Galvan and Galvan and Ors

In the matter of *Galvan and Galvan and Ors*, heard by Faulks DCJ, the dispute concerned the distribution of sale proceeds from a property and entitlements from a superannuation scheme. The proceedings involved Mr Galvan Snr (the Applicant), Ms Galvan Snr (the Respondent), Galvan Pty Limited as Trustee for the G Family Trust, Ms Galvan Jnr, and Mr Galvan Jnr.

The court was required to determine whether distributions made by Galvan Pty Limited as Trustee were to be set aside, and to make orders regarding the division of certain assets, including a superannuation interest and property held by the respondents Ms Galvan Jnr and Mr Galvan Jnr. A key issue was whether the Applicant, in his capacity as Director of the Trustee Company, had failed to give due consideration to the interests of the First Respondent (Ms Galvan Snr) as a beneficiary of the Trust when making distributions.

Faulks DCJ reasoned that the Applicant, as Director of the Trustee Company, had a duty to understand who the beneficiaries were and to consider distributions in their favour. The court found that the Applicant had failed to give due consideration to the First Respondent's interests, likely due to a lack of understanding that she was a beneficiary. This failure, coupled with a lack of appropriate advice, constituted an impropriety that could be remedied in equity. The court considered section 106B of the *Family Law Act 1975*, which allows for the setting aside of dispositions made to defeat existing or anticipated orders. While acknowledging a narrow interpretation might suggest the section did not apply as there were no existing orders when the first distribution was made, the court found such an interpretation would unduly restrict the remedial purpose of the section.

The court ordered that the distributions made by Galvan Pty Limited as Trustee in respect of the sale proceeds of F Street, Suburb H, ACT, be set aside. The Applicant was ordered to pay the Respondent $105,000 within 60 days. Further orders were made regarding the division of Ms Galvan Snr's entitlement from Mr Galvan Snr's interest in the Public Sector Superannuation Scheme, and declarations were made concerning the beneficial interests held by Ms Galvan Jnr and Mr Galvan Jnr in properties at I Street, Suburb J, and K Street, Suburb L, respectively. The court also noted that the Trustee of the Public Sector Superannuation Scheme had not been accorded procedural fairness and had liberty to apply in relation to those orders.