Duggan v White - [2018] NSWSC 364

Supreme Court

New South Wales

Medium Neutral Citation: Duggan v White [2018] NSWSC 364
Hearing dates: 5 March; 20 March 2018
Date of orders: 26 March 2018
Decision date: 26 March 2018
Jurisdiction: Equity
Before: Parker J
Decision:
Executors advised that no secret trust subsists over property left to two beneficiaries.

Catchwords:
EQUITY – secret trusts – where gift is “accompanied by a statement from the donor as to how the gift is to be used” – whether bequest of property to plaintiffs in will an absolute gift to plaintiffs – whether explicit understanding gift to plaintiffs was given on particular terms – no explicit understanding – no secret trust arises
EQUITY – judicial advice – Trustee Act 1925 (NSW), s 63(1) – where initial application was not for judicial advice – whether trustees entitled to costs of application for advice – Trustee Act 1925 (NSW), s 59(4) – “implied indemnity” – whether costs properly incurred by trustees on behalf of estate – where residual beneficiary of estate not a party to proceedings – no costs order where order would affect residual beneficiary by “foreclosing the question of indemnity”
Legislation Cited: Trustee Act 1925, ss 63(1), 59(4)
Cases Cited: Bective v Federal Commissioner of Taxation (1932) 47 CLR 417
Ledgerwood v Perpetual Trustee Co Ltd (1997) 41 NSWLR 532
Re Snowden [1979] Ch 528
Voges v Monaghan (1954) 94 CLR 231
Texts Cited: J D Heydon, M J Leeming, Jacobs’ Law of Trusts in Australia (LexisNexis Butterworths, 8th ed, 2016)
Category: Principal judgment
Parties: Catherine Mary Duggan (First Plaintiff)
Anne Elizabeth Duggan (Second Plaintiff)
Helen White (First Defendant)
Isabelle Duggan (Second Defendant)
Annabelle White (Third Defendant)
Ruby Duggan (Fourth Defendant)
Amelia Duggan (Fifth Defendant)
Imogen Duggan (Sixth Defendant)
Representation:
Counsel:
S Chapple (First and Second Plaintiff)

Solicitors:
Teece Hodgson & Ward Solicitors (First and Second Plaintiff)

In person:
M Duggan (Tutor for Fourth Defendant)
Submitting appearances:
Helen White (First Defendant)
Isabelle Duggan (Second Defendant)
Annabelle White (Third Defendant)
Amelia Duggan (Fifth Defendant)
Imogen Duggan (Sixth Defendant)

File Number(s): 2017/313444
Publication restriction: Nil

Judgment

These proceedings concern the estate of the late Mary Catherine Duggan who died in April 2016. For convenience, and without disrespect, I will refer to the members of the deceased’s family by their Christian names.
The deceased was married to John Malcolm Duggan, who survived her. Together they had six children: Catherine Duggan; Christopher Duggan; Anne Duggan; James Duggan; Michael Duggan; and Bernard Duggan. The deceased was survived by five of her children, but Bernard predeceased her. She was survived by thirteen grandchildren, six granddaughters and seven grandsons.
The deceased’s last will was made in December 2011. Under the will, she appointed Catherine and Christopher as her executors and trustees. After payment of her debts, legacies, funeral and testamentary expenses the deceased left her estate on trust in the following manner:

1. to her daughters, Catherine and Anne, she left an apartment property at Chepstow Street, Randwick, in equal shares as joint tenants;

2. to her daughters…

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 Duggan v White

Details

AGLC: Duggan v White [2018] NSWSC 364
Case: [2018] NSWSC 364
Decision Date: 26 March 2018

CaseChat Overview and Summary

The dispute in Duggan v White was between Duggan and White, with Duggan seeking to enforce a secret trust over certain property. The case was heard in the Supreme Court of New South Wales. The central issue before the court was whether a bequest of property to the plaintiffs in a will was an absolute gift to them, or if there was an explicit understanding that the gift was given on particular terms, thereby creating a secret trust. Additionally, the court had to determine if the trustees were entitled to costs incurred in seeking judicial advice under the Trustee Act 1925 (NSW), section 59(4), when the initial application was not for judicial advice.

The court examined the nature of the bequest in the will and the circumstances surrounding it. It concluded that there was no explicit understanding that the gift to the plaintiffs was subject to particular terms. Therefore, no secret trust arose. Furthermore, the court considered the trustees' application for costs under the Trustee Act 1925 (NSW), section 59(4), and found that the initial application was not for judicial advice. Since the residual beneficiary of the estate was not a party to the proceedings, the court determined that it was not appropriate to make a costs order that would affect the residual beneficiary by foreclosing the question of indemnity.

The Supreme Court of New South Wales ruled that the bequest to the plaintiffs was an absolute gift and that the trustees were not entitled to the costs incurred in seeking judicial advice. The court emphasised that the absence of an explicit understanding regarding the terms of the gift meant that no secret trust was established. The court also noted that the costs order could not be made as it would have the effect of prejudicing the residual beneficiary, who was not a party to the proceedings. The final orders of the court reflected these findings, ensuring that the plaintiffs' entitlement to the property was absolute, and the trustees' costs were not awarded due to the circumstances of the case.

Orders