Mercanti v Mercanti - [2016] WASCA 206

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE COURT OF APPEAL (WA)

CITATION: MERCANTI -v- MERCANTI [2016] WASCA 206

CORAM: BUSS P
NEWNES JA
MURPHY JA

HEARD: 20 APRIL 2016

DELIVERED : 29 NOVEMBER 2016

FILE NO/S: CACV 139 of 2015

BETWEEN: MICHAEL ANGELO MERCANTI
First Appellant
JASON DEAN MERCANTI
Second Appellant
AND
TYRONE KANE MERCANTI
First Respondent
PARRADELE PTY LTD
Second Respondent
SLONDIA NOMINEES PTY LTD
Third Respondent
CITYCOURT PTY LTD
Fourth Respondent

ON APPEAL FROM:
Jurisdiction              :  SUPREME COURT OF WESTERN AUSTRALIA
Coram  :LE MIERE J
Citation  :MERCANTI -v- MERCANTI [2015] WASC 297
File No  :CIV 1262 of 2013, CIV 2186 of 2013, CIV 1276 of 2014

Catchwords:

Trusts - Discretionary family trust - Proper construction of power of variation in the trust deed - Whether the power of variation authorised the removal of the appointor and the appointment of a new appointor

Trusts - Discretionary family trust - Deed of variation of the trust deed - Whether the deed of variation was executed by the corporate trustee pursuant to the lawful authority of the trustee's directors or shareholders - Duomatic principle

Equity - Fraud on a power - Discretionary family trust - Power of variation in the trust deed - Whether the execution of a deed of variation of the trust deed constituted a fraud on the power of variation

Equity - Equitable fraud - Undue influence - Discretionary family trust - Whether trial judge erred in failing to conclude that the agreement of a person who was the guardian and appointor of the trust, and also a director of the corporate trustee, to and the execution by him of a deed of variation was as a result of equitable fraud by or the undue influence of his son

Equity - Fraud on a power - Discretionary family trust - Power conferred on the appointor under the trust deed to remove the trustee of the trust and appoint a new trustee - Whether the exercise by the appointor of the power of removal and appointment constituted a fraud on the power

Legislation:

Corporations Act 2001 (Cth), s 127, s 248A, s 248D

Result:

Appeal dismissed

Category: A

Representation:

Counsel:

First Appellant               :     Mr S Penglis
Second Appellant          :     Mr S Penglis
First Respondent           :     Mr J W K Burnside QC & Mr B G Grubb
Second Respondent      :     Mr J W K Burnside QC & Mr B G Grubb
Third Respondent          :     No appearance
Fourth Respondent        :     No appearance

Solicitors:

First Appellant               :     Jackson McDonald
Second Appellant          :     Jackson McDonald
First Respondent           :     Metaxas & Hager
Second Respondent      :     Metaxas & Hager
Third Respondent          :     Metaxas & Hager
Fourth Respondent        :     Metaxas & Hager

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

Adams v Lambert [2006] HCA 10; (2006) 228 CLR 409
Allcard v Skinner (1887) 36 Ch D 145
Antony v Weerasekera [1953] 1 WLR 1007
Atkins v St Barbara Mines Ltd (1996) 135 FLR 119
Australian Broadcasting Commission v Australasian Performing Right Association Ltd [1973] HCA 36; (1973) 129 CLR 99
Baker v Local Government Superannuation Scheme Pty Ltd [2007] NSWSC 1173
Bank of New South Wales v Rogers [1941] HCA 9; (1941) 65 CLR 42
Beacon Life & Fire Assurance Co v Gibb (1862) 1 Moore NS 73; 15 ER 630
Beck v LW Furniture Consolidated (Aust) Pty Ltd [2011] NSWSC 235
Bell Group Ltd (in liq) v Westpac Banking Corporation [No 9] [2008] WASC 239; (2008) 39 WAR 1
Benjamin v Harding Corporation Pty Ltd (1995) 16 ACSR 376
Berger v Lysteron Pty Ltd [2012] VSC 95
Byrnes v Kendle [2011] HCA 26; (2011) 243 CLR 253
Cachia v Westpac Financial Services Ltd [2000] FCA 161; (2000) 170 ALR 65
Chacmol Holdings Pty Ltd v Handberg [2005] FCAFC 40; (2005) 215 ALR 748
Charlton v Members of the Teachers Tribunal [1981] VR 831
Commercial Bank of Australia Ltd v Amadio [1983] HCA 14; (1983) 151 CLR 447
Commissioners of Inland Revenue v Raphael [1935] AC 96
CPT Custodian Pty Ltd v Commissioner of State Revenue of the State of Victoria [2005] HCA 53; (2005) 224 CLR 98
Elder's Trustee and Executor Co Ltd v Higgins [1963] HCA 48; (1963) 113 CLR 426
Electricity Generation Corporation v Woodside Energy Ltd [2014] HCA 7; (2014) 251 CLR 640
Ellis v Dariush‑Far [2007] QCA 398; (2007) 242 ALR 635
Esso Australia Ltd v Australian Petroleum Agents' & Distributors' Association [1999] 3 VR 642
Fardon v Attorney‑General for the State of Queensland [2004] HCA 46; (2004) 223 CLR 575
Federal Commissioner of Taxation v Bargwanna [2012] HCA 11; (2012) 244 CLR 655
Fitzgerald v Masters [1956] HCA 53; (1956) 95 CLR 420
Fitzwood Pty Ltd v Unique Goal Pty Ltd (in liq) [2001] FCA 1628; (2001) 188 ALR 566
Fitzwood Pty Ltd v Unique Goal Pty Ltd (in liq) [2002] FCAFC 285
Flegeltaub v Telstra Super Pty Ltd [2000] VSC 107
Franklins Pty Ltd v Metcash Trading Ltd [2009] NSWCA 407; (2009) 76 NSWLR 603
Gardiner v Sevenoaks Rural District Council [1950] 2 All ER 84
Global Custodians Ltd v Mesh [2002] NSWSC 283
Goldsworthy v Brickell [1987] Ch 378
Gra‑Ham Australia Pty Ltd v Perpetual Trustees WA Ltd (1989) 1 WAR 65
Harre v Clark [2014] NZHC 2533
Harris v Jenkins [1922] HCA 54; (1922) 31 CLR 341
Harris v Rothery (as co‑executor of estate of late Harris) [2013] NSWSC 1275
Hartigan Nominees Pty Ltd v Rydge (1992) 29 NSWLR 405
Herrman v Simon (1990) 4 ACSR 81
Hill (Viscount) v Hill (Dowager Viscountess) [1897] 1 QB 483
Hillcrest (Ilford) Pty Ltd v Kingsford (Ilford) Pty Ltd (No 2) [2010] NSWSC 285; (2010) 4 ASTLR 233
Hotien Holdings Pty Ltd v Frits Maré [2007] NSWSC 599; (2007) 25 ACLC 854
Huguenin v Baseley (1807) 33 ER 526
Imperial Group Pension Trust Ltd v Imperial Tobacco Ltd [1991] 1 WLR 589
ING Funds Management Ltd v ANZ Nominees Ltd [2009] NSWSC 243; (2009) 228 FLR 444
Inland Revenue Commissioners v Schroder [1983] STC 480
International Air Transport Association v Ansett Australia Holdings Ltd [2008] HCA 3; (2008) 234 CLR 151
Jenkins v Ellett [2007] QSC 154
Johnson v Buttress [1936] HCA 41; (1936) 56 CLR 113
JW Broomhead (Vic) Pty Ltd v JW Broomhead Pty Ltd [1985] VR 891
Karger v Paul [1984] VR 161
Kearns v Hill (1990) 21 NSWLR 107
Kennon v Spry [2008] HCA 56; (2008) 238 CLR 306
Kent v SS 'Maria Luisa' (No 2) [2003] FCAFC 93; (2003) 130 FCR 12
Lancedale Holdings Pty Ltd v Heath Group Australasia Pty Ltd [1999] NSWCA 460; (1999) 33 ACSR 247
Letterstedt v Broers (1884) 9 App Cas 371
LGSS Pty Ltd v Egan [2002] NSWSC 1171
Lock v Westpac Banking Corporation (1991) 25 NSWLR 593
Lord Napier and Ettrick v RF Kershaw Ltd [1999] 1 WLR 756
Maciejewski v Telstra Super Pty Ltd (1998) 44 NSWLR 601
Maguire v Makaronis [1997] HCA 23; (1997) 188 CLR 449
Marshall v Sladden (1849) 7 Hare 428
McLeary v Swift [2013] NSWSC 216
Mercanti v Mercanti [2015] WASC 297
Montevento Holdings Pty Ltd v Scaffidi [2012] HCA 48; (2012) 246 CLR 325
Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37; (2015) 256 CLR 104
Muschinski v Dodds [1985] HCA 78; (1985) 160 CLR 583
Ngurli Ltd v McCann [1953] HCA 39; (1953) 90 CLR 425
Nocton v Lord Ashburton [1914] AC 932
O'Reilly v Alderson (1849) 8 Hare 101
Pepe v City & Suburban Permanent Building Society [1893] 2 Ch 311
Permanent Mortgages Pty Ltd v Vandenbergh [2010] WASC 10; (2010) 41 WAR 353
Poliwka v Heven Holdings Pty Ltd (No 2) (1992) 8 ACSR 747
Pope v DRP Nominees Pty Ltd [1999] SASC 337; (1999) 74 SASR 78
Quek v Beggs (1990) 5 BPR 11,761
R v The Charity Commissioners for England and Wales; Ex parte Baldwin [2001] WTLR 137
Rayner v NJ Sheaffe Pty Ltd [2010] NSWSC 810
Re Ball's Settlement Trusts [1968] 1 WLR 899
Re Blocksidge [1997] 1 Qd R 234
Re Burton (1994) 126 ALR 557
Re Courage Group's Pension Schemes [1987] 1 WLR 495
Re Dion Investments Pty Ltd [2013] NSWSC 1941
Re Dion Investments Pty Ltd [2014] NSWCA 367; (2014) 87 NSWLR 753
Re Duomatic Ltd [1969] 2 Ch 365
Re Dyer [1935] VR 273
Re Express Engineering Works Ltd [1920] 1 Ch 466
Re Hay's Settlement Trusts [1982] 1 WLR 202
Re Marsden's Trusts (1859) 4 Drew 594
Re Newen [1894] 2 Ch 297
Re Skeats' Settlement (1889) 42 Ch D 522
Re Y Trust [2011] JRC 135
Roden v International Gas Applications (1995) 125 FLR 396
Royal Botanic Gardens and Domain Trust v South Sydney City Council [2002] HCA 5; (2002) 240 CLR 45
Sainsbury v Inland Revenue Commissioners [1970] Ch 712
Scaffidi v Montevento Holdings Pty Ltd [2011] WASCA 146; (2011) 6 ASTLR 446
Schreuders v Grandiflora Nominees Pty Ltd [2016] VSCA 93
Scott v National Trust for Places of Historic Interest or Natural Beauty [1998] 2 All ER 705
Smith v Lucas (1881) 18 Ch D 531
Spong v Spong [1914] HCA 52; (1914) 18 CLR 544
Stuart v Armourguard Security Ltd [1996] 1 NZLR 484
Swiss Screens (Australia) Pty Ltd v Burgess (1987) 11 ACLR 756
The Commonwealth and the Central Wool Committee v The Colonial Combing, Spinning and Weaving Co Ltd [1922] HCA 62; (1922) 31 CLR 421
Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165
Topham v Duke of Portland (1869) 5 Ch App 40
Vatcher v Paull [1915] AC 372
Versteeg v The Queen (1988) 14 ACLR 1
Vision Super Pty Ltd v Poulter [2006] FCA 849; (2006) 154 FCR 185
West v Public Trustee [1942] SASR 109
Wright v Carter [1903] 1 Ch 27
X v A [2000] 1 All ER 490
Youyang Pty Ltd v Minter Ellison Morris Fletcher [2003] HCA 15; (2003) 212 CLR 484

Table of Contents

Buss P's reasons........................................................................................................................ 9
The Mercanti family and their associates
The Mercanti family businesses
The Mercanti trusts
The Mercanti companies
The purpose and use of discretionary family trusts in Australia
The relevant provisions of the MMF Trust Deed
The relevant issues in the primary proceedings
The circumstances in which Tyrone Mercanti and Parradele executed the written notices on 31 July 2013
The trial judge's conclusions
The grounds of appeal
Grounds 1 and 2: Michael Mercanti's and Jason Mercanti's submissions
Grounds 1 and 2: relevant legal principles
Grounds 1 and 2: their merits
Ground 3: Michael Mercanti's and Jason Mercanti's submissions
Ground 3: relevant legal principles
Ground 3: its merits
Ground 4: Michael Mercanti's and Jason Mercanti's submissions
Ground 4: relevant legal principles
Ground 4: its merits
Ground 5: Michael Mercanti's and Jason Mercanti's submissions
Ground 5: relevant legal principles
Ground 5: its merits
Ground 6: Michael Mercanti's and Jason Mercanti's submissions
Ground 6: relevant legal principles
Ground 6: its merits
Ground 7

Conclusion
Newnes & Murphy JJA's reasons.......................................................................................... 95

Introduction
The terms of the MMF Trust Deed
Grounds 1 and 2
Ground 3
Ground 4
Ground 5
Ground 6
Ground 7

BUSS P: This consolidated appeal comprises the appeals in CACV 137 of 2015, CACV 138 of 2015 and CACV 139 of 2015. On 22 October 2015, the Court of Appeal Registrar ordered that the individual appeals be consolidated and carried on as one appeal under the number and description CACV 139 of 2015 (Consolidated).
The appellants in the consolidated appeal comprise Michael Angelo Mercanti (Michael Mercanti) as first appellant and Jason Dean Mercanti (Jason Mercanti) as second appellant.
The respondents in the consolidated appeal comprise Tyrone Kane Mercanti (Tyrone Mercanti) as first respondent, Parradele Pty Ltd (Parradele) as second respondent, Slondia Nominees Pty Ltd (Slondia) as third respondent and Citycourt Pty Ltd (Citycourt) as fourth respondent.
Each appellant has appealed from the judgment of Le Miere J after a joint trial in the Supreme Court of three actions including, relevantly, CIV 2186 of 2013 (in which Michael Mercanti was the plaintiff) and CIV 1276 of 2014 (in which Jason Mercanti was the plaintiff).
On 20 August 2015, his Honour delivered judgment and published his reasons. See Mercanti v Mercanti [2015] WASC 297.
I would dismiss the appeal. My reasons are as follows.

The Mercanti family and their associates

Michael Mercanti has been referred to in the consolidated appeal and the primary proceedings as the patriarch of the Mercanti family. Sybil Yvonne Mercanti (Yvonne Mercanti) is his wife.
Michael Mercanti and Yvonne Mercanti have four adult sons, namely Michael Jamie Mercanti (known as Jamie), Troy Mercanti, Jason Mercanti and Tyrone Mercanti.
Tyrone Mercanti is married to Vanessa Mercanti.
The disputes which gave rise to the primary proceedings were principally between Michael Mercanti and Tyrone Mercanti.
Anthony Torre is Vanessa Mercanti's brother. He has been a close friend of the Mercanti family for more than 30 years.
Matthew Bizzaca, a chartered accountant, has been Michael Mercanti's and Yvonne Mercanti's accountant and financial adviser since about 1977.

The Mercanti family businesses

In about 1963 Michael Mercanti commenced carrying on a retail shoe repair business in partnership with Corrie Di Giovanni from a kiosk in the Dianella Plaza shopping centre. The partnership acquired additional kiosks until the mid‑1970s, when Michael Mercanti and Mr Di Giovanni dissolved the partnership and divided its assets. Michael Mercanti was allocated kiosks at Karrinyup and South Perth. He commenced carrying on a retail shoe repair business on his own account.
In about 1977 Michael Mercanti engaged Mr Bizzaca to provide financial and taxation advice. Mr Bizzaca recommended that, for taxation reasons, Michael Mercanti establish a discretionary family trust and transfer the retail shoe repair business to the trustee of the trust. Michael Mercanti instructed Mr Bizzaca to establish a trust which was called the M Mercanti Family Trust (MMF Trust). Slondia was the first Trustee. Slondia, in its capacity as Trustee of the MMF Trust, acquired the retail shoe repair business from Michael Mercanti. Between 1976 and 1985 the retail shoe repair business flourished. Further kiosks were acquired or opened.
In the early 1980s Michael Mercanti commenced carrying on a wholesale shoe repair supplies business in partnership with two other men. In the 1990s Michael Mercanti acquired the whole of the business. In 1996 Michael Mercanti instructed Mr Bizzaca to establish another discretionary family trust which was called the Footwear Wholesale Trust (FW Trust). Citycourt was the first Trustee. Citycourt, in its capacity as Trustee of the FW Trust, acquired the wholesale shoe repair supplies business from Michael Mercanti.

The Mercanti trusts

The MMF Trust was created by a deed executed on 1 June 1979. As I have mentioned, Slondia was the first Trustee. Michael Mercanti was the initial Guardian and Appointor. The assets of the MMF Trust include the retail shoe repair business set up by Michael Mercanti and four pieces of real estate.
The FW Trust was created by a deed executed on 16 August 1996. As I have mentioned, Citycourt was the first Trustee. Michael Mercanti was the initial Appointor. There was no Guardian. The assets of the FW Trust include the wholesale shoe repair supplies business set up by Michael Mercanti.

The Mercanti companies

Slondia was registered in 1979. Between at least 1995 and 2013 its registered office was at Mr Bizzaca's place of business.
Citycourt was registered in 1996. Between 1996 and 2013 its registered office was at Mr Bizzaca's place of business.
At all material times, Michael Mercanti and Yvonne Mercanti have been the shareholders of each of Slondia and Citycourt.
Michael Mercanti and Yvonne Mercanti have been directors of Slondia since 1979 and directors of Citycourt since 1996.
Tyrone Mercanti was a director of each of Slondia and Citycourt between 2001 and 30 July 2013.
Vanessa Mercanti was a director of Slondia between 2008 and 2013 and a director of Citycourt between November 2004 and 2013.
At all material times, Parradele has been controlled by Tyrone Mercanti.

The purpose and use of discretionary family trusts in Australia

As I have mentioned, the MMF Trust Deed was executed on 1 June 1979.
In the 1970s discretionary family trusts flourished in Australia. They were a taxation avoidance or minimisation device. In addition to reducing the amount or incidence of income tax, and gift, estate and death duties, discretionary family trusts offered flexibility and procedural simplicity. They facilitated succession planning. See Hardingham and Baxt, Discretionary Trusts, 1975, chapters 7, 8 and 9; Grbich, Munn and Reicher (eds), Modern Trusts and Taxation, 1978, 1-2; GL Davies, 'Some Problems with Discretionary Trusts', (1974-75) 9 Taxation in Australia 415; DH Bloom, 'The Discretionary Trust - Some Practical Implications', (1974-75) 9 Taxation In Australia 586; DKL Raphael 'Problems in Discretionary Trusts - What? Why? and How?', (1975-76) 10 Taxation in Australia 662; DG Hill, 'Comments on "Problems in Discretionary Trusts"', (1975-76) 10 Taxation in Australia 674; TW Magney, 'A Comparative Analysis of Estate Planning Vehicles', (1977-78) 12 Taxation in Australia 222.

The relevant provisions of the MMF Trust Deed

The parties to the MMF Trust Deed were John Horace Barrow Linton, as Settlor, and Slondia, as Trustee.
The recitals in the MMF Trust Deed state that the Settlor desired to make provision for the persons referred to and in the manner set out in the MMF Trust Deed; for that purpose the Settlor had upon execution of the MMF Trust Deed transferred or was about to transfer to the Trustee the settled sum of $10; and the Trustee had consented to become the Trustee under the MMF Trust Deed upon the trusts and with and subject to the powers and provisions expressed in the MMF Trust Deed.
Subject to variations made by a deed of variation executed in 2004, the efficacy of that deed being in contest in the primary proceedings and this appeal, at all material times the relevant provisions of the MMF Trust Deed have been as follows.
Clause 1 contains, relevantly, the following definitions:
In this Deed the following expressions shall unless there is something repugnant to or inconsistent with the subject matter have the meanings hereunder set out:-
(1)'Specified Beneficiary' and 'Specified Beneficiaries' shall mean the person or persons named and described or defined as such in the Schedule.
(2)'General Beneficiaries' shall mean and include ‑
(a)The Specified Beneficiary or the Specified Beneficiaries (as the case may be);
(b)the brothers sisters children and grandchildren of the Specified Beneficiaries or Specified Beneficiary and the children and grandchildren of such brothers and sisters children and grandchildren;
(c)any of the following entities whether formed in Australia or elsewhere namely ‑
(i)the Trustees (in their capacity as such) of any eligible trust;
(ii)any eligible corporation;
(iii)any other legal person at least one share or other interest in which is beneficially owned or held by any beneficiary (including the trustees of an eligible trust and an eligible corporation);
(iv)any charity;
(d)such other persons corporations and trusts (if any) as may be named described or defined in the Schedule as additional members of the class of General Beneficiaries;
PROVIDED HOWEVER that every member of the excluded class shall be excluded from the class of General Beneficiaries notwithstanding that he may otherwise be or be qualified to be included in the class of General Beneficiaries;
AND PROVIDED FURTHER that subject to clause 10 hereof the Trustees may at any time and from time to time declare in writing that any person shall be excluded from the class of General Beneficiaries notwithstanding that but for such exclusion he is or would by reason of one or more of the matters or circumstances hereinbefore referred to have been a General Beneficiary and the class of General Beneficiaries shall as from the date of the making of any such declaration be modified accordingly but so that this power shall not be capable of being exercised so as to derogate from any interest to which such General Beneficiary has previously become indefeasibly entitled whether in possession or in reversion or otherwise;
(3)'the excluded class' shall mean and include each of the following persons, namely ‑
(a)the Settlor;
(b)any notional Settlor;
(c)every person claiming under or in right of the Settlor or of any notional Settlor;
(d)the Trustees;
(e)every corporation and the trustees of every trust or settlement in or under which and any other person in which any other member of the excluded class has any interest so long as such interest continues;
PROVIDED HOWEVER that a person shall not be a member of the excluded class if his name is expressly included in the Schedule as an additional member of the class of General Beneficiaries;
AND PROVIDED FURTHER that subject to clause 10 hereof the Trustees may at any time and from time to time declare in writing that any person shall be a member of the excluded class notwithstanding that he is or might but for such declaration become a beneficiary and the excluded class shall as from the date of making any such declaration be modified accordingly but so that this power shall not be capable of being exercised so as to derogate from any interest to which such beneficiary has previously become indefeasibly entitled whether in possession or in reversion or otherwise;
(4)'eligible trust' shall mean any trust or settlement under which any beneficiary or class of General Beneficiaries has any interest;
PROVIDED that a trust shall be an eligible trust only if all interests therein must vest on or before the Vesting Date hereinafter referred to;
(5)'eligible corporation' shall mean any corporation at least one share in which is beneficially owned or held by any beneficiary (including the trustees of any eligible trust);
…
(7)'beneficiary' shall mean any of the General Beneficiaries;
(8)the expressions 'Specified Beneficiaries' and 'General Beneficiaries' shall include persons who at any time or from time to time until the Vesting Day fall within any of the foregoing definitions or within any description in the Schedule notwithstanding that such persons may not at the date of this Deed be in existence or fall within that definition or description and (in the case of trustees) notwithstanding that at the date of this Deed the trusts or settlements of which they are trustees have not been established or do not fall within that definition or description;
(9)'the Trustees' shall mean the person hereinbefore named as the Trustees or other the Trustee or Trustees for the time being of this Settlement;
(10)'the Trust Fund' shall mean the said settled sum all moneys investments and property paid transferred to or accepted by the Trustees as additions to the Trust Fund held by them pursuant to this Deed the accumulations of income hereinafter directed or empowered to be made all accretions and additions thereto from any source and the investments and property from time to time representing the said money investments property accumulations accretions and additions;
(11)'notional Settlor' shall subject to clause 27 hereof mean any person by whom any disposition of property of any nature to or in favour of the Trustees shall be made at any time otherwise than for fully adequate consideration in money or money's worth;
(12)'the Vesting Day' shall mean ‑
(a)the first to occur of the following dates namely ‑
(i)the day specified as 'the Vesting Day' in the Schedule;
(ii)such date being earlier than the day so specified as the Trustees may with the consent of the Guardian if there is a Guardian on the date of appointment and if there is then no Guardian without any consent appoint; or
(b)such date being later than the day specified in the Schedule as 'the Vesting Day' as the Trustees may subject to clause 10 hereof and subject to the same being within the perpetuity period appoint;
PROVIDED HOWEVER that where the date of expiration of the perpetuity period is earlier than the Vesting Day determined under the foregoing provisions that date shall be the Vesting Day and PROVIDED FURTHER that notwithstanding anything to the contrary herein contained all powers and dispositions made by or pursuant to or contained in this Deed which but for this provision would or might vest take effect or be exercisable after the expiration of the perpetuity period shall vest and take effect on and be exercisable only until the last day of the perpetuity period;
…
(14)'the Guardian' shall mean successively the person or persons (if any) successively named described or defined as such in the Schedule and where two or more persons are therein specified as acting jointly shall mean those persons acting jointly provided that the Trustees may at any time by instrument in writing (subject to clause 10 hereof) declare that any person who has not yet become Guardian but who would or might but for this proviso at some time become Guardian shall not become Guardian and if such declaration is so made that person shall not become Guardian notwithstanding that he is named as such in the Schedule;
(15)'the Appointor' shall mean successively the person or persons successively named described or defined as such in the Schedule or determined according to the provisions hereof and where two or more persons are specified in the Schedule as acting jointly shall mean those persons acting jointly provided that the Trustees may at any time by instrument in writing (subject to clause 10 hereof) declare that any person who has not yet become Appointor but who would or might but for this proviso at some time become Appointor shall not become Appointor and if such declaration is so made that person shall not become Appointor notwithstanding that he is named as such in the Schedule.

By cl 2, 'the Settlor as Settlor HEREBY DECLARES that the Trustees shall and the Trustees HEREBY DECLARE that they will henceforth stand possessed of the Trust Fund and of the income thereof upon the trusts and with and subject to the powers and provisions hereinafter expressed concerning the same'.
Clause 3(1) empowers the Trustee, 'at any time before the expiration of any Accounting Period with respect to all or any part or parts of the nett income of the Trust Fund for such Accounting Period', to determine the manner in which the nett income should be dealt with, as permitted by cl 3(1), including by paying, applying or setting aside all or any part or parts of the nett income to or for any one or more of the General Beneficiaries living or in existence at the time of the determination or to accumulate all or any part or parts of the nett income.
Clause 3(2) contains provisions which apply to any determination made by the Trustee pursuant to cl 3(1). Clause 3(2)(d) and cl 3(2)(f) provide:
(d)subject to clause 10 hereof the Trustees shall have an absolute discretion in the making of any determination and shall not be required to assign any reason therefor;
…
(f)without limiting the ability of the Trustees to make a determination by other means the Trustees may effect a determination for the purposes of this clause by oral declaration or by written statement whether or not published to any person and a certificate by the Trustees as to any determination shall be prima facie evidence that such determination was made as and when set out in such certificate.
Clause 4 confers on the Trustee, as from the Vesting Day, powers of appointment and distribution with respect to the Trust Fund and the income of the Trust Fund. By cl 4(1), as from the Vesting Day, the Trustee shall stand possessed of the Trust Fund and the income of the Trust Fund:
[I]n trust for such of the beneficiaries for such interests and in such proportions and for one to the exclusion of the other or others at such age or time or respective ages or times if more than one in such shares and with such trusts and powers for their respective benefit maintenance advancement and education (including discretionary trusts and powers exercisable over capital or income at the discretion of the Trustees or of any other person or persons) as the Trustees may subject to clause 10 hereof by instrument in writing revocable or irrevocable and without offending the rule against perpetuities before the Vesting Day appoint provided that any revocable appointment shall be revocable only until the end of the day preceding the Vesting Day when it shall become irrevocable.
Clause 6 empowers the Trustee, subject to cl 10, at any time or times and from time to time before the Vesting Day:
(a)to convey or transfer the whole or any part of the Trust Fund to or for the benefit of any Beneficiary for his or her own use and benefit;
(b)to lend any sum to any Beneficiary; and
(c)to pay or apply to or for the benefit of any Beneficiary the whole or any part of the income or capital or accrued or accumulated income to which the Beneficiary is either absolutely or contingently entitled.
Clause 7 confers extensive powers on the Trustee in relation to the Trust Fund. By cl 7(22), cl 7(25) and cl 7(33):
(22)subject to clause 10 hereof in any conditions or circumstances which the Trustees think expedient to appoint either in respect of the whole of the Trust Fund or any part thereof new Trustees in any country in the world and to transfer assign and set over the investments for the time being representing the Trust Fund or any part thereof to any such new Trustees upon similar trusts and subject to terms and conditions similar to those declared by this Deed and either subject to the control of the Trustees of this Deed or to the exclusion of such control and the Trustees of this Deed shall be indemnified and held harmless against any loss which may arise from the exercise of this power;
…
(25)subject to clause 10 hereof at any time or times before the Vesting Day by any irrevocable deed or deeds (without infringing the rule against perpetuities applicable to this Deed) to appoint that the whole or any part of the income or capital of the Trust Fund shall thenceforth be held upon the trusts and with and subject to the powers and provisions of any eligible trust approved by the Trustees and upon any such appointment being made to transfer to the trustees or trustee for the time being of the said eligible trust the property comprised in the said appointment whereupon the trusts herein declared concerning such property shall cease and determine and the said property shall for all purposes be subject to the trusts powers and provisions contained in the said eligible trust and be subject to and governed by the proper law of the said eligible trust whether such proper law shall be the proper law applicable to this Deed or not.
…
(33)generally to exercise or concur in exercising all the foregoing powers and discretions contained in this Deed or otherwise by law conferred notwithstanding that the Trustees or any person being a Trustee or any person being a director or shareholder of a Trustee hereof (being a company) has or may have a direct or personal interest (whether as trustee of any other settlement or in his personal capacity or as a shareholder or director or member or partner of any company or partnership or otherwise) in the mode or result of exercising such power or discretion or may benefit either directly or indirectly as a result of the exercise of any such power or discretion and notwithstanding that the Trustee for the time being is the sole Trustee.
Clause 10 is concerned with the office of Guardian:
Subject always to any express provision to the contrary herein contained every discretion vested in the Trustees shall be absolute and uncontrolled and every power vested in them shall be exercisable at their absolute and uncontrolled discretion PROVIDED that notwithstanding anything contained in this Deed ‑
(1)the Trustees may before exercising any discretion or power vested in them or making any determination hereunder consult the wishes of the Guardian (if any);
(2)the Trustees may subject to this clause by instrument in writing revocably or irrevocably wholly or partially release abandon or restrict any power conferred on them by this Deed;
(3)subject to sub‑clause (5) of this clause the Trustees shall not when there is a Guardian exercise the reserved powers or the restricted powers except with the consent of the Guardian;
(4)where a Guardian is named in the Schedule and there ceases to be a Guardian the Trustees shall not ‑
(a)exercise the reserved powers; or
(b)exercise the restricted powers in such manner as to impair or diminish the expectations of any Specified Beneficiary or of any other person or persons upon whom in the events which happen or pursuant to any appointment validly made pursuant to clause 4 hereof the Trust Fund is to devolve on the Vesting Day;
PROVIDED NEVERTHELESS that the Trustees shall have power to make a declaration pursuant to the second provisos to clauses 1(2) or 1(3) hereof in respect of any General Beneficiary who is adult and sui juris and who requests them to do so;
(5)the Guardian may at any time by instrument in writing revocably or irrevocably declare that thenceforth all or any of the reserved powers or the restricted powers ‑
(a)shall cease to be reserved powers or restricted powers as the case may be and after any such declaration the Trustees shall be entitled to exercise such power or powers as though no Guardian had been named in the Schedule; or
(b)shall be prohibited to the Trustees and after any such declaration the Trustees shall not be entitled to exercise such power or powers;
(6)where no Guardian is named in the Schedule the Trustees may unless otherwise expressly provided in the Schedule exercise all the reserved powers and the restricted powers in their absolute and uncontrolled discretion and without the consent of any other person;
(7)in this clause ‑
(a)'reserved powers' means ‑
(i)the power to make declarations pursuant to the second provisos to paragraphs (2) and (3) of clause 1 hereof;
(ii)the power pursuant to clause 1(12)(b) hereof to appoint a Vesting Day later than the day specified as the Vesting Day in the Schedule;
(iii)the power contained in the proviso to clause 1(14) hereof;
(iv)the power contained in the proviso to clause 1(15) hereof;
(v)the power pursuant to clause 3(1)(a) hereof to pay apply or set aside any amount to a General Beneficiary described in clause 1(2)(c) hereof on the first occasion on which that power is exercised in relation to that General Beneficiary;
(vi)the power to appoint the Trust Fund pursuant to clause 4(1) hereof;
(vii)the power to revoke a revocable appointment validly made pursuant to clause 4(1) hereof;
(viii)the power contained in clause 7(25) hereof;
(ix)the power contained in clause 28 hereof;
(x)the power contained in sub-clause (2) of this clause;
(b)'restricted powers' means ‑
(i)the powers contained in sub-clauses (1) (2) and (3) of clause 6 hereof;
(ii)the power contained in clause 7(22) hereof;
(c)'power' includes authority and discretion.
Clause 17 relates to the manner of exercise by the Trustee of any power, discretion or authority conferred on the Trustee by the MMF Trust Deed. It provides, relevantly:
(2)Any exercise by the Trustees of any power discretion or authority conferred on the Trustees by this Deed including without limiting the generality of the foregoing the making of an appointment pursuant to clause 4(1) hereof and the revocation addition to and variation of the trusts terms and conditions herein contained may be made (but without derogating from anything contained in clause 3(2)(f) hereof) ‑
(a)in writing signed by all (or where sub‑clause (3) of this clause applies by a majority of) the Trustees; or
(b)by a resolution duly passed at a meeting of the Trustees; or
(c)in the case of a sole corporate Trustee in the manner set out in sub‑clause (4) of this clause.
…
(4)Every Trustee which is a corporation or company may exercise or concur in exercising any discretion or power hereby conferred on the Trustee by a resolution of such corporation or company or by a resolution of its Board of Directors or governing body or by its representative as set out in sub‑clause (5) of this clause.
(5)Every Trustee not being a Sole Trustee which is a corporation or company may appoint a representative for the purpose of attending meetings of the Trustees.
Clause 21 is concerned with the office of Appointor:
The Appointor and on the death of the last surviving Appointor such other person as such survivor shall have appointed to act as Appointor and in default of appointment his legal personal representative shall be entitled by instrument in writing at any time and from time to time ‑
(1)to remove any Trustee hereof;
(2)to appoint any additional Trustee or Trustees;
(3)to appoint a new Trustee or Trustees in the place of any Trustee who resigns his Trusteeship or ceases to be a Trustee by operation of law;
PROVIDED THAT
(a)if and so long as the Appointor is a beneficiary he shall not be eligible to be appointed as a Trustee hereof;
(b)if there is no Appointor named in the Schedule or if at any time there is no one entitled to exercise the power hereinbefore conferred the statutory and other rights or [sic: of] removing and appointing Trustees hereof may be exercised by the Trustees or by the legal personal representatives or (if the Trustee be a corporation) the liquidator of the last surviving Trustee;
(c)a person appointed to act as Appointor by an Appointor named in the Schedule hereto shall have the same right of appointing a person to act as Appointor as the person who appointed him.
By cl 23, any Trustee, Guardian or Appointor, and any person who may by succession become a Trustee, Guardian or Appointor, 'may resign or renounce such position by notice in writing to the Trustees and forthwith upon the giving of such notice the person giving the same shall for all purposes hereunder cease to be a Trustee Guardian or Appointor or to be a person who may by succession become a Trustee Guardian or Appointor (as the case may be) … provided that if at any time there is no Appointor or other person entitled to exercise the power of appointment provided in clause 21 hereof a sole surviving Trustee shall not resign except upon appointing a new Trustee or new Trustees in his place'.
Clause 28 is concerned with the revocation, addition to or variation of 'the trusts terms and conditions' of the MMF Trust Deed:
Subject to clause 10 hereof the Trustees for the time being may at any time and from time to time by deeds revocable or irrevocable revoke add to or vary all or any of the trusts terms and conditions hereinbefore contained or the trusts terms and conditions contained in any variation or alteration or addition made thereto from time to time and may in like manner declare any new or other trusts terms and conditions concerning the Trust Fund or any part or parts thereof the trusts whereof shall have been so revoked added to or varied provided that the rule known as the Rule against Perpetuities is not thereby infringed and provided that such new or other trust powers discretion alterations or variations ‑
(1)insofar as the beneficial interests created by this Deed are revoked added to or varied shall be for the benefit of all or any one or more of the General Beneficiaries or any one or more persons born or unborn being lineal descendants of whatever degree (or the spouse of any lineal descendant) of any grandparent of any General Beneficiary; but
(2)shall not be in favour of or result in any benefit to any member of the excluded class;
(3)shall not affect the beneficial entitlement to any amount set aside for any beneficiary prior to the date of the variation alteration or addition; and
(4)shall not (save as provided in paragraph (1) of this clause) enlarge the number of persons capable of falling within the description 'beneficiary' hereinbefore contained.
Save as provided in this clause these presents shall not be capable of being revoked added to or varied.
The Schedule reads:

S C H E D U L E

Specified Beneficiaries:

MICHAEL MERCANTI and any spouse, children and remoter issue of the said MICHAEL MERCANTI.

Additional Members of the Class of General Beneficiaries:

The mother and the father of the said MICHAEL MERCANTI and the mother and father of SYBIL YVONNE MERCANTI.

In the Event of the total failure of both the Specified Beneficiaries and the Additional Members of the Class of General Beneficiaries:

Nil

Vesting Day:

30^th day of June, 2055

Guardian:

MICHAEL MERCANTI during his lifetime and after his death the spouse of the said MICHAEL MERCANTI and after her death such person nominated in writing to the trustee by the survivor of the said MICHAEL MERCANTI and his spouse during their lifetime and in default of such appointment the person nominated in writing by the duly appointed personal representative of the survivor of the said MICHAEL MERCANTI and his spouse.

Appointor:

MICHAEL MERCANTI during his lifetime and after his death the spouse of the said MICHAEL MERCANTI and after her death such person nominated in writing to the trustee by the survivor of the said MICHAEL MERCANTI and his spouse during their lifetime and in default of such appointment the person nominated in writing by the duly appointed personal representative of the survivor of the said MICHAEL MERCANTI and his spouse.

The relevant issues in the primary proceedings

The primary proceedings were concerned principally with the validity of:
(a)a deed of variation (the MMF Trust Deed of Variation) executed in 2004 by Slondia, in its capacity as Trustee of the MMF Trust, pursuant to which Slondia deleted provisions in the MMF Trust Deed with respect to the appointment of Michael Mercanti as the Guardian and Appointor of the MMF Trust and substituted new provisions appointing Tyrone Mercanti as the Guardian and Appointor;
(b)a written notice executed on 31 July 2013 by Tyrone Mercanti and Parradele, pursuant to which Tyrone Mercanti, in his capacity as Appointor of the MMF Trust, removed Slondia as Trustee and appointed Parradele as the new Trustee of the MMF Trust;
(c)a deed of variation (the FW Trust Deed of Variation) executed in 2004 by Citycourt, in its capacity as Trustee of the FW Trust, pursuant to which Citycourt deleted provisions in the FW Trust Deed with respect to the appointment of Michael Mercanti as the Appointor of the FW Trust and substituted new provisions appointing Tyrone Mercanti as the Appointor; and
(d)a written notice executed on 31 July 2013 by Tyrone Mercanti and Parradele, pursuant to which Tyrone Mercanti, in his capacity as Appointor of the FW Trust, removed Citycourt as Trustee and appointed Parradele as the new Trustee of the FW Trust.
The MMF Trust Deed of Variation and the FW Trust Deed of Variation were drafted by a solicitor, Peter Nettleton, of Brett Davies Lawyers.

The circumstances in which Tyrone Mercanti and Parradele executed the written notices on 31 July 2013

In about 1996 Michael Mercanti told Tyrone Mercanti that he had decided to appoint him as general manager of the business. Between 1996 and 2004 Tyrone Mercanti was the general manager of Slondia and Citycourt. In 2001 Michael Mercanti and Yvonne Mercanti appointed Tyrone Mercanti as a director of each of Slondia and Citycourt. After 1996 Michael Mercanti's involvement in the business diminished gradually until 2004, when he ceased to work on a full‑time basis. On about 15 June 2004, Michael Mercanti appointed Tyrone Mercanti as the managing director of each of Slondia and Citycourt.
Until late 2012 there was a close relationship between Tyrone Mercanti and his parents. However, in late 2012, that relationship broke down. The trial judge found that a significant cause of the breakdown was that Michael Mercanti wished to receive more income from the businesses of the MMF Trust and the FW Trust, or have his credit card expenses paid by those businesses, and Tyrone Mercanti declined. There were other disputes or differences between them.
On 30 July 2013, while Tyrone Mercanti was in China, his parents, as the shareholders of Slondia and Citycourt, removed Tyrone Mercanti as a director of those companies. At about 4.00 pm on that date (and without prior consultation with or notice to Tyrone Mercanti), Michael Mercanti, Yvonne Mercanti, Jamie Mercanti, Jason Mercanti and others acting on Michael Mercanti's instructions entered the business premises of the MMF Trust and the FW Trust, and took control of the premises and the business operations.
On 31 July 2013, Tyrone Mercanti and Parradele executed the notices removing Slondia as Trustee of the MMF Trust and Citycourt as Trustee of the FW Trust respectively and appointing Parradele as Trustee of each Trust.

The trial judge's conclusions

The trial judge concluded:
(a)On the proper construction of the MMF Trust Deed, the Trustee is empowered to vary the contents of the Schedule to the MMF Trust Deed so as to replace the Guardian and Appointor and appoint a new Guardian and Appointor.
(b)The MMF Trust Deed of Variation was validly executed by Slondia.
(c)The variation of the MMF Trust effected by the MMF Trust Deed of Variation was not made by Slondia in breach of trust.
(d)Michael Mercanti, as Guardian of the MMF Trust, consented to the exercise by Slondia of the 'reserved powers' (as defined in the MMF Trust Deed) to amend the MMF Trust Deed to replace the Guardian and Appointor.
(e)Tyrone Mercanti did not procure Michael Mercanti to sign the MMF Trust Deed of Variation or Slondia to execute the MMF Trust Deed of Variation in circumstances constituting equitable fraud by Tyrone Mercanti or undue influence by Tyrone Mercanti over Michael Mercanti.
(f)The MMF Trust Deed of Variation is of legal force and effect.
(g)The notice of removal of Slondia and acceptance of appointment of Parradele as Trustee of the MMF Trust is valid and of legal force and effect.
(h)The removal of Slondia and appointment of Parradele as Trustee of the MMF Trust was not made by Tyrone Mercanti in breach of his duties as Appointor of the MMF Trust.
(i)Parradele is and has been Trustee of the MMF Trust since the execution of the notice of removal of Slondia and acceptance of appointment of Parradele as the Trustee of the MMF Trust.
(j)Tyrone Mercanti is, and has been since the execution of the MMF Trust Deed of Variation, the Guardian and Appointor of the MMF Trust.
(k)On the proper construction of the FW Trust Deed, the Trustee from time to time is not empowered to vary the FW Trust Deed by amending or replacing the Appointor.
(l)The FW Trust Deed of Variation is of no legal force or effect.
(m)The notice of removal of Citycourt and acceptance of appointment of Parradele as Trustee of the FW Trust is of no legal force or effect.
(n)Citycourt is and at all material times has been the Trustee of the FW Trust.
(o)Michael Mercanti is and at all material times has been the Appointor of the FW Trust [201].

So, his Honour held, in essence, that the FW Trust Deed of Variation and the notice in relation to the FW Trust were invalid and of no legal force or effect, but that the MMF Trust Deed of Variation and the notice in relation to the MMF Trust were valid and of legal force and effect.
The trial judge made declaratory and other orders which gave effect to his conclusions.

The grounds of appeal

Michael Mercanti and Jason Mercanti rely on seven grounds of appeal.
Ground 1 alleges that the trial judge erred in law in concluding that the MMF Trust Deed empowers the Trustee to amend the MMF Trust Deed to remove the Appointor and appoint a new Appointor in his place. His Honour should have concluded that, on its proper construction, the MMF Trust Deed does not empower the Trustee to do so.
Ground 2 alleges that, alternatively to ground 1, his Honour erred in law in concluding that the MMF Trust Deed empowers the Trustee to amend the Schedule to the MMF Trust Deed so as to remove the Appointor and appoint a new Appointor in his place. His Honour should have concluded that, on its proper construction, the MMF Trust Deed does not empower the Trustee to do so.
Ground 3 alleges that his Honour erred in law in concluding that the MMF Trust Deed of Variation is a document of, and binding upon, Slondia. His Honour should have held that the MMF Trust Deed of Variation is not a document of, or binding upon, Slondia because, to Tyrone Mercanti's knowledge, the instrument was not executed by Slondia (through the affixation of its common seal or otherwise) pursuant to the lawful authority of Slondia's directors or shareholders.
Ground 4 alleges that his Honour erred in law in concluding that the MMF Trust Deed of Variation did not constitute a fraud on the power to amend the MMF Trust Deed and thus a breach of Slondia's fiduciary duty as Trustee of the MMF Trust. His Honour should have concluded that:
(a)given that Slondia's purpose in doing so was to transfer control of the MMF Trust to Tyrone Mercanti as 'an advance on [his] inheritance', and without the knowledge or consent of the other beneficiaries, Slondia's agreement to and execution of the MMF Trust Deed of Variation was a fraud on the power to amend the MMF Trust Deed and thus a breach of its fiduciary duty; and
(b)Tyrone Mercanti was a knowing participant in, alternatively a knowing recipient of the benefit of, such breach of duty.
Ground 5 alleges that his Honour erred in fact and in law in concluding that Michael Mercanti's agreement to and execution of the MMF Trust Deed of Variation, both as a director of Slondia and in his own right as the Guardian and Appointor, was not as a result of any equitable fraud by or the undue influence of Tyrone Mercanti. His Honour should have concluded that, having regard to the whole of the evidence adduced at trial (particularly, the evidence of Jamie Mercanti, Tyrone Mercanti, Rosalina Sinshum Chiu, Mehernosh Buhariwalla and Mr Nettleton), Michael Mercanti's agreement to and execution of the MMF Trust Deed of Variation was as a result of the equitable fraud by, further or alternatively the undue influence of, Tyrone Mercanti.
Ground 6 alleges that his Honour erred in law in concluding that Tyrone Mercanti's conduct on 31 July 2013 when, purportedly as Appointor of the MMF Trust, by a written notice of that date, he caused Slondia to be removed as Trustee of the MMF Trust and Parradele to be appointed as the new Trustee of the MMF Trust, did not constitute a fraud on the power of the Appointor, and thus a breach of duty. His Honour should have concluded, on the basis of Tyrone Mercanti's evidence at trial, that Tyrone Mercanti's conduct was a fraud on the power of the Appointor and a breach of duty.
Ground 7 alleges that his Honour erred in law in concluding that:
(a)The appointment of Tyrone Mercanti as the Appointor and Guardian of the MMF Trust was valid. His Honour should have concluded that the appointment was void, alternatively voidable, alternatively that Tyrone Mercanti held such powers on constructive trust for Michael Mercanti, by reason of each and any of grounds of appeal 1, 2, 3, 4 and 5.
(b)The appointment of Parradele as Trustee of the MMF Trust was valid. His Honour should have held that the appointment was void, alternatively voidable, by reason of each and any of grounds of appeal 1, 2, 3, 4, 5 and 6.

Grounds 1 and 2: Michael Mercanti's and Jason Mercanti's submissions

The trial judge held that the MMF Trust Deed of Variation validly deleted and replaced the 'definitions' of 'Guardian' and 'Appointor' in the Schedule to the MMF Trust Deed in the manner specified in the MMF Trust Deed of Variation.
Counsel for Michael Mercanti and Jason Mercanti submitted that cl 28 of the MMF Trust Deed does not empower the Trustee:
(a)to revoke, add to or vary the appointment of the 'Appointor' or the 'Guardian' as provided for in the MMF Trust Deed; and
(b)further or alternatively, to vary the Schedule to the MMF Trust Deed, alternatively to vary those parts of the Schedule relating to 'the person or persons successively named described or defined' (being words included in the definitions of 'the Appointor' and 'the Guardian' in cl 1 of the MMF Trust Deed) therein as the 'Appointor' or the 'Guardian'.
It was argued that cl 28 operates so as to provide that 'these presents' are not capable of being revoked, added to or varied other than as specified in cl 28. That is, apart from the specific matters referred to in cl 28, there is an express prohibition against revoking, adding to or varying 'these presents'.
Counsel emphasised that cl 28 'does not speak of amending the MMF Trust Deed (let alone the Schedule)'. Rather, the power conferred by cl 28 is confined to revoking, adding to or varying 'all or any of the trusts terms and conditions hereinbefore contained'.
It was submitted that the expression 'the trusts terms and conditions' in cl 28 must mean either:
(a)the 'terms and conditions' of the 'trusts' created by the MMF Trust Deed, namely the terms and conditions on which the Trustee holds 'the Trust Fund and income thereof' (that is, as if an apostrophe appeared before or after the last letter of the word 'trusts'); or
(b)the 'trusts', 'terms' and 'conditions' (that is, as if a comma appeared after the word 'trusts').
It was argued that, in any event, the Schedule appears in the MMF Trust Deed after cl 28 and, accordingly, is not a trust, term or condition 'hereinbefore' contained.
Counsel submitted that the MMF Trust Deed expressly deals with the powers of the Trustee (and the Appointor) in relation to changes to the identity of the Appointor. See, in particular, the definition of 'the Appointor' in cl 1(15), cl 21, cl 23 and the status of the power in cl 1(15) as a 'reserved power' within cl 10(7). According to counsel, those express provisions reinforce that, on the proper construction of the MMF Trust Deed as a whole, the general power of amendment in cl 28 does not extend to amending the definition of 'the Appointor' (let alone the actual identity of the Appointor). Counsel elaborated:
(a)if cl 28 empowers the Trustee to remove an Appointor and appoint a new Appointor, then the proviso to the definition of 'the Appointor' would have 'no work to do' and that consequence would be inconsistent with the apparent intention of the definition as a whole; and
(b)the express conferral on the Trustee, pursuant to the proviso to the definition of 'the Appointor', of power to declare that 'any person who has not yet become Appointor but who would or might but for this proviso at some time become Appointor shall not become Appointor', suggests that a wider power for the Trustee to remove or appoint an Appointor was omitted deliberately from the deed.
Further and alternatively, it was submitted that 'it would derogate from the fundamental purpose for which the power to amend was created' if cl 28 extends to empowering the Trustee to remove and replace the person occupying the office of Appointor (or a person who would, in future, occupy the office). According to counsel, the 'primary purpose' of the office of Appointor is 'to oversee and, if appropriate, remove the Trustee'.

Grounds 1 and 2: relevant legal principles

The construction of a written agreement involves ascertaining what a reasonable person would have understood the parties to the agreement to mean. The rights and liabilities of the parties under a clause in the agreement are to be determined objectively. Consideration should ordinarily be given not only to the language of the agreement, but also to the apparent purpose and object of any transaction created by or evidenced in the agreement. See Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165 [40] (Gleeson CJ, Gummow, Hayne, Callinan & Heydon JJ); International Air Transport Association v Ansett Australia Holdings Ltd [2008] HCA 3; (2008) 234 CLR 151 [8] (Gleeson CJ), [53] (Gummow, Hayne, Heydon, Crennan & Kiefel JJ); Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37; (2015) 256 CLR 104 [46] (French CJ, Nettle & Gordon JJ).
It is necessary, in determining the meaning of the provisions of a commercial contract, to ask what a reasonable businessperson would have understood those provisions to mean. That inquiry will require consideration of the language of the contract, the circumstances addressed by the contract and the commercial purpose or objects to be secured by the contract. See Electricity Generation Corporation v Woodside Energy Ltd [2014] HCA 7; (2014) 251 CLR 640 [35] (French CJ, Hayne, Crennan & Kiefel JJ); Mount Bruce Mining [47].
A written agreement must be construed as a whole. The words of a clause in the agreement are to be given the most appropriate meaning which they can legitimately bear. A court must have regard to all of the provisions of the agreement with a view to achieving harmony among them. See Australian Broadcasting Commission v Australasian Performing Right Association Ltd [1973] HCA 36; (1973) 129 CLR 99, 109 ‑ 110 (Gibbs J).
In Fitzgerald v Masters [1956] HCA 53; (1956) 95 CLR 420, Dixon CJ and Fullagar J said, '[w]ords may generally be supplied, omitted or corrected, in an instrument, where it is clearly necessary in order to avoid absurdity or inconsistency' (426 ‑ 427). See also Adams v Lambert [2006] HCA 10; (2006) 228 CLR 409 [21] (Gleeson CJ, Gummow, Kirby, Hayne, Callinan, Heydon & Crennan JJ).
The rules that apply to the construction of contracts apply to the construction of deeds. See Royal Botanic Gardens and Domain Trust v South Sydney City Council [2002] HCA 5; (2002) 240 CLR 45 [9] ‑ [10] (Gleeson CJ, Gaudron, McHugh, Gummow & Hayne JJ).
The rules applicable to the construction of contracts apply also to trusts. The search for 'intention' in relation to trusts, as with contracts, is for the intention as revealed in the words used by the parties. The expressed intention of the parties is to be found in the answer to the question, 'What is the meaning of what the parties have said?', not to the question, 'What did the parties mean to say?'. See Byrnes v Kendle [2011] HCA 26; (2011) 243 CLR 253 [53] (Gummow & Hayne JJ), [102] ‑ [107] (Heydon & Crennan JJ). See also Smith v Lucas (1881) 18 Ch D 531, 542 (Sir George Jessel MR); Commissioners of Inland Revenue v Raphael [1935] AC 96, 142 ‑ 143 (Lord Wright).
Similarly, in Scott and Ascher on Trusts (5^th ed, vol 1, 2006) § 4.1, it is said that 'it is necessary, when dealing with the creation of a trust and its terms, to speak not of the settlor's intention but of the settlor's manifestation of intention'. See also Byrnes [57] ‑ [58] (Gummow & Hayne JJ).
In Conaglen, 'Sham Trusts' (2008) 67 Cambridge Law Journal 176, it is stated:
The court's focus when construing the terms of [a] bilateral arrangement [creating a trust] is on the objective meaning that those terms would convey to a reasonable person, just as it is when construing contractual arrangements (181).
That passage was cited with approval by Heydon and Crennan JJ in Byrnes [113]. Their Honours added that the question is 'what the settlor or settlors did, not what they intended to do' [113].
Subjective intention is only relevant in relation to trusts, as with contracts, when the transaction is open to some challenge or some application for modification; for example, an equitable challenge for mistake or misrepresentation or undue influence. However, subjective intention is irrelevant both to the issue of whether a trust exists and also to the issue of the terms of the trust. See Byrnes [115] (Heydon & Crennan JJ).
In Montevento Holdings Pty Ltd v Scaffidi [2012] HCA 48; (2012) 246 CLR 325, the trust deed of a discretionary family trust authorised a person designated as the appointor to remove a trustee and appoint new trustees. The deed provided that if and so long as any individual appointor was a beneficiary that individual was not eligible to be appointed as a trustee. At the relevant times, Eugenio Scaffidi was within the class of beneficiaries of the trust and was also the appointor. He removed the trustee and appointed a company, Montevento Holdings Pty Ltd, of which he was the sole director and shareholder, as the sole trustee of the trust. The respondent did not challenge the validity of Eugenio Scaffidi's appointment of Montevento Holdings Pty Ltd as trustee on the basis of the equitable doctrine of fraud on a power. See Scaffidi v Montevento Holdings Pty Ltd [2011] WASCA 146; (2011) 6 ASTLR 446 [98] (Buss JA).
The High Court held that the trust deed prohibited only the appointment as a trustee of a natural person who held the office of appointor and, hence, the appointment of Montevento Holdings Pty Ltd was valid. French CJ, Hayne, Crennan, Bell and Gageler JJ noted that the trust deed distinguished consistently between individuals and corporations and that was the critical point which was sufficient to determine the appeal [22]. Their Honours said that the 'ordinary and natural meaning' of the clause in question, read in the context of the whole document, which repeatedly distinguished between an 'individual' (in the sense of a natural person) and a corporation, was that the trust deed prohibited only the appointment as a trustee of a natural person who held the office of appointor [25].
The words of a clause in a trust deed are therefore to be given their ordinary and natural meaning, read in the context of the trust deed as a whole, unless the words have a special or technical meaning. See the decisions of the High Court to which I have referred. See also Hill (Viscount) v Hill (Dowager Viscountess) [1897] 1 QB 483, 486 (Lord Esher MR); Schreuders v Grandiflora Nominees Pty Ltd [2016] VSCA 93 [21] (Kyrou, Ferguson & McLeish JJA).
It is the duty, '[p]erhaps the most important duty', of a trustee to adhere to and carry out the terms of the trust. See Youyang Pty Ltd v Minter Ellison Morris Fletcher [2003] HCA 15; (2003) 212 CLR 484 [32] ‑ [33] (Gleeson CJ, McHugh, Gummow, Kirby & Hayne JJ). A trustee's function is 'to take the trusts as it finds them and to administer them as they stand'. See Re Dion Investments Pty Ltd [2014] NSWCA 367; (2014) 87 NSWLR 753 [94] (Barrett JA; Beazley P & Gleeson JA agreeing). A trustee does not have an implied power to vary the trust deed.
However, a trust deed may contain an express power of variation. Most modern trust deeds contain an express power which enables the trusts and the provisions of the trust deed to be varied, but the nature, form and extent of the permitted variations depend, in general, upon the language and apparent purpose of the variation clause in the context of the trust deed as a whole.
In Gra‑Ham Australia Pty Ltd v Perpetual Trustees WA Ltd (1989) 1 WAR 65, the Full Court of the Supreme Court of Western Australia held that a power conferred on the trustee under a unit trust deed authorised the retrospective amendment of the deed for the purpose of defeating rights of unitholders which would otherwise have been vested or have accrued. Malcolm CJ (Nicholson J relevantly agreeing) said:
(a)the authorities do not say that a retrospective amendment of a trust deed is beyond power or unlawful; and
(b)what is within power and lawful is a matter of construction of the relevant instrument (85).
In Kearns v Hill (1990) 21 NSWLR 107, a trust deed of a discretionary family trust defined the term 'beneficiaries' in cl 1 to comprise the 'primary beneficiaries' together with certain named persons. The term 'primary beneficiaries' was defined in cl 1 to comprise certain other named persons.
The trust deed conferred on the trustees very extensive powers to deal with both the capital and the income of the trust fund.
Clause 24 of the trust deed contained a power of variation as follows:
(a)The trustee may [by] deed release or revoke any power or powers conferred on the trustee under this Deed and may vary or amend any of the provisions contained in this Deed other than clause 2 or the vesting date PROVIDED HOWEVER that no such release revocation variation or amendment shall be valid if such release revocation variation or amendment would have the effect of infringing any rule against perpetuities or directing or requiring any excessive accumulation of income or would entitle the settlor or the trustee or any person who has been a trustee of the settled fund to receive any of the income or corpus of the settled fund.
(b)On the execution of any deed pursuant to paragraph (a) of this clause:-
(i)the power (if any) purported to be released or revoked pursuant to such Deed shall be absolutely and irrevocably released or revoked.
(ii)the amendments to or variations of the provisions of this Deed purported to be effected thereby (if any) shall (subject as aforesaid) be deemed to be effective forthwith.
PROVIDED FURTHER that upon the death of the appointor the trustee shall have all the powers of the appointor under this clause.
By a deed poll, the trustees, purportedly exercising their power under cl 24(a), endeavoured to amend the trust deed by adding, in the definition of 'beneficiaries', a new class of beneficiaries called 'discretionary beneficiaries', being the children of the 'primary beneficiaries', and by making consequential amendments in other parts of the deed.
The deed poll did not relate to cl 2 or the vesting date or any of the matters referred to in the proviso to cl 24(a).
The appellant trustees contended that the deed poll was authorised by cl 24(a). The respondents, who were successful before the primary judge, contended that it was not.
The Court of Appeal of New South Wales (Meagher JA; Mahoney & Clarke JJA agreeing) allowed the appeal and held that the execution of the deed poll by the appellants was a valid exercise of the power granted under cl 24(a).
Meagher JA said:
(a)The language of cl 24(a) made it 'clear enough' that any clause of the deed was a 'provision' of that deed. If cl 24(a) had expressly said that the power to vary included a power to vary cl 1, the efficacy of the deed poll would be 'beyond doubt', and his Honour could see no difference between such language and the language actually employed, namely a power to vary 'any' of the provisions of the trust deed.
(b)The trustees' rights to vary the trust deed extended to alterations to the identity of the beneficiaries.
(c)As a matter of construction, cl 24(a) was an express power to alter the list of the beneficiaries contained in cl 1 (110).
In the appeal, counsel for the respondents sought to rely on a number of cases in which various courts have read down powers, in apparently unlimited terms, to vary trust deeds. Meagher JA made these observations:
Such cases certainly exist. Duke of Bedford v Marquess of Abercorn (1836) 1 My & Cr 312; 40 ER 394 is one. Re Dyer; Dyer v Trustees, Executors & Agency Co Ltd [1935] VLR 273, is another, and it was cited with approval by Megarry J, as he then was, in Re Ball's Settlement Trusts; Ball v Ball [1968] 1 WLR 899 at 904. In the Duke of Bedford's case it was held that, in determining the ambit of a variation clause it is legitimate to consider its scope and evident purpose, but that consideration is not of much use when the evident purpose of the power is to ensure maximum flexibility. In Re Dyer it was held that the power of variation contained in a particular trust deed did not extend to varying the trust in a way which would destroy its 'substratum'. That, again, is not really helpful in the present context, where either it is impossible to locate any substratum at all, or alternatively, the relevant substratum is the benefit of the descendants of a named person, and the interests of that class are being actively promoted rather than diminished by the 1988 deed poll. I put to one side the obvious consideration that each deed must be considered in its own particular context, so that no other deed executed in different circumstances and in different language can decide the fate of a given deed. I also put to one side the equally obvious consideration that the conditions which existed in England in 1850 are not necessarily the same as those which existed in New South Wales in 1970. On the other hand, it is impossible to discern in the deed of trust any intention that the list of beneficiaries contained in cl 1 should remain perpetually inviolate (110 ‑ 111).

Mahoney JA said:
[Counsel for the respondents] properly submitted that, in determining the construction of a clause authorising the variation of the provisions of a trust, it is legitimate to consider what was the purpose and intent of that clause. In earlier times, the view was taken in some cases that, as [counsel] submitted, the intention of the settler was that the alterations to be made should not alter the main structure of the trust or the beneficial entitlements under it. I doubt that that would be seen as the intention of such a clause at the present time. As the precedent books show, discretionary trusts have in more recent times been used to provide to the settler or the person having the benefit of the power of variation the power to make fundamental changes in the structure of the trust document and the entitlements under it. In England, the desire of settlers to retain such flexibility as would allow them to meet the changes resulting from war, taxes and depression is, I think, clear. And there are reasons why, in Australia, a power of variation of greater rather than lesser extent has been seen as desirable. Therefore I do not think that any limitation should be placed upon the generality of the power of variation by reason of the factors referred to in the cases cited (108).
So, it was held in Kearns that a power to vary a trust deed (including a power of variation given to a trustee) which, in its ordinary and natural meaning, included a power to vary the identity of the beneficiaries of a trust, by the addition of beneficiaries, could not be limited by reference to historical presumptions against variations which alter the main structure of, or beneficial entitlements under, trusts.
The fact that a provision in a trust deed contains infelicities is not a sufficient reason to construe it other than in accordance with its ordinary and natural meaning. See Kearns (109); Lancedale Holdings Pty Ltd v Heath Group Australasia Pty Ltd [1999] NSWCA 460; (1999) 33 ACSR 247 [44] (Hodgson CJ in Eq; Meagher JA agreeing and Giles JA relevantly agreeing).
In Cachia v Westpac Financial Services Ltd [2000] FCA 161; (2000) 170 ALR 65, Hely J applied Pepe v City & Suburban Permanent Building Society [1893] 2 Ch 311 and Gra‑Ham, and decided that an amendment to a unit trust deed was not invalidated by reason of the fact that it may defeat what would otherwise have been an entitlement of a unitholder who had requested redemption of his or her units prior to the operative date of the amendment [64] ‑ [66]. See also ING Funds Management Ltd v ANZ Nominees Ltd [2009] NSWSC 243; (2009) 228 FLR 444, where Barrett J commented:
The rights arising under a constitution or a trust deed or a set of rules which is susceptible to amendment are rights that exist subject always to the possibility that the governing instrument will be changed. It is an incident or aspect of every right arising from that instrument that the amendment power may alter or abolish the right subject, no doubt, to the doctrine of fraud on a power [149].
An express power to vary a trust deed may contain, within the language of the power, express or implied limitations in relation to its exercise; for example, as to the manner and form of the variation or the obtaining of specified consents to the variation.
The rules that are applicable to the construction of an express power to vary a trust deed (and trust deeds generally) are separate and distinct from limitations which may apply, independently of the language of the power, to its exercise. Limitations of that kind include, for example, the equitable doctrine of fraud on a power.
The power of variation in Cachia was apparently unconfined. Hely J (like Meagher JA in Kearns) noticed, however, that there are some authorities which suggest that a power to vary a trust deed may be held not to extend to a variation which would 'alter the substratum of the trust' [68]. His Honour referred to Re Dyer [1935] VR 273; Re Ball's Settlement Trusts [1968] 1 WLR 899; Re Blocksidge [1997] 1 Qd R 234; Kearns; Lock v Westpac Banking Corporation (1991) 25 NSWLR 593.
In Federal Commissioner of Taxation v Bargwanna [2012] HCA 11; (2012) 244 CLR 655, French CJ, Gummow, Hayne and Crennan JJ noted that references in a trust deed to 'the absolute and uncontrolled discretions and powers of the trustees' should be read in light of authorities which treat such apparently unconfined discretions and powers as not extending to alteration of the substratum of the trust [13]. Their Honours referred with approval to the analysis of the authorities by Hely J in Cachia [67] ‑ [76].
Hely J said that the authorities which suggest that a power to vary a trust deed may be held not to extend to a variation which would 'alter the substratum of the trust' may be 'no more than an application of the equitable doctrine of fraud on the power' [68]. His Honour's view is, in my respectful opinion, correct, having regard to the decisions of the High Court in Byrnes and Montevento, which have held that the rules applicable to the construction of contracts apply also to trusts, and to the decision of the High Court in Bargwanna. In other words, the notion of an alteration to the substratum of the trust is not an aspect of the rules applicable to the construction of a trust deed but is, rather, an application of the equitable doctrine of fraud on a power.
In Global Custodians Ltd v Mesh [2002] NSWSC 283, Young CJ in Eq said in relation to an express power of variation in a trust deed:
The exercise of a power to amend is a very technical matter. Up until the Conveyancing Act, or up until the Imperial Laws Application Act, the only way one could amend a trust, technically, was if the original deed contained uses in favour of the settlor to revoke and to re‑appoint. It is a very technical matter, and is dealt with in Thomas on Powers (Sweet & Maxwell, London, 1998) Chapter 13. As the learned author points out in para 13‑11 at p 563, every such power reserved in a deed will be construed strictly. Authority such as Hele v Bond (1717) Precedents in Chancery 474; 24 ER 213, and Evans v Saunders (1855) 6 De GM & G 654 at 671; 43 ER 1387 at 1394 bear this out [18].
His Honour made the observation that 'every such power reserved in a deed will be construed strictly' without citing Kearns and before the decisions of the High Court in Byrnes and Montevento. His Honour retreated from that stance in Re Dion Investments Pty Ltd [2013] NSWSC 1941 [43].
In Jenkins v Ellett [2007] QSC 154, the question in issue was the identity of the trustees of a discretionary family trust. The resolution of that question depended on whether a power in cl 11 of the trust deed, available to the trustees, to vary the trusts declared pursuant to the deed, included a power to remove or change the identity of 'the Principal'.
The Principal was the person who had power under cl 12.1 of the trust deed to appoint and remove trustees. The trust deed included a scheme in its schedule for the replacement of the Principal, on his death, by his spouse or executor. George Jenkins was the original Principal. Part 9 of the schedule to the trust deed provided, relevantly, that on George Jenkins' death his executor became the Principal.
On 2 February 1999, the then Principal, George Jenkins, who was also a trustee, removed Luciano Menniti as a trustee and appointed Joyce Ellett as his co‑trustee. Also on 2 February 1999, George Jenkins and Joyce Ellett as trustees, relying on the power of variation in cl 11 of the trust deed, purported to remove George Jenkins as the Principal and to appoint Joyce Ellett as the Principal.
On 29 January 2002, George Jenkins died. On 3 November 2003, probate of his will was granted to Georgina Jenkins. By a deed poll dated 10 December 2003, Georgina Jenkins, purporting to act as the Principal, appointed herself and her brother, Peter Jenkins, as new trustees, with Joyce Ellett as a continuing trustee.
A dispute emerged as to whether Joyce Ellett was the sole trustee or whether she, Georgina Jenkins and Peter Jenkins were co‑trustees.
Clause 11 of the trust deed provided:
The Trustee may by Deed revoke add to release or vary all or any of the Trusts declared or any Trusts declared by any variation, alteration or addition made from time to time and may by the same or any other Deed declare any new or other trusts or powers concerning the Trust Fund but so that the Trustee shall not have any power to revoke add to or vary any of the Trusts so that the Settlor may acquire a beneficial interest in the Trust Fund or any part of it nor to effect [sic] the beneficial entitlement of any Beneficiary to any amount applied for him prior to the date of revocation or alteration and any other person or persons upon whom any power or powers so conferred on him or them. Upon this exercise of any release and revocation pursuant to this clause the power so released and revoked shall be absolutely and irrevocably determined.
Douglas J identified the essential issue as whether the power given to the trustee under cl 11 to vary the trusts declared could extend to the removal of the Principal, especially where it was the Principal who, alone, in the trust deed as originally drafted, had the power to appoint and remove the trustee [14]. His Honour said that it was necessary, in answering the question, to construe the power in cl 11 by reference to the text of the provision in its surrounding context [14].
His Honour held that cl 11 should be construed so that its powers of amendment did not extend to a provision such as the definition of 'the Principal' in the schedule to the trust deed. His Honour reasoned:
Clause 2, in declaring that the trustee holds the trust fund 'upon the trusts subject to the powers and provisions contained in this Trust', highlights the link to cl 11's power to amend the 'Trusts declared'. The language of cl 2 also makes the declaration of trust subject to the power, for example, vesting in the Principal to appoint new trustees in cl 12. The power to amend in cl 11 is not to amend 'the trust constituted by and comprised in this Deed and the Schedule' but the 'Trusts declared', namely those declared in cl 2. The difference between the singular and plural forms of the word 'trust' is significant. It would have been easy for the drafter of the deed to provide the trustee with a broad power of amendment of 'this Trust', which is defined in cl 1 to mean 'the trust constituted by and comprised in this Deed and the Schedule' or of the deed and the schedule as a complete document if that were intended.
…
The power to appoint a new trustee available to the Principal under cl 12 does not seem to me to be one that requires easy amendment to add to any desirable flexibility in managing the fund; cf Meagher JA in Kearns v Hill (1990) 21 NSWLR 107 at 109. Clause 12's purpose of allowing the removal of a trustee is also inconsistent with the possibility that the trustee could negate the operation of the power by amending the schedule to the deed to change the identity of the Principal. Nor is it the case that the structure of the deed requires some continuing identity between the Principal and the trustee or trustees named under it so that there is a built‑in safeguard against the Principal's position being subverted.
The Principal's ability to remove and replace a trustee seems to me to be one of the fundamental features of the structure of this deed, one setting up a family discretionary trust. The maintenance of that power is obviously designed to ensure that the control of the trust will remain with the significant intended beneficiary, here George Jenkins, and after him his spouse or his executor, as follows from the definition of 'The Principal' in the schedule. To allow the power in cl 12 to be subverted by the trustee it was designed to supervise purporting to use cl 11's powers to amend the deed rather than the trusts declared by the deed is not, in my view, permissible. It is akin to destroying the substratum of the deed [16], [18] ‑ [19].
It is unnecessary to consider whether the approach to the construction of pension or superannuation schemes differs from the approach to the construction of trust deeds generally. Pension or superannuation schemes are 'quite different' from traditional trusts. See Imperial Group Pension Trust Ltd v Imperial Tobacco Ltd [1991] 1 WLR 589, 597 (Browne‑Wilkinson V‑C); Lock (607 ‑ 608) (Waddell CJ in Eq). See also Vision Super Pty Ltd v Poulter [2006] FCA 849; (2006) 154 FCR 185 [66] (Young J) and the cases there cited.

Grounds 1 and 2: their merits

The MMF Trust Deed was executed on 1 June 1979. It includes recitals and an operative part. The operative part refers to a Schedule. The Schedule contains details of the Specified Beneficiaries, the Additional Members of the Class of General Beneficiaries, the Vesting Day, the Guardian and the Appointor.
The inclusion of the Schedule reflects a convenient drafting technique in the context of a trust deed that was obviously intended for use as a standard form document. It is apparent, on a fair reading of the MMF Trust Deed as a whole, that all of the clauses embodied in the operative part (that is, cl 1 to cl 29) are standard. Ordinarily, the only amendments necessary, to ensure that each trust deed related to the particular persons or entities for whom the trust was to be established, would be:
(a)the date on page 1;
(b)the name, address and description of the Settlor and the Trustee on page 1;
(c)the amount of the settled sum in recital B on page 1;
(d)the name of the trust in recital D on page 1; and
(e)the details of the Specified Beneficiaries; any Additional Members of the Class of General Beneficiaries; any provision dealing with the possibility of there being a 'total failure' of both the Specified Beneficiaries and the Additional Members of the Class of General Beneficiaries; the Vesting Day; and the Guardian and the Appointor, in the Schedule on page 25.
Recital A states that the Settlor 'desires to make provision for the persons hereinafter referred to as and in the manner hereinafter set out'. The expression 'in the manner hereinafter set out' refers to the operative part of the MMF Trust Deed including the Schedule.
Recital C provides that the Trustees have consented to become 'the Trustees hereof upon the trusts and with and subject to the powers and provisions hereinafter expressed'. The expression 'the powers and provisions hereinafter expressed' refers to the powers and provisions set out in the operative part of the MMF Trust Deed including the Schedule.
Recitals are separate and distinct from the operative part of a deed. If the provisions of the operative part are clear, it is not permissible to refer to the recitals to contradict or modify the clear meaning of the operative part. See Chacmol Holdings Pty Ltd v Handberg [2005] FCAFC 40; (2005) 215 ALR 748 [38] ‑ [50] (Tamberlin J; North & Dowsett JJ relevantly agreeing). If, however, the operative part is unclear, the recitals may be referred to for the purpose of ascertaining the intention of the parties as expressed in the operative part. See Ellis v Dariush‑Far [2007] QCA 398; (2007) 242 ALR 635 [18] (Keane JA; Williams JA & Daubney J agreeing). See also, in relation to the use of recitals in the construction of a deed, Franklins Pty Ltd v Metcash Trading Ltd [2009] NSWCA 407; (2009) 76 NSWLR 603 [379] ‑ [390] (Campbell JA; Allsop P & Giles JA relevantly agreeing).
Clause 1 of the MMF Trust Deed contains a number of definitions. Some of the definitions are deviant in form in that they include an operative provision. Definitions of this kind have been described as 'stuffed' definitions. See P Butt, Modern Legal Drafting, (3^rd ed, 2013) [6.79] ‑ [6.80].
The definitions in cl 1 which include an operative provision are the definitions of 'Specified Beneficiary', 'Specified Beneficiaries', 'General Beneficiaries', 'the excluded class', 'the Vesting Day', 'the Guardian' and 'the Appointor'.
The expression 'the Appointor' is defined in cl 1(15) as follows:
'[T]he Appointor' shall mean successively the person or persons successively named described or defined as such in the Schedule or determined according to the provisions hereof and where two or more persons are specified in the Schedule as acting jointly shall mean those persons acting jointly provided that the Trustees may at any time by instrument in writing (subject to clause 10 hereof) declare that any person who has not yet become Appointor but who would or might but for this proviso at some time become Appointor shall not become Appointor and if such declaration is so made that person shall not become Appointor notwithstanding that he is named as such in the Schedule[.]
The provisions of the Schedule in which persons are 'named described or defined' as the Appointor read:
MICHAEL MERCANTI during his lifetime and after his death the spouse of the said MICHAEL MERCANTI and after her death such person nominated in writing to the trustee by the survivor of the said MICHAEL MERCANTI and his spouse during their lifetime and in default of such appointment the person nominated in writing by the duly appointed personal representative of the survivor of the said MICHAEL MERCANTI and his spouse.
The exercise of the power contained in the proviso to the definition of 'the Appointor' in cl 1(15) is expressed to be 'subject to clause 10 hereof'. By cl 10, relevantly, that power is one of the 'reserved powers'.
The expression 'the Guardian' is defined in cl 1(14). It is relevantly identical to the definition of the expression 'the Appointor' in cl 1(15).
The provisions of the Schedule in which persons are 'named described or defined' as the Guardian are identical to the provisions of the Schedule in which persons are 'named described or defined' as the Appointor.
Clause 10 provides, relevantly:
(a)by cl 10(3), subject to cl 10(5), the Trustees shall not, when there is a Guardian, exercise the reserved powers except with the consent of the Guardian;
(b)by cl 10(4), where a Guardian is named in the Schedule and there ceases to be a Guardian, the Trustees shall not exercise the reserved powers;
(c)by cl 10(5), the Guardian may at any time, by instrument in writing, revocably or irrevocably declare that thenceforth all or any of the reserved powers:
(i)shall cease to be reserved powers, and after any such declaration the Trustees shall be entitled to exercise such power or powers as though no Guardian had been named in the Schedule; or
(ii)shall be prohibited to the Trustees, and after any such declaration the Trustees shall not be entitled to exercise such power or powers; and
(d)by cl 10(6), where no Guardian is named in the Schedule, the Trustees may, unless otherwise expressly provided in the Schedule, exercise all the reserved powers in their absolute and uncontrolled discretion and without the consent of any other person.
Clause 2 contains the Settlor's declaration of trust and the Trustees' declaration that they will hold the Trust Fund upon trust. It provides:
In consideration of the premises the Settlor as Settlor HEREBY DECLARES that the Trustees shall and the Trustees HEREBY DECLARE that they will henceforth stand possessed of the Trust Fund and of the income thereof upon the trusts and with and subject to the powers and provisions hereinafter expressed concerning the same.
The 'premises' of a deed are, technically, all parts of the deed before the habendum. See Norton on Deeds (2^nd ed, 1928), 218. However, more generally, in a written instrument, the word 'premises' means 'the subject or thing previously expressed' or 'that which [has] gone before'. See Beacon Life & Fire Assurance Co v Gibb (1862) 1 Moore NS 73, 97; 15 ER 630, 639 (Lord Chelmsford); Gardiner v Sevenoaks Rural District Council [1950] 2 All ER 84, 85 (Lord Goddard CJ; Humphreys & Morris JJ agreeing). It is unnecessary to determine the meaning of 'premises' in cl 2.

Those observations have particular application to a case such as this, involving a difficult family dispute.
Secondly, it cannot be accepted that the judge, in effect, overlooked the 14 matters referred to by the appellants in determining whether Michael was the subject of equitable fraud. The judge referred to the relevant evidence in his reasons.[60] It cannot be assumed that the judge overlooked the matters raised by the appellants when he came to consider the question of Michael's understanding of the transactions.
[60] Primary reasons [42] - [56].
Ground 5 should be dismissed.

Ground 6

Ground 6 alleges, in effect, that Tyrone's conduct, as Appointor, in removing Slondia as Trustee in July 2013, and appointing Parradele as Trustee, was a fraud on the power of appointment under cl 21 of the MMF Trust Deed as varied in 2004 by the MMF Variation Deed.
The MMF Variation Deed did not alter the terms of cl 21 and cl 28 of the MMF Trust Deed. However, cl 1.2 of the MMF Variation Deed provided that the MMF Trust Deed would be varied by:
Deleting the definitions of [relevantly] Appointor in the Schedule to the Trust Deed and replacing it with the following definition of Appointor …:
…
Tyrone Kane Mercanti; and
Upon the death of Tyrone Kane Mercanti if no other appointment has been made then Michael Angelo Mercanti and Sybil Yvonne Mercanti; and
If neither of Michael Angelo Mercanti and Sybil Yvonne Mercanti survives Tyrone Kane Mercanti or upon the death of Michael Angelo Mercanti and Sybil Yvonne Mercanti if no other appointment has been made then a legal personal representative of Tyrone Kane Mercanti.
As noted earlier, cl 21 provides, in effect, that the Appointor may remove any Trustee and appoint any additional Trustee provided, amongst other things, that if and so long as the Appointor is a beneficiary, he or she shall not be eligible to be appointed as a Trustee.
The alleged fraud on the power was said to emerge from certain passages of Tyrone's evidence referred to by the judge as follows:[61]
In his witness statement Tyrone says that on 30 July 2013, without any warning and whilst he was in China on company business, he was removed as a director of Slondia ... He says that he was on the telephone with Larry Thomas, the CFO of the business, when Mr Thomas had the telephone taken out of his hand by Jason. Jason told Tyrone that Mr Thomas was busy talking to the new owners of the business and then hung up. Later that afternoon Mr Thomas told Tyrone that Michael, Yvonne, Jamie and Jason, together with others, had entered the business premises and taken control of the office and stated that Tyrone was no longer in control and that they were in control. Tyrone says that the then current management team of the business - the general manager, the CFO and the office administrator did not return to work after 30 July. They had worked for the business for approximately the last 10 years. Tyrone says 'in response to the conduct of my parents and my brothers' he executed the notices of removal and acceptance of appointment of trustee.
In cross-examination it was put to Tyrone that he executed the notices before the court heard the interlocutory injunction application and that he executed them when he did because he knew that he would not be able to exercise the power as appointor if the court granted an injunction. Tyrone denied that part of his purpose on 31 July 2013 was to execute the notices in time for his lawyer to be able to bring them to court before the hearing of the injunction application. Tyrone said that his intention was to retain the status quo in the sense of maintaining his position within the group. He said that the exercise of the power put him back where he was the day before his parents and brothers seized control of the business premises and dismissed him as managing director of Slondia ... He did that by replacing Slondia ... as [trustee] with Parradele, a company controlled by himself and his wife.
…
The trigger for Tyrone executing the notices of removal and appointment was his parents and brothers seizing control of the business premises and dismissing him as managing director on 30 July …
…
The status quo before 30 July was that Tyrone was the managing director of each of the trustees and the general manager of the business. He had been managing director for nine years and general manager for 17 years. The chief financial officer was Mr Thomas, who had been there for about six years. On 30 July Michael and Yvonne, without prior consultation with or notice to Tyrone, removed him as a director of … Slondia … and, with the assistance of Jamie and Jason, seized control of the business premises and management of Slondia … and the business.
[61] Primary reasons [169] ‑ [170], [172], [174].
The appellants also contend that the judge erred in not finding, in terms, that the Appointor's power to remove the Trustee was a 'fiduciary power'.[62] However, his Honour accepted that the power was to be exercised in good faith and for proper purposes;[63] that these requirements would preclude any exercise of the power 'corruptly or improperly, or in a manner which [was] for the purpose not of carrying into effect the trust, but defeating the purpose of the trust';[64] and his Honour evidently accepted, having regard to his discussion of whether there was an abuse or unlawful exercise of power, that the power was to be exercised in the interests of the trust and not for the personal benefit of the Appointor.[65] The appellants, in this context, did not explain in what respects it was alleged that the proper exercise of the power required anything more than it be exercised in the manner explained and applied by his Honour. It was not contended, for example, that Tyrone, as Appointor, had, and breached, a duty to consider, from time to time, whether to exercise the power.[66]
[62] Appellants' submissions, par 50; WB 30.
[63] Primary reasons [166].
[64] Primary reasons [167], quoting Re Marsden's Trusts (1859) 4 Drew 594, 599 - 600.
[65] Primary reasons [175] - [176].
[66] cf LGSS Pty Ltd v Egan [2002] NSWSC 1171 [107]; Kessler & Finn, 'Drafting Trusts and Will Trusts in Australia' (LawBook Co, 2008) [6.170], [6.190].
The object of the power under a provision such as cl 21 is to facilitate the appointment of a new or replacement trustee. A trustee is the archetype of the fiduciary[67] and the office of trustee only exists for the benefit of the beneficiaries.[68] A power of this kind conferred in a trust instrument has generally been construed as having been conferred by the settlor not for the purpose of advancing the personal interests of the appointor or otherwise for the personal enjoyment of the appointor, but rather for the due execution of the trusts for the benefit of the objects of the trust. See, eg, Re Burton;[69]; Pope v DRP Nominees Pty Ltd;[70] McLeary v Swift;[71] Berger v Lysteron Pty Ltd;[72] Rayner v NJ Sheaffe Pty Ltd;[73] Scaffidi;[74] Harre v Clark.[75] Underhill and Hayton, Law of Trusts and Trustees;[76] Young, Croft & Smith 'On Equity';[77] Ford & Lee 'Principles of the Law of Trusts'.[78]
[67] McGuire v Makaronis [1997] HCA 23; (1997) 188 CLR 449, 473.
[68] Letterstedt v Broers (1884) 9 App Cas 371, 387.
[69] Re Burton (1994) 126 ALR 557, 559 - 560.
[70] Pope v DRP Nominees Pty Ltd [1999] SASC 337; (1999) 74 SASR 78 [45] ‑ [48].
[71] McLeary v Swift [2013] NSWSC 216 [34].
[72] Berger v Lysteron Pty Ltd [2012] VSC 95 [85].
[73] Rayner v NJ Sheaffe Pty Ltd [2010] NSWSC 810 [12], [16], [150].
[74] Scaffidi [149] (reversed on other grounds in Montevento Holdings).
[75] Harre v Clark [2014] NZHC 2533 [25].
[76] Underhill and Hayton, Law of Trusts and Trustees (18th ed, LexisNexis, 2010) [1.80 ‑ 1.83].
[77] Young, Croft & Smith 'On Equity' (LawBook Co, 2009) [8.830].
[78] Ford & Lee 'Principles of the Law of Trusts' (Thomson Reuters, 2016) [8180].
Nevertheless, each instrument must be construed according to its own terms. In this case, although under the MMF Trust Deed (as varied), the Appointor may be an eligible object of the trust, when the trust instrument is read as a whole, the power under cl 21 is, objectively construed, conferred for the purposes of the due execution of the trusts of the MMF Trust for the benefit of its objects, rather than as a personal privilege, or for the personal benefit, of the Appointor. The following matters are particularly relevant: the prohibition in cl 21 on the Appointor appointing himself or herself as trustee whilst he or she is a beneficiary; the provisions providing for the circumstances in which the Appointor may be replaced;[79] the proviso in cl 21 that where no Appointor exists, the power to remove and appoint new Trustees may be exercised instead by the Trustees (ie, fiduciary office holders); and the fact that the power under cl 21 is not expressed in unconditional and absolute terms. It is not necessary to enter into the debate as to whether the power to appoint a trustee held by a donee who does not hold a fiduciary office as such (eg, the donee does not hold the office of trustee) is a 'fiduciary power', properly so‑called.[80] In this case, the judge, having, in substance, correctly understood the nature of the power, and applied it to the facts of the case, was not in error in not describing the power as a 'fiduciary power'.
[79] Clause 28 read with cl 10.
[80] See P D Finn, Fiduciary Obligations [627], [644]; cf G W Thomas, Thomas on Powers (2nd ed, Oxford University Press, 2012) [1.52]; Young, Croft & Smith 'On Equity' [8.830].
As to whether there was an abuse or unlawful exercise of power, the judge's findings were as follows:[81]
Appointing a company controlled by him as trustee was not of itself the exercise of the power by Tyrone for a foreign or improper purpose. Tyrone's purpose was to appoint in place of Slondia … as trustee … a company which would reinstate the management of the business which had been removed without consultation or notice by Slondia … acting by its shareholders, Michael and Yvonne. There is no evidence that Tyrone intended to effect any purpose beyond putting Parradele in control of the [MMF Trust] and the management of the family business. For example, there is no evidence that Tyrone intended Parradele to deal improperly with trust assets. As trustee, Parradele was bound to exercise its powers, including its power in relation to the assets and income of the trusts, as a fiduciary.
Tyrone's purpose was to restore the status quo in the sense I have described. There is no evidence that Tyrone did so to achieve any purpose other than the proper and effective management of the business. It is not for the court to assess the relevant competence of Parradele on the one hand and Slondia … on the other hand to act as trustees of the trusts and control the management of the business. The action of Tyrone in removing Slondia … as [trustee] and replacing [it] with Parradele does not give rise to an inference that Tyrone did so for any purpose other than that Parradele would properly fulfil its duties as trustee including properly managing the business. The plaintiffs have not established that Tyrone executed the notices of removal and acceptance of appointment of trustee for any improper or ulterior purpose. (emphasis added)
[81] Primary reasons [175] - [176].
The appellants nevertheless contend[82] that Tyrone exercised the power 'for reasons purely personal to himself and in disregard to the interests of all other beneficiaries', and that the exercise of the power did not maintain the 'status quo', but rather substantially changed it 'by removing the trustee of over 17 years that was controlled by the heads of the Mercanti family and replace it with a trustee which was not controlled by the heads of the Mercanti's [sic] family'. The appellants also suggested that the abuse of power was 'all the more egregious' because Tyrone had not consulted the other beneficiaries before exercising the power under cl 21.[83]
[82] Written submissions, pars 51 - 56.
[83] Written submissions, par 55.
The question of the purpose for which Tyrone appointed Parradele as Trustee was a question of fact. The judge found, in effect, that Tyrone's purpose was to appoint Parradele to reinstate the management of the business.[84] The reinstatement of the management of the trust's business was not, as the judge said, an improper purpose in itself. Even though the reinstated 'management' was effectively Tyrone, the exercise of the power of the Appointor was, in the circumstances of this case, as the judge found, consistent with a legitimate concern for 'the proper and effective management of the business'.[85] The effective management of the trust's business would be to the benefit of all the objects of the trust. There is no error in the judge's reasoning or conclusion.
[84] Primary reasons [175].
[85] Primary reasons [176].
The appellants also contend that the judge, in effect, failed to recognise that in order to succeed on the abuse of power claim, the appellants needed only to establish that Tyrone exercised the power for purely personal purposes, and that the appellants were not required to establish that Tyrone appointed Parradele with the expectation that it would not discharge its fiduciary duties as trustee. This submission cannot be accepted either. The judge was not suggesting that the appellants had to establish that Parradele would not discharge its fiduciary duties as trustee. His Honour was merely observing that the purpose of the exercise of the power was to reinstate the previous management, which was within proper purposes for a trading trust, and that this purpose was not tainted by some collateral or corrupt purpose of having a trustee who the Appointor knew or expected would not properly discharge its fiduciary duties.
Accordingly, no error has been shown with respect to the judge's conclusion that on the evidence, the appointment by Tyrone of Parradele as the new trustee was not an unlawful exercise of the power conferred on the Appointor by cl 21.
Finally, there is no merit in the suggestion that the alleged fraudulent exercise of power was 'all the more egregious' for want of consultation. For the reasons given earlier, there was no unlawful exercise of power. Moreover, under the MMF Trust Deed (including as varied), the power to appoint a trustee was a 'reserved power' which required the consent of the Guardian. There is no basis for supposing, and the appellants did not explain the basis upon which it might be suggested, in the circumstances of this case, that the proper exercise of the power under cl 21 would, beyond obtaining the consent of the Guardian, require consultation with the 'beneficiaries' or eligible objects of the trust.
Ground 6 should be dismissed.

Ground 7

Ground 7 is merely a conclusionary ground. It must fail as the earlier grounds have not been established.

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE COURT OF APPEAL (WA)

CITATION: MERCANTI -v- MERCANTI [2016] WASCA 206 (S)

CORAM: NEWNES JA
MURPHY JA

HEARD: 21 DECEMBER 2016

DELIVERED : 21 DECEMBER 2016

PUBLISHED : 22 DECEMBER 2016

FILE NO/S: CACV 139 of 2015

BETWEEN: MICHAEL ANGELO MERCANTI
First Appellant
JASON DEAN MERCANTI
Second Appellant
AND
TYRONE KANE MERCANTI
First Respondent
PARRADELE PTY LTD
Second Respondent
SLONDIA NOMINEES PTY LTD
Third Respondent
CITYCOURT PTY LTD
Fourth Respondent

ON APPEAL FROM:
Jurisdiction              :  SUPREME COURT OF WESTERN AUSTRALIA
Coram  :LE MIERE J
Citation  :MERCANTI -v- MERCANTI [2015] WASC 297
File No  :CIV 1262 of 2013, CIV 2186 of 2013, CIV 1276 of 2014

Catchwords:

Practice and procedure - Injunction sought for limited period over Christmas/New Year - Second appellant's proposed application for special leave to appeal to the High Court and for substantive suspensory relief in the High Court - Preservation of status quo in relation to management of business

Legislation:

Nil

Result:

Injunction continued to 6 January 2017

Category: B

Representation:

Counsel:

First Appellant               :     No appearance
Second Appellant          :     Mr S Penglis
First Respondent           :     Mr B G Grubb
Second Respondent      :     Mr B G Grubb
Third Respondent          :     No appearance
Fourth Respondent        :     No appearance

Solicitors:

First Appellant               :     No appearance
Second Appellant          :     Fletcher Law
First Respondent           :     Metaxas & Hager
Second Respondent      :     Metaxas & Hager
Third Respondent          :     Metaxas & Hager
Fourth Respondent        :     Metaxas & Hager

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

Mercanti v Mercanti [2016] WASCA 206
REASONS OF THE COURT:

(This judgment was delivered extemporaneously on 21 December 2016 and has edited from the transcript.)

On 29 November 2016, the court delivered reasons for judgment dismissing the appeal herein. Nevertheless, the court extended an injunction which had earlier been given by the court on 9 October 2015.[86] That earlier injunction itself was, in substance, an extension of an earlier injunction originally granted by the trial judge. Each injunction had, in broad terms, the effect of preserving the then‑existing status quo in relation to the management and control of the MMF Trust, pending a curial resolution of the parties' disputes over the MMF Trust. Although the appeal had been dismissed, the court, on 29 November 2016, was of the view that, on balance, it was in the interests of justice overall to preserve the status quo to allow the appellants to obtain advice, as their counsel had foreshadowed, in relation to a possible application for special leave to the High Court of Australia.
[86] See Mercanti v Mercanti [2016] WASCA 206.
The application today is for an extension of the injunction of 29 November 2016 (as amended by interim orders on 19 December 2016) to 4.00 pm on 6 January 2017. The evidence in support is to the effect that the second appellant wishes to apply to the High Court for special leave and, for various reasons set out in the affidavit, he has been unable to do so in the few weeks since 29 November 2016. The High Court registry is, it is said, open on 3 January 2017, and the High Court could, it is said, hear a stay or injunction application in the week commencing 3 January 2017.
The application is resisted by the respondents on the grounds that there is no good reason why any application to the High Court has not been made to date; that there are no 'exceptional circumstances'; and that there are changed circumstances since the earlier injunctions were granted.
As to the respondents' first argument, we consider that the second appellant's explanation for the delay is not unreasonable. As to the second argument, the second appellant does not seek a substantive stay order pending determination of any successful appeal to the High Court. Rather, he is seeking an extension of an injunction for a very limited time to allow him to file grounds for special leave in relation to the issues raised in ground 4 of the appeal herein, and to allow him to approach the High Court for the principal suspensory relief which he seeks from that court in light of those grounds. Consistently with the view we took on 29 November 2016, even though the appeal has been dismissed, this is a case in which, subject to a consideration of the third matter raised by the respondents, it is reasonable, having regard (among other things) to the history of the matter, to allow some limited opportunity for the appellants to seek special leave to appeal to the High Court, without disturbing the present status quo.
As to the third matter, the respondents refer to a default notice dated 8 December 2016, issued to Slondia in relation to rent. They also refer to a distribution of $864,222 by the MMF Trust to the FW Trust, which Mr Harris, on behalf of the appellants, had said was done to minimise capital gains tax. It is said by the respondents that the property was acquired prior to 20 September 1985, and no capital gains tax would have been payable. Mr Harris has subsequently said that he had a mistaken belief as to it being subject to capital gains tax.

Mr Harris, on behalf of the appellants, has sworn an affidavit dated 19 December 2016 in which he stated, in effect, that he is informed that the rental payment is to be made this week. He also said that whilst he was mistaken as to the capital gains tax issue, having regard to and for the benefit of the consolidated group in order to minimise the tax payable, it was appropriate to make the distribution to the FW Trust. He said that had the moneys not been distributed, the MMF Trust would not have been able to satisfy the tax liability that would have been created, given the financial position of the MMF Trust at the time of the sale of the property.
This court is not in a position today to assess the correctness of these last‑mentioned points. The distribution in question appears to have preceded at least the grant of the injunction on 29 November 2016.
In all the circumstances, and having regard to the very limited period of time sought and the obvious difficulties at this time of year, we are prepared to extend the injunction to 4.00 pm, 6 January 2017 on the same undertakings by the same persons as previously given on 29 November 2016.

S C H E D U L E
Specified Beneficiaries:	MICHAEL MERCANTI and any spouse, children and remoter issue of the said MICHAEL MERCANTI.
Additional Members of the Class of General Beneficiaries:	The mother and the father of the said MICHAEL MERCANTI and the mother and father of SYBIL YVONNE MERCANTI.
In the Event of the total failure of both the Specified Beneficiaries and the Additional Members of the Class of General Beneficiaries:	Nil
Vesting Day:	30^th day of June, 2055
Guardian:	MICHAEL MERCANTI during his lifetime and after his death the spouse of the said MICHAEL MERCANTI and after her death such person nominated in writing to the trustee by the survivor of the said MICHAEL MERCANTI and his spouse during their lifetime and in default of such appointment the person nominated in writing by the duly appointed personal representative of the survivor of the said MICHAEL MERCANTI and his spouse.
Appointor:	MICHAEL MERCANTI during his lifetime and after his death the spouse of the said MICHAEL MERCANTI and after her death such person nominated in writing to the trustee by the survivor of the said MICHAEL MERCANTI and his spouse during their lifetime and in default of such appointment the person nominated in writing by the duly appointed personal representative of the survivor of the said MICHAEL MERCANTI and his spouse.