Bass & Bass and Anor - [2014] FamCA 1000

FAMILY COURT OF AUSTRALIA

BASS & BASS AND ANOR

[2014] FamCA 1000

FAMILY LAW – PROPERTY – TRUST – Whether a trust has been established – Whether the trust established by the parties was limited in its use – Where a trust is established for the benefit of a child – Whether the trust was for the payment of child support – Whether the trust is capable of being modified – Whether the husband is entitled to the trust surplus as a result of an alleged failed trust – Where the wife seeks to remove the husband as trustee of the trust – Where the wife seeks payment of periodic child support – Where it is found that the trust was not limited in its application as suggested by the husband – Where it is found that it would not be just and equitable to return the corpus of the trust to the husband – Where the husband and wife are removed as trustees.

Family Law Act 1979 (Cth) ss 79A(1A), 117(4), (5) (6), (7), (7A, (8)

Child Support (Assessment) Act 1989 (Cth) ss 122, 123A, 124, 125, 129(2), 141(1), 151, 151B, 151C

Kautr v Hilton (1953) 90 CLR 86
Byrnes v Kendle (2011) 243 CLR 253
Morgan v 45 Flers Avenue Pty Limited (1987) 11 NSWLR 573
Abela and Abela (1995) FLC 92-568
Christian & Donald [2004] FamCA 1171
Miller v Cameron (1936) 54 CLR 572

APPLICANT:

Mr Bass

RESPONDENT:

Ms Bass

CASE GUARDIAN:

Ms Shaw

FILE NUMBER:

PAC

5029

2012

DATE DELIVERED:

11 September 2014

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Aldridge J

HEARING DATE:

1 & 2 May 2014

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Laughton SC

SOLICITOR FOR THE APPLICANT:

Tilley Family Law & Mediation

COUNSEL FOR THE RESPONDENT:

Mr Kearney SC

SOLICITOR FOR THE RESPONDENT:

Broun Abrahams Burreket

COUNSEL FOR THE CASE GUARDIAN:

Mr Meek SC

SOLICITOR FOR THE CASE GUARDIAN:

Abrams Turner Whelan

Orders

That this matter is stood over before me at 9.30 am on Friday 26 September 2014 and I direct the parties to attend on that occasion with short minutes of order to give effect to this judgment.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Bass & Bass has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: PAC 5029 of 2012

Mr Bass

Applicant

And

Ms Bass

Respondent

And

Ms Shaw

Case Guardian

REASONS FOR JUDGMENT

P Bass (“the child”) is 17 years old. On 17 July 2008, the court, by consent, ordered Mr Bass (“the husband”) to pay $350,000 into a bank account to be held by a trust to be set up and used to support the child P, primarily by providing education at private schools, if possible (“the Trust”).
The orders, it is said, were made pursuant to the Child Support (Assessment) Act 1989 (Cth) (“CSAA”).
The child did not, and now will not, attend a private school. About $300,000 remains in the Trust. The husband says the purpose of the orders and the Trust has failed and that he should get his money back.
Ms Bass (“the wife”) disputes that purpose of the Trust was limited, as suggested by the husband. She asserts that, in any event, the Trust has an independent life of its own, separate from the orders which created it and that it now cannot and should not be set aside.
Further, and in any event, she now seeks orders pursuant to the CSAA in addition to the orders made in 2008 for the payment of periodic child support.
The wife also seeks to remove the husband as a trustee of the Trust.
On 21 August 2013 I appointed Ms Shaw as a Case Guardian for the child and joined her as a party to the proceedings.
The child P is the youngest of six children of the parents. The parents married in 1984 and the wife asserts that they separated on 3 April 2004. The husband asserts that they separated on 2 July 2004.
In July 2004 the child was diagnosed with a mild intellectual disability. That continues to be the position.
On 31 October 2005 consent orders dealing with the parent’s financial issues were made in the Local Court of New South Wales. Those orders were varied on 18 November 2005.
At that time the child lived primarily with the wife but spent significant time and, at times, equal shared time, with the husband.
In 2006 the husband filed an application for parenting orders in relation to the child. The wife filed a response which also sought parenting orders in relation to the child but also relief pursuant to s 79A of the Family Law Act 1979 (Cth) (“the Act”).
On 17 July 2008 the Family Court of Australia made a number of consent orders. It is these orders which are the genesis of these proceedings. Orders were made pursuant to s 79A of the Act, in relation to the parenting of the child and pursuant the CSAA.
There were extensive notations to which it will be necessary to refer shortly.
Under the heading “Departure Orders made pursuant to the Child Support Act” the following appear:
16Pursuant to section 124 of the Child Support Act the Husband shall provide child support to the Wife for the child [P] as follows:
16.1 By way of payment as and when they fall due, all tuition fees until the end of [P’s] primary school education at [Y] Public School, or such other school as the parties may agree in writing;
16.2 By way of payment of, as and when they fall due, all tuition fees for the whole of [P’s] secondary school education (ie, up to and including year 12 unless the school recommends otherwise to the parties agree otherwise in writing) for such of the schools selected under the provisions of Order 12.2;
16.3 By way of payment of, as and when they fall due, all applicable tuition fees and/or course fees to enable [P] to undertake a life skills course or similar if [P] does not complete his secondary education (up to and including Year 12) at one of the schools provided by Order 12.2;
16.4 By way of payment of, as and when they fall due, all other educational expenses that are included on the school account for [P] including school books, the provisions of a teacher’s school aide, if recommended by the school, extra curricular activities (provided if the extra curricular expense exceeds $200, it must be agreed by the parties in writing, such agreement not to unreasonably be withheld);
16.5 By way of payment of, as and when they fall due, all fees applicable to [P’s] comprehension tutoring (currently undertaken by Ms [EE]) in accordance with Order 11.2;
16.6 By way of payment of, as and when they fall due, all maths tutoring for [P] in accordance with Order 11.3;
16.7 By way of payment of, as and when they fall due, all music lessons for [P] arranged in accordance with Order 11.4;
16.8 By way of payment of, as and when they fall due, all costs incurred in relation to [P’s] school uniforms and sports equipment;
16.9 By way of payment of, as and when they fall due, one half of all medical, hospital, orthodontic, dental, therapy and other expenses arising in relation to[ P’s] well being and health that are not covered by [P’s] entitlement under the private health insurance policy maintained by the Wife in respect of [P] and the Wife shall continue to maintain the current level of private health insurance until a child support terminating event occurs in relation to [P]; and, notwithstanding any contrary provision of these Orders the payments referred to as being payable by the husband and the payments referred to as being payable by the wife in this Order 16.9 are not to be paid by the CST, but by the parties respectively; and
16.10By way of payment of, as and when they fall due, such other educational expenses as may be agreed by the parties in writing.
17The child support offer to be paid by the Husband in accordance with Order 16 herein in to reduce the amount payable by him under any Assessment of child support. For the period from the date of these Orders until a child support terminating event occurs in relation to [P] the Husband’s payments in accordance with Order 15 herein are to reduce the annual rate of child support payable by him 100% to nil.
18Except as provided by Order 16, the parties shall otherwise bear sole responsibility for all costs in relation to [P] whilst he is in their respective care.
19Pursuant to section 124 of the Child Support Act the Wife shall provide child support to the Husband for the child [P] by way of payment of all costs in relation to [P] whilst [P] is in the care of the Wife.
20The child support order to be paid by the Wife in accordance with Order 19 herein is to reduce the amount payable by her under any Assessment of child support terminating event occurs in relation to [P] the Wife’s payments in accordance with Order 19 herein are to reduce the annual rate of child support payable by her by 100% to nil.
21Pursuant to section 117 of the Child Support Act there be a departure from the administrative assessment of child support payable by the Husband for the child [P] such that for the period from the commencement of the Husband’s child support liability in respect of [P] to the date of these Orders the total amount of child support be set equal to the monies already paid for that period, with the effect that no arrears remain payable and no overpayment is created.
22Forthwith upon the making of these Orders the Husband and Wife shall do all things and sign all documents necessary to establish the Child Support Trust and for the purpose of this Order:
22.1 The Husband shall cause to be paid to a National Australia Bank account in the name of [the Wife] and [the Husband’s] trustees for the [B] Child Support Trust the sum of $350,000 way of payment of $5,000 within 7 days of the date of the making of these orders and a further $345,000 within 60 days of the making of these orders;
22.2 The Husband and Wife shall instruct [FF Legal] to prepare the trust deed and any other documentation necessary to establish the CST, the costs of and incidental to such preparation to be paid by the trustees out of the capital of the Trust;
22.3 The Husband and Wife shall be the trustees of the said trust
22.4 The terms of the Child Support Trust must include the following terms:
22.4.1until the CST is wound up, its capital must be applied to meet the obligations referred to in Order 16.
22.4.2the trustee shall pay educational or tutoring expenses additional to those specified in Order 16 as agreed between the parties in writing.
22.4.3the trustee shall cause the CST to be wound up on 31 December 2015, unless the parties agree in writing to extend the date for the winding up of the trust
22.4.4upon the winding up of the trust, the trustee shall hold any residual corpus in the CST for [P] absolutely.
22.4.5all income of the CST is to be paid to the Husband as and when it is received, on the basis that the Husband is solely responsible for:
22.4.5.1all costs associated with the administration of the CST (expect the costs referred to in Order 22.2); and
22.4.5.2all tax arising on income received by the CST.
23That the Husband’s child support liability pursuant to Order 16 herein shall be reduced by such amount and to the extent that any or all of the liability of the Husband subject to Order 16 is met by means of payments from the Child Support Trust provided that in the even that any payments from the Child Support Trust (whether by way of income and/or capital) are insufficient to meet the liability of the Husband pursuant to Order 16 then the Husband shall be and remain liable for such payment pursuant to Order 16.
24The child support ordered to be provided by the Husband is intended by the parties to represent 100% of any liability of the Husband for child support for all of the children of the marriage, including any claim for arrears of child support. To that end, each of the parties shall, forthwith upon the making of these Orders, do all acts and things necessary to:
24.1 withdraw any outstanding applications for review in relation to child support;
24.2 acknowledge that any arrears of child support are waived; and
24.3 cause to be registered the present Agreement with the Child Support Agency.
25That the application by the Wife for adult child maintenance is hereby dismissed.
26That all other outstanding applications be are hereby dismissed.
27As between Husband and Wife, all outstanding interim orders, including orders for reserved costs or other costs, are hereby dismissed, to the intent that each of the Husband and Wife shall be responsible for their own costs incidental to all of the proceedings (including appeals). [emphasis as original]
Leaving aside orders 25 – 27, which obviously were not made under the CSAA, there was a dispute between the parents as to whether all of the other orders and in particular order 22 were, in fact, made pursuant to the CSAA. It was the case of the wife that order 22 was made pursuant to s 79A of the Act and could only be set aside under that section. The husband did not make that application.
Shortly after the orders were made, the parents established two National Australia Bank accounts. One was styled “[Mr Bass] and [Ms Bass] as trustees for [P Bass] for Child Support Trust”. It was a cheque account. A rolling term deposit account was also established. Neither party took any steps to cause a trust deed to be prepared or to take any other formal steps to establish a trust.
Thereafter funds, as agreed between the parents from time to time, were dispersed to meet expenses in relation to the child.
From the date of the orders until February 2010 the child spent equal time with the parents but on varying basis.
From February 2010 the child lived mainly with his father.
On 15 March 2011 the wife commenced parenting proceedings in relation to the child. On 26 April 2012 Fowler J ordered that the wife have sole parental responsibility for the child, that the child live with her and that the child have no contact with the husband except with the consent of the wife.
From 27 April 2012 to the present the child has lived with the wife and has had no contact with the husband.
On 9 November 2012 the husband commenced these proceedings. His counsel’s written outline of submissions identified the following orders sought by the husband:
1.Pursuant to Section 129(1) of the Child Support (Assessment) Act (the CSAA), order that Orders 16 – 24 of the Orders made by this Court on 17 July 2008 (the Orders) be discharged.
2.If order 1 is made, and order that funds standing to the credit of the National Australia Bank Limited (NAB) in the joint names of the parties and styled [Mr Bass] and [Ms Bass] of the [B] Child Support Trust, (the account) be paid to [the Husband].
3.An order that the issue of child support for ([P]) born … 1997 be determined by the Child Support Agency (CSA) by way of administrative assessment pursuant to CSAA.
4.A declaration that no trust came into existence by reason of the making of the Orders.
5.Alternatively, if a trust is found to exist, a declaration that the purpose of the trust pursuant to the Orders has failed and there be a reduction on the corpus of the trust to $30,000.00 and the surplus funds in the account be paid to [the Husband].
6.An order that [the Wife] be removed as a trustee of the trust.
7.Alternatively an Order that both [the Husband] and [the Wife] be removed as trustees of the Trust and be replaced by a corporate trustee or alternatively two suitable trustees.
8.An order that [the Wife] pay the costs of [the Husband], of and incidental to the Application.
The wife consented to the making of order 1 but did so on the basis that it had a markedly different effect to that asserted by the husband.
The husband asserts that the setting aside of the orders would set aside the orders for the creation of the Trust and any trust created pursuant to the orders, thus providing the basis for the return to him of the funds.
The wife asserts that the setting aside of the orders does not have that effect and that, if the orders are set aside, the Trust created by those orders would, nonetheless, continue to exist entirely unaffected. Thus the funds could not be returned to the husband.
The Case Guardian opposed the setting aside of the orders. The Case Guardian accepted that the setting aside of the orders would have the effect of setting aside any trust created by them.
The wife opposed the balance of the orders.
She sought the following orders:
1That an order be entered in accordance with paragraph 1 of the Initiating Application (Family Law) filed on 9 November 2012, noting that:
1.1The respondent consents to the entry of such order in her personal capacity only, and not as trustee for [P]; and,
1.2The trust for the benefit of [P] settled by the applicant and the respondent in favour of [P] in or about July 2008 remains unaltered by the discharge of paragraphs 16 to 24 inclusive of the Orders of 17 July 2008 of the Family Court of Australia Sydney.
2That in respect of the child support period from 27 April 2012 to the date of making of this Order, the applicant shall within 28 days pay child support to the respondent in respect of the child [P] born … 1997 in a lump sum amount equivalent to $594 per week for each week of the said period.
3That in respect of the child support period from the date of making this Order until 31 December 2015, or the occurrence of an earlier child support terminating event the applicant shall pay child support to the respondent in respect of the child [P] born ... 1997:
3.1Within 28 days a lump sum amount equivalent to $594 per week for each week of the said period;
3.2In the alternative to paragraph 3.1 and in the event that such Order is not made within 28 days a lump sum amount equivalent to $594 per week for each week of the said period plus an additional $30,000 (for adjustments in CPI) to an interest bearing account in the name of the respondent to be applied only in payment of the amount of $594 per week to the respondent each week until 31 December 2015, or the occurrence of an earlier child support terminating event, with any balance remaining to be paid to the applicant subject to any further order of the court; or
3.3In the alternative to paragraph 3.1 and 3.2 and in the event that neither Order 3.1 or 3.2 is made, the sum of $594 per week from the date of this Order until 31 December 2015 to the occurrence of an earlier child support terminating event.
4The amount of child support referred to in clause 3.2 and 3.3 shall be adjusted annually in accordance with the rise, if any, of the Consumer Price Index Sydney All Group the first of such adjustment to be made from 1 July 2013 following the quarter ended 30 June 2013 and for the purposes of such calculation the base figure shall be that as published by Commonwealth Statistician for the quarter ended June 2013.
5That in the event the Court finds otherwise than is set out in Clause 1.2 above, the amount of periodical child support referred to in Clauses 2 to 4 above be amended to $994.
6The Applicant be removed as trustee for [P] in respect of the Trust established on or about July 2008 and [U Bass] and/or [L Bass] be appointed in place thereof and as a consequence of the same the Applicant forthwith do all things and sign all documents to authorise and permit the transfer to the trustees of the Trust all of the monies standing to the account of:
6.1NAB Account Number …891; and
6.2NAB Term Deposit Account Number …542.
7That save as provided in paragraph 1 herein, the Initiating Application (Family Law) filed on 9 November 2012 be dismissed:
8That the applicant pays the costs of the respondent, both personally and in her capacity as trustee for [P], of an incidental to these proceedings on an indemnity basis.

It is necessary to determine firstly whether or not a trust has been created and whether or not it can be set aside by orders of the court. If there is a trust and it can be set aside or varied, the issue is then whether it should be set aside or varied. I will then deal with issues relating to removal of trustees and the wife’s application for further child support.

WAS A TRUST CONSTITUTED BY OR SUBSEQUENT TO THE 2008 ORDERS AND IF SO WHAT WERE ITS TERMS

The husband submits that the orders remain no more than child support departure orders pursuant to s 124 of the CSAA unless and until a trust deed is signed. He submits such a trust deed could not be signed until all of the terms necessary for the operation of the Trust have been agreed.
This position is supported, it is submitted, by a number of notations to the orders which speak of the trust in the future tense. The best example is Notation P which states:
The parties propose establishing the child support trust.
As has been seen the parents established the bank accounts whereby they styled themselves as trustees for the ‘[B] Child Support Trust’. The husband paid the agreed sums into those bank accounts.
The parents then arranged for the payment of expenses of the child that they agreed fell within paragraph 16 of the consent orders. (The parents did not always agree on whether payments should be made - often the dispute about payment was whether or not the proposed expense fell within the orders or not).
When one turns to order 22 it can be seen that the husband complied with order 22.1 by providing the funds.
The parents became the trustees of a bank account which was, at least, in part compliance with order 22.3. In accordance with the orders the capital was retained within the Trust and applied to the expenses that were agreed.
In accordance with order 22.4.5 the income of the Trust was paid to the husband who remained responsible for the costs associated with this administration and any income tax.
The funds had been variously expended on private school application fees, private school fees, school uniforms, extra-curricular activities, and on occasions, transport costs and dental work.
In short, save for the instructing of the solicitors to draft and the parties to enter into a trust deed, the orders were carried out.
There are four essential elements present in every trust: the trustee, the trust property, the beneficiary and the personal obligation annexed to the property.
There can be no dispute as to these elements here – the parents are the trustees, the funds in the bank account are the trust property and the beneficiary is the child. The personal obligation attached to the property is the obligation on the parents to use that money to pay the interest to the husband and to apply the capital for the child’s benefit.
There must be certainty of intention to create a trust.
A trust will be created, whether or not the creator thereof is precisely aware of doing so, provided that in substance the creator intends that his actions should have the legal effect of creating the relationship which is known in law as a trust. If the language is such that an intention to create such a legal effect is manifested, then a trust will be created whether the words ‘trust’ or ‘trustee’ are used, or not.
(Jacob’s Law of Trusts in Australia 7^th Edition [p 501])
In Kautr v Hilton (1953) 90 CLR 86 at [97] Dixon CJ Williams and Fullagar JJ said:
The established rule that an order to constitute a trust intention to do so must be clear and that it must also be clear what property is subject to the trust and reasonably certain who are the beneficiaries.
Of this paragraph Hayden and Crennan JJ said in Byrnes v Kendle (2011) 243 CLR 253 at [114]:
But the “intention” referred to is an intention to be extracted from the words used, not a subjective intention which may have existed but which cannot be extracted from those words. This is as true of unilateral declarations of alleged trust as it is of bilateral governance to create an alleged trust.
It is to be recalled that the orders of the court, being in this case by consent, give expression to an agreement reached between the parties. Morgan v 45 Flers Avenue Pty Limited (1987) 11 NSWLR 573 at 579. Obviously the parties agreed, by means of the orders, to create a trust. They, of course, could have done so without recourse to the court, or without reference to the CSAA but no doubt they saw benefit in doing both.
The terms of order 22 are clear and unequivocal – they clearly and expressly refer to the creation of a trust. Apart from order 22.2, which was not put into effect, and order 22.43, in respect of which the events are yet to arise, the parents have dealt with the funds paid into the bank account in accordance with order 22.4.
Lest there be any doubt about it, a number of notations to the orders support the view that a trust was to be created by the orders. They include (noting that the orders abbreviate Child Support Trust to CST):
F. In order to secure, and with the intention of meeting at least in part, his obligations to maintain the child of the marriage, [P], the Husband intends to effect a transfer of money into a child support trust for that purpose.
P. The parties propose establishing the Child Support Trust.
Q. The parties intend that:
a.The child support payable by the Husband pursuant to these Orders be in substitution for any Assessment made by the Child Support Agency either now or in the future; and,
b.The Wife shall not be liable for the payment of child support to the Husband or otherwise at any time in the future.
R.The Parties expect that upon the establishment of the CST, the capital on the CST will provide for the costs of [P’s] education at both primary and secondary levels. It is understood and acknowledged by the Husband that any of [P’s] educational expenses (including but not limited to tuition fees) that are not met by the CST will be met solely by the Husband as and when same fall due, subject to the provisions of Order 16 hereof.
S.It is noted and acknowledged and agreed by the Husband that he is to be solely responsible for all of the expenses payable by him under order 16 in respect of [P], provided that the Husband’s liability in this regard may be met and / or reduced by the application of income and / or capital from the CST for such purpose.
V.The parties anticipate that the educational expenses for [P] set out in Order 16 are unlikely to exceed $6,000 for the balance of 2008, $10,000 for 2009 and $45,000 for 2010 and their average will not exceed $50,000 (subject to inflation) over the balance of the time until [P] turns 18. However, these are only estimates and if the expenses exceed the above projections, as a consequence of an unexpected increase in the costs of educational expenses, then upon the CST being exhausted, the Husband will meet those costs. However, it is upon these estimates that the parties have entered into the agreement for departure from Child Support referred to herein, and in particular it is anticipated by the parties that the CST will likely cover all of the expenses for [P] set out in Order 16 hereof.
[Emphasis added].
Since the making of the orders the husband has not paid any child support outside the terms of these orders. The wife has not sought any other child support.
The orders of the court required the parties to do all things and sign all necessary documents to establish the Trust. This they have done other than for a formal trust deed. By the opening of the bank account, the payment into the bank account of the required funds, the payment out of the funds from time to time is quite clear that a trust was created and contains within it at least the terms contained in order 22.4 of the consent orders.
This is because upon payment into the bank account the necessary elements of a trust were put in place. The parents held the funds subject to the obligation to use them for the benefit of the child. Merely because further or other terms could be incorporated in the Trust the lack of those terms does not prevent the Trust from operating on the terms to which I have just referred. As can be seen it has done so for many years.
Accordingly, the submission of the husband that no trust was established is rejected.

IS THE TRUST CAPABLE OF BEING SET ASIDE OR MODIFIED?

The wife submits the creation of the Trust and its variation and termination is referrable to the general law of trusts and not s 124. This is so, it is said, because neither s 124 nor s 141 of the CSAA provides a power to the court to make the orders contained within order 22.
It was not explored in submissions whether the relevant orders other than order 22 could have been justified by s 79A of the Act. Order 15, which is not relevant for present purposes, was an order made pursuant to s 79A(1A) of the Act.
Rather, it was the position of the wife that the Trust, once created and even if created by orders made pursuant to the CSAA, was capable of variation only under the general law relating to trusts and not the Act.
Division 5 of the CSAA enables orders for the provision of child support other than in the form of periodic amounts paid to the carer. Section 122 provides:
This Division applies where a carer entitled to child support wants a liable parent to provide, or a liable parent wants to provide, child support for a child otherwise than in the form of periodic amounts paid to the carer entitled to child support.
Section 124 of the CSAA provides:
Orders for provision of child support otherwise than in form of periodic amounts paid to carer entitled to child support
(1) Where:
(a) a carer entitled to child support or a liable parent makes an application under paragraph 123(1)(a); and
(b) the court is satisfied that it would be:
(i) just and equitable as regards the child, the carer entitled to child support and the liable parent; and
(ii) otherwise proper;
to make an order that the liable parent provide child support for the child otherwise than in the form of periodic amounts paid to the carer entitled to child support;
the court may make the order.
(2) In determining the application, the court must have regard to:
(a) the administrative assessment in force in relation to the child, the carer entitled to child support and the liable parent; and
(aa) any determination in force under Part 6A (departure determinations) in relation to the child, the carer entitled to child support and the liable parent; and
(b) any order in force under Division 4 (departure orders) in relation to the child, the carer entitled to child support and the liable parent; and
(c) whether the carer entitled to child support is in receipt of an income tested pension, allowance or benefit or, if the carer entitled to child support is not in receipt of such a pension, allowance or benefit, whether the circumstances of the carer are such that, taking into account the effect of the order proposed to be made by the court, the carer would be unable to support himself or herself without an income tested pension, allowance or benefit.
(3) In determining whether it would be just and equitable as regards the child, the carer entitled to child support and the liable parent to make an order under subsection (1), the court must have regard to the matters mentioned in subsections 117(4), (6), (7), (7A) and (8).
(3A) In having regard to the earning capacity of a parent of the child under paragraph 117(4)(da), the court may determine that the parent’s earning capacity is greater than is reflected in his or her income for the purposes of this Act only if the court is satisfied as mentioned in subsection 117(7B).
(4) In determining whether it would be otherwise proper to make an order under subsection (1), the court must have regard to the matters mentioned in subsection 117(5).
(5) Subsections (2), (3), (3A) and (4) do not limit the matters to which the court may have regard.
Section 124 does not deal with the precise form of orders that may be made for the payment of non-periodic child support other than to say the court may make an order that child support be provided otherwise than in the form of periodic amounts paid to the carer.
The wife submitted that, although Parliament’s intention was to empower the court to make orders for child support that departed from the usual form of child support (that is periodic support), the terms of s 124 do not state what form those orders should take and that there is nothing in the text of s 124 that permits the creation of a trust.
Firstly, an order for a payment of non-periodic child support payment under s 124 is different to a child support departure order pursuant to s 117 – one empowers the court to make an order for periodic payments, the other to make orders for non-periodic child support. Section 124 does not refer to any particular orders that the court might make. It is in broad terms. Whilst it does not expressly refer to the creation of a trust its terms do not exclude a trust as a mechanism to provide non-periodic child support.
Section 141 of the CSAA provides
General powers of the court
(1) In exercising its powers under this Act, a court may do all or any of the following:
(a) order payment of a lump sum, whether in one amount or by instalments;
(b) order payment of a weekly, monthly, yearly or other periodic amount;
(c) order that a specified transfer or settlement of property be made;
(d) order that payment of an amount ordered to be paid be wholly or partly secured as the court specifies;
(e) order that any necessary deed or instrument be executed, and that such documents of title be produced and such other things be done, as are necessary to enable an order to be carried out effectively or to provide security for the due performance of an order;
(f) order that payment be made to a specified person or public authority or into court;
(g) make a permanent order, an order pending the disposal of proceedings, an order for a fixed period, an order until a child attains a specified age or an order until further order;
(h) make an order expressed to be retrospective to such day as the court considers appropriate;
(j) subject to section 129 (Modification of orders under Division 5), make an order:
(i) discharging an order; or
(ii) suspending the operation of an order wholly or in part and either until further order or until a fixed time or the happening of a future event; or
(iii) reviving wholly or in part the operation of an order that has been suspended; or
(iv) varying an order in any way;
(k) make an order imposing terms and conditions;
(m) make an order by consent;
(n) make any other order (whether or not of the same kind as those referred to in paragraphs (a) to (m) (inclusive)) that the court considers appropriate;
(p) make an order at any time.
(2) The making of an order of a kind referred to in paragraph (1)(c), or of any other order under this Act, in relation to a child does not prevent a court from making a subsequent order (whether under this Act or otherwise) in relation to the child.
(3) The applicable Rules of Court may make provision with respect to the making of orders under this Act (whether as to their form or otherwise) for the purpose of facilitating their enforcement and the collection of any child support payable under them.
Section 141(1)(d) enables the court to order the amount be wholly or partly secured “as the court specifies.”
Section 141(1)(e) enables the court to order that any necessary deed or instrument be executed and “such other things be done as are necessary to enable an order to be carried out effectively or to provide security for the performance of an order.” Pursuant to s 141(1)(f) the court may order that a payment be made to a “specified person”.
Thus s 141 enables the court to take all steps necessary to create a trust for the purposes of making an order under s 124. A deed or an instrument includes a trust deed.
The payment of money to a specific person to be held by them to pay non-periodic child support is also clearly within the terms of s 141 and can be seen as a means of providing security for the payment when required. This could be by way of a trust for that purpose.
It is submitted by the wife that s 124 was not intended to effect a displacement of the principles of equity in relation to the creation of trusts. In combination with s 141 it gives the court very broad powers to fashion appropriate orders for the payment of non-periodic child support. If there be a power under the CSAA to order the parties to do all things necessary to create a trust, which there is, I do not see how that is a displacement of the principles of equity. Even if it was such a displacement, the statute would prevail.
Section 124 and s 141 therefore enabled the court to make order 22. Consequently it is an order that could be made pursuant to the CSAA. The fact that s 141 was not specifically referred to in order 22 is immaterial.
Secondly, it was submitted that s 141 is not an independent source of power to make orders. That may well be so but, once s 124 is enlivened, as I have found it has been, then s 141 is also enlivened as to the manner and form of orders that are available to be made to give effect to the decision to award non-periodic child support made under s 124 of the CSAA.
Order 22 is located under the heading “Departure Orders made pursuant to the Child Support Act”. It is contained within a group of orders that are unequivocally made under the CSAA. It is an order that could be made under that Act. It is an appropriate order to have been made under that Act in the circumstances of this case. It sits comfortably with the other orders being made under the CSAA.
Order 22 is not located within the section of the orders dealing with s 79A. None of those orders purport to deal with the support of the child.
It was submitted that, as the Trust is to terminate on 31 December 2015 and not the end of the last school term in 2015, the orders creating the Trust could not have been made under the CSAA. This is so, it is submitted, because, although ordinarily a child ceases to be an eligible child for the purposes of the CSAA when he or she turns 18, an assessment for child support may be made until the last day of the secondary school year in which the child turns 18. (Sections 151B and 151 of the CSAA).
The purpose of the Trust is to provide a sum of money to be used to pay child support. This order dealing with termination does not compel the payment of child support beyond the end of the last school term in 2015. It simply deals with what is to occur with any funds that are not required for that purpose.
Where security is ordered to be provided for the payment of child support it would be appropriate and prudent for there to be orders providing for the release of the security once it is no longer required. The power to do so clearly follows from the power to create the security and flows from s 141. It is thus an ancillary order and not an order for the payment of child support beyond the period provided for in s 151C. Rather, the order provides, not for child support, but for the fate of funds not used for child support. The date provided for the fate of funds not required for child support would, logically, be a date after the obligation to pay child support ends. The Orders are consistent with this approach.
I am comfortably satisfied that order 22 was made pursuant to ss 124 and 141 of the CSAA.
Thus the Trust was created pursuant to orders made under the CSAA.

CAN THE TRUST BE TERMINATED OR VARIED?

The parents and the Case Guardian accepted that if it were found that the Trust was created pursuant to orders made under the CSAA then s 129 of that Act was an available source of power to modify, in accordance with the terms of that section, the orders giving rise to the Trust and thus to the Trust itself. This must be so, because in asking the court to make orders under s 124 of the CSAA, the parties submitted to the processes of the court and that Act. That includes s 129 of the CSAA. See Morgan v 45 Flers Avenue at [579].

The husband did not submit that there was any basis for variation or termination of the Trust other than pursuant to s 129 of the CSAA.

HAS THE TRUST FAILED ?

The husband submits that if the purpose of the Trust has failed the funds in the Trust should be returned to him.
Insofar as this submission relied upon general law the wife submitted that this court has no inherent jurisdiction to determine that issue. However, I determined on 27 March 2013 that the court has, in the circumstances of this matter, accrued jurisdiction enabling it to determine this issue
Accordingly I turn to the issue of whether or not the purpose of the Trust has failed.
The husband identified the purpose of the Trust which had failed as being provision for the private school education of the child.
The orders clearly refer to education in a general sense.
Order 16.1 refers to the child’s primary school education at Y Public School or such other school as the parties may agree in writing. Order 16.2 refers to secondary school education and the payment of fees “…. for such of the schools selected under the provisions of Order 12.2.”
Order 16.3 contemplates the child not completing his secondary education.
Order 12 provides:
12 The parties shall as soon as practicable following the date of these Orders and in any event within one (1) month hereof:
12.1 make enquiries of the privates schools referred to in Order 12.2 being “mainstream” private schools and not being schools specifically for intellectually delayed or otherwise handicapped children unless otherwise agreed in writing by the parties, as to any programmes or facilities they have for special or additional educational programmes for children with [the child’s] intellectual difficulties, including private tutoring ancillary to or through the said school;
12.2 use their best endeavours to ensure the enrolment and attendance of [the child] at one of the following schools to be approached forthwith unless otherwise agreed in writing: [list of ten schools omitted] (and if more than one accepts [the child] then the parties will accept the first one that accepts him in the order set out above), or if that application fails, such other private school of similar quality and preferably at an approximately mid-point in travel from the respective residences of the parties, as is agreed by the parties in writing.
12.3 in the event that [the child] is unable to be enrolled for the year 2010 in any of the schools listed in Order 12.2 and no other private school is found for [the child], then the parties shall arrange for [the child’s] placement in a public school that has tutoring or extra facilities to assist with [the child’s] education given his special needs, such school if practicable to be located geographically close to the midpoint of the parties’ main Sydney residences and away, is possible, from major congested traffic routes.
Whilst order 12.2 clearly contemplates a private school, order 12.3 clearly contemplates a public school education.
This is confirmed by the notations. Notation R refers to the costs of the child’s education at both primary and secondary levels without specifying the level.
Notation V refers to the likely educational expenses. The figures for 2010 and following are consistent with a private school education but are no more than that.
There are orders which enable the trust fund to be expended on expenses other than educational expenses.
Order 9.2 provides that if the child is retained overseas by one of the parents the other parent is entitled to payment of up to $75,000 from the Trust to be applied to the expenses in recovering and returning the child to Australia. The party responsible for the wrongful failure to return the child to Australia is, by order 9.4, liable to repay the amount spent to the Trust.
Order 11 refers to the parties providing tuition for the child outside school.
Order 16.9 provides for the payment of one half of medical, hospital, orthodontic, dental, therapy and other expenses in the circumstances set out in that order.
Whilst the notations expressed the hope that the child would go to a private school the orders are not so limited. Whilst the orders clearly catered for a private school education they did so in a broader context that also allowed for a public school education.
The purpose of the Trust cannot be said to be limited to the provision of a private school education. Indeed, whilst it might be said that primarily the Trust was, as the Case Guardian submitted, to address “educational” expenses, having regard to order 16.9 and order 9, it cannot be said to be limited to education expenses generally.
The child has not attended a private school. There is no expectation that he will do so. He is currently accessing a life skills course. Some limited tutoring expenses are being paid from the Trust Fund.
The wife would wish to, but the husband opposes, payments being made for physical educational expenses and some other expenses.
Since it was set up, albeit in a limited way, the Trust Fund has been used to pay limited educational expenses of the child and some orthodontic expenses. It continues to do so. Thus it continues to act for the purposes for which it was set up.
It was submitted:
If the parties contemplated that there would be little or no funds left in the trust after [the child’s] education at a private school it would have paid for, then it is difficult to construe a purpose beyond the date which it is to be wound up, on 31 December 2015 unless otherwise extended in writing by agreement.
Such a purpose can be found in order 22.4.3 for the payment of any residue to the child. The surplus is there for his benefit. That is a valid a purpose as any.
The fact that the surplus will be larger than was expected or hoped for does not mean that the purpose of the Trust has failed.
I do not accept the submission of the husband that the sole or primary purpose of the Trust was for the provision of a private school education or that the purpose of the Trust has failed.

SHOULD THE ORDERS MADE IN 2008 BE MODIFIED PURSUANT TO S 129 OF THE CHILD SUPPORT (ASSESSMENT) ACT 1989?

A court must not make an order modifying an order under s 124 unless it is satisfied that making a variation is justified because of a change in the circumstance of the child, the carer entitled to child support or a liable parent concerned since the order was made or last varied.
The parents and the Case Guardian agreed that there had been a change of circumstances. I find that there has been such a change.
Firstly, the private schooling that was hoped for has not taken place. Consequently, greater funds remain in the Trust than was considered likely at the time the orders were made.
Secondly, at the time the orders were made an order was made for the shared parenting of the child. Since 2010 there was a period when he lived almost solely with the husband and since 2012 he has lived solely with his mother with no contact with the husband.
The variation that the husband seeks is a variation of orders 22.4.3 and 22.4.4 which, for ease of understanding, I shall repeat. Order 22.4 provides the terms of the child support trust must include the following terms:
22.4.3 the trustee shall cause the CST to be wound up on 31 December 2015, unless the parties agree in writing to extend the date for the winding up of the trust
22.4.4upon the winding up of the trust, the trustee shall hold any residual corpus in the CST for [the child] absolutely.
The husband seeks the return of the corpus or, alternatively as his ultimate submission became, the return of such of the corpus as would leave $30,000 in the Trust for the benefit of the child. This, it was said, was a generous allowance for what was likely to be his educational expenses for the next year or so.
Pursuant to s 129(2) the court must not make an order modifying the earlier order unless the court is satisfied that it would be just and equitable as regards the child, the carer entitled to child support and the liable parent and that it is otherwise proper to make the order.
In doing so the court’s attention is drawn to matters specified under s 123A or a statement made under s 125 at the time the orders were made. There was neither in the present case.
In determining whether it is just and equitable to make the order the court must have regard to the matters set out in s 117(4), (6), (7), (7a) and (8).
In determining whether it is otherwise proper to make the order the court must have regard to the matters in s 117(5).
The consideration of the court is not limited to those matters.

SECTION 117(4)

The other children of the parents are adults although one of them receives care from the wife for a health related condition.
Both parents have an obligation to maintain the child. The child’s needs are those of the mildly intellectually disabled child. He needs somewhere to live and to be supported. Those are presently provided by the wife. The child attends swimming lessons which are paid for by the wife. The wife would wish to engage the child in physical education lessons and maths tuition but the husband does not agree to those costs being paid out of the Trust Fund.
The wife estimates that the weekly expenses of the child are $994, of which education expenses are said to be $400. That assessment was not tested or the subject of criticism by the husband.
The child is presently at school and will remain there attending his life skills course. He will complete secondary school next year. He has no income and his earning capacity is untested but must be regarded as very limited.
It is accurate to describe each of the parents presently as asset rich but income poor.
The wife discloses that she has net assets of $4,618,121. The bulk of those assets are represented by the home in which she lives with her children and her new partner on the Upper North Shore with an estimated value of $2,950 000 and a commercial property with an estimated value of $4,200,000. The house is unencumbered but there is a mortgage over the commercial property in the sum of $2,532,500.
Until December 2013 the property was let which, after payment of the mortgage and expenses, generated an income for the wife’s benefit. The wife was unable to relet the property and is in the course of trying to sell it.
There was some considerable cross-examination of the wife as to the circumstances in which the property was not relet to the existing tenant. The evidence does not enable me to determine whether or not the wife acted in a commercially prudent way or not but that is immaterial, for present purposes, if some other person may have acted differently. Her present financial position is what it is.
She still bears the burden of the mortgage and the rates and levies on that property. She has a shortfall between her income and expenses of some $7,743 per week. (She receives the sum of $690 support from other members of the household.) If the property is sold, of course the expenses in relation to that property of $4,377 will cease and the wife will have the benefit of the equity in that property. What she proposes to do with that however is not known.
The husband says that he has an average weekly income of $150 with expenditure of $7,901 per week. He owns property valued at $8,577,400 with liabilities of $3,229,000. His tax returns for the last four years show his income to have been:
2010  $882,741
2011  $218,025
2012  $318,362
2013   $32,132
Thus, whilst each of the parties has significant financial resources to support the child their present income is, of itself not, sufficient to do so having regard to their own needs.
The wife has a limited earning capacity. She has not worked for some time and is essentially a full-time parent, particularly in relation to the child.
The husband has spent significant time in Southeast Asia but has undertaken a property development in Australia regularly.
It was not suggested by either of the parents that the commitments of the other were not necessary to support themselves or any other person that they a duty to maintain.
There was no submission that making the order sought by the husband would lead to any particular hardship to the child or to either parent.
The child is presently raised in a manner that the husband considers appropriate. The wife would wish to engage the child in further activities due to his special needs. Schooling is, however, not likely to be a significant expense.
As I have said the child does not have the capacity to earn or derive an income.
It was submitted by the wife that the funds standing in the CST were, in fact, the child’s funds at least insofar as they were held for him and he would ultimately receive any surplus. It follows, it is submitted, that the child’s own funds should not be returned to the father or used for his own support.
Whilst the corpus is clearly held for the benefit of the child the income is payable to the husband.
The child is entitled to the residue standing in the trust as at 31 December 2015. Until then the trustees are entitled to spend such of those funds as they decide is proper. They are entitled, if they consider it proper, to spend it all. Until 31 December 2015 arrives it cannot be said that the child is entitled to the funds in the Trust. He is then entitled to the residue standing in the Trust but until then he is only entitled to the proper operation of the Trust for his benefit by the trustees. That does not entitle him to the particular sum held by the Trust from time to time, or any sum at all. He is entitled to have the Trust duly administered.
At present the funds held by the Trust are only available for his educational and other needs as identified in the orders and not available for his general support. Given the present poor income of the parents it would be in the child’s interests and for the benefit of the child if those sums could be made generally available for the child.
The evidence does not satisfy me that the husband has any need for those funds.
When the child turns 18 the trustees will hold the corpus in trust absolutely for the child. In the ordinary course, he would then be entitled to call for the payment of the funds to himself. Because of his intellectual disability that will not occur and the funds will continue to be held for his benefit, probably under the aegis of the Public Guardian. If that course eventuates the funds in the account will be held for the general welfare and benefit of the child. That will continue to be to his advantage.
These factors arising out of ss 117(4), (6) and (7) favour retaining the money in the Trust and not varying the Trust to return it to the husband. Indeed these factors support varying the terms of the Trust so as to remove the educational restriction upon the funds so they may be used generally for the child’s benefit. Very little of the remaining funds are likely to be spent on the child’s education. If they remain in the Fund, as I have said, they will become available for his general support and welfare in the circumstances outlined when he turns 18. There is no logical reason why that position should not start immediately.
It was submitted by the husband that the purpose of the orders was to provide a security for the payment of child support for which the husband remained liable whether or not there were funds in the CST to pay it. Given that the child support was said to be solely for the purpose of education and that it is likely that most of the funds will not be spent on education, it was submitted that the husband should receive the funds back, they not being required for the purpose for which they were provided.
This argument has some force until one turns to clause 22.4. Had the Trust been simply for security for such money as might be needed for educational expenses, and not otherwise, the parties could have agreed that, upon the winding up of the Trust, any residual corpus be paid to the husband or such other person as he may direct. They did not do so. They agreed it should be held for the child’s benefit.
As I have said, that is a valid purpose of the Trust.
The Trust has some unusual features, one of which is that the husband is to receive the income of the Trust. That alone indicates that the parties had given close attention to the terms of the orders and the Trust.
There is no reason to think that they did otherwise in relation to the other terms.
The clear inference for order 22.4 is that the parties had clearly thought about and considered one of the essential terms of the Trust to be the residue going to the child.
This strongly supports rejection of the husband’s submission.
The husband submitted that, as it was the expectation of the parties that the child go to a private school, that any such surplus was expected to be small and that, as he did not go to a private school and the surplus is now large, it should be returned.
Yet, as I have found, it was contemplated by the parties that the child might not attend a private secondary school at all. Order 12.3 makes that expressly clear. It must have therefore been in the contemplation of the parties, even if they did not think that it was likely, that there could be a large surplus. A surplus of some magnitude was clearly allowed for. The fact that it is now larger than the husband anticipated does not justify, of itself, amending the terms of the order so as to permit the return of the funds.
To the extent that the husband seeks to rely on his actual intention at the time, as opposed to that to be drawn from the orders themselves, that course is not permissible. Byrnes v Kendle, supra.
Accordingly I am not satisfied that it is just and equitable to modify the orders made so as to vary order 22.4.4 to return the corpus of the Trust to the husband, either now or on the termination of the trust on 31 December 2015.
It follows that it is not otherwise proper to make that order.
The question then becomes whether or not the orders should be modified so as to make more of the funds presently available for the benefit of the child prior to 31 December 2015.
I shall return to that aspect of the matter after having discussed the wife’s application for further child support.
The wife seeks an order for payment of a lump sum of $62,370 for child support (which is $594 per week for 105 weeks). This child support is to cover the period from the child resuming living with the wife pursuant to the Orders of Fowler J on 27 April 2012 to the date of the hearing. She then seeks a further sum of $50,490 (which is $594 per week for 85 weeks). This is to cover the period from the date of the hearing to 31 December 2015.
I have already referred to the needs of the child which are at present solely being provided by the wife. Both parents are presently asset rich and income poor. The husband has assets which he could marshal for the payment of this child support.
In determining this application I must have regard to s 124 of the CSAA which is as follows:
Orders for provision of child support otherwise than in form of periodic amounts paid to carer entitled to child support
(1) Where:
(a) a carer entitled to child support or a liable parent makes an application under paragraph 123(1)(a); and
(b) the court is satisfied that it would be:
(i) just and equitable as regards the child, the carer entitled to child support and the liable parent; and
(ii) otherwise proper;
to make an order that the liable parent provide child support for the child otherwise than in the form of periodic amounts paid to the carer entitled to child support;
the court may make the order.
(2) In determining the application, the court must have regard to:
(a) the administrative assessment in force in relation to the child, the carer entitled to child support and the liable parent; and
(aa) any determination in force under Part 6A (departure determinations) in relation to the child, the carer entitled to child support and the liable parent; and
(b) any order in force under Division 4 (departure orders) in relation to the child, the carer entitled to child support and the liable parent; and
(c) whether the carer entitled to child support is in receipt of an income tested pension, allowance or benefit or, if the carer entitled to child support is not in receipt of such a pension, allowance or benefit, whether the circumstances of the carer are such that, taking into account the effect of the order proposed to be made by the court, the carer would be unable to support himself or herself without an income tested pension, allowance or benefit.
(3) In determining whether it would be just and equitable as regards the child, the carer entitled to child support and the liable parent to make an order under subsection (1), the court must have regard to the matters mentioned in subsections 117(4), (6), (7), (7A) and (8).
(3A) In having regard to the earning capacity of a parent of the child under paragraph 117(4)(da), the court may determine that the parent’s earning capacity is greater than is reflected in his or her income for the purposes of this Act only if the court is satisfied as mentioned in subsection 117(7B).
(4) In determining whether it would be otherwise proper to make an order under subsection (1), the court must have regard to the matters mentioned in subsection 117(5).
(5) Subsections (2), (3), (3A) and (4) do not limit the matters to which the court may have regard.

It can be seen that, as with s 129, I am required to determine whether it is just and equitable to make the order and must do so having regard to the matters set out in s 124(3). I must also determine whether it is otherwise proper to make the order and must take into account the matters set out in s 125.
I have already discussed those matters in relation to s 125 and will not repeat them.
In Abela and Abela (1995) FLC 92-568 Nicholson CJ said at [p 81,649]
[the wife’s] asset position is such that I can see no reason why she should not assist and participate in the obligation of maintaining the children having regard to the way in which the Act is framed.
It was put on her behalf that she should not be forced into the position of depleting her capital. I can see no basis in law for drawing this distinction. Indeed, I can see great difficulties in accepting such a proposition. There are many in our community who are rich in assets but adept at producing a result whereby they disclose little or no income and it would be highly undesirable if they were able to take advantage of such machinations to deprive their children of support. I do not suggest that the wife in this case falls into that category but the principle that she contends for might produce such a result in cases of that nature.
That passage was approved by the Full Court in Christian & Donald [2004] FamCA 1171 at [66].
In those circumstances, it is not just and equitable that the wife, who is also presently asset rich and income poor, should bear all of the costs of raising the child herself.
There are two further considerations to be taken into account.
In order 18 of the 2008 orders required the parties to bear sole responsibility for the costs of the child whilst he was in their respective care. Those orders provided that the child would spend significant time with both parents.
From February 2010 until 26 April 2012 the child lived primarily with the husband. The wife did not pay any child support.
Since the return of the child to the wife in April 2012 the husband has not paid any child support.
Given that each parent appears to have had, at least, the assets available to them to contribute to the child’s child support since between February 2010 and May 2012 and since the parents have had the primary care of the child for approximately equal time during that period is not just and equitable to require the husband to pay child support for the period from April 2012 to May 2014.
This is because, in practical terms, each of the parents has contributed equally to the care and upkeep of the child over the last four years. If the order sought by the wife is made the burden would fall largely upon the husband. That is not consistent with the objects of the CSAA which are that, where appropriate, each parent should contribute to the support and maintenance of their children. Each has had the ability to do so over the last four years.
Accordingly, it is not just and equitable, and would not be proper, to make the order sought by the wife seeking child support payments up to the time of the hearing.
It remains to consider whether a child support order should be made from the present to the end of the child’s schooling next year.
Throughout that period the wife will continue to support and maintain the child. She seeks payment of slightly more than one half of the costs of the child’s support. Although there was a dispute as to whether or not the extra tuition and training sought by the wife fell within the definition of education expenses as defined by the order, it was not suggested by the husband that those expenses were not otherwise desirable or reasonable.
The view I have taken of the husband’s financial position and particularly his property interests is that it is appropriate that he contribute towards the child’s financial support. How best is that to be done?
There seem to me to be two possibilities.
The first is to make an order pursuant to s 124 as sought by the wife.
The second is to vary the terms of the Trust pursuant to s 129 to enable those payments to be made out of the Trust.
After Judgment was reserved the court sought further submissions from the parties in relation to the following:

(a)in the event that the Court determines that it has the power to amend the orders of 17 July 2008 and the terms of any trust created thereby, and

(b)in Court determines that it would be appropriate to vary the terms of the trust so as to make all or part of the funds held by the trust immediately available for [the child's] needs generally;

whether it would be appropriate:
(a) to add in Order 16:
16:11 -by way of payment of $594 per week to the mother for the support of [the child]; or

(b) to add to Order 16:
16:11 -by way of payment for the maintenance, welfare and support of [the child]; or

(c)some other order, and if so which, to enable the funds in the trust to be used immediately for [the child]'s benefit.

The parties may also wish to make submissions about the assumptions in paragraphs (a) and (b) as well.
Such submission should be in writing and are to be served and lodged by no later than close of business on 7 July 2014.

Pursuant to a request from the parties the time for providing submissions was extended to 21 July 2014.
Each of the parties provided further written submissions to the court.
The husband submitted that as the only relevant expenses of the child were some $594 per week and as the object of the CSAA is for both parties to contribute to the support of the child, the wife should contribute 50 per cent towards those costs.
Thus, it was submitted by the husband the appropriate approach was to discharge in their entirety the orders made on 17 July 2008, make a provision for the payment of a lump sum to be paid to the wife (representing approximately one half of $594 per week until the child turns 18 years of age) and to pay the balance back to the husband.
The wife asserts that the child’s reasonable expenses are $994 per week as she includes as reasonable expenses training, tuition and physical education expenses which the husband does not regard as reasonable or necessary. In addition the wife provides the child with home transport and the like which are not included in the expenses of $594 per week. Whilst minds might differ, and some obviously do, as to whether the additional expenses thought reasonable by the wife and thought not reasonable by the husband, it cannot be said that they are unreasonable expenses or that they are expenses that a parent could not reasonably incur in the interests of the child. Thus the reasonable expenses of the child are significantly more than $594 per week. In any event, even if the child’s expenses were paid for in full the wife would still be contributing to his up keep by providing a place for him to stay and the like.
Nevertheless, there is force in the husband’s submission that the intention of the CSAA is for both parents to contribute to the support of their children and that proposed amendments to the Trust should not relieve the wife entirely of her obligation to do so.
This would be a most telling submission if the terms of the Trust provided that any unused residue was to be returned to the husband when the child turned 18. That is not however a term of the Trust.
By agreeing to the orders the husband has, in effect, agreed to give the child whatever the residue might be. As I have found it is not appropriate in these circumstances to return any of the residue to the husband.
That being so, the submission of the husband carries significantly less weight than it otherwise would.
It was then submitted by the husband that it would not be just to vary the order because at [87] “The orders …. [are] …. predicated upon a particular level of expenditure for [the child’s] education”. I have found that is not the case.
It was submitted by the wife that the effect of the proposed orders would be to impose liability for the child’s support upon the wife and the child to the exclusion of any contribution by the husband, except as provided by Order 16.9.
This, it is said, is contrary to the intent of the CSAA which is to impose a duty upon both parents to maintain their children.
This submission overlooks the fact that the source of the funds in the Trust was the husband. He provided all of the funds to the Trust and that has to be seen as a significant contribution by him.
Secondly, it was submitted that the orders were contrary to the purpose for the Trust which is that the child is ultimately to receive the benefit of any capital remaining in the Trust when he turns 18 years.
This submission overlooks the fact that the funds in the Trust might properly be used for the child’s benefit until that time.
Finally, it was submitted that the order did not recognise the financial capacity of each party, including the husband, to contribute towards the child’s support. Having regard to the source of the funds and the parties’ present assets and income I do not accept that submission.
The wife submitted that in the event that the husband was removed as a trustee of the Trust the appropriate order to be made would be the order proposed in 1.22 above but modified by the addition of the words “other than as is to be provided to the parties pursuant to Order 16.9 herein”.
As the purpose of the variation of the orders is to provide funds for the child’s benefit and not to relieve the parents otherwise of their obligations, the proposed addition therefore has merit.
The Case Guardian submitted that at [7]:
In circumstances where: there is clearly still a large amount of money in the Trust; the evidence discloses that [the child] is currently being benefited by life skills type courses and assistance, as distinct from conventional subject based secondary education (for want of better description), and where there is clearly a desirability of limiting further litigation over the Trust and its terms, the Case Guardian submits that the child-support under the proposed order (ii) is more desirable than the child support under proposed order (i).
I accept that submission.
Similarly to the wife, the Case Guardian raised concerns about the proposed order if both parties remained as co-trustees. They will not and those objections therefore are no longer relevant.
Finally, again as did the wife, the Case Guardian appropriately referred to order 16.9 and suggested that any proposed modification maintain the obligations imposed by it.
I am satisfied that it is appropriate to vary the terms of the Trust by adding to order 16.11 the words “for the maintenance, welfare and support of [the child], other than as to be provided by the parties pursuant to Order 16.9 herein”.
These orders thus will see the wife continuing, at the least, to provide the capital support she has continued to provide for the child and the support she is obliged to provide under order 16.9. It is true that the Orders might enable many of the child’s expenses to be paid by the Trust. I accept that this is to her benefit. It is also to the benefit of the child. I do not see it as a detriment to the husband because he has already parted with the funds and as I have found, will not be having any surplus returned to him. Had the residue then been returnable to the husband then different considerations may well have applied.
Further, the trustees are obliged to administer the Trust for the benefit of the child, and not the benefit of the wife. Thus, no doubt, the trustees would be wary of expending funds merely to relieve the wife of supporting the child.
Accordingly I find it just and equitable to make the variation proposed.
Taking all the above matters into account it would be a proper order to make. It would see provision made for the child’s support, it takes into account the parent’s present financial circumstances and requires neither to deplete their capital.
Accordingly there will be an order that paragraph 16 of the orders be modified pursuant to s 129 of the CSAA by inserting in the clause 16 of the orders:
16.11 by way of payment for the maintenance, welfare and support of [the child] other than as to be provided by the parties pursuant to Order 16.9 herein.

SHOULD EITHER OR BOTH OF THE PARENTS BE REMOVED AS TRUSTEES OF THE TRUST

The husband seeks an order that the wife be removed as a trustee of the trust or, alternatively, the removal of both trustees.
The wife seeks the removal of the husband as a trustee of the trust or, alternatively, the removal of both trustees.
The Case Guardian submitted that the antagonism between the wife and the husband as trustees is not properly conducive to the proper administration of the Trust and consideration should be given to making orders addressing that situation. It was submitted that because the wife has the day to day care of the child she is clearly better placed to be an administrator of the Trust and thus, on balance, the husband ought to be removed as a trustee.
There is ample power under s 129 and s 141 of the CSAA to vary the orders made in 2008 to remove the trustees and to appoint new ones.
If I am wrong about the application in s 129 of the Trust under the general law the removal of trustees be governed by inherent power of the court. This Court, of itself, does not have such an inherent jurisdiction but may do so if the matter falls within the accrued jurisdiction of the court. For the reasons I gave in March 2013 the court can deal with the issue of removal of the trustee as part of this hearing, it being part of the one justiciable issue.
The principles to be applied to removal of trustees was summarised by Dixon J in Miller v Cameron (1936) 54 CLR 572 at pp 580-581 as:
The jurisdiction to remove a trustee is exercised with a view to the interests of the beneficiaries to the security of the trust property and to an efficient and satisfactory execution of the trusts and a faithful and sound exercise of the powers conferred upon the trustee. In deciding the remove a trustee the Court forms a judgment based upon considerations, possibly large in number and varied in character, which combine to show that the welfare of the beneficiaries is opposed to his continued occupation of the office. Such a judgment must be largely discretionary. A trustee is not to be removed unless circumstances exist which afford ground upon which the jurisdiction may be exercised. But in a case where enough appears to authorize the Court to act, the delicate question whether it should act and proceed to remove the trustee is one upon which the decision of a primary Judge is entitled to especial weight.
As that case shows it is not necessary to demonstrate any misapplication of funds or matters of that kind.
In his written submissions the husband said at [131]:
The Court would conclude, that if there is a trust, it is unworkable with the current trustees. If the Court intended to remove one then it would remove both and either:
131.1 appoint other trustees or
131.2 appoint a corporate trustee in their place.
Somewhat confusingly, in oral submissions, it was submitted that there was no warrant for removing the husband as a trustee as the court could not be satisfied that he was acting unreasonably and that it had not been put to him that he had acted unreasonably, vengefully, negligently or in breach of fiduciary duty. It was then reiterated that if the Trust was unworkable the Court should remove the trustees.
The wife’s submissions were, at [27]:
The position of the father, does however, result in the conclusion that his continued role as a trustee of the trust is untenable having regard inter alia to:
27.1 the historical and ongoing conflict with the mother over the proper administration of the Trust;
27.2 the patent conflict between his position in the present proceedings and his obligation as trustee;
such that he ought be replaced as trustee.
In the outline of closing submissions for the wife, it was said at [113]:
In view the acceptance in the Husband’s written outline of submissions that the trust is unworkable (at [131]) it is clear that the test for removal and substitution is satisfied, since it is neither in the interest of [the child] nor the efficient administration of the Trust for his benefit that the Father remain a trustee.
Generally speaking, since the orders were made the parties have agreed on the sums to be paid out of the Trust, although that fact ignores the often protracted and unpleasant correspondence that lead to the agreements. There has been a continuing dispute about a number of items. The husband has consistently refused to approve payments for swimming and physical education training. He has refused to pay for the mathematics tutoring of the child asserting that the tutor had not given proper invoices and had no qualifications in any event, to teach the disabled.
There was a long and continuing dispute lasting many months as to whether or not the wife had claimed the sum of $161.12 twice.
Taking those matters simply at face value, one could explain the disagreements simply as trustees taking a different view as to what was permitted by the terms of the Trust.
The extensive correspondence over minor issues itself indicates that all was not smooth sailing between the trustees.
The tone of the email exchanges is frequently personal and vindictive. Two examples, one from each parent, will suffice.
On 27 May 2013 the husband wrote to the wife:
I am so tired of reading your lies and abuse, that you seem bent on venting, apparently to justify your destructive behaviour to [the child] throughout the last case and thereafter against his entire stated wishes as fully known to you.
You do not need a court to tell you that you are a liar and perjurer, you know that from your own actions and statements. Your ability to persuade a court to the contrary do not change the facts one iota and all your denials and subversions now are just that. The truth is known by you, me and [the child] and will always be so known. Pity you had to go that far for your sub agenda and hurt him so deeply in the process
[as per original].
The following day the wife replied:
I note you make no comment relating to the lies you told in the Bankruptcy Court in 1983 when you declared you had no assets to pay your creditors and the lies in your Affidavit filed 8 August 2007 in The Family Court of Australia that clearly reveals you hid those assets in your first wife’s name yet you do not mention the AVO the police placed on you and the further AVO [the] Court placed on you in incorrect circumstances.
As you know, the police placed an immediate AVO on you as a result of your possession of unregistered firearms and ammunition. As you know, after the hearing at [the] Court, that AVO was extended for a further 2 years. Thankfully, when faced with further police action that AVO forced you to modify your behaviour to me physically. The Section 10 from … Court does not infer innocence on your part. Thankfully the police had already confiscated your weapons.
The arguments between the parents, their disagreements as to the manner in which payments should be vouched and the subsequent delays in payment did not assist the child.
In those circumstances I am satisfied that the interests of the child and the proper administration of the Trust require one or both of the parents to be removed as trustees.
What then is the appropriate order?
It is not possible from a perusal of the emails sent between the parties to determine who, if anyone indeed, is at fault. Clearly, however, they do not get on at all. Ordinarily, then, it would be appropriate to remove both trustees.
Given that the wife is the primary carer for the child there is force in the proposition that she should remain as a trustee.
I have decided that the proper administration of the Trust would be assisted, and would be seen to be assisted, by there being two entirely new trustees. Not only will the trustees be independent, they should be seen to be independent. Accordingly, there will be in due course an order that the two trustees be removed and two new trustees be appointed and that the trust property vested in them.

No particular trustee has been proposed during the hearing. It will be necessary for the parties to put forward new trustees together with affidavits of consent and fitness. Directions will be made for that purpose.

I certify that the preceding two hundred and twenty three (223) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Aldridge delivered on 11 September 2014.

Associate:

Date: 11 September 2014