Lin v Lin (No 2) - [2022] VSC 542

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

TRUSTS, EQUITY AND PROBATE LIST

S CI 2018 02053

TSAI MEI CHUAN LIN (in her own capacity and as administrator of the estate of WEN CHIH LIN, deceased) and others (according to the attached schedule)	Plaintiffs
v
SHIH-HSIEN LIN and others (according to the attached schedule)	Defendants

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JUDGE:	McMillan J
WHERE HELD:	Melbourne
DATE OF HEARING:	17, 18, 28 February and 1 March 2022
DATE OF JUDGMENT:	16 September 2022
CASE MAY BE CITED AS:	Lin & Ors v Lin & Ors (No 2)
MEDIUM NEUTRAL CITATION:	[2022] VSC 542

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TRUSTS – Appointment of appointor of two discretionary trusts – Validity of deeds of appointment of appointor – Interpretation of trust deed – Principles of construction of trust deed – Plain and ordinary meaning of words used in trust deed – Byrnes v Kendle (2011) 243 CLR 253 – Schreuders v Grandiflora Nominees Pty Ltd [2016] VSCA 93.

LACK OF CAPACITY – Whether deceased lacked mental capacity to appoint defendant as appointor of discretionary trusts – Standard of mental capacity required – Whether deceased was capable of understanding general purport or broad operation of deeds of appointment – Distinction between lack of capacity and plea of non est factum – No finding of mental incapacity – Gibbons v Wright (1954) 91 CLR 423 – Petelin v Cullin (1975) 132 CLR 355.

UNDUE INFLUENCE – Whether deeds appointing defendant as appointor of discretionary trusts were the product of undue influence – Whether relationship of presumed undue influence existed – Whether transaction explicable on other grounds – Whether deeds of appointment invalid as a result – No finding of undue influence – Johnson v Buttress (1936) 56 CLR 113 – Thorne v Kennedy (2017) 263 CLR 85.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr F Lim, solicitor	Francis Lim Barristers & Solicitors
For the First and Seventh Defendants	In person[1]

[1]Although Mr Shih-Hsien Lin, the first defendant, appeared in person and during the trial also represented the seventh defendant, the first and seventh defendants’ closing submissions dated 14 April 2022 were prepared by counsel.

HER HONOUR:

Introduction

This proceeding primarily concerns the control and administration of two family trusts established in 1989 and 1990 (‘the family trusts’). Issues of the rightful legal and beneficial ownership or co-ownership of two properties also arise, albeit peripherally. This is the second judgment in the proceeding. In the first judgment Mukhtar AsJ correctly described the proceeding as ‘an acrimonious dispute amongst members of a Taiwanese-Australian family’.[2] Many facets and details of the dispute, though described at great length in the voluminous evidence put forward by the parties over the four years that the proceeding has been on foot, are not of relevance to the issues with which these reasons are concerned. However, elaboration of some events and details is necessary to provide sufficient context and background to the issues addressed by these reasons.
[2]Lin & Ors…

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 Lin v Lin (No 2)

Details

AGLC: Lin v Lin (No 2) [2022] VSC 542
Case: [2022] VSC 542
Decision Date: 16 September 2022

CaseChat Overview and Summary

In the matter of Lin v Lin (No 2), the court was tasked with determining the validity of deeds of appointment that named the defendant as the appointor of two discretionary trusts. The dispute arose from the interpretation of the trust deed and whether the deceased had the requisite mental capacity to appoint the defendant. Additionally, the court examined whether the appointment was influenced by undue influence. The case was heard in the Supreme Court of Victoria.

The legal issues central to this case involved interpreting the trust deed and determining the deceased's mental capacity at the time of executing the deeds of appointment. The court had to ascertain whether the deceased had the mental capacity to understand the general purport or broad operation of the deeds, and whether the appointment was free from undue influence. The principles of construction of trust deeds and the standard of mental capacity required for such appointments were central to the decision.

The court found that the deceased had the requisite mental capacity to appoint the defendant as the appointor of the discretionary trusts. The court relied on established legal principles and case law to conclude that the deceased could understand the broad operation of the deeds. Furthermore, the court held that the deeds of appointment were not the product of undue influence. The relationship between the parties did not give rise to a presumption of undue influence, and the transactions were explicable on other grounds. Therefore, the court determined that the deeds of appointment were valid.

The final orders of the court confirmed the validity of the deeds of appointment, thereby affirming the defendant's role as the appointor of the discretionary trusts. The court's decision underscored the importance of the deceased's understanding of the trust deeds and the absence of undue influence in the appointment process.

Orders