JPD as Guardian v DMS as Trustee - [2022] QSC 181

SUPREME COURT OF QUEENSLAND

CITATION:

JPD as Guardian v DMS as Trustee [2022] QSC 181

PARTIES:

REDACTED

FILE NO/S:
161 of 2022

211 of 2022

DIVISION:

Trial

PROCEEDING:

Application

ORIGINATING COURT:
Supreme Court of Queensland at Cairns

DELIVERED ON:

30 August 2022

DELIVERED AT:

Cairns

HEARING DATES:

1 August 2022, 2 August 2022

JUDGE:

Henry J

ORDERS:

1.     The application in matter 211/22 is dismissed.

2.     The application in matter 161/22 to remove the existing trustee and executor and in substitution appoint Renee Anne Bennett is granted on the terms ordered in order 6 hereof.

3.     I will hear the parties as to costs at 9am 2 September 2022.

4.     The part of this decision’s reasons identifying the parties in the coversheet and the content of order 6 hereof be redacted in any publication of these reasons and orders, except for their publication between or to the parties, Renee Anne Bennett and a Court and for the purpose of Renee Anne Bennett assuming and performing her role as administrator and trustee.

5.     Liberty to apply on the giving of two business days notice in writing.

REDACTED

REDACTED

CATCHWORDS:

EQUITY – TRUSTS AND TRUSTEES – APPOINTMENT, REMOVAL AND ESTATE OF TRUSTEES – RETIREMENT AND REMOVAL – REMOVAL BY THE COURT – GROUNDS FOR REMOVAL – where the father of the beneficiary children applies for the removal of the trustee under s 80 Trusts Act 1973 (Qld) – where the trustee has made decisions prioritising the children’s wealth in adulthood – where the trustee has breached her undertaking to provide quarterly financial statements of the trust – where the father is not consulted on important trust decisions bearing upon the children’s welfare – where the trustee has made decisions in an attempt to conform to the wishes of the dead mother – where the trustee has attempted to impose a move on the family to a smaller residence also owned by the trust – where the father of the children does not earn working income – where the father sought money from the trust to fund a move to Brisbane from Cairns – where this proposal was rejected – whether it is expedient for the court to interfere – whether the welfare of the beneficiaries is opposed to the trustee’s continuation of office

EQUITY – TRUSTS AND TRUSTEES – APPLICATIONS TO COURT FOR ADVICE AND AUTHORITY – PETITION OR SUMMONS FOR ADVICE – GENERALLY – where the trustee made a decision to require the family to vacate the premises they were living at the time which the trust owns – where the trustee made a decision to refuse to fund a proposed move to Brisbane – where the trustee seeks directions under s 96 Trusts Act 1973 (Qld) in respect of whether the two decisions made were justified – where the application to the court was made after the decisions were made – whether such an order can be made – whether there is any utility in making such orders – whether s 96’s pre-requisite of a written statement of facts was met

Succession Act 1981 (Qld) s 6
Trusts Act 1973 (Qld) ss 80, 82, 90, 96, 97

Ainsworth v Criminal Justice Commission (1992) 175 CLR 564, cited
Elovalis v Elovalis [2008] WASCA 141, cited
Finch v Telstra Super Pty Ltd (2010) 242 CLR 254, cited
Harrison v Mills [1976] 1 NSWLR 42, cited
Hartigan Nominess P/L v Rydge (1992) 29 NSWLR 405, cited
Kordamentha Pty Ltd & Anor v LM Investment Management Limited & Anor [2015] QSC 4, distinguished
Macedonian Church v Eminence Petar (2008) 237 CLR 66, cited
Miller v Cameron (1936) 54 CLR 572, applied
Neagle v Rimmington [2002] 3 NZLR 826, cited
Nofz as executor of the estate of Henry Matthew Fitzgerald (dec) v Kane & Ors [2015] QSC 372, distinguished
Noosa Shire Council v TM Burke Estates Pty Ltd [2000] 1 Qd R 398, cited
Re Whitehouse [1982] Qd R 196, considered
Sneath & Anor v Sneath & Ors [2014] QSC 152, distinguished
SZBYR v Minister for Immigration and Citizenship (2007) 235 ALR 609, cited
Titterton v Oates (1998) 143 FLR 467, cited

COUNSEL:
C Ryall with J Seccull for the applicant in matter 161/22 and for the respondents in matter 211/22

D de Jersey QC for the respondents in matter 161/22 and for the applicants in matter 211/22

SOLICITORS:
The Will and All for the applicant in matter 161/22 and for the respondents in matter 211/22

MacDonnells Law for the respondents in matter 161/22 and for the applicants in matter 211/22

A trustee of several related trusts and the father of the trusts’ four child beneficiaries are in dispute. The children live with the father, their sole living parent and litigation guardian. The trustee was a good friend of the children’s deceased mother, who divorced from their father and effectively left her estate on trust for the children.
The trustee has a low opinion of the father, who has no wealth and is not in paid employment. She places no genuine weight on the importance of his position in the children’s lives and does not try to consult him adequately. She sees herself as righteously pursuing a protective influence over the children’s lives on behalf of the children’s dead mother. The well-intentioned result is conduct which overlooks the importance to the children’s present and future interests of them being raised in a family with a secure sense of its own autonomy.
Matters have reached the extraordinary point that the trustee has used her control of the trust fund to effectively control what city the family should live in, contrary to its wishes. The court’s intervention is required.
Relief sought
The primary application before this court, matter 161/22, was brought by the father on 22 March 2022. It seeks the removal of the trustee as executor and various consequential orders which would also see her removed as trustee and be replaced in all her relevant capacities by a solicitor appointed by the Court to act as administrator and trustee. For the reasons which follow, that application should be granted.
On 13 April 2022 the trustee filed a cross-application in matter 211/22 by which she seeks “directions in respect to” whether two decisions she made during 2021 “is justified”. The cross-application was misconceived and should be summarily dismissed. To avoid distraction, reasons for that conclusion will be given after these reasons deal with the primary application.
To remove doubt, the affidavits read in both applications were treated by the parties as cross-admissible at the hearing and accordingly the affidavits read in the cross-application will also be regarded as evidence in the primary application.[1]
[1]See, eg, T1-4 L38.
Brief background to the primary application
The children’s mother died of cancer on 28 August 2017. She was survived by her four children and their father. The children’s present ages and the initials by which these reasons will refer to them are: R 16 years, L 12 years, Sn 12 years and Sa 11 years. L and Sn are twins.
The mother and the father were married for many years but had divorced and reached a financial agreement by the time of her death.
The mother’s will bequeathed her property to be held on trust pursuant to a discretionary testamentary trust under which the children are the primary beneficiaries. The will had the effect of allowing the creation in due course of a minors’ trust fund to hold the mother’s superannuation benefits on trust for the children as beneficiaries.
The will appointed two people as both executors and trustees: the children’s aunt and the mother’s close friend. The aunt renounced in August 2018. The mother’s friend remains the sole executor and the sole trustee of both the trusts. As executor she is the sole shareholder and a director of a company trustee for a trust of the mother’s (the visionary trust) which owns units in an investment unit trust. The children and any trust in which they have an interest are beneficiaries of the visionary trust.
One of the testamentary trust’s assets is a five-bedroom residential property at Cultivation Close, Edmonton. It was the mother’s home prior to her death. She and the father had shared custody of the children who, when in the mother’s care, also lived at the Cultivation Close residence. After the mother’s death the children lived in rental premises with their father. There was a dispute in connection with a financial contribution a relative of the mother had made to the purchase of the Cultivation Close residence. That dispute was eventually resolved and the children returned to live at the property with their father.
In addition to consolidating ownership of the mother’s home at Cultivation Close by 15 June 2018, the trust also acquired two residential properties in Bentley Park, at Fitzmaurice Drive and Whela Close, in 2020.
There have been various legal disputes between the father and the trustee.
On 23 November 2017 the father filed a caveat against the grant of probate, which initially resulted in the making of limited administration orders. In February 2018 the father also issued proceedings as the children’s litigation guardian, seeking further provision for them from the estate. That proceeding appears to have been prompted, at least in part, by uncertainty in the wording of the testamentary trust deed annexed to the will about the paramountcy of the children’s interest as beneficiaries. It culminated in a mediation, and, in turn, a deed of settlement dated 22 January 2019, by which it was agreed probate would be granted and that in the absence of a good and valid reason the trustee would treat the beneficiaries equally when exercising discretion under the testamentary trust deed and would not remove beneficiaries or appoint new ones. The settlement terms included the trustee undertaking to provide financial information as part of the deed of settlement. She did not comply with that undertaking.
A dispute also arose between the trustee and the father from September 2018 about whether the mother’s superannuation fund payout should be made to her or him as trustee for the children. At first the fund administrators had determined the payout should be to the father as trustee for the children but the trustee objected on grounds including what was described as the father’s “history of financial mismanagement and ineptitude”. That description was supported, in a schedule sent to the fund administrator, by particulars of alleged non-compliance by the father in his profession of accountant with the professional obligations of chartered accountants and with corporation and tax law, the failure of one of his companies to pay rent and his alleged misuse of monies. The fund administrator then reversed its decision in the trustee’s favour. The father lodged an objection but it was withdrawn as part of the deed of settlement arrived at in the aforementioned mediation.[2]
[2]Matter 161/22 Court doc 10 Ex 36.
There was also a custody proceeding instituted by the children’s aunt in the Federal Circuit Court of Australia, in which the trustee was an intervenor. That proceeding culminated in consent orders on 14 September 2020 with it being ordered that the father “have sole parental responsibility for the children” and that the children “shall live with the father”. That outcome reflected the status quo, the father having had custody of the children, living together with them as a family since their mother’s death. Orders were also made allowing some contact by the trustee with the beneficiaries.
The occupancy of the five-bedroom Cultivation Close residence by the family was pursuant to a lease by which the trustee leased the property rent free to the father and the children for a fixed term commencing 14 July 2018, ending 13 July 2021. The trustee informed the father, via a letter from her solicitor of 9 July 2021, that the lease would not be renewed, that the family would need to vacate by 10 December 2021 and that the four-bedroom residential property at Whela Close had been acquired by the trust with a view to the father and the children residing there. A formal notice to leave by 10 December 2021 was not complied with.
On 12 November 2021, the father advised the trustee by letter from his solicitor to hers that he and the children were to relocate to Brisbane for the start of the 2022 school term and sought financial assistance for the children to live and be educated in Brisbane. On 29 November 2021 the trustee refused that assistance by a letter from her solicitor to the father’s solicitor. Because of the father’s lack of material independent resources this refusal (the Brisbane refusal) had the practical effect that the family could not live in Brisbane as it wished.
On 15 December 2021 the trustee commenced proceedings in the Queensland Civil and Administrative Tribunal against the family, applying for an order requiring them to leave Cultivation Close. That application was dismissed on 7 February 2022.
In the meantime, by letter dated 22 December 2021 from the father’s solicitor to the trustee’s solicitor the trustee was given further information about the desirability of the family’s move to Brisbane to live and was asked to re-consider her decision of 29 November 2021. There was no response to that aspect of the letter.
The nature of relief sought and the issues bearing upon it
The father seeks orders having the effect of an independent solicitor, Ms Bennett, replacing the trustee as trustee of the testamentary and minors’ trusts and executor. The suitability of Ms Bennett to serve as trustee and executor has not been placed in issue. Further, it is not in issue that the practicalities of the trustee’s removal and replacement as trustee would be most conveniently accommodated by a like change with the executor being replaced by an administrator in exercise of the court’s power in s 6 Succession Act 1981 (Qld), there being no suggestion of any need for the present trustee to remain as executor for some purpose unconnected with her role as trustee. The form of orders proposed to implement her removal as trustee and executor and substitution by Ms Bennett are uncontroversial and should be made if the trustee is to be removed. The determinative question is whether she should be removed.
The power of courts of equity to remove a trustee when expedient to do so is now found in s 80 Trusts Act 1973 (Qld) which relevantly provides:
“80 Power of court to appoint new trustees
(1) The court may, whenever it is expedient to appoint a new trustee or new trustees, and it is found inexpedient, difficult or impracticable to do so without the assistance of the court, make an order appointing a new trustee or new trustees either in substitution for or in addition to any existing trustee or trustees ...
(2) In particular and without prejudice to the generality of subsection (1) the court may make an order appointing a new trustee in substitution for a trustee … who for any … reason whatsoever appears to the court to be undesirable as a trustee.”
Section 80 does not proscribe the reasons which may render it undesirable for a trustee to continue. The decision whether a trustee should continue in office inevitably involves a differently focussed inquiry than is required when, pursuant to s 8 Trusts Act, the court is asked to review a particular act or decision of the trustee. The jurisdiction conferred by s 80 is remedial, not punitive and does not require bad faith, misconduct or breach of trust to be established.[3]
[3]Elovalis v Elovalis [2008] WASCA 141 [30], [40].
Nonetheless, the starting position is that there must exist good reason to intervene. On this point Macrossan J observed in Re Whitehouse:[4]
“There must be a proper justification for any relief which is granted, since the trust is entitled to independence from unwarranted interference by the courts, just as the discretion is exercisable under the trust at the discretions of the trustee appointed under it and not of anyone else.”[5]
[4][1982] Qd R 196.
[5][1982] Qd R 196, 200.
To those observations it should be added that the need for good reason is especially important where, as here, the trustee targeted for removal was settlor appointed and where the proposed replacement trustee will charge for performing the role whereas the targeted trustee does not so charge. Put another way, the settlor’s wishes as to who should be entrusted with the trustee role and the potential financial impost on trust funds occasioned by the court’s interference are material considerations in weighing whether the court’s interference is justified.
The father’s counsel highlighted the mother’s wishes were that there be two trustees and that wish has already been thwarted by the resignation of one of them – the aunt. Nonetheless, it remains that the existing trustee was a trustee chosen by the mother and that is a consideration to which weight should be given in assessing whether the court’s intervention is justified.
The trustee in the present case has been entrusted with an absolute discretion, which is hers to exercise. The trust documents do not use language which confine the breadth of the discretion beyond the ordinary requirement, characteristic of trusts generally, that the discretion to apply the trust funds is exercised for “the benefit” of the beneficiaries.[6] That requirement does not impose a general obligation on a trustee to consult beneficiaries or their guardians, to ascertain their views.[7] However, the trustee’s broad discretion must be exercised in a proper way, by reference to proper considerations,[8] so that in some cases consultation may be appropriate in order to give proper consideration to what is for the benefit of the beneficiaries.[9] As will be seen, this is such a case.
[6]See, eg, Matter 161/22 Court doc 3 Ex JPD1 at p 12 [5.1] and the broad power relating to maintenance and advancement at pp 19-20 [2.1].
[7]Hartigan Nominess P/L v Rydge (1992) 29 NSWLR 405, 431.
[8]Hartigan Nominess P/L v Rydge (1992) 29 NSWLR 405, 427.
[9]See, for example, the reasoning relating to superannuation trustees in Finch v Telstra Super Pty Ltd (2010) 242 CLR 254, 280-281.
In determining whether intervention is justified in an application of this kind the guiding consideration will be the welfare of the beneficiaries.[10] The proper approach was explained by Dixon J in Miller v Cameron[11] as follows:
“In deciding to remove a trustee the court forms a judgment based upon considerations, possibly large in number and varied in character, which combine to show that the welfare of the beneficiaries is opposed to his continued occupation of the office. Such a judgment must be largely discretionary. A trustee is not to be removed unless circumstances exist which afford ground upon which the jurisdiction may be exercised. But in the case where enough appears to authorise the court to act, the delicate question whether it should act and proceed to remove the trustee is one upon which the decision of a primary judge is entitled to especial weight.”[12] (emphasis added)
[10]Letterstedt v Broers (1884) 9 AC 371, 387.
[11](1936) 54 CLR 572.
[12](1936) 54 CLR 572, 580-581.
It follows that a trustee’s past conduct may be so concerning as to give good reason to intervene but, in considering whether the court should intervene, the issue is whether the future welfare of the beneficiaries is opposed to the trustee continuing.
In the present case, the father complains that in her pattern of behaviour the trustee has had insufficient regard to the welfare of the beneficiaries in the contemporary context of them being raised together as a family by him. Various criticisms were alleged of her conduct. Some were so neutral or inconsequential as to require no material attention. Those of apparently relevant substance in summary amount to an alleged dual pattern of:
·lack of respect for the importance of the father’s position in the children’s lives, and
·disinterest in genuinely attempting to consult him about major decisions bearing upon the children’s contemporary welfare.
The nub of the father’s case is that such a pattern had emerged in the trustee’s conduct by the time of the Brisbane refusal and infected the manner of that refusal, demonstrating the children’s welfare is opposed to her continued occupation of the office.

The trustee contends the Brisbane decision was readily justifiable and that she has administered the trust with proper regard to the children’s welfare, behaving consultatively towards the father, despite him tending to be unresponsive towards her. If there was some shortcoming in her approach it is contended the circumstances do not warrant this court interfering to replace her.
In considering whether there is factual substance to the alleged dual pattern of conduct by the trustee and how it culminated in the manner of the Brisbane refusal it is convenient to marshal the analysis under these overlapping topics:
·allegiance to the mother’s priority on the children’s wealth in adulthood;
·the breach of the undertaking to provide quarterly financial statements;
·not respecting the importance of the father’s position in the children’s lives;
·lack of consultation of the father;
·trying to impose a move out of Cultivation Close to Whela Close;
·the Brisbane refusal.
Discussion of the first two topics gives relevant context to the following two, which in turn coalesce in their relevance to the final two topics.
Allegiance to the mother’s priority on the children’s wealth in adulthood
The mother’s will annexed the terms of the testamentary trust, wherein the four children were identified as primary beneficiaries. Their children were in turn identified as secondary beneficiaries and any other of their lineal descendants were identified as tertiary beneficiaries. The terms also contemplated the trust could last for 80 years. That, and the inclusion of references to the secondary and tertiary beneficiaries, reflects an optimistic view of the future scale of the trust fund and of the likely financial needs of the primary beneficiaries during their minority.
The trustee’s accounts of her conversations with the mother show the mother had hoped the father would fund their children’s upbringing and that by the time they were adults the trust could afford to give one house each to each child. The trustee has retained a zealous allegiance to the wishes of her dead friend, particularly the aspiration of one house each for each child in adulthood.
The mother’s hope that the father would fund the children’s upbringing, helping preserve funds to later fulfill her one house each for each child in adulthood aspiration, was misplaced. The evidence shows the father has no substantial assets or income. He has not been in paid employment for some years. He evidently used to manage his wife’s accountancy practice, which was transferred to him as part of the property settlement. That seems not to have had a successful financial outcome for him. In any event, he ceased work as an accountant because of issues with depression and anxiety, which were heightened by the marital breakdown and resurgent following the death of the mother. The evidence does not expressly identify to what if any degree those issues persist, but it is not suggested they interfere with his parental competence.
The father deposes he does not intend to resume his career while bringing up the children. That is a choice many parents make in what they assess are the best interests of their children. No criticism is made of his parental choice in these proceedings but that choice is obviously very disappointing to the trustee in her pursuit of the mother’s wishes. Her opinion is that the father should have returned to paid work.[13]
[13]T1-41 L27.
The father is not said to have material assets and relies upon Centrelink payments. If he is left to raise the children without the financial assistance of the trust it is obvious that, for the balance of their important formative years, the children will reside in housing and receive a level of economic support in their education and day-to-day living which would be grossly inferior to that which the trust can readily provide.
The welfare of the children as a consideration in administering the trusts does not fall to be assessed in a vacuum. Relevant considerations obviously include the substantial value of assets held on trust for them, relative to the father’s poor financial capacity, and the well-known importance of raising properly educated children in a secure, nurturing home environment. Whatever the mother’s hopes may have been it cannot be doubted, had she known the father would not resume gainful employment, that she would have wanted her substantial assets to be administered to fund a more comfortable upbringing for the children than the father can afford.
Having regard to the significant value of trust assets held for the children’s benefit and the father’s poor financial situation, the welfare of the children requires that the trustee contribute trust assets to substantially fund the provision of a family home for them and substantially fund the costs of their day-to-day living and education. As much is not in dispute, for that is what the trustee has purported to do.[14] That is as it should be, for a trustee must not merely give effect, without more, to the wishes of the settlor and must consider the instant exercise of the power, which is for the trustee to decide to make.[15]
[14]I say “purported” because her decision-making about the extent and nature of the funding provided has not always been consultative of the father.
[15] Hartigan Nominees Pty Ltd v Rydge (1992) 29 NSWLR 405, 427.
A dynamic underlying this case is that the need for provision of funding for the children’s welfare in childhood, makes it more challenging for the trustee to pursue the priority their mother wished placed on their wealth in adulthood – a situation the trustee resentfully attributes to what she sees as the father’s failure to return to work. It was likely an influential dynamic in the genesis of the trustee’s dual pattern, discussed hereunder, of lack of respect for the importance of the father’s position in the children’s lives and disinterest in genuinely attempting to consult him about major decisions bearing upon the children’s contemporary welfare.
The trustee deposed to having had various meetings with financial advisors Findex Advice Services Pty Ltd (Findex) from 21 November 2019 and has exhibited various records of that process, including advice given. Findex’s advice to her of 13 December 2019 recommended the testamentary trust maintain a cash reserve and invest in management investment accounts. By the time of the trustee’s meeting with Findex in early May 2020 the collective trust assets and values were said to be:
Family home (Cultivation Close)  $ 780,000
NAB working account  $        503
NAB bank account  $ 387,230
NAB term deposit  $ 332,378
Estate bank account  $ 389,295
Abbott Street Commercial Property Trust (the visionary trust)    $1,032,070
Encircle account  $ 441,405
Total  $3,362,881
The trustee’s notes recorded that the potential estimated income from the Abbott Street Commercial Property Trust of about $75,000 per annum was not being received because the property was not tenanted. Her notes for the meeting included a handwritten reference to the idea of “buy some houses to get income in”.[16]
[16]Matter 161/22 Court doc 10 Ex DMS56.
The ensuing record of advice by Findex of 8 May 2020 recommended no investment changes to the existing investment portfolio.[17] Between then and the next meeting with Findex on 23 September 2020 the trustee, applying her own financial judgment, purchased the Fitzmaurice Drive property for $440,000 on 24 July 2020 and the Whela Close property for $390,000 on 11 August 2020.
[17]Matter 161/22 Court doc 10 Ex DMS57.
To raise the total purchase monies of $830,000 she apparently depleted nearly all of the NAB account funds and about half the estate bank account funds. In the interim she had also reduced what had hitherto been a pattern of paying $600 a week for the children’s living expenses down to $600 a month.
Of that reduction, which seemingly occurred after May 2020, the trustee deposes:
“Until approximately May 2020, the trusts contributed $600 per week for living expenses. This regular transaction came up for review in May 2020 and I undertook a review. I considered the costs of groceries for the 4 children, which I estimated to be approximately $300/week based on my shopping for them when they visited me. I was aware the Centrelink payments had increased due to COVID subsidies. I decided to reduce the allowance to $600/month having regard to these matters.”[18]
[18]Matter 161/22 Court doc 10 [170].
What the trustee means by the transaction coming up for review is unclear. In any event it was not something she reviewed with the father. This was simply a unilateral decision by her. The lawyer then acting for the father, in the yet to be completed custody proceeding, queried the reduction and, in response, the trustee’s solicitor replied by letter of 21 August 2020 asserting:
“The payment of $600 per week had been put in place during the difficult period following [the mother’s] passing to assist in necessary transitions and adjustments for the family. Our client has now determined that it is appropriate to reduce this discretionary payment to $600 per month. This level of support is considered reasonable having regard to the following matters:
1.   The trust provides considerable additional financial support for the … children including:
(a)the provision of the home at Cultivation Close for the family to reside in, including payment of rates, pool maintenance and insurance; and
(b)payment of the following direct expenses:
(i)school fees of approximately $450 a month;
(ii)health insurance of approximately $400 a month;
(iii)ASG scholarship fees of $1,000 a month; and
(iv)counselling of approximately $1,500 per month, based on $190/session and two sessions per child per month.
(c)     purchases of clothing and footwear from time to time.
2.   The reasonable expectation that your client will also provide financial support for the children and their expenses. Our client considers that a contribution from the Trust of the above payments and the further discretionary payment of $600 per month is reasonable and that any further expenses should be met by your client.”[19]
[19]Matter 161/22 Court doc 10 Ex DMS88.
It is noteworthy the letter’s explanation made no mention of explanations now advanced about there having been a COVID subsidy related Centrelink increase or about the trustee’s estimate of likely grocery costs in a household of which she was not a member. Neither explanation explains why a change of such magnitude had not occurred gradually. The change represented a reduction in annual terms from a total of $31,200 to a total of $7,200, a variation of $24,000. If the explanation for the reduction advanced in the solicitor’s letter, namely that the much larger payments were necessary to assist in transitions and adjustments following the death of the mother, it is difficult to understand why there would not have been a graduated adjustment in the weekly payment over time as the post death transitions and adjustments dissipated. Instead, there was a sudden drop to a pattern of paying less than one-quarter of the previous pattern of payment for living expenses.
The letter of 21 August 2020 went on to indicate the trustee would consider any request made for additional funding provided sufficient information was provided. The trustee deposes there was no response to the solicitor’s letter and that she received no request for an increased allowance directly from the father, adding this self-serving commentary:
“As part of my prudent management of the trusts I considered it necessary to have relevant information to support any request for increased payment, including details of other sources of financial support for the children. This included details of their financial support available from [the father]. I considered this information to be relevant to my reasonable assessment of any increase to living allowances.”[20]
That rather obscures the reality that she had imprudently failed to consult the father in the first place, before her decision to make the dramatic reduction in the previous pattern of living expense payments – payments she presumably had previously assessed were prudent. Remarkably the trustee’s affidavit subsequently refers to the fact she increased the allowance in the month the primary application was filed but did so without any request from the father, which is at odds with her above quoted commentary about prudence requiring the father to supply information before she assessed an increase to the payment.[21]
[20]Matter 161/22 Court doc 10 [173].
[21]Matter 161/22 Court doc 10 [174].
The decision to lurch to paying less than a quarter of what had previously been paid towards the children’s living expenses must have been motivated by considerations other than the children’s then welfare, for there had been no consultation of the adult uniquely placed to know the children’s living expense needs, their father. This is not to suggest it might not have been appropriate for the trustee to have reduced the children’s living expenses after consulting the father. Indeed, the father does not mount a case that there has been inadequate funding and rather takes the position that he prefers to meet shortfalls himself rather than submit to requesting funding and being lectured about not having a job.[22] The point about the sudden, major reduction in living expenses is that the absence of consultation meant the current welfare of the children was not the subject of properly informed consideration before reaching the decision.
[22]T1-32 LL20-27.
The decision had the consequence that substantially less trust assets would be expended on the children in the short term, helping to preserve and grow trust asset value in the long term, something the trustee plainly rated as important in pursuing the mother’s wishes. The decision to make such a major reduction without consultation suggests that, as with the Cairns real estate acquisitions of the same year, the children’s wealth in adulthood was a causally influential consideration in the decision.
It is uncontroversial that, at least initially, the real estate acquisitions of 2020 were financially beneficial acquisitions for the trust. Their value increased during the era of substantial growth in Australian house prices of recent years. In the meantime, they helpfully provided rental income. Such income was important in the context of an investment strategy which had so markedly reduced the trust’s cash holdings. However, the Whela Close property fell vacant and thus earned no income from May 2021. The trustee did not re-let the property because her plan was that Whela Close would be provided to accommodate the children and their father, who would have to move from their family home at Cultivation Close because she would sell it to raise funds to buy two more houses.
Evidence that this was her plan appears in Findex’s review meeting notes of the meeting of 18 October 2021. The notes record the following comment against the asset described as “family home – Cultivation Close”:
“This will be sold with funds to be invested. The lease expired on this in July 2021. You will then move the family to … Whela Street. Given six months notice so the children will not have to relocate during school term. When this is sold [the trustee] will look at buying two properties. She wants to try and provide a house for each child if possible. This was a request of [the mother]. May need to invest $50k-100k to bring it back to its former condition. Purchased for $890k. Current market has potential to get above $1.1. Real estate advised this could go higher. There is a current market scarcity for a property with acreage. The house has a separate four-bay shed, outdoor cabana and pool as well as a stable for one-two horses.”[23] (emphasis added)
[23]Matter 161/22 Court doc 10 Ex DMS65.
The notes’ ensuing comment against the asset of Whela Close recorded the trustee’s intention for there to be a seven-year lease for the family to reside at the property, which would see the youngest child through to completion of high school. Later in the same document there was a comment against the Encircle account asset then valued at $544,700 with an income of $36,014 to this effect:
“You previously advised you don’t want to touch these funds for 10 years.”[24]
Such evidence further illustrates the emphasis the trustee placed upon building wealth for the beneficiaries in adulthood.
[24]Matter 161/22 Court doc 10 Ex DMS65.
The document noted a total income of $66,064 and total expenses of $67,066, a shortfall of $1,002. Obviously, the trust’s financial capacity to more comfortably absorb the trustee’s purchase of the Whela Close and Fitzmaurice Street properties depended upon removing the children and the father from their family home at Cultivation Close to Whela Close.
In the present proceeding, the trustee represented that she is not firmly committed to the one house each for each child in adulthood aspiration. I reject that. Evidence of her words to others, including the above evidence of what she told Findex, exposed she is firmly committed to that aspiration. The evidence also exposed her resentment of the father for jeopardising that aspiration by not returning to paid employment. For example:
·In an email to the father in early September 2018 the trustee told him of how the testatrix said she wanted to buy each child a house but knew there would not be enough money. The email went on to refer to a variety of adverse comments other people had made to her about him and his poor past financial conduct in explanation of why she would not relent and allow him to “be in control of the money”. The email went on to say:
“All believe you should be working and contributing to the household. If I have to (sic) sacrificed all of my personal and much business life in the past for four years for [the mother]. She gave her life. I’m not about to give up her fight now.”[25]
[25]Matter 161/22 Court doc 3 Ex JPD14.
These are telling comments, revealing the trustee’s dim view of the father for not earning a living and her passionate view of the pursuit of the mother’s wishes as a “fight” not be given up.
·In an email to the father of 16 January 2019 the trustee wrote:
“You would be aware, as I and others do, [the mother] never intended for her estate to be used for raising the children. She wanted the major part of the estate left for the children to inherent (sic) as young adults. In her words “I have paid for everything, it is his turn to start paying”.”[26]
Such language further evidences the trustee’s loyalty to the mother’s hope the father would pay to raise the children so trust assets would be preserved for the children in adulthood.
·In the latter half of 2021 the trustee conversed with the four children when driving past houses in Cairns. The conversation was recorded. It caught the trustee out telling the children they would have a house each. The recording was unattractive listening and the trustee’s testimony in explanation of it unconvincing.[27] It included the following:
“So that’s the house I bought for [R], and I’m now going to show you the house [L] that I bought for you. … When I sell Cultivation Close, I’ll buy two more homes exactly the same, one for [Sn] and one for [Sa], and that was what your mum wanted. Your mum wanted your dad to go and get a job and start paying and contributing towards raising you children, and that hasn’t happened. Mum’s money in the estate’s been paying for your medical, your school fees, your scholarship fees, it pays for everything, as well as I put money in an account each week for food, and that’s the truth and when youse are old enough, you’ll know a lot more truth as well, but I’m not going to talk badly about your father the way he talks about me, when it’s not the truth, it’s all lies, and I’m really really upset and disappointed that he would put his own selfishness before you children, ‘cause that’s what it is.”[28]
[26]Matter 161/22 Court doc 3 Ex JPD15.
[27]T1-39.
[28]Matter 161/22 Court doc 3 Ex JPD11.

During that recorded conversation, the trustee did more than again affirm her continuing plan to implement the mother’s aspiration of one house for each child in adulthood. In saying she was “not going to talk badly about” the father to his own children the trustee seems to have overlooked she was doing just that. Denigrating the father to his children in the way she did suggests the trustee’s low respect for the father as a person has infected her respect for the significance of the position he holds vis-à-vis the children and their family unit. In any event, whatever the reason for it, this is not the only conduct of the trustee which demonstrates she does not accord genuine weight to the importance of the father’s position in the children’s lives.
The breach of the undertaking to provide quarterly financial statements
It will be recalled that, as part of the 22 January 2019 deed of settlement of the further provision proceeding, the trustee undertook to provide financial information. That undertaking was to provide quarterly financial statements in the form of an unaudited statement of cash flows and balance sheets to the father within 21 days of the end of each quarter.
The trustee failed to comply with that undertaking in any of the ensuing quarters between the execution of the deed of settlement in January 2019 and the filing of the present application. Her affidavit exhibits cashflow and balance sheets for the last two quarters of 2021 and the first quarter of 2022. It thus remains that the records undertaken to be provided for any of the quarters of 2019, 2020 or the first half of 2021 have not been provided. It will be recalled those omitted periods included the era of the acquisitions of the Fitzmaurice Drive and Bentley Park properties and the over three-quarter reduction of the regular living expenses payment for the children.
The trustee has proffered no explanation for her failure to comply with her undertaking. At best for her, the non-compliance is further evidence that she assigns a low priority to the importance of the father’s position in the children’s lives.
Not respecting the importance of the father’s position in the children’s lives
The trustee and the mother were old and close friends and interacted with each other’s children over the years. The trustee is R’s godmother.
The trustee sought to maintain contact between her and other members of her family with the children after the mother’s death, doing so in various ways, particularly in respect of the three youngest children. However, she deposes the contact became minimal from the latter half of 2018 when a dispute developed between the father and her as to which of them should receive the mother’s superannuation fund payout on trust for the children. She deposes the father stopped communicating with her and did not allow the children to visit her.[29]
[29]Matter 161/22 Court doc 10 p 7.
On 30 April 2019 the trustee emailed the father accusing him of turning the children against her and stating she would now take legal action to gain access to the children. Four days later, on 4 May 2019 the trustee had her solicitor write to the father, seeking his agreement to a suggested regime of contact between the children and the trustee. Notably, the reason given for seeking the contact was not to allow the trustee to better discharge her role as trustee or support him in his role as the children’s sole carer. Rather, it was her belief the children would be missing contact with her and her family and that it was in the interests of the children’s emotional wellbeing “to maintain the friendships and links on their mother’s side”. The father, who only days earlier had been accused by her of turning his children against her, did not respond.
The trustee now deposes, under the subheading “Care of the children after [the mother’s] death”, to her then increasing concerns for the father’s “ability to cope with the sole care of the children and the cumulative effects of the stress of [the mother’s] illness and death”. Yet she does not in that context actually depose to any instances of the father not coping with the sole care of the children.[30]
[30]Matter 161/22 Court doc 10 p 5.
On 21 August 2019, later in the same month that the children’s aunt had renounced, the trustee made application to intervene in the Family Court proceedings which had been brought by the aunt. That application, which was made by the trustee in person, sought orders including providing for contact by the trustee with the children. Notably, it also sought an order that, with the father, she “have equal shared parental responsibility for long-term decisions concerning the health and education of the children”.[31] That order was not made, unsurprisingly. That she would seek such a level of control over the internal decision-makings of the family suggests, in light of evidence already canvassed, that she genuinely saw herself as a loyal agent of the children’s dead mother in the children’s ongoing lives.
[31]Matter 161/22 Court doc 10 Ex DMS30, p 8.
The consent order, made on 14 September 2020, did permit the trustee to “spend time” with the children “as agreed” and failing agreement, for four weekends a year and one week each of the Christmas and Easter school holidays. It also allowed her to have one telephone or video call with the children a fortnight. The orders also authorised the children’s’ school to provide the trustee with information about their progress at school and permitted the trustee to attend school related events.
On one view the father was very generous to the trustee in consenting to those aspects of the orders, however he deposes he was advised a court may allow such contact because she was trustee. The inference, correct or not, seems to be that some contact would be seen by a court as necessary to aid the trustee in administering the trusts in the children’s best interest by informing herself about the children’s welfare. Because the orders were consent orders there was no articulation by a court as to the purpose of allowing the trustee the forms of contact alluded to. In any event it is not suggested the contact has a parental purpose and nor could it be, for the consent order clearly indicates sole parental responsibility lies with the father.
The trustee obviously regards the contact orders as doing more than allowing her as trustee to be aware of the children’s needs. Her dealings with the children have included texts to twelve year old L, sent without the father’s approval, advising he is “too young” to get the Covid 19 vaccination and “Don’t trust the vaccine yet it has not been in use long enough”.[32] Also, she has from time to time given the children gifts and taken the children on holiday, apparently trying to perpetuate close relations between the children and her and her family.
[32]Matter 161/22 Court doc 3 Ex JPD20 [72].
One holiday, in which she and her husband took the children to Great Keppel Island in April 2021, appears to have been the source of particular tension. That is because during the trip the trustee took the children to see her mother and one of the children told the father that the trustee had introduced her mother as the children’s grandma. The trustee denies she did such a thing.
After the Great Keppel holiday, the trustee sought advice from her solicitor as to whether payments could be made from the minors’ trust fund to pay holiday expenses for the children and for gifts for the children. The advice included:
“10. We consider that you’re entitled to use the trust funds for pay for holidays for the children. In our view, such costs are for the benefit of the beneficiary and could be reasonably paid. Holiday costs should be apportioned to each child’s trust fund. …
14. We consider that you’re also entitled to use the trust funds to purchase gifts for the children, from their late mother. This was a specific wish and instruction of [the mother] and you seek to honour it. Gifts are purchased for the children at birthdays and Christmas. We consider these gifts are for the benefit of the relevant child beneficiary.”
On the topic of holidays for the children, it is noteworthy the trustee has not offered funds for the father to go on holidays with his children.[33] Of that, the trustee deposes there has been no request made for that to occur and that she would reasonably consider it if it was.[34] If the trustee genuinely respected the father’s parental position vis-à-vis the children it is difficult to understand why she needed to wait for an approach and would not of her own volition raise with the father the possibility of the trust funding holidays for the children with him. She could scarcely have overlooked the idea. After all, she went so far as to seek legal advice about it as it related to her.
[33]T1-48 L35.
[34]Matter 161/22 Court doc 10, p 27.
In respect of the trustee providing gifts, the trustee gives gifts to the children at birthdays and Christmas, purporting to be gifts from their late mother (to remove doubt, I do not overlook exhibits 1 and 2 in this context but perceive them to be of neutral relevance). The father disapproves of that practice and has clearly requested the trustee to stop it. She has nonetheless persisted in her conduct, doubtless seeing herself as righteously carrying out the wishes of the children’s dead mother. Indeed, she testified she will not comply with the father’s request because, “It’s not in the best interest of the children”.[35]
[35]T1-38 L39.
This is a relatively minor aspect of the case overall but it well illustrates the trustee’s lack of insight into her failure to respect the father’s position of sole parental responsibility.
Lack of consultation of the father
The trustee’s obviously low regard for the father and his role is reciprocated by the father’s obvious resentment of her for what he doubtless perceives to be the high-handed way she exercises her role of influence over his family. This has all long manifested in a poor state of communication between them.
Additionally, the Family Court Orders may have been wrongly understood as a general restriction confining communication to texts and emails in other than urgent circumstances. Of itself that is not a critical problem attending their communication – they at least seem capable of sending texts and emails if needs be.
The more concerning communication problem is that the trustee does not try to communicate consultatively with the father. It is a failing which further evidences her lack of genuine respect for his important position of sole parental responsibility. It is a failing which means that in administering the trusts, when making long term or strategic decisions bearing upon the children’s welfare, she does not seek, let alone take into informed account, the views of their sole parent about their welfare.
The trustee asserts she tried to contact the father by telephone to discuss the trusts in 2018 and 2019 but that he did not answer her calls. She does not say what she was seeking to discuss about the trusts or what if any messages she left for the father regarding the content of what she wanted to discuss. In any event, she accepts that he would on occasions respond to her texts or emails, after a number of reminders.[36]
[36]Matter 161/22 Court doc 10, p 22.
Plainly it was ever open to the trustee to engage in attempts at consulting him by text, email or letter. Indeed, the trustee deposes that despite the father’s unresponsiveness she has continued to communicate with the father by email and text with respect to the children, including as to their needs.[37] She deposes such contact, in combination with her own contact with the children and information from their schools, means she is “sufficiently informed as to the children’s needs to properly manage the trusts and ensure their needs are met”.[38] I reject that evidence in its application to making major trustee decisions bearing upon the children’s welfare because, in making such decisions, she does not seek to inform herself by trying to consult the father.
[37]Matter 161/22 Court doc 10, p 23.
[38]Matter 161/22 Court doc 10, p 24.
The examples the trustee exhibited in support of her assertion of communicative dealings with the father involved no attempted consultation about important decision-making relevant to the children’s welfare.[39] Rather, they were notifications or queries about mundane logistical matters, namely:
·an email of 13 April 2019 requesting that accounts for sport or activity for each of the children be addressed to “the estate” for payment;[40]
·an email of 25 April 2019 advising she had “transferred money for May so there would be money in the account for the boys’ birthday on the coming weekend”;[41]
·an email of 8 August 2019 about the logistics of arranging tax file numbers for the children;[42]
·an email of 19 January 2021 which began with her saying that she had forwarded the Family Court orders to two of the children’s schools and requesting information about school uniform numbers and sizes;[43]
·an email of 2 March 2022 enquiring which child a PET certificate course payment related to.[44]
[39]Matter 161/22 Court doc 10, p 23.
[40]Matter 161/22 Court doc 10 Ex DMS80.
[41]Matter 161/22 Court doc 10 Ex DMS81.
[42]Matter 161/22 Court doc 10 Ex DMS82.
[43]Matter 161/22 Court doc 10 Ex DMS83.
[44]Matter 161/22 Court doc 10 Ex DMS84.
It is noteworthy in passing that not even the logistical emails were uncontroversial. Before the email of 19 January 2021 moved to the topic of school uniform numbers and sizes, it commenced with these words:
“I have forwarded the final Court orders dated September 2020 to St Augustine and St Josephs. It is very much my intention to be part of the children’s school life where possible.” (emphasis added)
If that forecast encroachment upon parental space was not enough to dampen the father’s desire to communicate with the trustee, she also adopted a new manner of signing off her correspondence as trustee with the father, adding her educational qualifications after her name and endorsing the base of the email with:
“Children are the sum of what parents contribute to their lives. Richard Straus
Information is not the problem – lack of knowledge is. Robert Theobold”
It is noteworthy that by the time of an email dated 17 May 2022 from the trustee to the father, in this instance about a prospective overseas school trip for one of the children, the trustee had enhanced the condescension of her email sign-off, including not only her educational qualifications and the Straus and Theobold quotes but also the following:
“Education & Experience:
Successful parenting – 30 years
1994 PPP parenting course (6 week) Rob Jones (Regional Councillor for FNQ public primary schools
1997 PET course – parent effectiveness training (8 weeks) Robert Pereira Facilitator for FNQ Catholic Education.
1997 Advanced – Effective Listening Course (4 weeks) Robert Pereira”
It is difficult to see why the father would need to know such information about the trustee or how such power signoffs could enhance communication between them.
There does exist one email in evidence, an email of 30 April 2019, in which the trustee invited the father to discuss strategic matters.[45] Making a virtue of necessity the trustee’s counsel placed much reliance on this email, in support of the submission that she “has reached out”. However, examination of the context and tone of that email’s remarkable language, demonstrates it was likely to provoke animus, not consultative communication. The email addressed five subheadings, namely “Lexus vehicle”, “House”, “Estate assets”, “Children’s wellbeing” and “Expenses”. The discussion of the Lexus vehicle was essentially the trustee’s explanation for having sold the mother’s Lexus motor vehicle. The discussion of the house, namely the Cultivation Close residence (returned to in another context later in these reasons) informed the father the house would need to be sold at the end of the lease if he was unable to maintain aspects of it. Under the third heading, Estate assets, the trustee wrote:
“I have previously asked you to advise a suitable time to discuss strategic strategies for other estate assets. If you do not respond to this communication. I will not be communicating again re this matter.”
[45]Matter 161/22 Court doc 3 Ex JPD17.
Exactly what the trustee meant by strategies “for other estate assets” is not clear but, given the earlier references to the Lexus vehicle and the house, it does not jump out as a generalised invitation to discuss long-term planning for expenditure by the trust in the best interests of the children’s upbringing. In any event, it was expressly a once-off offer with the trustee indicating she would not communicate again on the matter. That the father may not have responded on this occasion in 2019 scarcely meant the trustee would be justified in not trying to raise strategic issues with him ever after.
If threatening such a future approach was not enough to deter a response, the remainder of the email certainly was. Under the heading “Children’s wellbeing” the trustee wrote, in language verging on that of an estranged co-parent:
“It is clear from my visit on Sunday that you have now turned the children against me alongside anyone else from Rose’s family.
Rose always advocated equal access to the children, she did not go for a custody arrangement as she wanted the children to be with whoever they were happy with.
This weekend apart from being ignored, it was the first time the three little ones did not ask again when can we come to the farm.
At a previous visit in the children’s words ‘Dad hates you.” why is that? “Dad hates everyone on Mums side of the family. He only likes his side of the family’. You have obviously told them now they are never coming to the farm again. From what I have heard and witnessed in the past, this is nothing short of emotional abuse. I have over the past five years given freely of my time to [the mother] and wasted a lot of time trying to work in with everyone concerned and I am no longer in a position professionally and personally to do so. It is time to refocus on my businesses and not spend quality time concerned about other people’s failures.
You have two friends trying to help you with your wellbeing and the childrens wellbeing and it is apparent from the children’s behaviour you are not taking any advice or support being offered. I will now take action to gain legal access to the children so all matters concerning the children can be brought to a head as swiftly as possible.”
It is notable in passing that on the father’s account the children were tiring of having to have contact with the trustee. That would not be a surprising turn of events – time moves on, children grow older, the allure of imposed adult company fades.
In any event, the present point is that the language and tone of this email would have tended to deter a communicative, let alone a consultative relationship. After dealing briefly with the topic of “Expenses”, the email closed with these spiteful words:
“Also anything I may have said about you in the public space is nothing but the truth. Unfortunately some people don’t like the truth when it inconveniences them.”
That the trustee’s affidavit and her counsel seized upon such an appalling email as evidence of her supposedly trying to discuss strategic matters with the father speaks eloquently of the dearth of evidence that she was genuinely attempting to consult the father on strategic matters.[46]
[46]Matter 161/22 Court doc 10 [162]; also see matter 211/22 Court doc 2 [32].
The father deposes that as he progressed through the email he “switched off”, feeling like the only content in the email was the trustee attacking him. He deposes that because she had in “almost all communication showed arrogance, condescension, ignorance and vitriol” that he saw no point in attempting to undertake discussion with her. He deposes:
“I had just gone through hell, with separation and divorce from [the mother], and then her death, and struggling financially because I committed myself to caring for my children, to then be preached and dictated to about how to raise my children, and how to manage my life in the way the trustee does, was and is intolerable.”[47]
[47]Matter 211/22 Court doc 7, p 4.

The cross-application cannot be said to have been made “upon a written statement of facts”. That provides a further, indeed a threshold, reason why the cross-application should be summarily dismissed.
Orders
It will be necessary to hear the parties as to costs.
This hearing proceeded in open court and no application has been made for any non-publication order. However, in an era when court decisions are published online, it appears to be in the interests of the children’s privacy that the Court not broadcast searchable identifying information in publishing its judgment. To that end these reasons did not identify the children or the parties by name. I will publish two copies of these reasons and the orders made to the parties, one of which will redact the coversheet and order content which tends to identify the parties and children. I will make orders ensuring only the redacted version may be published without constraint.
My orders should allow for liberty to apply to allow for the prospect any broader non-publication is sought and of any unforeseen logistical issues in connection with the orders.
My orders are:
1. The application in matter 211/22 is dismissed.
2.The application in matter 161/22, to remove the existing trustee and executor and in substitution appoint Renee Anne Bennett, is granted on the terms ordered in order 6 hereof.
3.I will hear the parties as to costs at 9am 2 September 2022.
4.The part of this decision’s reasons identifying the parties in the coversheet and the content of order 6 hereof be redacted in any publication of these reasons and orders, except for their publication between or to the parties, Renee Anne Bennett and a Court and for the purpose of Renee Anne Bennett assuming and performing her role as administrator and trustee.
5.Liberty to apply on the giving of two business days notice in writing.

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