PARTIES: EDWARDS, Rita Stephanie v CRAWFORD, Stephanie Amy
FILE NO: 3240/2017 DELIVERED ON: 25 May 2020 DELIVERED AT: Hobart HEARING DATES: 2, 3 March; 17, 21 April 2020 JUDGMENT OF: Porter AJ
CATCHWORDS:
Equity – Trusts and trustees – Generally – Other matters – Secret trusts – Elements of a fully secret trust – Testator had five daughters including plaintiff – Testator left four equal shares of estate to plaintiff's sisters and fifth share to plaintiff's daughter – Claim by plaintiff against defendant daughter that her share held on secret trust pending plaintiff's discharge from bankruptcy – Dispute as to testator's intention – Communication of testator's alleged intention by plaintiff to defendant – Secret trust not made out.
Counsel: Plaintiff: C McKenzie, J Dunn Defendant: S Wright Solicitors: Plaintiff: McLean, McKenzie & Topfer Defendant: Stephen G Wright
Judgment Number: [2020] TASSC 20 Number of paragraphs: 145
Serial No 20/2020
File No 3240/2017
RITA STEPHANIE EDWARDS v STEPHANIE AMY CRAWFORD
REASONS FOR JUDGMENT PORTER AJ
25 May 2020
Introduction
The plaintiff is the daughter of the late Maria Mammarella (Mrs Mammarella/the testator) who died on 18 October 2014. The defendant is the daughter of the plaintiff, and so the granddaughter of the testator. By her will dated 4 April 2014 the testator left a one fifth share in her estate to each of four other daughters; the plaintiff's sisters. The remaining fifth share was left to the defendant (the share).
The plaintiff claims that the defendant had accepted that she was to hold her share on trust for the plaintiff. Accordingly, the relief claimed is a declaration that the funds received by the defendant from the estate were received on trust for the plaintiff. In the statement of claim the plaintiff seeks that declaratory relief, along with further and consequential relief, but at the trial of the action I was asked only to make the declaration. The alleged trust is said to have been a 'secret trust'. No other basis for the relief was argued.
Following the trial I reserved my decision. On 14 April 2020 the defendant sought to re-open her case to adduce evidence of an earlier will. That evidence qualified as fresh evidence but the application was opposed on other grounds. On 21 April I dismissed the application. I did so on the ground that well before 14 April I had decided the plaintiff should fail in the action, and so it was not in fact capable of affecting the outcome. In that situation, determining the application, either way, without declaring my position would have meant proceeding on a pretext or artificial basis, something with which I would have been quite uncomfortable, and which would have created…
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.
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AGLC
Edwards v Crawford [2020] TASSC 20
Case
[2020] TASSC 20
Decision Date
CaseChat Overview and Summary
Edwards, a bankrupt, sought to establish that a share of his late father's estate, which was left to his daughter, the defendant, was held on trust for him until his discharge from bankruptcy. The dispute hinged on whether a valid secret trust had been established, which would require the daughter to hold the share for Edwards during his bankruptcy. The court was tasked with determining the existence and validity of the secret trust, as well as the communication of the testator's intention to the trustee.
The primary legal issues revolved around the elements necessary to establish a fully secret trust and whether those elements were present in this case. Specifically, the court had to determine if there was clear evidence of the testator's intention to create the trust, if this intention was properly communicated to the trustee, and if the trustee accepted the trust. The court also considered the communication of the testator's intention by Edwards to his daughter, and whether such communication was sufficient to establish the trust.
The court concluded that the evidence did not support the creation of a valid secret trust. The court found that there was no clear evidence of the testator's intention to create a trust, and that any communication of this intention by Edwards to his daughter did not amount to a valid declaration of trust. The court emphasised that for a secret trust to be valid, the intention of the testator must be clearly established and communicated to the intended trustee, who must then accept the trust. In this case, the court determined that these elements were not met, and thus the secret trust was not valid.
The court dismissed Edwards' claim, finding that the share of the estate left to his daughter was not held on trust for him. The court did not make any further orders as the dismissal of the claim resolved the dispute.