause 2(c), children and issue are already included in the class entitled to the benefit of the income earlier in that sub-clause. Accordingly the reference “actually dead” is to be understood to be the persons who would take pursuant to the provisions of clause 2(d) and thereby is a reference to the sisters and potentially their children.
In my view the approach taken by Jenkins J in Huntington’s is of particular assistance. It is to be acknowledged that care must be taken in drawing from authorities dealing with questions of construction of a different document in a different context. However, the issues being discussed by Jenkins J bear a relevant similarity to those in the present proceeding, and his observations provide guidance and support to the conclusions that I have reached.
The settled funds of each sister always have the potential to be the subject of accretion. Accordingly, the trusts did not fail and did not determine when the settled funds were distributed to the beneficiaries. There remained the possibility of further accretion.
In the alternative if this consideration does not resolve the question, I would accept the submissions of the defendant that the meaning of “failed and determined” in clause 2(d) was as that phrase is defined in clause 2(b).
Issues arising under Deed of Settlement for Joyce
Joyce predeceased Dawn. It follows that clauses 2(a) and 2(b) of the Deed for Joyce have no application.
The one-third share in the settled fund for Dawn is to be applied under clause 2(d) of the subject Deed so that the share is then held by the Trustee upon the trusts of the Deed for Joyce. A further question arises as to how the one-third share is to be applied under clause 2(c) of the Deed for Joyce.
Joyce died leaving issue, three grandchildren. Joyce had been predeceased by her one daughter Gay who died in 1986.
Clause 2(c) of Joyce’s Deed provides:
AFTER the death of the Beneficiary UPON TRUST as to the Capital as well as the income of the Settled Fund for such one or more of the issue of the Beneficiary born in her lifetime or within Twenty one years after her death for such interest and in such manner consistent with the rule against perpetuities as she may be deed or deeds with or without power of revocation and new appointment or by Will appoint AND in default of any such appointment and subject to any partial appointment UPON TRUST for all the children or any the child of the Beneficiary who being male shall attain the age of Twenty one years or being female shall attain that age or marry under that age in equal shares as tenants in common if more than one.
A difficulty arises in relation to the appointment made by Joyce in her will, under clause 2(c) of her Deed, and whether that appointment has any application in relation to the one third share as distinct from its application in relation to Joyce’s own settled fund.
The power of appointment was exercised by Joyce in a codicil that specifically refers to Joyce’s “Indenture”, as well the benefits which she had received from David’s “Indenture”. It was correctly submitted that it should be inferred therefore that when making the codicil Joyce had regard to the terms of the Deeds as a whole.
Joyce specifically defined the trust assets in respect of which she was seeking to exercise the power of appointment. By the time this power of appointment was exercised, Joyce must have known that Dawn was then aged, unmarried and, in a practical sense, infertile so that there was a real likelihood of a further accretion to her settled fund from that of Dawn. Joyce either chose not to, or inadvertently failed to, exercise the power of appointment in respect of that contingent accretion.
A reading of the codicil makes it clear that Joyce was only seeking to exercise the power of appointment in respect of the identified assets. The codicil cannot reasonably be read as extending to the accreted assets from Dawn’s Settlement, and provides:
1. WHEREAS by Clause 2(c) of an Indenture of Settlement made the 9^th day of March 1929 and made between LAURA EMILY DAVIDSON (1) ELDER’S TRUSTEE AND EXECUTOR COMPANY LIMITED and LAURA EMILY DAVIDSON (2) I have a Special Power of Appointment to appoint on my death the capital and income settled thereunder and also settled under a similar Deed of the same date in which the late DAVID JACKSON was originally a beneficiary and I now desire to exercise this Special Power of Appointment in manner hereinafter appearing.
2. NOW I hereby exercise my aforementioned Special Power of Appointment in favour of such of my granddaughter JULIA ANNE GALE and my granddaughter SUSAN WILDEY as shall be living at the date of my death and if more than one in equal shares for their own use and benefit absolutely provided that all taxes and duties and costs whatsoever or wheresoever arising and attributable thereto shall be charged thereon and paid therefrom.
In Re Walpole’s Marriage Settlement[15] has application to this case. Joyce J in similar circumstances held that the earlier exercise of a power of appointment did not operate as an appointment in relation to after acquired property. The power of appointment could only apply to a fund, which at the time that the power was operative, included property comprising an accretion from Dawn’s trust. The power was operative from the date of Joyce’s death, namely 5 January 2004. Dawn did not die until 9 December 2005. Accordingly Joyce had no power to effect an appointment in respect of those assets which fell into her settled funds from Dawn’s Deed after Joyce’s death.
[15] InRe Walpole’s Marriage Settlement [1903] 1 Chancery 938. See also Hicking v Fair [1899] AC 15, 38; Kenna v Conolly (1938) 60 CLR 583, 595-596; Executor Trustee Australia Ltd v DeMeyrick [2005] SASC 388.
The effect of clause 2(c) of Joyce’s Deed is that the accreted funds are held upon trust for her male children who attain the age of 21 years and her female children who attain that age or marry under that age in equal shares. Insofar as Joyce’s daughter Gay predeceased her after having attained the age of 21 years, or having married, the accreted funds fall into Gay’s estate.
Conclusion
It is appropriate to make declarations and provide directions in accordance with my earlier referred to conclusions. I will hear the parties as to the terms of those declarations and directions and with respect to any consequential matters.

206—Actions for administration
(1)In an action related to a trust or deceased estate, the Court may (if it thinks fit) determine questions arising in the action without making an order for administration.
(2)In any such action, the Court may make orders for the protection of persons who may be interested in the trust or deceased estate (whether or not they are parties to the action).
Examples—
1The Court might make orders for the ascertainment of possible beneficiaries.
2The Court might order the trustees, executors or administrators to file accounts of their administration in the Court.