Hallani v Hallani (No 2) - [2013] NSWSC 790

Supreme Court

New South Wales

Medium Neutral Citation: Hallani v Hallani (No 2) [2013] NSWSC 790
Hearing dates: 6 June 2013
Decision date: 06 June 2013
Jurisdiction: Equity Division
Before: Lindsay J
Decision:
1. Decline to excuse the defendant's breach of trust, in whole or part, under the Trustee Act 1925 NSW, s 85.
2. Order that the defendant pay to the plaintiff the sum of $148,676.36 inclusive of interest.
3. Order that the defendant pay the plaintiff's costs.

Catchwords: Equity - Trusts and trustees - Powers, duties, rights and liabilities of trustees - Liability for beach of trust - Relief from liability - Defendant-trustee previously found to be liable for breach of trust by transferring trust money to Lebanon beyond practical control of plaintiff-beneficiary - Different view not justified by subsequent events - Breach of trust not excused.
Legislation Cited: Trustee Act 1925 NSW
Uniform Civil Procedure Rules 2005 NSW, r 28.2
Civil Procedure Act 2005 NSW
Cases Cited: Hallani v Hallani [2013] NSWSC 91
Category: Principal judgment
Parties: Lana Hallani (Plaintiff)
Fadi Hallani (Defendant)
Representation: S Brennan with J Stanton (Plaintiff)
Dr F Hallani in person (Defendant)
Morgan Ardino & Co. (Plaintiff)

File Number(s): 2011/0220787

Judgment - ex tempore

These proceedings have moved towards final orders in two stages.

The first stage culminated in the publication of reasons for judgment on 14 February 2013, reported as Hallani v Hallani [2013] NSWSC 91 ("the first judgment").

The second stage, culminating in today's judgment, concerns the question whether the defendant should, in whole or part, be granted relief under s 85 of the Trustee Act 1925 NSW against the liability for $127,834.92 that he was found in the first judgment, prima facie, to have to the plaintiff.

The marker between the first and second stages of the proceedings is an order made (under the Uniform Civil Procedure Rules 2005 NSW, r 28.2) for the separate determination of the question whether the defendant should have s 85 relief. That order is referred to in para [5] of the first judgment. The terms of s 85 are set out in para [3] of that judgment.

Since publication of the first judgment, the proceedings have been adjourned from time to time for the purpose of ascertaining whether the estate moneys found to have been misapplied by the defendant, by transfer to Lebanon between 12 and 14 July 2010 or thereabouts, can be recovered or, at least, accounted for to the satisfaction of the plaintiff.

Had the defendant been able to mediate between the plaintiff and his (the defendant's) parents with a view to re-establishing contact between the plaintiff and her sons, with a view to them being restored to her care, that might, arguably, have had a bearing on the availability of s 85 relief to the defendant.

I do not say that that would necessarily have been the case, only that it might have been a factor bearing upon an assessment of whether the defendant had acted honestly, reasonably and in…

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 Hallani v Hallani (No 2)

Details

AGLC: Hallani v Hallani (No 2) [2013] NSWSC 790
Case: [2013] NSWSC 790
Decision Date: 06 June 2013

CaseChat Overview and Summary

The parties in this case are Hallani and Hallani, and the nature of the dispute involves a breach of trust by a trustee. The court in this instance is the Federal Court of Australia. The dispute revolves around the defendant-trustee's liability for breaching the trust by transferring trust money to Lebanon, which was beyond the practical control of the plaintiff-beneficiary. The plaintiff had previously been successful in establishing the defendant's liability for the breach of trust.

The legal issues that the court was required to decide pertain to the defendant's liability for the breach of trust and whether the breach could be excused by subsequent events. The court had to determine if the defendant's actions constituted a breach of trust and if the breach could be excused by any subsequent events. The court also had to consider whether the defendant's liability for the breach of trust could be relieved.

The court's reasoning and outcome were that the defendant's liability for the breach of trust could not be excused by subsequent events. The court found that the defendant had breached the trust by transferring trust money to Lebanon, which was beyond the practical control of the plaintiff-beneficiary. The court held that the defendant's actions constituted a breach of trust, and the breach could not be excused by any subsequent events. The court also found that the defendant's liability for the breach of trust could not be relieved.

In conclusion, the court found that the defendant-trustee was liable for the breach of trust by transferring trust money to Lebanon beyond the practical control of the plaintiff-beneficiary. The court held that the breach of trust could not be excused by subsequent events and that the defendant's liability for the breach of trust could not be relieved. The final orders of the court were not explicitly stated in the judgment.

Orders