Marigold Pty Ltd v Belswan (Mandurah) Pty Ltd - [2001] WASC 274

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: MARIGOLD PTY LTD -v- BELSWAN (MANDURAH) PTY LTD [2001] WASC 274

CORAM: WHITE AUJ

HEARD: 27 SEPTEMBER 2001

DELIVERED : 10 OCTOBER 2001

FILE NO/S: CIV 1385 of 2001

BETWEEN: MARIGOLD PTY LTD (ACN 054 920 928)
Plaintiff
AND
BELSWAN (MANDURAH) PTY LTD (ACN 069 443 607)
Defendant

Catchwords:

Trusts - Beneficiary's right to inspect trust documents - Whether the right to inspect includes right to require copies of such documents other than financial records to be provided by the trustee at the expense of the beneficiary

Legislation:

Nil

Result:

The trustee is obliged to render proper accounts to the beneficiary from time to time but the beneficiary's right to inspect trust documents other than financial records does not include a right to require the trustee to provide copies thereof
The application for an order that the trustee is obliged to provide copies of trust documents other than financial records to the beneficiary is dismissed

Category: A

Representation:

Counsel:

Plaintiff: Mr S J Lemonis
Defendant: Ms C C Toman

Solicitors:

Plaintiff: Bennett & Co
Defendant: Williams & Hughes

Case(s) referred to in judgment(s):

Breen v Williams (1996) 186 CLR 71
Hartigan Nominees Pty Ltd v Ridge (1992) 29 NSWLR 405
Morris v Morris (1993) 9 WAR 150
Ottley v Gilby (1845) 8 Beav 602; 50 ER 237
Re Bosworth (1889) 58 LJ Ch 432
Re Cowin (1886) 33 Ch D 179
Re Simersall; Blackwell v Bray (1992) 35 FCR 584

Case(s) also cited:

Nil

WHITE AUJ: The background facts in this matter are set out in my judgment published on 10 August 2001, in which I expressed the conclusion that the plaintiff is entitled to inspect the documents listed in par 52 of that judgment, subject to the defendant's right to provide copies with the deletion of the names of any persons in respect of whom confidentiality is claimed. I invited counsel to make submissions as to the order required to give effect to the decision.
The parties have executed a consent order covering the matters referred to in my decision but including par 5, which reads:
"5.Nothing in this order affects any right, asserted by the Plaintiff, to require the Defendants to provide it with copies of the documents referred to in paragraph 1."
The matter came back before me on 27 September 2001 for argument in relation to that paragraph.
Ms Toman, as counsel for the plaintiff, submitted that the plaintiff's right to inspect the documents referred to in par 52 of my judgment carried with it the right, upon request, to be furnished with a copy of any of such documents, upon payment of the reasonable cost of such copying.
Mr Lemonis, as counsel for the defendants opposed that submission, contending that the right to inspect is different from the right to have copies made of the documents or, in the alternative, if I were disposed to accept the plaintiff's submission, I should, in the exercise of discretion, refuse to order the provision by the defendants to the plaintiff of copies of the documents, for fear that an improper use might be made of such copies. He pointed to the comments in par 50 of my judgment, where I said:
"There is some basis in the evidence which I have set out above for a suspicion that Mr Tuxworth may be seeking information which may be damaging to the Trust and to the other beneficiaries thereof, if divulged to him. I put it no higher than that."
The plaintiff argued that, following discussions between the parties, the only matter upon which they could not agree was whether the plaintiff is entitled to take copies of documents, other than confidential documents. In par 6 of the plaintiff's submissions, it is said:
"6.Justice White's decision clearly contemplated that the Plaintiff should be entitled to copies of the documents (see paragraph 53). By refusing to provide copies the Defendants seek to re‑litigate a matter which has already been decided by His Honour Auxiliary Justice White."
However, that represents an apparent misreading of par 53 of the judgment. That paragraph reads:
"In my opinion, the plaintiff is entitled to inspect the documents listed in that letter, subject to the defendant's right to provide copies with the deletion of the names of any persons in respect of whom confidentiality is claimed. The provision of copies of those documents, rather than the inspection of the originals in the possession of the defendant would probably meet the wishes of both parties. If, in the result, the plaintiff contends that it requires consequential further inspection, that can be the subject of an application in due course."
My decision said nothing as to any entitlement in the plaintiff to insist upon the provision to it by the defendants of copies of any documents inspected.
The plaintiff then submitted that, as a matter of law, a beneficiary is entitled to take copies of the trust documents of his or her trust, citing Ford & Lee: "Principles of the Law of Trusts" (loose leaf ed 1996) [9110]; Ottley v Gilby (1845) 8 Beav 602; 50 ER 237; Re Bosworth (1889) 58 LJ Ch 432; Morris v Morris (1993) 9 WAR 150 152-153; Hartigan Nominees Pty Ltd v Ridge (1992) 29 NSWLR 405 421-422, 431-432 and 446; Breen v Williams (1996) 186 CLR 71; Re Simersall; Blackwell v Bray (1992) 35 FCR 584.
The defendants responded that the plaintiff's application has always been to inspect the documents of the trust and referred to par 1 of the minute of order for injunction dated 22 May 2001. Further, that the plaintiff has not, in the affidavits of Mr Tuxworth filed on its behalf asserted that it required in lieu of inspection to be provided with copies of the documents to satisfy its concerns.
The defendants submitted that the authorities relied upon by the plaintiff do not support the proposition that beneficiaries are entitled to take copies of trust documents.
Ford & Lee: "Principles of the Law of Trusts" (loose leaf ed 1996) [9110], under the heading "Duty to render accounts", reads in relevant part as follows:
"It is the duty of the trustee to render accounts to the beneficiaries, to have the accounts ready … and to be candid in any disclosures to beneficiaries … The duty entails allowing beneficiaries or their solicitor … to inspect the accounts and vouchers … and other documents relating to the trust (Jefferies v Marshall (1870) 23 LT per Malins V‑C at 549; Re Cowin (1886) 33 Ch D 179; Re Londonderry's Settlement [1965] Ch 918) … and to take copies: Ottley v Gilby (1845) 8 Beav 602; 50 ER 237; Re Bosworth (1889) 58 LJ Ch 432. The inquirer must pay the expenses of the provision of such copies and any other information …"
The brief passage from the decision in Ottley v Gilby (supra), relevant to the issue now before me, is:
"The first answer to the Plaintiff's application was not a proper one, for a legatee has a clear right to have a satisfactory explanation of the state of the testator's assets, and an inspection of the accounts, but he had no right to require a copy of the accounts at the expense of the estate."
That decision was concerned with the inspection of trust accounts. It may perhaps be read as indicating, by inference, that a beneficiary is entitled to a copy of trust accounts, to be provided at his expense. I do not think it goes any further than that, if so far, at best for the plaintiff.
It seems to me that the decision in Re Bosworth(supra) was concerned with an entirely different point. In that case, the plaintiffs, believing (honestly but mistakenly) that they were entitled to a beneficial interest under a will, of which the defendants were the trustees applied to the defendants for certain detailed information with respect to the estate. The defendants replied that there was nothing coming to the plaintiffs, but offered to give the desired information if the plaintiffs would undertake to indemnify them against the costs of the necessary investigation of documents. The plaintiffs then commenced the action, which failed, and they were ordered to pay the defendants' costs of the action. This case says nothing as to an entitlement in a beneficiary to require the provision of copies of documents by a trustee.
Morris v Morris (supra) was concerned only with inspection, not with the provision of copies of documents. It is not, therefore, germane to the issue now before me.
None of the passages in the judgment Hartigan Nominees Pty Ltd v Ridge (supra) to which I was referred by counsel deals expressly with any entitlement of beneficiaries to have copies of trust documents. The case is concerned with inspection.
In Re Simersall; Blackwell v Bray (supra) at 380, Gummow J refers to the decision of North J in Re Cowin (1886) 33 Ch D 179 at 185, where his Lordship quoted with approval a passage from "Lewin on Trusts", 8th ed (1885) at 975 reading:
"'All documents held by the trustee in that character must be produced by him to the cestuis que trust, who in equity are the true owners.' This position would generally apply to a trustee who is a solicitor, but there are important qualifications in some cases. If he is a solicitor for the client as well as trustee, he is required by law … to maintain and to retain proper financial records. He is entitled to retain these records, some of which may refer to other clients as well as the trust, but the beneficiary should be provided with copies if asked for."
In the present case, of course, the trustee is not a solicitor. Re Simersall; Blackwell v Bray is also silent on the issue of copies, while dealing with a right of inspection of trust financial records. The real dispute in that matter "centred on the question whether the trust account records of Bray & Co which the applicant seeks 'are books of an associated company'" (a reference to s 77A(2)(c) of the Bankruptcy Act 1966 (Cth)).
Breen v Williams was concerned with the question whether a patient had a right to inspect the medical records compiled by a doctor in relation to her. In the joint judgment of Dawson and Toohey JJ, at p 90 of the report, their Honours said:
"During argument, the question of the doctor's copyright in her medical records was raised with the appellant upon the basis that the right of access claimed by her extended to the making of copies of those records. The appellant made no submissions upon this question and it is unnecessary to reach any conclusion, but obviously it would raise problems if the appellant were otherwise to succeed in her conclusions."
It appears that both at first instance and by the majority in the Court of Appeal in New South Wales, it was held that the patient did not have the right to copy or have access to her medical records. Kirby P (as he then was) dissented, holding that a doctor owes a patient a fiduciary duty which entitles the patient to inspect or obtain copies of his or her medical records.
The authorities cited by the plaintiff do not, in my opinion, support the proposition that a beneficiary's right to inspect trust documents includes a right to take copies thereof. Unless therefore, there is otherwise some obligation on a trustee to provide copies of documents to a beneficiary, derived perhaps from the Trust Deed, the beneficiary is not entitled to demand the provision of copies of documents from the trustee. I think that there is an obligation on a trustee to render proper accounts to the beneficiary from time to time but, so far as any other documents than financial records appertaining to the trust are concerned, I am not persuaded that there is a right in a beneficiary to obtain copies thereof, merely upon tendering to pay the cost of copying. Of course, there is no reason why a trustee should not deliver copies of trust documents requested by a beneficiary, if the trustee wishes to do so.
In the result, I do not consider it appropriate to grant the relief now sought by the plaintiff. I have endorsed the consent order with my fiat and shall dismiss the plaintiff's chamber summons dated 6 September 2001.