Re Lidgett (No 2) - [2024] VSC 364

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMON LAW DIVISION
TRUSTS, EQUITY AND PROBATE LIST

S ECI 2023 01502

ANNA ELIZABETH LIDGETT (In her capacity as the trustee of the Lidgett Property Trust)	Plaintiff
v
SIMON JOHN LIDGETT	First Defendant
TRENA LIDGETT	Second Defendant
ERICA LIDGETT	Third Defendant
JILLIAN LIDGETT	Fourth Defendant

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JUDGE:	Moore J
WHERE HELD:	Melbourne
DATE OF HEARING:	Written submissions
DATE OF JUDGMENT:	26 June 2024
CASE MAY BE CITED AS:	Re Lidgett (No 2)
MEDIUM NEUTRAL CITATION:	[2024] VSC 364

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COSTS – Trusts – Following application for judicial advice – Where it was justified and appropriate for the plaintiff to play no active role in related proceedings in her capacity as trustee – Plaintiff’s right as trustee to indemnity out of trust assets – Plaintiff and first defendant’s costs be paid out of the assets of the trust - Supreme Court (General Civil Procedure) Rules 2015 r 54.02, 63 – Macedonian Orthodox Community Church St Petka Incorporated v His Eminence Petar Diocesan Bishop of the Macedonian Orthodox Diocese of Australia and New Zealand (2008) 237 CLR 66 – Wales v Wales [2015] VSCA 345 – Di Benedetto v Kilton Grange Pty Ltd [2017] VSCA 119 – Hopkins v Edwards [2020] VSC 456 – Re Evans; Marks v Evans (No 2) [2023] VSC 158.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr T Wodak	Heinz Law
For the First Defendant	Mr D Clough	Cinque Oakley Bryant Lawyers
For the Second, Third and Fourth Defendants	No appearance

HIS HONOUR:

Introduction

This proceeding concerns an application by the plaintiff, Anna Lidgett, in her capacity as the trustee of the Lidgett Property Trust (the Trust), for judicial advice pursuant to r 54.02 of the Supreme Court (General Civil Procedure) Rules 2015 (the Rules). The plaintiff sought advice that it would be appropriate and justified for the Trust to defend claims brought against her as trustee in a proceeding commenced by the first defendant, Simon Lidgett (the related proceeding). The plaintiff also sought an order that it would be appropriate and justified for her, in her capacity as trustee of the Trust, to pay out of the assets of the Trust the costs associated with defending that proceeding.

I determined that it would be justified and appropriate for the plaintiff, in her capacity as trustee, to play no active role in the related proceedings and that it would not be appropriate or justified for her to pay the costs of defending the related proceeding out of the assets of the Trust.[1] This judgment is in relation to costs.
[1]See Re Lidgett [2023] VSC 673 (the reasons for judgment).

The plaintiff seeks an order that her and the first defendant’s costs of this proceeding be paid out of the assets of the Trust, save for the costs thrown away of and incidental to a hearing in the Court on 12 September 2023 (the 12 September hearing). The plaintiff seeks an order…

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.

Continue reading Re Lidgett (No 2)

Details

AGLC: Re Lidgett (No 2) [2024] VSC 364
Case: [2024] VSC 364
Decision Date: 26 June 2024

CaseChat Overview and Summary

In the case of Re Lidgett (No 2), the plaintiff, acting as the trustee of a trust, sought to have her costs and those of the first defendant covered by the trust assets. This followed an application for judicial advice in relation to the trust. The plaintiff, who had taken no active part in related proceedings in her capacity as trustee, argued that she was entitled to an indemnity from the trust for the costs incurred. The case was heard in the Supreme Court of Victoria.

The central legal issues revolved around whether the plaintiff's inactivity in the related proceedings was justified and appropriate, and if so, whether she was entitled to indemnity from the trust for her costs. The court also needed to determine whether the first defendant's costs should be covered by the trust, given the plaintiff's role as trustee.

The court examined the principle established in Macedonian Orthodox Community Church St Petka Incorporated v His Eminence Petar Diocesan Bishop of the Macedonian Orthodox Diocese of Australia and New Zealand, which allows for trustees to be indemnified from trust assets when their actions are justified. It considered the relevance of the plaintiff's inactivity in the related proceedings, and whether this justified her right to an indemnity. The court also referenced the Supreme Court (General Civil Procedure) Rules 2015, particularly r 54.02 and 63, which govern the payment of costs from trust assets. After careful consideration, the court determined that the plaintiff's lack of active involvement in the related proceedings was justified and appropriate, and thus she was entitled to be indemnified from the trust for her costs. The court also found that the first defendant's costs should be paid from the trust assets.

The court ordered that the plaintiff's and the first defendant's costs be paid out of the assets of the trust. This decision was based on the plaintiff's justified inactivity in the related proceedings and the precedent set by previous cases such as Wales v Wales, Di Benedetto v Kilton Grange Pty Ltd, Hopkins v Edwards, and Re Evans; Marks v Evans (No 2).

Orders