McFarlane v Jeffery Crondon Smith as administrator of the estate of Dorothy Joyce McFarlane

Case •

[2023] WASC 336

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   MCFARLANE -v- JEFFERY CRONDON SMITH as administrator of the estate of DOROTHY JOYCE MCFARLANE [2023] WASC 336

CORAM:   STRK J

HEARD:   21 JULY 2021 & SUBMISSIONS SUBSEQUENTLY FILED

DELIVERED          :   4 SEPTEMBER 2023

FILE NO/S:   CIV 1258 of 2021

BETWEEN:   PETER DONALD MCFARLANE

Plaintiff

AND

JEFFERY CRONDON SMITH as administrator of the estate of DOROTHY JOYCE MCFARLANE

Defendant


Catchwords:

Deceased estate - Administrator appointed on the basis of intestacy - Personal representative - The court's jurisdiction as a court of equity - Inherent supervisory jurisdiction with respect to trusts - Whether an administrator is ipso facto a trustee upon appointment - Whether a person entitled in distribution is entitled as a beneficiary of a trust to discovery and inspection of the deceased's documents on the basis that they are trust documents and the administrator is a trustee

Legislation:

Administration Act 1903 (WA)
Rules of the Supreme Court 1971 (WA)
Supreme Court Act 1935 (WA)
Trustees Act 1962 (WA)

Result:

Application refused

Category:    B

Representation:

Counsel:

Plaintiff : C V Eastwood
Defendant : F A Robertson & G M Rattigan

Solicitors:

Plaintiff : Eastwood Law
Defendant : Rattigan & Associates

Cases referred to in decision:

Acaster v Anderson (1848) 1 Rob Eccl 671; 163 ER 1174

AIT Investment Group Pty Ltd v Markham Property Fund No 2 Pty Ltd [2015] NSWSC 216

Attenborough v Solomon [1913] AC 76

Barns v Barns [2003] HCA 9; (2003) 214 CLR 169

Breen v Williams [1996] HCA 57; (1996) 186 CLR 71

Brougham v Poulett (1855) 19 Beav 119; 52 ER 294

Burke v Dawes [1938] HCA 6; (1938) 59 CLR 1

Commissioner of Stamp Duties (Qld) v Livingston [1965] AC 694; (1964) 112 CLR 12

Deutsch v Trumble [2016] VSC 263

Easterbrook v Young (1979) 136 CLR 308

Erceg v Erceg [2017] NZSC 28; [2017] 1 NZLR 320

Estate Kouvakas; Lucas v Konakas [2014] NSWSC 786

Estate Polykarpou; Re a charity [2016] NSWSC 409; (2016) 16 ASTLR 400

Hartigan Nominees Pty Ltd v Rydge (1992) 29 NSWLR 405

Hooper v Kirella [1999] FCA 1584; (1999) 167 ALR 388

In re Ellis, Ellis v Ellis [2015] WASC 77; (2015) 14 ASTLR 475

In the Will of Taylor (dec'd) [1922] VLR 280, 284; (1922) 28 ALR 192

Marigold Pty Ltd v Belswan (Mandurah) Pty Ltd [2001] WASC 209

McCormack v Trevor John Fairs as executor of the estate of the late Maxine Fairs [2021] WASC 303

Murray v Schreuder [2009] WASC 51

Official Receiver in Bankruptcy v Schultz [1990] HCA 45; (1990) 170 CLR 306

O'Rourke v Darbishire [1920] AC 581; [1920] All ER Rep 1

Pagels v McDonald [1936] HCA 15; (1936) 54 CLR 519

Palmer v Ayres [2017] HCA 5; (2017) 259 CLR 478

Porteous v Rinehart (1998) 19 WAR 495

Rauch v Maguire [2010] 2 NZLR 845

Re Fairbairn [1967] VR 633

Re Londonderry's Settlement [1965] Ch 918; [1964] 3 All ER 855

Re Przychodski [2006] VSC 781

Rouse v IOOF Australia Trustees Ltd [1999] SASC 181; (1999) 73 SASR 484

Schmidt v Rosewood Trust [2003] 2 AC 709; [2003] All ER (D) 442 (Mar)

Silkman v Shakespeare Haney Securities Ltd [2011] NSWSC 148; (2011) 8 ASTLR 117

Spellson v George (1987) 11 NSWLR 300

Sutcliffe v Sutcliffe [2005] EWHC 3058 (CH); [2005] All ER (D) 116

Tsaknis as Executor and Trustee of the Estate of Geoffrey Douglas Roland Lilburne (Dec) v Lilburne [2010] WASC 152

Wright v Stevens [2018] NSWSC 548

STRK J:

Introduction

  1. The plaintiff is the eldest son of the late Dorothy Joyce McFarlane. The defendant is the administrator of the deceased's estate, letters of administration having been granted to him on the basis that he deposed to being the de facto partner of the deceased. The estate of the deceased has not been fully administered. These reasons concern the application made by the plaintiff for access to certain documents. The plaintiff seeks to invoke principles relating to the administration of trusts. Pursuant to the court's inherent powers, the plaintiff seeks discovery and inspection of the following:

    1.All documents, whether in written form or on computer disc or in other machine readable form, which are or have been in the possession, custody or power of the defendant recording or evidencing:

    (a)bank statements or documents in respect of the late Dorothy Joyce McFarlanes Bankwest Account bearing the account number 133-015338-1 for the period from 23 October 2015 to the present day;

    and

    (b)bank statements or documents from any financial institution in respect of any accounts held by the late Dorothy Joyce McFarlane for the period from 23 October 2015 to the present day.

  2. The plaintiff says that the proper characterisation of the defendant as administrator of the deceased's estate is as trustee. He contends that a personal representative occupies the role of trustee from the date of his or her appointment, consistent with the extended meaning of the term 'trustee' as defined in the Trustees Act 1962 (WA) at s 6. On the basis that a personal representative occupies the role of trustee from the date of his or her appointment, the plaintiff contends that the inherent supervisory jurisdiction of the court with respect to trusts is enlivened with respect to the present application.[1]

    [1] Plaintiff's supplementary submissions pars 2 - 4, relying upon In re Ellis, Ellis v Ellis [2015] WASC 77; (2015) 14 ASTLR 475 [109] (EM Heenan J); Estate Polykarpou; Re a charity [2016] NSWSC 409; (2016) 16 ASTLR 400 (Lindsay J), and said to be supported by Commissioner of Stamp Duties (Qld) v Livingston [1965] AC 694; (1964) 112 CLR 12.

  3. The plaintiff says that what flows from the characterisation is that as a beneficiary of the deceased's estate, he has the right to inspect the requested bank records as they are trust documents. Further, the plaintiff says that as a trustee the defendant is subject to the court's power as a court of equity such that the court may exercise discretion to order that the defendant give the plaintiff discovery and inspection of the requested documents; and the circumstances favour the exercise of discretion in his favour.

  4. The plaintiff brings the application pursuant to the court's inherent jurisdiction, referencing the jurisdiction afforded by s 16 and, 'to the extent that it's relevant', s 18 of the Supreme Court Act 1935 (WA).[2] The plaintiff seeks that the court exercise its jurisdiction with respect to the administration of trusts.

    [2] ts 2 (21 July 2021).

  5. The application is opposed by the defendant. I do not understand the defendant to take issue with the (not unqualified) right of a beneficiary of a trust to inspect trust documents, whether founded on a proprietary right or the exercise of the court's inherent jurisdiction to supervise, and if necessary intervene in the administration of trusts. However, the defendant says that the plaintiff's characterisation of the role of the defendant in his capacity as administrator is wrong, the defendant is not a trustee, and therefore the plaintiff is not entitled to access the requested bank records on the basis asserted. Further, the requested bank records concern a period which commences before the death of the deceased and the defendant queries whether bank records for the date range requested are all 'trust documents'.

  6. The defendant says that the question to be determined by this application is ultimately whether the defendant is a trustee at general law and, if so, whether the documents sought are 'trust documents'. The defendant contends that the answer to both questions is no.[3]

    [3] Defendant's supplementary submissions pars 19 - 20.

  7. For the following reasons, the defendant's position with respect to the characterisation of the administration and the parties' relationship is to be preferred. An administrator is not ipso facto a trustee upon appointment. The plaintiff's application, and asserted right to discovery and inspection, is prosecuted on the basis that the inherent supervisory jurisdiction of the court with respect to trusts is enlivened. In my view, the basis relied upon does not support the plaintiff's application.

Documents filed in support of the application

  1. At the hearing of the application, counsel for the plaintiff read the affidavit sworn by the plaintiff on 29 March 2021, to which the plaintiff attached documents marked PDM‑1 to PDM‑10. Among other things, the plaintiff deposed to his relationship with the deceased; to the deceased having been married to Donald Bain McFarlane, the plaintiff's father, who died in January 1985 in New Zealand; to the deceased having moved to Perth from New Zealand in 1989; to the deceased's death on 18 December 2019; and to having in his possession an unsigned copy of a will bearing the date 1993 (which document is defined in the plaintiff's affidavit as the Copy Will) in which the plaintiff is named as executor of the deceased's estate and save for specific gifts of jewellery, provided for the residuary of the deceased's estate to be divided as between the plaintiff and the plaintiff's brother (the deceased's second child).

  2. The plaintiff deposed that in or around 1993, in the deceased's unit at Scarborough, the deceased showed the plaintiff two copies of her will, one which had a black backing sheet, and one which had a red backing sheet. The plaintiff deposed that he recalls that one of the documents was signed, but could not remember which one; that the deceased said to him words to the effect 'she had done her will and you are to be the executor'; that the deceased went through the will with him; that he recalls that the content was the same as the Copy Will; and that the deceased informed him that she would keep her will in the blue filing cabinet if at any time it was required.

  3. As to the deceased's relationship with the defendant, among other things, the plaintiff deposed to his belief that the deceased met the defendant in about 2005; to his knowledge of the deceased's relationship with the defendant, which he described as being 'more of a social companion'; to the travel undertaken by the deceased and the defendant; to the deceased becoming more frail and having mobility difficulties from 2009 onwards; to the plaintiff's concern at the time that the deceased was becoming increasingly isolated from her family; and to the plaintiff's observations and concerns as to the defendant exhibiting 'more coercive and controlling behaviour' towards the deceased over time.

  4. The plaintiff deposed that in or around 2011, the deceased sold her property in Scarborough for approximately $395,000; to his belief as to the circumstances in which the deceased's property came to be sold; to his belief that the deceased gifted $25,000 to the defendant for his help in selling the Scarborough property; that following settlement of the Scarborough property, the deceased moved into the defendant's residence in Jandakot; to the deceased having her own room at the defendant's residence; and to the difficulties the plaintiff then experienced in speaking to and spending time with the deceased by reason of the defendant's conduct.

  5. The plaintiff deposed to the circumstances in which the deceased in about late October 2015 gave him the Copy Will and a Bankwest statement dated 23 October 2015. He deposed that when the deceased handed the documents to him she said words to the effect: 'This is my Will. I want you to have these for safekeeping. This one is my recent one.' He also deposed to a confrontation that occurred between the plaintiff and the defendant following the plaintiff's conversation with the deceased described here.

  6. The plaintiff attached to his affidavit and marked PDM‑1 a copy of the Copy Will; and attached and marked PDM‑8 a copy of the Bankwest statement dated 23 October 2015 for a Gold Term Deposit Account bearing account number 133‑015338‑1 which recorded a balance of $463,980.67 (Bankwest account).

  7. The plaintiff described the deterioration of the deceased's health between 2016 and 2017, and to being informed by a doctor treating the deceased that the deceased had advanced dementia.

  8. He deposed to contested proceedings before the State Administrative Tribunal concerning the deceased between February 2017 and April 2017; to conflict as between the plaintiff and the defendant; and to the defendant seeking a violence restraining order against him.

  9. The plaintiff deposed to the circumstances of the deceased's death, and to the searches he undertook to locate the deceased's will.

  10. The plaintiff further deposed to his belief that letters of administration were granted to the defendant, who claimed to have been the deceased's de facto partner, which characterisation both the plaintiff and his brother dispute; to the defendant not having sought his consent to the grant of letters of administration in favour of the defendant, and to neither the plaintiff nor his brother having consented to the same; and to having been informed by the solicitors for the defendant that the defendant had estimated the value of the deceased's estate as $26,023.76 for the purposes of the probate application.

  11. Among other things, the plaintiff complains that the defendant failed to obtain his consent and provide adequate notice to him before applying for a grant of letters of administration, and also failed to make adequate enquiries as to whether the deceased made a will before applying to the court for a grant on the basis of intestacy.[4]

    [4] Plaintiff's submissions pars 3 - 6.

  12. The plaintiff deposed to various communications as between his legal representatives and the legal representatives of the defendant concerning, among other things, the defendant's asserted status as the deceased's de facto partner, and the apparent dissipation of $400,000 from the Bankwest account.

  13. The plaintiff attached to his affidavit and marked PDM‑7 correspondence issued by his representatives to the defendant's representatives which indicated that the plaintiff was considering issuing a citation against the defendant to bring in the grant as a precursor to issuing proceedings for revocation of the letters of administration, and in so far as the revocation of the grant is concerned, the view was held that:

    1.there exists a document that constitutes a will under part 10 of the Wills Act 1970 (WA) in which our client is appointed as sole executor and is a residuary beneficiary; and

    2.further, and in the alternative, in the event that the deceased is found to have died intestate, our client objects to a grant being issued to your client on the ground that your client was not at the material time or at any time in a de facto relationship with the deceased within the meaning of section 15 of the Administration Act 1903 (WA).

  14. The plaintiff also attached to his affidavit and marked PDM‑9 correspondence issued by the defendant's representatives to his representatives which indicated that with respect to the administration of the deceased's estate, the estate funds remained in the account of the deceased and the defendant proffered an undertaking not to deal with those funds until the plaintiff and his brother determined what action they wished to take.

  15. At par 173 of his affidavit, the plaintiff deposed to his belief that he is a beneficiary of the deceased's estate; that he is entitled to obtain documents relating to the estate; that the defendant failed to conduct a proper search and/or enquiries as to the whereabouts of the deceased's will; that there is a real issue as to what happened to the unaccounted funds of the deceased in the Bankwest account; that the defendant as the administrator and trustee of the deceased's estate is obliged to provide documents and information to the plaintiff as a beneficiary and provide an account in respect of the administration of the estate; that despite numerous requests, the defendant through his legal representatives neglected, failed or ignored those requests; that none of the documents sought by this application had been provided by the defendant to the plaintiff; and there is no way for the plaintiff to obtain the documents other than through the defendant.

  16. In support of the application, the plaintiff also relied upon a written outline of submissions and list of authorities, and with leave supplementary submissions filed after the hearing of the application.

Documents filed in opposition to the application

  1. At the hearing of the application, counsel for the defendant read the affidavit sworn by the defendant on 18 May 2021. In his affidavit, the defendant deposed, among other things, to having been granted letters of administration on 9 September 2020; to having been the deceased's de facto partner for about 15 years, from shortly after they met in about 2004 until her death; to the deceased's health prior to her death; to his various interactions with the plaintiff; and to having no knowledge of the Copy Will referred to by the plaintiff in his affidavit.

  2. The defendant denies the plaintiff's characterisation of his relationship with the deceased and denies much of the conduct attributed to him by the plaintiff.

  3. In opposition to the application, the defendant also relied upon a written outline of submissions, and with leave supplementary submissions filed after the hearing of the application.

Overview of the plaintiff's position

  1. The plaintiff says that the application to access the requested bank records ought be granted because a person entitled in distribution of a deceased estate is entitled to discovery and inspection of such documents from the administrator of that estate on the basis that:

    (a)the administrator is a trustee, the requested documents are trust documents, and beneficiaries have the prima facie right to access documents and information in relation to a trust; alternatively

    (b)the administrator is a trustee, and a trustee has a fiduciary duty to keep beneficiaries informed.[5]

    [5] Plaintiff's submissions pars 9 - 16.

  2. These contentions were developed on behalf of the plaintiff as follows:[6]

    [6] Plaintiff's submissions pars 25 - 30.

    (a)the documents the subject of the application are documents which belong to the estate of the deceased;

    (b)the plaintiff has a fixed present entitlement, conferred by the Administration Act 1903 (WA) s 14, to a share in the deceased's estate; and

    (c)as a beneficiary of the estate in intestacy, alternatively under the deceased's will (an unsigned copy of which the deceased had provided to the plaintiff for safekeeping, which is described in these reasons as the Copy Will), the plaintiff is entitled to access to the documents the subject of the application,

    in a context where:

    (d)the documents sought are solely in the possession of the defendant;

    (e)the plaintiff requested access to the documents and was refused;

    (f)despite request, the defendant did not explain what happened to the moneys of the deceased that had been held in the Bankwest account;

    (g)the plaintiff says that the documents are vital to clarify his full entitlement to the estate of the deceased, and to determine whether the deceased's funds were misused during the time the deceased was deemed incapable of managing her affairs; and

    (h)the defendant had not advanced any evidence or provided any reasons to deny the plaintiff's application or that the plaintiff is not entitled to the requested documents.

  3. At the hearing of the application, counsel clarified that the plaintiff (as a beneficiary) seeks to invoke the exercise by the court of its inherent power under s 16 of the Supreme Court Act as a court of equity to compel the defendant (in his capacity as a trustee) to give discovery and inspection of the requested documents (said to be trust documents). While a passing reference was also made to s 18 of the Supreme Court Act, by which the court is granted probate jurisdiction and authority to hear and determine all questions relating to testamentary causes and matters, the application advanced on behalf of the plaintiff has as its focus s 16 and the court's inherent supervisory jurisdiction with respect to trusts.[7]

    [7] ts 2 (21 July 2021).

  1. As to the entitlement to access, the plaintiff's position is that a personal representative occupies the role of trustee from the date of his or her appointment, consistent with the meaning of the term 'trustee' as defined in the Trustees Act at s 6.[8] On the premise that a personal representative occupies the role of trustee from the date of his or her appointment, the plaintiff contends that the inherent supervisory jurisdiction of the court with respect to trustees is enlivened with respect to the present application. In support of the position advanced, the plaintiff refers to and relies upon the decision of EM Heenan J in In re Ellis, Ellis v Ellis, and particularly his Honour's reasons at [109], which passage is reproduced at [57] below. This submission was developed in the plaintiff's supplementary submissions.

    [8] ts 6 - 7, 31 - 32, 35 - 36 (21 July 2021); plaintiff's supplementary submissions pars 15 - 16.

  2. It was submitted that beneficiaries have a prima facie right of access to documents and information in relation to the trust, the right does not depend on an allegation of fraud or other breach of trust being made against a trustee.[9] Further, that right might be founded on a proprietary right,[10] or the fiduciary duty of trustees to keep beneficiaries informed.[11]

    [9] Plaintiff's submissions par 10, citing Spellson v George (1987) 11 NSWLR 300; approved in Hartigan Nominees Pty Ltd v Rydge (1992) 29 NSWLR 405 (425).

    [10] Plaintiff's submissions pars 13 and 14, citing O'Rourke v Darbishire [1920] AC 581; [1920] All ER Rep 1; and Breen v Williams [1996] HCA 57; (1996) 186 CLR 71.

    [11] Plaintiff's submissions par 15, citing Hartigan Nominees Pty Ltd v Rydge (405, 421 - 422, 442 - 445).

  3. As to qualifications of the right of inspection, counsel for the plaintiff acknowledged that the beneficiary's right to information and inspection of trust documents is subject to an obligation to pay for the costs of the service.[12] It was also acknowledged that the right of a beneficiary to inspect trust documents, whether founded on a proprietary right or fiduciary duty, was not unqualified. It was accepted that confidentiality or privilege are circumstances in which a discretion to refuse inspection may arise.[13]

    [12] Plaintiff's submissions par 11, citing Re Fairbairn [1967] VR 633.

    [13] Plaintiff's submissions par 12, citing Marigold Pty Ltd v Belswan (Mandurah) Pty Ltd [2001] WASC 209 [23], which referenced Rouse v IOOF Australia Trustees Ltd [1999] SASC 181; (1999) 73 SASR 484 and Re Londonderry's Settlement [1965] Ch 918; [1964] 3 All ER 855.

  4. As to the approach that the court ought adopt in the determination of the plaintiff's application if the court proceeds on the basis that it must be grounded upon a proprietary right, by reference to the decision of Salmon LJ in Re Londonderry's Settlement, counsel submitted that an applicant must establish that:[14]

    (a)the applicant is a beneficiary of a trust and not merely a discretionary beneficiary or object;

    (b)the relevant documents are trust documents, that is, documents related to the administration of the trust; and

    (c)certain recognised exceptions, such as confidentiality inuring in the documents, are inapplicable.

    [14] Plaintiff's submissions par 18; ts 3 (21 July 2021).

  5. Counsel further submitted that subject to the recognised exceptions, the plaintiff's claim for inspection was a claim as of right involving no discretion on the part of the court if the above elements were to be established.[15]

    [15] Plaintiff's submissions par 19.

  6. As to what might constitute 'trust documents', again by reference to the decision of Salmon LJ in Re Londonderry's Settlement, counsel submitted that:[16]

    (a)they are documents in the possession of trustee qua trustee;

    (b)they contain information about the trust which the beneficiaries are entitled to know; and

    (c)the beneficiaries have a proprietary interest in the document and are accordingly entitled to see them.

    [16] Plaintiff's submissions par 20, citing Re Londonderry's Settlement (938).

  7. Counsel noted that there is a second line of authority which concerns access to trust documents grounded on a discretionary approach (not a proprietary right). Counsel referred to decision of Schmidt v Rosewood Trust [2003] 2 AC 709; [2003] All ER (D) 442 (Mar), and submitted that the second approach involves the following propositions:[17]

    (a)the object of a discretion, including a mere power, may apply to the court for access, as well as beneficiaries with a 'fixed' interest;

    (b)the power to order disclosure is 'one aspect of the court's inherent jurisdiction to supervise, and if necessary to intervene in, the administration of trusts';

    (c)the power to order inspection is discretionary; and

    (d)the court may have to 'balance' the competing interests of different beneficiaries, the trustees and third parties, with disclosure being limited and safeguards being put in place.

    [17] Plaintiff's submissions par 22, citing AIT Investment Group Pty Ltd v Markham Property Fund No 2 Pty Ltd [2015] NSWSC 216 [66]; ts 3 - 5 (21 July 2021).

  8. As to the exercise of discretion in the context of a non‑discretionary trust, counsel noted that in Murray v Schreuder [2009] WASC 51 at [58], Newnes J observed as follows:[18]

    In the case of a non-discretionary trust, I take the law to be that a beneficiary has a right - subject to exceptions - to inspect trust documents used by the trustee in the administration of the trust. An exception will arise in the case of documents which are private to the trustee that may evidence the reasons that the trustee has made his or her decision or exercised a discretion, in circumstances where disclosure is not required and has not been made by the trustee: Hartigan v Rydge (434, 442, 445); or where the document is the subject of a duty of confidence owed to a third party: see, for example, Hartigan v Rydge (433, 446); Schmidt (734); Morris v Morris (1993) 9 WAR 150, 154; or where disclosure is not in the interests of the beneficiaries as a whole: Rouse v IOOF Australia Trustees Ltd (1999) 73 SASR 484, 499; or where the terms of the trust deed give rise to an express or implied limit on a beneficiary's right of access to trust documents: Hartigan v Rydge (446).

    [18] Plaintiff's submissions par 24.

  9. The plaintiff's position is that while he expects that the court would be satisfied that he holds a proprietary right and is entitled to access the requested documents applying the test set out at [33] above, the better view is that the court applying the discretionary approach ought grant the application.[19] The plaintiff says that it is in the interests of justice that he be provided with the documents sought by this application, and as the requested documents are estate documents, as a beneficiary, he is entitled to have access to them.[20]

    [19] ts 4 - 5 (21 July 2021).

    [20] Plaintiff's submissions par 31.

Overview of the defendant's position

  1. By way of overview, the defendant's position is as follows:

    (a)while there is a suggestion of impropriety on the part of the defendant in obtaining a grant of letters of administration and that there may be a will (which suggestions are not accepted by the defendant), the plaintiff's application does not concern these matters;[21]

    [21] Defendant's submissions par 3.

    (b)the burden of proving the nature and extent of the trust as well as proving that the documents sought come within the description of trust documents falls on the plaintiff;[22]

    [22] Defendant's submissions par 15.

    (c)the plaintiff has not demonstrated that the defendant is a trustee at the time of this application. The plaintiff's assumption that the defendant's appointment as personal representative automatically makes him a trustee or that the office is identical to that of a trustee is incorrect,[23] and unless otherwise expressly provided for, the offices are not held concurrently, but consecutively;[24]

    [23] Defendant's submissions par 5, referring to the discussion of the distinctions between these offices in Attenborough v Solomon [1913] AC 76.

    [24] Defendant's submissions par 5, citing Attenborough v Solomon; and Easterbrook v Young (1979) 136 CLR 308 (319 - 320).

    (d)properly construed, s 6 of the Trustees Act does not modify or change the general law position as articulated in Commissioner of Stamp Duties (Qld) v Livingston;[25]

    [25] Defendant's supplementary submissions pars 2 - 11.

    (e)properly understood, In re Ellis, Ellis v Ellis is not authority for the proposition that a legal personal representative is for all purposes a trustee by reason of s 6 of the Trustees Act;[26]

    (f)the duty of an administrator is to get in the assets of the deceased, pay her debts, to distribute the assets on the intestacy and produce accounts to that effect.[27] It is a question of fact as to whether a person is appointed as an executor (or in this case an administrator) and a trustee;[28]

    (g)in relation to the 'status' of a personal representative, a personal representative only becomes a trustee, in the relevant sense, once the administration of the estate is at an end and all that remains is a distribution of the net assets left over, and then the relevant trust would be in respect of the moneys to be paid out from the estate;

    (h)the plaintiff has assumed, the defendant says without any proper basis or authority, that the entire process of administration of the estate is 'the trust';[29]

    (i)the plaintiff has not demonstrated that they are the beneficiary of any particular trust. He has no beneficial entitlement in any particular asset of the estate, and his right is limited to a chose in action to compel administration of the estate;[30]

    (j)an entitlement in an unadministered estate from that of a beneficiary under a trust has been distinguished;[31]

    (k)a beneficiary of an unadministered deceased estate does not have any beneficial interest in any of the assets comprising that estate, and that beneficiary has no more than an equitable chose in action against the personal representative to compel administration of the estate;[32]

    (l)in the absence of any beneficial interest in any of the assets comprising the estate, the plaintiff cannot be a beneficiary of any relevant trust, and it follows that the authorities about the entitlement of beneficiaries to trust documents do not assist the plaintiff who is not a beneficiary in the relevant sense but merely possesses a chose in action to compel administration;[33]

    (m)the plaintiff has not demonstrated that the documents sought relate to the management of any trust by the defendant. The documents sought pre-date his trusteeship and relate to funds for which the defendant is not trustee and for which he was never the trustee. Rather, the documents the subject of the application are documents, specifically bank statements, of accounts held by the deceased during her life. That is, documents which came into existence before the deceased died and before the grant of letters of administration in favour of the defendant;[34] and

    (n)even assuming that the defendant is a trustee and is managing a trust, documents brought into existence prior to the deceased's death and prior to the defendant's appointment cannot be trust documents as they pre-date the creation of the asserted trust.[35]

    [26] Defendant's supplementary submissions pars 12 - 17.

    [27] Defendant's submissions par 4, citing Porteous v Rinehart (1998) 19 WAR 495 (502 - 503) and the authorities there cited.

    [28] Defendant's submissions par 4, referring to the authorities cited in Porteous v Rinehart (503).

    [29] Defendant's submissions par 16.

    [30] Defendant's submissions par 20.

    [31] Defendant's submissions par 6, citing Commissioner of Stamp Duties (Qld) v Livingston (18), followed in Official Receiver in Bankruptcy v Schultz [1990] HCA 45; (1990) 170 CLR 306 (312); and Barns v Barns [2003] HCA 9; (2003) 214 CLR 169 (189).

    [32] Defendant's submissions par 11.

    [33] Defendant's submissions par 12.

    [34] Defendant's submissions par 1.

    [35] Defendant's submissions par 18.

Consideration and disposition

Administrators, executors and trustees

  1. A number of legal institutions in certain aspects and in certain contexts appear to resemble the trust, including that of an executor and administrator. However, the distinction is well established on the authorities.[36] A beneficiary of a will (whether as a residuary beneficiary or a specific legatee), does not have a proprietary interest in the estate or any part of it; and as a corollary, an executor of a will is not a trustee (in the strict sense) of the estate for the beneficiaries or any of them.[37] The general principle is that neither an executor nor an administrator is ipso facto a trustee and the expression 'personal representatives' does not include trustees. The explanation is historical.[38]

    [36] In re Ellis, Ellis v Ellis [109], citing Commissioner of Stamp Duties (Qld) v Livingston. See also Porteous v Rinehart (502 - 503); MJ Leeming and JD Heydon, Jacobs' Law of Trusts in Australia (8th ed, 2016) [2-01], [2-40] - [2-45].

    [37] Official Receiver in Bankruptcy v Schultz (313 - 314).

    [38] JR Martyn and N Caddick KC, Williams, Mortimer & Sunnucks - Executors, Administrators and Probate (21st ed, 2015) [76-02].

  2. As was observed by Viscount Radcliffe in Commissioner of Stamp Duties (Qld) v Livingston at 17, 'whatever property came to the executor virtute officii came to him in full ownership, without distinction between legal and equitable interests. The whole of the property was his.' In this state, this is reflected in s 8 of the Administration Act, which provides that upon the grant of probate or administration, all real and personal estate which a deceased person dies seised, possessed of, or entitled to in Western Australia shall, as from the death of such person, pass to and become vested in the executor to whom probate has been granted, or administrator for all the estate and interest of the deceased therein in the manner following, that is to say - (a) on testacy or on partial intestacy, in the executor or administrator with the will annexed; and (b) on intestacy, in the administrator.

  3. If a testator under a will appoints a person as his or her executor and trustee, then upon grant, the appointee acts as executor when the appointee performs executorial duties, and thereafter while the appointee continues to hold property the appointee is a trustee thereof, albeit his or her capacity as executor remains insofar as he or she may be called upon at a future time to deal with property in that capacity.[39]

    [39] Porteous v Rinehart (503).

  4. A will may expressly establish a trust of the estate property (many do), and when that trust comes into effect is a matter of construction of the particular will. It is a question of fact whether a person appointed as both an executor and a trustee is acting in one capacity or another.[40]

    [40] MJ Leeming and JD Heydon, Jacobs' Law of Trusts in Australia (8th ed, 2016) [2-40], see also: Porteous v Rinehart (503), referring to Brougham v Poulett (1855) 19 Beav 119; 52 ER 294 (300); Pagels v McDonald [1936] HCA 15; (1936) 54 CLR 519 (526); Burke v Dawes [1938] HCA 6; (1938) 59 CLR 1 (13 - 14, 19 -20) and Commissioner of Stamp Duties (Qld) v Livingston (17).

  5. Therefore, at the initial stages of an administration, the executor or administrator is not necessarily holding the property of the estate as trustee for a legatee or beneficiary. Administrators who have cleared the estate and completed the administration become trustees holding for the beneficiaries, either on an intestacy or under the terms of the will (if granted letters of administration with will annexed).[41] The question whether or not the administration is complete is a question of fact. It continues until either an assent or a conveyance has taken place.[42]

    [41] RR D'Costa, P Teverson and T Synak, Tristram and Coote's Probate Practice (32nd ed, 2020) [6.24].

    [42] JR Martyn and N Caddick KC, Williams, Mortimer & Sunnucks - Executors, Administrators and Probate (21st ed, 2015) [76-01].

  6. In this case, the grant made in favour of the defendant was not made on the basis that the defendant was appointed by the deceased to execute a will which established a trust of the estate property. Rather, the defendant was granted letters of administration to administer the deceased's estate by a registrar of the court exercising the court's non‑contentious probate jurisdiction on the deposed basis of intestacy. The defendant was granted letters of administration to administer the estate of the deceased according to law, and I understand that the estate has not been fully administered. There has been no assent or conveyance by the defendant.

  7. While it has been observed that the origins of the offices of trustee and personal representative are quite different, in modern times, largely as the result of statute, the two offices have a greater similarity than before.[43] Personal representatives have been included within the definition of 'trustees' in legislation; and statutory trusts have been created.[44]

    [43] MJ Leeming and JD Heydon, Jacobs' Law of Trusts in Australia (8th ed, 2016) [2-01], [2-40].

    [44] See the Trustees Act s 6; and Administration Act s 13.

  8. In support of the plaintiff's application, reference was made to the terms and effect of s 6 of the Trustees Act. In Western Australia, except where otherwise provided, the provisions of the Trustees Act, being an Act to consolidate and amend the law relating to trustees, apply to every trust as defined in s 6 of the Act.[45] In the Trustees Act, the terms 'trust' and 'trustee' are afforded an expanded meaning, as s 6 of the Trustees Act relevantly provides:

    6.Terms used

    (1)In this Act, unless the context otherwise requires, -

    …

    trust does not include the duties incidental to an estate conveyed by way of mortgage, but with that exception trust extends to implied and constructive trusts, and to cases where the trustee has a beneficial interest in the trust property, and to the duties incidental to the office of a personal representative; and trustee has a corresponding meaning and includes a trustee corporation and every other corporation in which property subject to a trust is vested and every person who immediately before the commencement of this Act was a trustee of the settlement or in any way a trustee under the Settled Land Act of 1892 and, where the context admits, includes a personal representative; and new trustee includes an additional trustee;

    [45] Trustees Act s 5(1); and long title.

  9. That is, s 6 extends the meaning of 'trust' in the Trustees Act to the duties incidental to the office of a personal representative unless the context otherwise requires, and 'trustee' has a corresponding meaning and where the context admits, includes a personal representative. However, the Trustees Act makes plain that the term 'trustee' does not include a personal representative as such for the purposes of certain sections.[46]

    [46] See for example the Trustees Act s 7(9) (New trustees, appointment of), and s 45(2) (Trustees, dying, devolution or powers or trusts).

  10. Properly construed, the effect of s 6 is to extend the definition of 'trust' and 'trustee' for the purposes of the Trustees Act, and not for all purposes. The introductory words of s 6, given their usual meaning, make plain that 'In this Act, unless the context otherwise requires',[47] certain words have certain meanings.

    [47] Emphasis added.

  11. I accept the defendant's submission that properly construed s 6 of the Trustees Act does not modify or change the general law position as articulated in Commissioner of Stamp Duties (Qld) v Livingston. For the reasons set out below, I accept that the decision of EM Heenan J in In re Ellis, Ellis v Ellis is not authority for the proposition that a legal personal representative is for all purposes a trustee by reason of s 6 of the Trustees Act. The distinction at law is not modified for all purposes by the expansive definition of 'trust' and 'trustee' for the purposes of the Trustees Act. No such intention is evidenced in the text of the Trustees Act when viewed as a whole, and when considered in its context.

  1. For these reasons I do not accept the plaintiff's submission that: [48]

    The principle expressed by Heenan J, in In Re; Ellis at [109] serves to invokes (sic) the Court's inherent equitable jurisdiction in this case. Seen in that context, s 6 of the Act simply puts beyond doubt the common law's characterisation of the role of personal representatives as trustees.

Treatment of personal representatives by the court

[48] Plaintiff's supplementary submissions par 16. See also ts 5, 31 (21 July 2021).

  1. While the defendant did not become a trustee in the strict sense upon his appointment as administrator, as observed by Viscount Radcliffe in Commissioner of Stamp Duties (Qld) v Livingston at 17, the estate property was (and is) held by him '… for the purpose of carrying out the functions and duties of administration, not for his own benefit; and these duties would be enforced upon him by the Court of Chancery, if application has to be made for that purpose by a creditor or beneficiary interested in the estate. Certainly, therefore, he was in a fiduciary position with regard to the assets that came to him in the right of his office, and for certain purposes and in some respects he was treated by the court as a trustee …'

  2. Viscount Radcliffe further noted at 17 that:

    It may not be possible to state exhaustively what those trusts are at any one moment. Essentially, they are trusts to preserve the assets, to deal properly with them, and to apply them in a due course of administration for the benefit of those interested according to that course, creditors, the death duty authorities, legatees of various sorts, and the residuary beneficiaries. What equity did not do was to recognise or create for residuary legatees a beneficial interest in the assets in the executor's hands during the course of administration.

  3. Therefore, while the administrator was not a trustee in the strict sense from the date of his appointment, the court will control the use of his rights over assets that come to him in that capacity, and:[49]

    … it will do so by the enforcement of remedies which do not involve the admission or recognition of equitable rights of property in those assets. Equity in fact calls into existence and protects equitable rights and interests in property only where their recognition has been found to be required in order to give effect to its doctrines.

In re Ellis, Ellis v Ellis

[49] Commissioner of Stamp Duties (Qld) v Livingston (22).

  1. The plaintiff submits that the decision of EM Heenan J in In re Ellis, Ellis v Ellis is authority for the proposition that a personal representative occupies the role of trustee from the date of his or her appointment, consistent with the meaning of the term 'trustee' as defined in the Trustees Act at s 6,[50] and as a personal representative occupies the role of trustee from the date of his or her appointment, the inherent supervisory jurisdiction of the court with respect to trustees is enlivened in the present application.[51] What is said to flow from that characterisation is set out at [3] above.

    [50] ts 6 - 7, 31 (21 July 2021).

    [51] Plaintiff's supplementary submissions pars 2 - 14, citing In re Ellis, Ellis v Ellis [109] (EM Heenan J); Estate Polykarpou; Re a charity (Lindsay J) [35], and said to be supported by Commissioner of Stamp Duties (Qld) v Livingston (14), (15), (17), (18).

  2. In re Ellis, Ellis v Ellis, his Honour was dealing with controversies which had arisen in a proceeding before a registrar on the passing of an executor's accounts demanded by a beneficiary pursuant to s 43(1)(b) of the Administration Act. In that context, his Honour made observations as to the availability of the remedy of account, whether in the exclusive jurisdiction or equity or in aid of common law rights or at law, and the passing of accounts by a personal representative.

  3. When considering an administrator or executor's obligation to pass accounts under s 43 of the Administration Act, particularly the timing of passing a personal representative's accounts, at [108] his Honour observed that there will be estates in which the process of administration is likely to last for many years, and at [109] ‑ [110] observed as follows:

    This does not mean that the passing of a personal representative's accounts can or should be delayed until the final point of administration in an estate. In many of these cases the process of administration, by which the deceased's assets are identified, collected, and where appropriate realised, and the deceased's debts and the expenses of administration are identified and paid can be performed and thus the administration completed even though the estate is not full distributed. This accounts for the distinction between the personal representative's role as an executor or administrator on the one hand and his or her role of trustee in holding the estate after it has been realised and the debts discharged on the trusts of the will for a much longer period. This distinction between administration and trusteeship is well established on the authorities, eg, Commissioner of Stamp Duties (Q) v Livingston, although in this State, as in many other places, the role of the personal representative, whether executor or administrator, is from the very first treated by statute as including that of trustee: see Trustees Act s 6 by which 'trust' is specifically defined to include the duties incidental to the office of a personal representative.

    Consequently, the ability to demand that the personal representative pass his or her accounts or otherwise account for the discharge of those obligations can be made repeatedly or progressively during the course of an extended administration, and the passing of those accounts, or the performance of an accounting obligation by the personal representative under some other procedure will, in those instances, relate to the performance of the administration or the trust up to that point. It may result in the accounts up to that point becoming settled and, therefore, binding on all interested parties (in the absence of fraud) but leave the opportunity open for a further passing of accounts or other accounting later in the case of an administration or trusteeship continuing over many years.

  4. His Honour further observed at [187] that the procedure under the Non-Contentious Probate Rules 1967 (WA) r 37 was not apt or sufficient by itself to allow the controversies which had arisen in a proceeding before a registrar to be dealt with because of the large area of factual and legal controversy inevitably arising from them, and determined at [189] that:

    As a consequence, the matter having been referred to me pursuant to r 4 of the NCR, I consider that I should exercise the ample jurisdiction of the court, not merely under s 43 of the Administration Act but the court's plenary jurisdiction in equity, to order a specific inquiry and an account into the matters relating to the money claimed to have been expended by the executor in the three various ways on the property and house at Mount Claremont and to direct that that inquiry and account be conducted by the registrar as a specific inquiry and account before completing the passing of accounts under r 37 which at present stands adjourned. That specific account and inquiry can be reported to the court, whereupon it can be decided, if still necessary, for the adjourned account under r 37 to proceed.

  5. Understood in context, I do not understand his Honour's reasons to stand for the proposition that the general law distinction between personal representation and trusteeship (in the strict sense) is not observed in the context of the administration of deceased estates. Indeed, the application before his Honour did not require determination of whether the role of the personal representative is for all purposes from the very first treated as that of trustee. I accept the defendant's submission that properly understood, the decision of EM Heenan J in In re Ellis, Ellis v Ellis is not authority for the proposition that a legal personal representative is for all purposes a trustee by reason of s 6 of the Trustees Act. I do not accept the plaintiff's submission that the general law of distinction is 'not the position in Western Australia' as a consequence of EM Heenan J's reasons at [109];[52] nor do I accept the plaintiff's submission that his Honour's reasons at [109] 'does no more than simply displace the position in Livingston by reason of the effect of statute and it is clear that his Honour is making a pronouncement on the meaning and the implication of that section for the purpose of how to conceive the role of a personal representative.'[53]

    [52] ts 5 - 6 (21 July 2021).

    [53] ts 31 (21 July 2021).

  6. Counsel for the plaintiff also referred to the decision of Lindsay J in Estate Polykarpou; Re a charity, which concerned the proper construction of a will, and whether upon its proper construction the will manifested a general charitable intention so as to warrant, and require, the gift to be administered cy pres. In that context, Lindsay J at [33] ‑ [35] found that:

    The existence of a trust can be discerned, in the present case, in the language and structure of the deceased's will. The factors noticed in paragraph 21(a) are sufficient to establish that.

    Even if an actual intention that estate property be held on trust were not so clearly discernible, it is difficult to imagine a testamentary gift to charity (a gift to a purpose, not a person) that would be amenable to a finding that an executor holds estate property the subject of the gift without coming under the obligations of a trustee.

    Although a distinction is drawn between an executor and a trustee in analysis of the course of administration of a deceased estate, the nature of the powers and duties of a personal representative of a deceased person and the nature of a beneficiary's interest in a deceased estate (eg. Commissioner of Stamp Duties (Qld) v Livingston[1964] UKPC 2; [1965] AC 694 at 717C-F, upholding Livingston v Commissioner of Stamp Duties (Qld)[1960] HCA 94; (1960) 107 CLR 411 at 435, 451 and 459), it is nevertheless correct to say generally (as recorded in H Picarda, The Law and Practice Relating to Charities (Bloomsbury Professional, England, 4th ed, 2010) at page 479) that 'all the property of the deceased devolves upon his [or her] personal representatives upon trust'.

  7. Again, understood in context, I do not understand Lindsay J's reasons to stand for the proposition that the general law distinction between personal representation and trusteeship (in the strict sense) is not observed in the context of the administration of deceased estates. Rather, the reasons are consistent with the observations made by Viscount Radcliffe, that for certain purposes and in some respects a personal representative will be treated by the court as a trustee.[54]

The court's jurisdiction

[54] Commissioner of Stamp Duties (Qld) v Livingston (17).

  1. The plaintiff contends, and I accept that this court has jurisdiction under s 16(1)(d)(i) of the Supreme Court Act as a court of equity with power and authority to 'administer justice, and to do, exercise and perform all acts, matters and things necessary for the due execution of such equitable jurisdiction as, at commencement of the Supreme Court Ordinance 1861, the Lord Chancellor of England could or lawfully might have done within the realm of England in the exercise of the jurisdiction to him belonging; …', with the consequence that this court has general jurisdiction in equity extending to all matters relating to and concerning the operation, administration or terms of any trust and the duties and obligations of any trustee.[55]

    [55] Supreme Court Act s 16(1)(d)(i), as observed by EM Heenan J in Tsaknis as Executor and Trustee of the Estate of Geoffrey Douglas Roland Lilburne (Dec) v Lilburne [2010] WASC 152 [35]. See also Wright v Stevens [2018] NSWSC 548 [260] ‑ [261], referring to Schmidt v Rosewood Trust Ltd [36].

  2. As observed above, the court will control the use of a personal representative's rights over assets that come to him or her in that capacity.[56] I accept that where property is held by a personal representative, for the purpose of carrying out the functions and duties of administration, not for his own benefit, such duties would be enforced upon him by the court. Lindsay J in Estate Polykarpou; Re a charity at [38] observed that:

    Equity jurisprudence is familiar with analyses that require elaboration of the particular context in which the word 'trust' is deployed and for the purpose of which, to provide a contrast, the term 'trust in the strict sense' is used: eg, Clay v Clay [2001] HCA 9; (2001) 202 CLR 410 at 428[37]-432[43]. Such distinctions are commonplace upon an exercise of equity jurisdiction. They are not usually found, or readily justified, in delineation of the jurisdiction of a court (such as the Supreme Court of NSW) endowed with plenary equity jurisdiction.

    [56] See [54] above; Commissioner of Stamp Duties (Qld) v Livingston (22).

  3. Further, as noted by EM Heenan J in Tsaknis as Executor and Trustee of the Estate of Geoffrey Douglas Roland Lilburne (Dec) v Lilburne at [35], without in any way restricting the amplitude of the court's powers (referring to the court's powers under s 16(1)(d)(i)), the Rules of the Supreme Court 1971 (WA) O 58 r 2 provides that any trustee or any person interested under the administration of a deceased estate or under any trust may apply on originating summons for the determination, without a general administration of the estate or trust, of any of a number of designated questions or matters including '(g) the determination of any question arising in the administration of the estate or trust'. I note that an order directing the administrator to do a particular act may also be sought under O 58 r 2(e).

  4. Under the Trustees Act, the court also has power to make certain orders and give directions in relation to the duties incidental to the office of a personal representative. By way of example, under s 92 of the Trustees Act, a trustee (which in context would include a personal representative) may apply to the court for directions.

  5. Another source of jurisdiction to settle questions arising in respect of any will or administration is that given to the court under s 45 of the Administration Act.

  6. Counsel for the plaintiff made passing reference to s 18 of the Supreme Court Act, but did not advance the application by particular reliance upon s 18.[57] The court is vested with probate jurisdiction pursuant to s 18 of the Supreme Court Act, influenced by the law and practice of the old ecclesiastical courts of England, exercised by courts of England's established Church, the Church of England. The primary function of the court in exercising its probate jurisdiction is to make grants of representation for deceased estates. The court's probate jurisdiction brings with it the inherent power necessary to the effective exercise of the jurisdiction granted.[58] Section 18 expressly provides that the court has authority to hear and determine all questions relating to testamentary causes and matters.

    [57] ts 2 (21 July 2021).

    [58] Lexis Nexis, Civil Procedure Western Australia (online version) at [1115.1], referring to Estate Kouvakas; Lucas v Konakas [2014] NSWSC 786 [102] - [201].

  7. As was noted by Lindsay J in Estate Kouvakas; Lucas v Konakas at [108], unlike the common law jurisdiction, the probate jurisdiction is not primarily concerned with claims of right between adversarial parties. It is concerned with the due administration of property (in the form of an 'estate') having regard to the interests of the dead, the living and the public. Furthermore, independently of any operation of equity's jurisdiction, a strong evaluative, discretionary element is generally intrinsic to an exercise of probate jurisdiction, and with its focus on the management of property, and competing (sometimes unrepresented) interests in property, it is important that the probate jurisdiction of the court be administered with flexibility, unconstrained by unnecessary jurisdictional divides, able to adapt practice and procedure to deal with practical problems attending property management.[59]

    [59] Estate Kouvakas; Lucas v Konakas [109] - [110].

  1. In exercising its probate jurisdiction, the court has an inquisitorial role that requires a greater supervision and control of proceedings than in adversarial proceedings.[60] Contentious (or contested) probate actions may be commenced in this court for the grant of probate of the will, or letters of administration of the estate of a deceased person or for the revocation of such a grant or for a decree pronouncing for or against the validity of an alleged will, not being an action which is non-contentious or common form probate business.

    [60] Lexis Nexis, Civil Procedure Western Australia (online version) at[1115.1], referring to Re Przychodski [2006] VSC 781 [14] - [15], by way of example.

  2. There is also a constant duty of personal representatives to keep clear and accurate accounts of the estate and always to be ready to render such accounts when called up to do so. A personal representative is liable to be ordered by the court to account either generally in proceedings for general administration of the estate or under the court's jurisdiction to order specific accounts. The power to order an account includes the inherent jurisdiction of the court.[61]

    [61] In Re Ellis, Ellis v Ellis [81], citing Sutcliffe v Sutcliffe [2005] EWHC 3058 (CH); [2005] All ER (D) 116 [5]; and Acaster v Anderson (1848) 1 Rob Eccl 671; 163 ER 1174.

  3. Remedies are available to a person aggrieved by an administrator where there has been diversion or concealment of estate assets by that administrator, wrongful omission on the part of an administrator, or a failure to receive some personal estate which they ought to have got in, including under the Trustees Act and the Administration Act. An appropriate course may be for an aggrieved beneficiary or beneficiaries to commence an action seeking an account, and/or compensation and other remedies against the alleged defaulting trustee in which specific allegations of fraud, misappropriation, conversion or wilful breach of trust could be pleaded and require the trustee/personal representative to defend that action and, in doing so, to disclose all records related to the impugned transactions resulting in a trial with oral evidence and cross-examination.[62]

    [62] In re Ellis, Ellis v Ellis [120].

  4. Order 73 of the Rules of the Supreme Court regulates contentious (or contested) probate proceedings. In the court's contentious probate jurisdiction there is power to order discovery of documents, which power is not limited by O 73 r 11 of the Rules of the Supreme Court which provides for affidavits of scripts.[63] The traditional approach in probate claims is that the court exercises a wider latitude in ordering discovery in such claims than is exercised in other proceedings, given the particular nature of the enquiry in probate claims.[64] However, in this case, no contentious probate proceeding has been commenced by the plaintiff.

    [63] Lexis Nexis, Civil Procedure Western Australia(online version) at [73.11.1], referring to In the Will of Taylor (dec'd) [1922] VLR 280, 284; (1922) 28 ALR 192.

    [64] RR D'Costa, P Teverson and T Synak, Tristram and Coote's Probate Practice (32nd ed, 2020) [36.10].

  5. While there is no process prescribed in O 73 for pre‑action discovery, applications for pre‑action discovery as against a personal representative have been made pursuant to O 26A of the Rules of the Supreme Court.[65] The plaintiff's application for discovery and inspection is not however made pursuant to the Rules of the Supreme Court O 26A, nor does it appear to be based on the old bill of discovery procedure.[66]

Disposition - the application as advanced by the plaintiff

[65] Lexis Nexis, Civil Procedure Western Australia(online version) at [26A.4.3] referring to McCormack v Trevor John Fairs as executor of the estate of the late Maxine Fairs [2021] WASC 303.

[66] Preliminary discovery in equity described in Hooper v Kirella [1999] FCA 1584; (1999) 167 ALR 358 [24] - [29] (Wilcox, Sackville and Katz JJ).

  1. By the originating summons, the plaintiff asks the court to exercise its inherent powers to compel the defendant to give discovery and inspection of the requested documents. The genesis of the power is not particularised in the originating summons, but the application is prosecuted on the basis that the inherent supervisory jurisdiction of the court with respect to trusts and trustees is available to the plaintiff, in circumstances where no will that expressly establishes a trust of the estate property has been proven; the defendant has been granted letters of administration on the basis of deposed intestacy; and the plaintiff is presently a person entitled in distribution under s 14 of the Administration Act. Other than a passing reference to s 18 of the Supreme Court Act, the plaintiff seeks orders pursuant to the court's inherent jurisdiction with respect to trusts pursuant to s 16(1)(d)(i).

  2. The plaintiff's affidavit gives rise to a number of concerns in relation to the defendant's conduct. The plaintiff says that he seeks to clarify his full entitlement to the estate of the deceased, and particularly seeks to determine whether the deceased's funds were misused during the time the deceased was deemed incapable of managing her affairs. While noting the plaintiff's concerns and giving due regard to the context in which the application is prosecuted, I make no findings as to factual disputes which arise on the affidavits.

  3. On behalf of the plaintiff it is said that it is in the interests of justice that he be provided with the requested documents as they are estate documents (therefore trust documents); he is entitled (as a beneficiary) to have access to them; and the circumstances justify the defendant (as trustee) being compelled to give discovery and inspection of the same.

  4. As noted above, it was submitted that '[t]he principle expressed by EM Heenan J… at [109] serves to invoke the Court's inherent equitable jurisdiction in this case. Seen in that context, [s 6 of the Trustees Act] simply puts beyond doubt the common law's characterisation of the role of personal representatives as trustees.'[67] At par 13 of the plaintiff's supplementary submissions, counsel did clarify that '[w]hat is significant, for the purpose of this application, is the characterisation of the personal representative as trustee and the associated trust in the broader sense.' Submissions were also made as to the proportionality of allowing the application on the basis prosecuted.[68]

    [67] Plaintiff's supplementary submissions par 16.

    [68] ts 34 (21 July 2021).

  5. I understand the plaintiff asks that the court exercise its inherent supervisory jurisdiction to extend to the plaintiff a beneficiary of a trust's right of inspection, grounded upon 'the characterisation of the personal representative as trustee and the associated trust in the broader sense'.

'Discovery and inspection'

  1. I approach the determination of the application cognisant that there is a distinction between the right of a beneficiary arising under the law of trusts on the one hand, and on the other the right of an applicant to seek pre‑action discovery from a potential party or a litigant to discovery from an opposing party.[69] As noted above, the plaintiff's application is not an application made pursuant to the Rules of the Supreme Court for pre‑action discovery, nor is it an application made pursuant to any provision in the Trustees Act, the Administration Act or O 58 r 2 of the Rules of the Supreme Court. While the plaintiff's affidavit gives rise to a number of concerns in relation to the defendant's conduct, the application did not appear to be prosecuted based on the old bill of discovery procedure.

    [69] Rauch v Maguire [2010] 2 NZLR 845 [24] ‑ [30], referring to Lord Wrenbury's observations in O'Rourke v Darbishire, as reproduced in Wright v Stevens [274].

  2. What is sought is access to the requested bank records (said to be 'trust documents'), on the basis that the defendant is a trustee and the plaintiff is a beneficiary under the court's inherent jurisdiction (or they are at least characterised as such 'in the broader sense').[70]

Is the defendant a trustee?

[70] Plaintiff's supplementary submissions par 13.

  1. For the reasons set out above, I proceed on the basis that the defendant was not a trustee from the date of his appointment. The estate of the deceased has not been fully administered. While the defendant may be in a fiduciary position with regard to the assets that come to him in the right of his office, and for certain purposes and in some respects he may be treated by statute and the court as a trustee, he is not a trustee in the strict sense.

The requested documents

  1. As to the requested documents, I proceed on the basis that on the deceased's death any documents owned by her and then in existence were physical objects, the legal title to which, as personal chattels, passed to and became vested in the defendant upon his appointment as the deceased's personal representative.[71] While the parties did not address whether electronic bank records in the deceased's power also formed part of the deceased's estate upon her death as property in the form of a chose in action which passed to and became vested in the defendant upon his appointment as the deceased's personal representative, I proceed on the basis that they do.

    [71] Re Fairbairn, deceased (635, 639); Administration Act s 8.

  2. I would describe the requested bank records as being estate property, held by the defendant for the purpose of carrying out the functions and duties of administration, not for his own benefit. However, the requested bank records are not property in the defendant's hands in which equity recognises or creates for the plaintiff's benefit as a person entitled in distribution a beneficial interest during the course of administration.[72] The requested bank records are not trust property in the strict sense.

When access will be ordered

[72] Commissioner of Stamp Duties (Qld) v Livingston (17).

  1. The plaintiff refers to and relies on a number of authorities where the court, as a court of equity, has concluded that a beneficiary of a trust is entitled to inspect trust documents, and has exercised its discretion to order a trustee to make inspection available to a beneficiary.

  2. The court has authority as a court of equity to compel the provision of information by a trustee of a trust, albeit there has been considerable debate (particularly in the context of discretionary trusts) as to whether the right of inspection of trust documents arises because the discretionary object has an equitable proprietary right or interest in the trust documents,[73] or whether it rests upon the exercise of the court's inherent jurisdiction to supervise and if necessary intervene in the administration of trusts, particularly a discretion based upon a fiduciary duty of a trustee to keep the discretionary object informed when requested to do so, and to render accounts.[74]

    [73] As observed in Wright v Stevens [252] - [254], referring to O'Rourke v Darbishire (626 - 627); Re Londonderry's Settlement (937 ‑ 938); AIT Investment Group Pty Ltd v Markham Property Fund (No 2) Pty Ltd [66]; and Deutsch v Trumble [2016] VSC 263 [46].

    [74] As observed in Wright v Stevens [255] - [258], [259], [286], [289] referring to Schmidt v Rosewood Trust Ltd [51]. See also Silkman v Shakespeare Haney Securities Ltd [2011] NSWSC 148; (2011) 8 ASTLR 117 [27]; Palmer v Ayres [2017] HCA 5; (2017) 259 CLR 478; Erceg v Erceg [2017] NZSC 28; [2017] 1 NZLR 320 [18].

  3. The defendant says that the authorities that concern the entitlement of beneficiaries to trust documents do not assist the plaintiff who is not a beneficiary in the relevant sense, but merely possesses a chose in action to compel administration.[75]

The 'proprietary approach'

[75] Defendant's submissions pars 11 - 12.

  1. There are two streams of authority. The first has been described as the 'proprietary approach' and is grounded upon the proprietary interest in the estate or any part of it held by a beneficiary of the trust.[76] The proprietary approach was adopted by Lord Wrenbury in O'Rourke v Darbishire, who at 626 - 627 wrote:[77]

    The beneficiary is entitled to see all trust documents because they are trust documents and because he is a beneficiary. They are in a sense his own.

    [76] As observed in Wright v Stevens [253], citing AIT Investment Group Pty Ltd v Markham Property Fund (No 2) Pty Ltd [66]; and Deutsch v Trumble [46].

    [77] As observed in Wright v Stevens [253].

  2. In this case, the defendant is not a trustee and while the requested documents are property of the estate, they are not trust documents. The requested documents are not property in the defendant's hands in which the plaintiff has a proprietary interest. It can not be said that they are 'in a sense his own'.

  3. The first line of authority does not assist the plaintiff in the prosecution of this application.

The 'discretionary approach'

  1. The other stream has been described as the 'discretionary approach', which was adopted by the Privy Council in Schmidt v Rosewood Trust Ltd. As was observed in Wright v Stevens at [255], the discretionary approach considers that an order to disclose trust documents is one aspect of the court's inherent jurisdiction to supervise, and if necessary intervene in, the administration of trusts, however, such an order for access to documents will depend on the court's discretion.[78]

    [78] Citing Schmidt v Rosewood Trust Ltd [51].

  2. Schmidt v Rosewood Trust Ltd concerned an application to access information in the context of a discretionary trust, and in that context, the applicant's status as a beneficiary was questionable. The respondent trustees opposed disclosure on the ground that the applicant was not a beneficiary.

  3. In Schmidt v Rosewood Trust Ltd at [36], Lord Walker observed that:

    It is fundamental to the law of trusts that the court has jurisdiction to supervise and if appropriate intervene in the administration of a trust, including a discretionary trust. As Holland J said in the Australian case of Randall v Lubrano (unreported) 31 October 1975, cited by Kirby P in Hartigan Nominees Pty Ltd v Rydge (1992) 29 NSWLR 405, 416:

    “no matter how wide the trustee's discretion in the administration and application of a discretionary trust fund and even if in all or some respects the discretions are expressed in the deed as equivalent to those of an absolute owner of the trust fund, the trustee is still a trustee.”

  4. In contrast to the first stream of authority, the second assumes that a beneficiary's right or claim to disclosure of trust documents or information need not always have the proprietary basis of a transmissible interest in trust property. A fixed or transmissible beneficial interest is not required.[79] At [51], Lord Walker in Schmidt v Rosewood Trust Ltd continued:

    Their Lordships considered the more principled and correct approach is to regard the right to seek disclosure of trust documents as one aspect of the court's inherent jurisdiction to supervise, and if necessary to intervene in the administration of trusts. The right to seek the court's intervention does not depend on entitlement to a fixed and transmissible beneficial interest. The object of a discretion (including a mere power) may also be entitled to protection from a court of equity, although the circumstances in which you may seek protection, and the nature of protection you may expect to obtain, will depend on the court's discretion …

    [79]Schmidt v Rosewood Trust Ltd [50] - [52], citing Hartigan Nominees Pty Ltd v Rydge (421 - 422).

  5. While proprietary rights may be sufficient, the second stream of authority assumes that such a right is not necessary to a right of access which the courts will enforce to uphold a beneficiary's entitlement to a reasonable assurance of the manifest integrity of the administration of the trust by the trustees. In Hartigan Nominees Pty Ltd v Rydge, Kirby P agreed that the beneficiary's rights to inspect trust documents are founded therefore not upon any equitable proprietary right which he or she may have in respect of those documents but upon the trustee's fiduciary duty to keep the beneficiary informed and to render accounts.[80]

    [80] Hartigan Nominees Pty Ltd v Rydge (421 - 422), as cited in Schmidt v Rosewood Trust Ltd [52].

  6. As noted above, while the authority of the court as a court of equity to compel the provision of information by a trustee of a trust is well settled, there has been considerable debate (particularly in the context of discretionary trusts) as to whether the right of inspection of trust documents arises because the discretionary object has an equitable proprietary right or interest in the trust documents,[81] or whether it rests upon the exercise of a discretion based upon the fiduciary duty of a trustee to keep the discretionary object informed when requested to do so, and to render accounts.[82] As was observed in Wright v Stevens, the Australian position on whether a discretionary object has an entitlement to access documents remains unsettled.[83]

    [81] As observed in Wright v Stevens [252] - [254], referring to O'Rourke v Darbishire (626 - 627); Re Londonderry's Settlement (937 ‑ 938); AIT Investment Group Pty Ltd v Markham Property Fund (No 2) Pty Ltd [66]; and Deutsch v Trumble [46].

    [82] As observed in Wright v Stevens [255] - [258], [259], [286], [289] referring to Schmidt v Rosewood Trust Ltd [51]. See also Silkman v Shakespeare Haney Securities Ltd [27]; Palmer v Ayres; Erceg v Erceg [18].

    [83] Wright v Stevens [252], and the cases discussed at [253] - [285].

  7. While the second stream assumes that a beneficiary's right or claim to disclosure of trust documents or information need not always have the proprietary basis of a transmissible interest in trust property, developed in the context of equity's supervision of trusts, in particular, in the context of discretionary trusts. The context in which the plaintiff seeks access to documents by this application does not concern a discretionary trust.

  8. I do not proceed on the basis that the plenary jurisdiction of the court in equity is limited to trusts in the strict sense. I accept that while the defendant was not a trustee in the strict sense from the date of his appointment as personal representative, the court will control the use of his rights over assets that come to him in that capacity, and it will do so by the enforcement of remedies which do not involve the admission or recognition of equitable rights of property in those assets.

  9. However, in this case, the plaintiff seeks that the court applies the authorities which afford to a beneficiary of a trust the right to access documents in a context where there is no trust in the strict sense, discretionary or otherwise. The defendant is a personal representative who is in a fiduciary position with regard to the assets that come to him in the right of his office, and for certain purposes and in some respects he is treated by the court as a trustee. I do not accept the submissions made on behalf of the plaintiff as to the proper reading of In re Ellis, Ellis v Ellis or the effect of s 6 of the Trustees Act. 

  10. While I accept that the court's probate jurisdiction brings with it the inherent power necessary to the effective exercise of the jurisdiction granted, I have not been taken to any authority where the court, as a court of equity and exercising inherent jurisdiction, has applied the authorities referred to and relied upon by the plaintiff and ordered access to information or documents in circumstances such as this. This is perhaps because the relief sought on behalf of the plaintiff may have been prosecuted on a different basis, or pursuant to a different power or discretion. In all of the circumstances, and having given careful consideration to the authorities and the submissions made on behalf of the plaintiff, including with respect to proportionality, I consider it appropriate to proceed with caution and not accede to the plaintiff's request on the basis it was prosecuted.

Conclusion and orders

  1. I regret that this decision was not delivered sooner, and its delivery was not prioritised. For the reasons set out above, I am satisfied that an order for discovery and inspection against the defendant ought be refused on the basis that was argued. Once the parties have the opportunity to consider these reasons, I will hear from them as to the form of order and costs.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

RW

Associate to the Honourable Justice Strk

4 SEPTEMBER 2023


Actions
Download as PDF Download as Word Document
Cases Citing This Decision

4

Moylan v Sims [2025] WASC 349
Celenza v Celenza Executor for Estate of Maria Celenza [2025] WASC 183
Kelly v Connell as Executor of the Estate of John Kelly [2024] WASC 274
Cases Cited

31

Statutory Material Cited

0

Re Ellis; Ellis v Ellis [2015] WASC 77
Estate Polykarpou; re a Charity [2016] NSWSC 409
Commissioner of Taxation v Linter Textiles Australia Ltd (in liq) [2005] HCA 20