In the matter of Equity Trustees Limited as responsible entity of Fort Street Real Estate Capital Fund I, Fort Street Real Estate Capital Fund II and Fort Street Real Estate Capital Fund III

In the Federal Court of Australia, Equity Trustees Limited, as the responsible entity for three real estate capital funds, applied for judicial advice under section 63 of the Trustee Act 1925 (NSW). The application sought guidance on whether the entity could propound resolutions aimed at implementing a proposed trust scheme. The underlying dispute centred on the constitutionality of the proposed amendments, specifically whether they fell within the permissible scope of alteration under the Corporations Act 2001 (Cth) and section 601GC.

The court was tasked with determining two primary legal issues. First, it had to examine whether the responsible entity would be justified in proceeding with the resolutions to implement the proposed trust scheme. Second, it needed to assess whether the proposed amendments were within the constitutional powers of alteration and consistent with section 601GC of the Corporations Act. The court considered the implications of the proposed changes on the rights of unitholders and whether they adhered to the statutory framework governing managed investments.

In reaching its decision, the court meticulously reviewed the statutory provisions and relevant case law to evaluate the scope of the responsible entity's powers. The court found that the proposed amendments were within the constitutional powers of alteration and complied with the requirements of section 601GC of the Corporations Act. Consequently, the court concluded that the responsible entity would be justified in propounding the resolutions to implement the proposed trust scheme, provided that the necessary procedural requirements were met and the interests of the unitholders were adequately protected.

The final orders of the court granted the application for judicial advice, affirming that the responsible entity could proceed with the proposed resolutions. The court emphasised the importance of ensuring that all necessary disclosures were made to the unitholders and that the process complied with the relevant statutory provisions. The decision provided clarity and legal certainty for the responsible entity in managing the proposed trust scheme.