Davidson v Davidson - [1991] HCATrans 128

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No Sll of 1991
B e t w e e n -
KEITH ROBERT DAVIDSON
Applicant

and
MIRIAM IRENE DAVIDSON
Respondent

Application for special
leave to appeal

MASON CJ DAWSON J GAUDRON J

Davidson

10/5/91

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 10 MAY 1991, AT 12.29 PM

MR M.D. BROUN, QC: If the Court pleases, I appear with

MR R.C.P. MATER for the applicant for leave.

(instructed by Henry David York). I have some
copies of the cases I will refer to and a couple of
pages which summarize our submissions.

MR J.W. BLACK, QC: If the Court pleases, I appear with my

learned friend, MR T.R. OSTINI-FITZGERALD, for the
respondent. (instructed by Laurence & Laurence)

MASON CJ: Did we not reject a similar invitation in

Ashton's case some years ago?

MR BROUN: Well, Your Honour, the Full Court in fact

referred to that very fact as indicating in some
way this Court's approval of Ashton.

MASON CJ:

No, the Court did not approve Ashton, but what

the Court did was to decline an invitation to take
Ashton on.

MR BROUN: That is so, Your Honour. There are big

differences in Ashton but the first matter we would
point to is that the Full Court, since Ashton, has
been developing the law of trust - the modern law
of trust, perhaps me might call it - still further
in a way which we would submit is not permissible.
But the big differences with Ashton was that the
Full Court of the Family Court there proceeded on
the basis that the trust was, in substance, a sham,
that it was in fact just the husband who had total
control of everything, total control of the assets,
benefitted himself from it and that there was no
apparently real trust being administered or never
intended since the money had, in substance, come in
a way that was his also.

MASON CJ: But is that an accurate description of what

occurred in Ashton?

MR BROUN: Well, Your Honour, the Full Court as a secondary

thing in Ashton said, in effect, exactly the same

as they have said in this case, that alternatively
to it not being a sham - in this case the court
found that the trust was not a sham, and I will
take Your Honours to that - but in Ashton the
Full Cotirt said, as an alternative to finding it is
a sham, in fact, the husband has the power to
appoint a compliant trustee who will then be able
to distribute assets to a company in which he is
the majority shareholder as long as one of the
other beneficiaries is a minority shareholder and
can then give himself, in effect, the whole of the
assets of the trust. But they put that up as what
we might call a second alternative. In this…

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 Davidson v Davidson

Details

AGLC: Davidson v Davidson [1991] HCATrans 128
Case: [1991] HCATrans 128
Decision Date

CaseChat Overview and Summary

This matter concerned an application for leave to appeal to the High Court of Australia, brought by the applicant, Keith Robert Davidson, against the respondent, Miriam Irene Davidson. The dispute arose from proceedings in the Family Court of Australia concerning the division of matrimonial assets, specifically involving a trust.

The central legal issue before the High Court was whether the Full Court of the Family Court had erred in its approach to the distribution of assets held within a trust, particularly in circumstances where the trust was found to be genuine and not a sham. The applicant's counsel argued that the Full Court had developed the law of trusts in a manner that was not permissible, drawing a comparison to a previous High Court decision in *Ashton's case*.

The applicant's submissions highlighted a key distinction between the present case and *Ashton's case*. In *Ashton's case*, the Full Court had proceeded on the basis that the trust was a sham, with the husband retaining total control. In contrast, in the present case, the Family Court found the trust to be genuine. However, the applicant's counsel pointed to an alternative finding in *Ashton's case*, where the husband had the power to appoint a compliant trustee to distribute assets to a company in which he was a majority shareholder. This alternative reasoning, which the applicant argued was similar to the approach taken in the present case, was presented as the primary basis for the Full Court's decision. The applicant contended that the Full Court's acceptance of this mechanism, even in a genuine trust, represented an impermissible development of trust law.

Orders