Nemler-Aquilina v Mercader - [2025] VSC 595

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

TRUSTS, EQUITY AND PROBATE LIST

S CI 2025 04198

IN THE MATTER of the Estate of Emmanuel Francis Aquilina, deceased

- and –

IN THE MATTER of section 34(1)(c) of the Administration and Probate Act 1958 (Vic)

- and –

IN THE MATTER of sections 48(1) and 55 of the Trustee Act 1958 (Vic)

IVY EVELYN NEMLER-AQUILINA	Plaintiff
v
FE MERCADER (personally and in her capacity as Executor of the estate of Emmanuel Francis Aquilina, deceased)	Defendant

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JUDGE:	Moore J
WHERE HELD:	Melbourne
DATE OF HEARING:	12 September 2025
DATE OF JUDGMENT:	19 September 2025
CASE MAY BE CITED AS:	Nemler-Aquilina v Mercader
MEDIUM NEUTRAL CITATION:	[2025] VSC 595

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WILLS AND ESTATES – Where plaintiff seeks removal of defendant as executor and trustee of deceased’s estate – Only asset of estate is real property – Defendant entered into deed of settlement with third party without consent of and in opposition to beneficiaries – Deed of settlement terms include sale of property and payment of 40% of proceeds of sale to third party – Where defendant did not seek judicial advice to compromise third party claim – Where defendant did not obtain consent of beneficiaries to compromise third party claim – Where defendant failed to seek independent legal advice regarding third party claim – Where defendant unreasonably refused to acknowledge plaintiff was a beneficiary of estate – Where defendant failed to provide prompt and proper responses to beneficiaries – Where defendant in breach of Court orders – Defendant unfit to act as executor – Defendant removed as executor and trustee of deceased’s estate – Plaintiff appointed in place – Miller v Cameron (1936) 54 CLR 572 - Monty Financial Services v Delmo [1996] 1 VR 65 – Fysh v Coote [2000] VSCA 150 – Dowling v St Vincent de Paul Society of Victoria Inc [2003] VSC 454 – Administration and Probate Act 1958 (Vic) s 34(1)(c) – Trustee Act 1958 (Vic) s 19(1)(f) – Family Law Act 1975 (Cth) ss 90C, 90G(1) – Supreme Court (General Civil Procedure) Rules 2025 (Vic), Order 54.

COSTS – Where plaintiff seeks defendant pay costs on indemnity basis without indemnification from deceased’s estate – Where defendant’s failures are numerous and profound - Impropriety exception – Defendant to pay plaintiff’s costs on indemnity basis – Costs to be paid personally by defendant without indemnification from estate – Banksia Securities Ltd v Insurance House Pty Ltd (Costs) [2020] VSC 234 – Hopkins v Edwards [2020] VSC 456.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr T Staindl	Perpetuity Legal
For the Defendant	Appeared in person

HIS HONOUR:

Emmanuel Francis Aquilina died on 14 August 2024 leaving a will dated 29 March 2000 (the Will). By the Will, the deceased appointed his second wife, Teresita Aquilina (Teresita),[1] and Mercader Barristers and Solicitors as the executors of his estate. As Teresita predeceased the deceased, the executor of the estate…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2025] VSC 595
Decision Date: 19 September 2025

CaseChat Overview and Summary

The case of Nemler-Aquilina v Mercader involved the plaintiff seeking the removal of the defendant from their position as executor and trustee of their deceased relative's estate. The only asset of the estate was a piece of real property. The defendant had entered into a deed of settlement with a third party without the consent of, or in opposition to, the beneficiaries of the estate. The terms of the deed included the sale of the property and the payment of 40% of the proceeds of the sale to the third party. The defendant did not seek judicial advice to compromise the third party's claim, nor did they obtain the consent of the beneficiaries to compromise the claim. They also failed to seek independent legal advice regarding the third party's claim, unreasonably refused to acknowledge the plaintiff as a beneficiary, failed to provide prompt and proper responses to the beneficiaries, and breached court orders. The defendant was deemed unfit to act as executor, and the plaintiff was appointed in their place.

The legal issues in the case included whether the defendant's conduct warranted their removal as executor and trustee of the estate, and whether the defendant should be ordered to pay the plaintiff's costs on an indemnity basis. The court held that the defendant's conduct amounted to a breach of their fiduciary duties and that they were unfit to continue as executor and trustee. The court also found that the defendant's failures were numerous and profound and that an indemnity costs order was appropriate. The court referred to several cases and statutes in reaching its decision, including Miller v Cameron, Monty Financial Services v Delmo, Fysh v Coote, Dowling v St Vincent de Paul Society of Victoria Inc, and various sections of the Administration and Probate Act 1958, Trustee Act 1958, Family Law Act 1975, and Supreme Court (General Civil Procedure) Rules 2025.

The court found that the defendant's conduct was in breach of their fiduciary duties and that they had acted unreasonably and without regard for the interests of the beneficiaries. The court noted that the defendant had failed to seek judicial advice, obtain the consent of the beneficiaries, seek independent legal advice, acknowledge the plaintiff as a beneficiary, provide prompt and proper responses to the beneficiaries, and comply with court orders. The court also found that the defendant's actions in entering into the deed of settlement without the consent of the beneficiaries was a clear breach of their fiduciary duties. The court held that the defendant was unfit to act as executor and trustee and ordered that the plaintiff be appointed in their place. The court also ordered that the defendant pay the plaintiff's costs on an indemnity basis without indemnification from the estate. The court referred to Banksia Securities Ltd v Insurance House Pty Ltd (Costs) and Hopkins v Edwards (Costs) in making its decision on costs.

The court's final orders were that the defendant be removed as executor and trustee of the estate, that the plaintiff be appointed in their place, and that the defendant pay the plaintiff's costs on an indemnity basis without indemnification from the estate. The court emphasised the importance of fiduciaries acting in the best interests of their beneficiaries and the need for them to comply with their legal and ethical obligations. The court's decision sends a strong message to fiduciaries that they will be held accountable for any breaches of their duties and that they may be removed from their positions if they act unreasonably or in opposition to the interests of their beneficiaries.

Orders