Palmer v Palmer

Case [2018] QSC 217

SUPREME COURT OF QUEENSLAND

CITATION:

Palmer v Palmer & Anor [2018] QSC 217

PARTIES:

RYAN ANDREW PALMER AS A TRUSTEE OF THE ROSS LESLIE PALMER TESTAMENTARY TRUST

(applicant)

v
IAN LINDSAY PALMER AS A TRUSTEE OF THE ROSS LESLIE PALMER TESTAMENTARY TRUST

(first respondent)
ROSS LESLIE PALMER AND IAN LINDSAY PALMER AS EXECUTORS AND TRUSTEES OF THE ESTATE OF LESLIE HAROLD PALMER (DECEASED)
(second respondents)

FILE NO:

BS9305 of 2017

DIVISION:

Trial Division

PROCEEDING:

Application

DELIVERED ON:

28 September 2018

DELIVERED AT:

Brisbane

HEARING DATE:

11 September 2018

JUDGE:

Mullins J

ORDER:

The application filed on 9 July 2018 is dismissed.

CATCHWORDS:

EQUITY – TRUSTS AND TRUSTEES – APPOINTMENT, REMOVAL AND ESTATE OF TRUSTEES – RETIREMENT AND REMOVAL – REMOVAL BY THE COURT – GROUNDS FOR REMOVAL – where a beneficiary of a discretionary testamentary trust applies to be substituted as one of the co-trustees of the trust – where the co-trustees are currently the beneficiary’s son and brother – where the beneficiary’s brother proposes to resign as trustee, when the other co-trustee relocates to Australia – where most of the adult beneficiaries do not support the application – where the beneficiary’s son has concerns over the ability of his father to cooperate with him if they were co-trustees – where communication difficulties exist between the father and the son – whether it is expedient and in the interests of the beneficiaries to order the substitution of trustee

EQUITY – TRUSTS – DISCRETIONARY TRUST – REMOVAL OF APPOINTOR – where the beneficiary of a discretionary testamentary trust seeks to remove and substitute the appointor given power under the deceased’s will to appoint and remove trustees of the three testamentary trust established under the will – where the beneficiary seeking his removal is the only beneficiary under any of the testamentary trusts who seeks to alter the role of the appointor – whether the court has the power to remove the appointor – whether the appointor should be removed as the appointor

Trusts Act 1973 (Qld), s 80

Hancock v Rinehart [2015] NSWSC 646, considered
Jenkins v Ellett [2007] QSC 154, followed
Mercanti v Mercanti (2016) 50 WAR 495; [2016] WASCA 206, considered
Miller v Cameron (1936) 54 CLR 572; [1936] HCA 13, considered
Porteous v Rinehart (1998) 19 WAR 495; [1998] WASC 270, considered
Tempest v Lord Camoys (1882) 21 Ch D 571, cited

COUNSEL:

S J Lee for the applicant

W A Hickey (sol) for the first respondent and one of the second respondents
Mr Ross Leslie Palmer (the other second respondent) in person  

SOLICITORS:

Holding Redlich for the applicant

HWL Ebsworth Lawyers for the first respondent and one of the second respondents

  1. Mr Ross Leslie Palmer who is one of the second respondents in this proceeding filed an application on 9 July 2018 seeking to remove his brother Mr Ian Lindsay Palmer (who is the first respondent and the other second respondent) as trustee of the Ross Leslie…

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Details
AGLC
Palmer v Palmer [2018] QSC 217
Case
[2018] QSC 217
Decision Date

CaseChat Overview and Summary

In the case of Palmer v Palmer, the court was asked to decide whether Ross Palmer, a beneficiary of a discretionary testamentary trust, should be substituted as one of the co-trustees of the trust. The current co-trustees are Ross's son, Ian Palmer, and his brother, Ryan Palmer. The dispute arose when Ryan proposed to resign as trustee, coinciding with Ian relocating to Australia. Most of the adult beneficiaries did not support Ross's application. Ian expressed concerns over his ability to cooperate with Ross if they were co-trustees, due to existing communication difficulties between them. The legal issues involved the court's power to remove a trustee and whether such a removal would be in the beneficiaries' interests. The court considered the evidence provided by the parties, including the affidavits and emails, and ultimately determined that Ross's application should be dismissed. The court found that there was insufficient evidence to substantiate Ross's claims against Ian, particularly regarding fiduciary duty and the Corporations Act 2001 (Cth). Therefore, the application for Ross to be substituted as a co-trustee was denied.

Orders

Orders of the court

The application filed on 9 July 2018 is dismissed.

Background

Background to the litigation

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Evidence

Evidence Before The Court

The grounds set out in Mr Ross Palmer’s affidavit filed on 9 July 2018 for seeking the removal of Mr Ian Palmer as a trustee of the RLPT Trust are:(a) decisions made by Mr Ian Palmer as a director of companies in which the RLPT Trust has interests are not in the interests of the beneficiaries of the RLPT Trust;(b) the decision by the trustees of the RLPT Trust to reduce the weekly allowance payable to Mr Ross Palmer and to cease paying the mortgage on the property in which he was living was not a decision in Mr Ross Palmer’s best interests;(c) Mr Ian Palmer acts with the advice of Mr Hussein and in recent years the relationship between Mr Hussein and Mr Ian Palmer on the one hand and Mr Ross Palmer on the other has broken down to such an extent that it is impossible/impracticable and not in the interests of the beneficiaries of the RLPT Trust to have Mr Ian Palmer as trustee. Disputed evidence The hearing of the application was heard in a summary way with submissions being made by reference to the evidence in the affidavits relied on by the parties. No deponent was cross-examined. Mr Lee raised whether he should cross-examine Mr Ross Palmer, in order to put to him the allegations in Mr Ryan Palmer’s affidavit. I indicated that I did not consider cross-examination was required, where Mr Ross Palmer declined the opportunity to answer by affidavit the allegations in the affidavits relied on by the other parties against him. There are a number of peripheral matters in dispute, but they do not need to be decided for the purpose of the application. One of those matters is the nature of Mr Ross Palmer’s medical condition. Mr Ross Palmer accepts that he has been diagnosed with Asperger’s and post traumatic stress disorder. He denies ever having been diagnosed with bipolar disorder. In fact, Mr Lee of counsel concedes that the evidence before the court does not permit a finding that Mr Ross Palmer has bipolar disorder. Mr Ryan Palmer relies on an affidavit from psychiatrist Dr Andrew Nielsen who prepared a report providing expert opinion setting out the symptoms of Asperger’s, PTSD and bipolar disorder and responding to various statements made by Mr Ross Palmer that purported to explain the nature of his condition. What is relevant is not how Mr Ross Palmer’s condition is labelled, but how he conducts himself in his dealings with family members. That is dealt with in the affidavits of Mr Ross Palmer, Mr Ryan Palmer and Mr Ian Palmer. In addition, Mr Ryan Palmer’s solicitor Ms Xavier has exhibited to her affidavit filed on 5 September 2018 a bundle comprising 129 pages of various emails received by her firm from Mr Ross Palmer since 27 November 2017 which are relevant to the issue of how Mr Ross Palmer deals with others. Mr Ross Palmer exhibits to his affidavit minutes of a meeting of directors of Palmer Properties Pty Ltd and Longon Pty Ltd dated 28 June 2017 at which Mr Ian Palmer, Mr Hussein and Mr Darren Palmer were present. There is reference made in those minutes to requiring that a loan made by Longon Pty Ltd (which is a company in which the shares were distributed to the RLPT Trust and the other two testamentary trusts) to Naluky Homes Pty Ltd as trustee for $1m to be paid within four months. Naluky Homes Pty Ltd is a company of which Mr Ian Palmer is the sole director. Mr Ross Palmer also exhibits the loan agreement made on 29 July 2016 relating to this loan of $1m. There is no evidence about whether the loan was repaid. All Mr Ross Palmer asserts is that he has “always raised concerns regarding the loans and repayment time lines which are decisions made purely by the trustees” and uses that loan to Naluky Homes Pty Ltd as an example. The only attack on Mr Ian Palmer is in relation to a decision of directors to which he was a party made about the timing for the repayment of the loan. In oral submissions, Mr Ross Palmer claimed there was a breach of fiduciary duty and the Corporations Act 2001 (Cth) in making the loan, but did not develop the argument. There is not sufficient evidence put before the court by Mr Ross Palmer to raise a case to answer by Mr Ian Palmer about his conduct as a trustee of the RLPT Trust in connection with that transaction.

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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