Hunter v Colton

In the case of Hunter v Colton, the plaintiffs, who are the grandchildren of the deceased Rosemary Hunter, sought an inspection of the administration of the JB Colton Family Trust under Section 84C of the Trustee Act 1936. They claimed that the trustees, Alan Colton and John Powell, had failed to maintain the necessary records as required by Regulation 6 of the Trustee Regulations 1996. The Trust, established in 1971, held assets worth approximately $7.5 million in shares and $350,000 in deposits. The plaintiffs alleged that the trustees had neglected to keep proper records and that these records were missing. The defendants argued that the missing records had been reconstructed by an accountant employed by the trustees, and there were no allegations of misconduct or fraud.

The legal issues the court had to resolve were whether the plaintiffs had a proper interest in the matter and if the trustees' failure to maintain records warranted the appointment of an inspector under Section 84C of the Trustee Act. The court also had to consider whether the reconstructed records adequately addressed the deficiencies. The court examined the statutory requirements under Section 84B of the Act and Regulation 6 of the Regulations, which mandate that trustees must keep prescribed records and make them available for inspection by the Public Trustee, other trustees, or beneficiaries.

The court found that the plaintiffs had a proper interest in the matter and that the trustees' failure to keep the required records was significant enough to warrant the appointment of an inspector. Despite the defendants' argument that the missing records had been reconstructed, the court noted that the reconstructed records were not sufficient to replace the original records that should have been kept. The court concluded that the appointment of an inspector was necessary to investigate the administration of the trust and ensure compliance with the statutory requirements.

The court ordered the appointment of an inspector to investigate the administration of the JB Colton Family Trust. The inspector was tasked with examining the trustees' records, interviewing relevant parties, and reporting the findings to the Supreme Court and the Attorney-General. This decision ensures that the administration of the trust is thoroughly investigated and that the beneficiaries' interests are protected.