HIGH COURT OF AUSTRALIA
FRENCH CJ,
HAYNE, CRENNAN, BELL AND GAGELER JJMONTEVENTO HOLDINGS PTY LTD & ANOR APPELLANTS
AND
GIUSEPPE DIEGO SCAFFIDI & ANOR RESPONDENTS
Montevento Holdings Pty Ltd v Scaffidi
[2012] HCA 48
7 November 2012
P22/2012
ORDER
1.Appeal allowed.
2.Set aside the orders of the Court of Appeal of the Supreme Court of Western Australia made on 27 July 2011 and, in their place, order that:
(a)the appeal to that Court be dismissed; and
(b)Giuseppe Scaffidi pay the costs of Eugenio Scaffidi, Maria Scaffidi and Montevento Holdings Pty Ltd, including reserved costs, to be taxed if not agreed.
3.The first respondent pay the appellants' costs of the appeal to this Court.
On appeal from the Supreme Court of Western Australia
Representation
K A Vernon with A S Meysner for the appellants (instructed by Butcher Paull & Calder)
P E Cahill SC with C J Garde for the first respondent (instructed by Oldfield Legal)
Submitting appearance for the second respondent
Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.
FRENCH CJ, HAYNE, CRENNAN, BELL AND GAGELER JJ. Part of the background to this appeal is a long-running dispute between members of the Scaffidi family over the control of a trust called The Scaffidi Family Trust ("the trust"). The appeal concerns the proper construction of a clause in the trust deed governing the appointment of trustees.
The second appellant, Eugenio Scaffidi, and the first respondent, Giuseppe Scaffidi, are brothers. They are the only children of Antonio Scaffidi, who died on 29 August 2004, and the second respondent, his widow Maria Scaffidi, who is party to these proceedings by her guardian ad litem, the Public Trustee. The second respondent has filed an appearance submitting to any orders made by the Court. The first appellant, Montevento Holdings Pty Ltd ("Montevento"), was incorporated on 27 March 2007. Since that date, Eugenio Scaffidi has been its sole director and shareholder.
The trust was created by a deed of settlement dated 2 May 1977 ("the trust deed"). It is a discretionary trust designed to regulate the acquisition, management and disposal of assets of the Scaffidi family. Giuseppe, Eugenio and Maria Scaffidi are all within the class of beneficiaries of the trust, and Eugenio Scaffidi is the appointor of the trust.
This appeal concerns the proper construction of cl 11.03 of the trust deed, which provides that "[i]f, and so long as any individual Appointor is a Beneficiary that individual shall not be eligible to be appointed as a Trustee." By a deed poll dated 18 February 2009, in his capacity as appointor, Eugenio Scaffidi appointed Montevento as the sole trustee of the trust. On 19 April 2010, Giuseppe Scaffidi commenced proceedings in the Supreme Court of Western Australia against Eugenio and Maria Scaffidi and Montevento, seeking a declaration that the appointment of Montevento as the sole trustee of the trust was invalid because it breached cl…
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- Case
- [2012] HCA 48
- Decision Date
CaseChat Overview and Summary
The central legal issue before the High Court was whether a corporation, of which an individual appointor was the sole director and shareholder, was eligible to be appointed as a trustee of the trust, given the restriction in cl 11.03. This required the Court to interpret the meaning of "individual Appointor" within the context of the trust deed and determine if the restriction extended to a corporate trustee where the individual appointor held significant control. The Court also considered the distinction drawn within the trust deed between "individual" and "corporation" in other provisions.
The High Court allowed the appeal, setting aside the orders of the Court of Appeal. The Court reasoned that the trust deed clearly distinguished between an "individual" and a "corporation" in its provisions. Clause 11.03 specifically referred to an "individual Appointor" being ineligible to be appointed as a trustee. The Court found that Montevento, being a corporation, did not fall within the prohibition of cl 11.03, even though Giuseppe Scaffidi, an individual appointor and beneficiary, was its sole director and shareholder. The Court held that the restriction applied only to natural persons being appointed as trustees and did not extend to a corporate trustee controlled by such an individual. Consequently, Montevento's appointment as trustee was valid.
Orders
Orders of the court
1. Appeal allowed.
2. Set aside the orders of the Court of Appeal of the Supreme Court of Western Australia made on 27 July 2011 and, in their place, order that:
(a) the appeal to that Court be dismissed; and
(b) Giuseppe Scaffidi pay the costs of Eugenio Scaffidi, Maria Scaffidi and Montevento Holdings Pty Ltd, including reserved costs, to be taxed if not agreed.
3. The first respondent pay the appellants' costs of the appeal to this Court.
Background
Background to the litigation
Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
Established by:
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