Re IPR Nominees Pty Ltd

[2015] VSC 395

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

S CI 2015 02904

IN THE MATTER OF

IPR NOMINEES PTY LTD (as trustee of the 1965 Irvin Peter Rockman Trust)

Applicant

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JUDGE:	Bell J
WHERE HELD:	Melbourne
DATE OF HEARING:	5 August 2015
DATE OF JUDGMENT:	5 August 2015
CASE MAY BE CITED AS:	Re IPR Nominees Pty Ltd
MEDIUM NEUTRAL CITATION:	[2015] VSC 395

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TRUSTS – trustees – judicial advice – whether trustee should defend legal proceeding brought on behalf of minority beneficiaries in respect of trust – whether trust should so advise trustee – Supreme Court (General Civil Procedure) Rules 2005 (Vic).

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APPEARANCES:	Counsel	Solicitors
For the applicant	Mr N O’Bryan SC	Kenna Teasdale Lawyers

HIS HONOUR: 

1IPR Nominees Pty Ltd is the trustee of The 1965 Irvin Peter Rockman Trust. In proceeding S CI 2015 01263, two of six of the late Mr Rockman's children, by their litigation guardian, have sought relief against IPR in relation to the trust. In the application currently before me under rule 54.02 of the Supreme Court (General Civil Procedure) Rules 2005 (Vic), IPR seeks advice from the court as to whether it should defend that proceeding. Consistently with rule 54.03(c), the beneficiaries under the trust are not parties to the application.

2As was made clear in Macedonian Orthodox Community Church St Petka Incorporated v His Eminence Petar the Diocesan Bishop of Macedonian Orthodox Diocese of Australia and New Zealand,[1] the function of the court in an application of this kind is, for the protection of both the trustee and the trust, to provide the trustee with advice about a question concerning the administration of a trust. In exercising this function, the court gives ‘private and personal’[2] advice to the trustee about the matter in question. It is clear that, in an application of this kind, the court may give advice about whether it is appropriate for a trustee to defend a proceeding brought against the trustee in respect of the trust, and indeed Macedonian Orthodox Community Church was such a case.

[1] (2008) 237 CLR 66, 93–4 [71]–[72] (Gummow ACJ, Kirby, Hayne and Heydon JJ) (‘Macedonian Orthodox Community Church’).

[2] Ibid, 91 [64].

3An affidavit in support of this application exhibited a copy of the originating motion in the substantive proceeding and I have also examined the documents in the court file in that proceeding. As set out in the originating motion, the relief and remedy sought is:

1.   A declaration that the Deed of Variation made 2003 (the Deed) in The 1965 Irvin Peter Rockman Trust (the Trust) is beyond power provided to the trustee of the Trust by the Deed of Settlement made 12 August 1965 (the Trust Deed), and accordingly is void and of no effect.

2.   A declaration that the Trust vested on the death of Irvin Peter Rockman on 30 August 2010.

3.   An order for the taking of accounts of the Trust.

4.   An order that the corpus of the Trust be distributed to the children of Irvin Peter Rockman in equal shares on each of them attaining the age of 21 years in accordance with clause 4 of the Trust Deed.

5. Alternatively, an order pursuant to section 63A of the Trustee Act 1958, or in the equitable jurisdiction of this Honourable Court, that the vesting day of the Trust be brought forward to 2 August 2024.

6. An order pursuant to section 48 of the Trustee Act 1958 that the Defendant be removed as the Trustee of the Trust.

7.   An order that Equity Trustees Limited be appointed trustee of the Trust in place of the Defendant.

8. An order pursuant to section 51 of the Trustee Act 1958 vesting the property of the Trust in Equity Trustees Limited.

9.   An order that the Defendant deliver up to Equity Trustees Limited all documents of the Trust.

10.  Any further consequential orders, accounts, directions and inquiries necessary for the proper administration of the Trust.

11.  Costs.

12.  Such further or other orders as this Honourable Court considers just and equitable.

As can be seen, the relief and remedy sought is wide ranging and would affect, in a fundamental way, both the administration of the trust and the distribution of its benefits between the beneficiaries. 

4In my view this is clearly a case in which IPR should be advised that it is appropriate for it to defend the proceeding.  In reaching this conclusion, I have particularly taken into account the following considerations:

·     IPR is a necessary and appropriate defendant and the only present defendant. The proceeding would probably go undefended if IPR did not participate, which is highly undesirable for many reasons. Even if the other beneficiaries were to become defendants, they do not have the knowledge and capacity to defend that IPR possesses. 

·     The relief and remedy sought is wide ranging and fundamental, as I have indicated.

·     The relief and remedy sought appear to raise issues of fact concerning the administration of the trust and the exercise of the powers of IPR as the trustee which are within IPR's knowledge in that capacity. Moreover, removal of IPR as the trustee is sought.  In that connection, it appears likely that allegations will be made against IPR. It has a legitimate interest in defending those allegations.

·     The relief and remedy sought appear to raise issues of law concerning the administration of the trust and the exercise of the power of IPR as the trustee in respect of which IPR has a direct and legitimate interest in that capacity.

5For those reasons, pursuant to rule 54.02(1), the court determines that it is appropriate for IPR to defend the substantive proceeding unconditionally. There will be an order accordingly. There should be an order, too, that the costs of the application herein be paid out of the funds of the trust.

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