Bergade v La Provence Developments Pty Ltd

In the Supreme Court of Queensland, Daniel Bergade, the plaintiff, sought a review of certain decisions made by the trustees of the La Provence Unit Trust, with La Provence Developments Pty Ltd, the defendant, being the trustee. The Gras family, beneficiaries of the trust, initiated a summons under section 8 of the Trusts Act 1973 to challenge the trustees' decisions. The court was required to determine the appropriate allocation of costs associated with the summons. The primary legal issue was whether the costs incurred by the Gras family, who initiated the summons, should be borne by the trust fund or whether they should be liable for their own costs and the costs of the other respondents.

The court ruled that the Gras family's application did not fall within the category of being necessary for the administration of the trust. Instead, it was seen as an adversarial claim against other beneficiaries, thus placing the burden of costs on the unsuccessful party. The court determined that the Gras family should pay the trustees' costs on a solicitor and own client basis. If the trustees were unable to recover these costs from the Gras family, they could recover them from the trust assets, starting with the amounts payable to the Gras family and then from the remaining trust assets. The Gras family were also ordered to pay the costs of the other respondents, including Daniel and Viviane Bergade, Marc Perrett, SCI Le Murex, and the Navarros, on a party and party basis. The trustees' costs were to be paid from the trust fund before those of the respondents/beneficiaries.

The court's decision was based on the principle that in cases where a beneficiary brings an application that amounts to adverse litigation against other beneficiaries, the unsuccessful party bears the costs. This aligns with the approach outlined by Kekewich J in Re Buckton. The court held that the Gras family's application, while initiated to challenge the trustees' decisions, essentially amounted to litigation against other beneficiaries. Therefore, they were held liable for the costs of the successful respondents, as well as for the trustees' costs.