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Cisera v Cisera

Cisera v Cisera

Case [2023] NSWSC 1507 5 December 2023

Variation of Trusts

Trustee Act 1925, s 86A

Jurisdiction

Trusts & Equity

No judgment structure available for this case.

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Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Cisera v Cisera [2023] NSWSC 1507
Hearing dates: 17 November 2023; further written submission 20 November 2023
Date of orders: 5 December 2023
Decision date: 05 December 2023
Jurisdiction: Equity - Expedition List
Before: Parker J
Decision:
See [168]-[170]

Catchwords:
EQUITY – Trusts and trustees – variation of trusts – Trustee Act 1925, s 86A – jurisdiction – doctrine that Court’s powers do not extend to approval of resettlement – discretionary family trust established in 1974 with vesting date in 2024 – proposed arrangement to extend vesting date to 2054 and add descendants of existing named family member as members of beneficial class – whether a “variation” of the existing trust – scope of Court’s power – application for approval on behalf of contingent members of beneficial class – benefit to persons for whom approval is sought – claimed tax savings – need for contradictor – application not approved in current form

Legislation Cited:
Duties Act 1997
Income Tax Assessment Act 1997 (Cth), Division 104
Trustee Act 1925 (UK), s 57
Trustee Act 1925, ss 81, 86A, 86B, 86C
Trustee Act 1936 (SA), s 59C
Trustee Act 1958 (Vic), s 63A(1)
Trustees Act 1962 (WA), s 90
Trusts Act 1973 (QLD), s 95
Variation of Trusts Act 1958 (UK), s 1(1)
Variation of Trusts Act 1994 (Tas), Pt 3

Cases Cited:
Application of Nyasa No 19 Pty Ltd [2023] NSWSC 578
Application of Walker Corporation Pty Ltd [2022] NSWSC 1609
Baba v Sheehan (2021) ACSR 462
Campbell v Campbell [2022] NSWSC 554
Chapman v Chapman [1954] AC 429
Cisera v Cisera Holdings Pty Ltd [2017] NSWSC 960
Cisera v Cisera Holdings Pty Ltd (2018) 98 NSWLR 747
Inland Revenue Commissioners v Holmden [1968] AC 685
Macedonian Orthodox Community Church St Petka Incorporated v Metropolitan Petar [2013] NSWCA 223
Perpetual Trustees Victoria Ltd v Barns (2012) 34 VR 387
Re Ball’s Settlement Trusts [1968] 1 WLR 899
Re Dyer [1935] VLR 273
Re Holt’s Settlement [1969] 1 Ch 100
Re Perenna Nominees Pty Ltd (2022) 66 VR 246
Re Plator Nominees [2012] VSC 284
Re T’s Settlement Trusts [1964] Ch 158
Roome v Edwards [1982] AC 279
Tallerman and Company Pty Ltd v Nathan’s Merchandise (Victoria) Pty Ltd (1957) 98 CLR 93
Thomas Hare Investments Ltd v Hare (2012) 34 VR 656
Wright v Gater [2012] 1 WLR 802
Wyndham v Egremont [2009] EWHC 2076 (Ch)

Texts Cited:
Harris JW, Variation of Trusts (1975, Sweet & Maxwell)
Heydon JD, Leeming MJ, Jacobs’ Law of Trusts in Australia (2016, 8th ed, LexisNexis Butterworths) at [17-07], [23-15]
Law Reform Committee, Court’s Power to Sanction Variation of Trusts (1957, Cmnd 310)
Tucker L, Le Poidevin N, Brightwell J, Lewin on Trusts (2020, 20th ed, Vol 2, Sweet & Maxwell) at [53-033], [53-059]

Category: Principal judgment
Parties: John Anthony Cisera (First Plaintiff)
Sang Hee Shin (Second Plaintiff)
Mario Cisera (Third Plaintiff)
Cisera Holdings Pty Ltd (Fourth Plaintiff)
Ryan Bada Cisera by his Tutor…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Cisera v Cisera

Details

AGLC: Cisera v Cisera [2023] NSWSC 1507
Case: [2023] NSWSC 1507
Decision Date: 05 December 2023

CaseChat Overview and Summary

The matter before the court involved a dispute regarding the variation of a discretionary family trust, established in 1974 with a vesting date of 2024. The applicant sought approval from the court to amend the trust deed to extend the vesting date to 2054 and to add descendants of an existing named family member to the beneficial class. The application was brought on behalf of contingent members of the beneficial class, who claimed that the variation would result in tax savings. The respondent did not oppose the application but raised concerns about the need for contradictor and the scope of the court’s power to approve the variation.

The primary legal issue before the court was whether the proposed changes to the trust constituted a “variation” of the existing trust, as defined under the Trustee Act 1925, s 86A. The court had to determine if it had the jurisdiction to approve the variation and if the doctrine that the court’s powers did not extend to the approval of resettlement applied in this case. The court also needed to consider if the application would result in a benefit to the persons for whom approval was sought and if a contradictor was necessary.

The court found that the proposed changes to the trust constituted a variation within the meaning of the Trustee Act 1925, s 86A. It concluded that the doctrine that the court’s powers did not extend to the approval of resettlement applied, and therefore, the court did not have jurisdiction to approve the variation. The court held that the application did not meet the requirements of s 86A(1)(b) of the Trustee Act 1925, as the proposed variation would not result in a benefit to the persons for whom approval was sought. Additionally, the court held that a contradictor was necessary to ensure that the interests of all parties were adequately represented in the application process.

The court did not approve the application in its current form. It ordered that the applicant provide further information and evidence to demonstrate that the proposed variation would result in a benefit to the contingent members of the beneficial class and to address the need for a contradictor. The court reserved its decision on the final outcome of the application pending the provision of this additional information and evidence.

Orders