Re Porlock Pty Ltd

[2015] NSWSC 1243

Supreme Court

New South Wales

Medium Neutral Citation:	Porlock Pty Ltd [2015] NSWSC 1243
Hearing dates:	28 August 2015
Date of orders:	28 August 2015
Decision date:	28 August 2015
Before:	Young AJA
Decision:	Order made giving judicial advice
Catchwords:	TRUSTS – trust deed of 1957 lost – trustees seek judicial advice as to content of trusts – secondary evidence from former accountant as to deed and its contents – judicial advice given
Legislation Cited:	Trustee Act 1925
Cases Cited:	Hewitt v Farrell (1814) 12 SCR (NSW) (Eq) 94
Category:	Principal judgment
Parties:	Porlock Pty Ltd - plaintiff
Representation:	Counsel: D Barlin – for the plaintiff   Solicitors: Sydney Business Lawyers – for the plaintiff
File Number(s):	2015/145334

Judgment

1. This is an application under section 63 of the Trustee Act 1925 for judicial advice. The plaintiff is the trustee of the JDB Carr Trust No.2. That trust was set up about 1957 though it is unclear who the settlor was. It has some substantial assets. The problem is that no one can find a copy of the Trust Deed and the trustee wishes to be confirmed in its belief as to how it holds the trust property.

2. The court has no power to actually recreate a Trust Deed. We are not in the same situation as one is when there is a lost will. What the court is doing is advising the trustee as to whether it would be justified in dealing with the trust property in the way in which it proposes. It is clear that the trustee recognises that it does not hold the trust property beneficially.

3. The question then is on what trust does it hold the property. There is secondary evidence as to that matter. Until he retired Mr W M Samuel who was an accountant who practised not only in the Sydney area but also at Crookwell, close to where the natural persons who are associated with the plaintiff live, wrote a letter to a member of the family saying that:

‘the Trust Deed provides that the income derived by the trust is to be paid to James D B Carr during his life and further provides that after the death of James D B Carr the property is to be held as to both capital and income for all and/or any of his children living at his death or attaining the age of 21 and if more than one in equal shares as tenants in common’

4. and then he gives further details.

5. Mr Samuel has actually sworn an affidavit in these proceedings and he says that he believed that letter accurately sets out the assets and terms of the trust as at that stage and he believes that the letter is accurate partly because the letter is written in a form which would seem to him to be him quoting the actual Trust Deed.

6. Mr Samuel's affidavit says that the deed establishing the trust was stored at his Crookwell office up until his retirement in 1985. The solicitors for the plaintiff have made diligent search for a copy of the Trust Deed without any success.

7. There have been relatively few authorities as to what one does when one cannot find a Trust Deed. Right back in 1874 Faucett, PJ dealt with Hewitt v Farrell (1874) 12 SCR (NSW) (Eq) 94. His Honour was troubled about the Statute of Frauds in holding that there was a trust when it was not clear to him whether there was an actual Trust Deed in existence. He also was concerned that there was no secondary evidence of the terms of the trust. Accordingly he declined to make an order.

8. However, there are three differences in the present case:

1. this is an application for judicial advice;

2. there is secondary evidence; and

3. there is evidence that the deed actually existed so there is no problem with the Statute of Frauds.

9. Mr Barlin of counsel has given a very thorough advice. I am indebted to him for that and with respect I think it is correct. The plaintiff does not hold the property beneficially. The best evidence there is as to what is the trusts is the letter from the accountant and the trustees would be justified in acting on it. If at some time in the future the deed happens to turn up and the people see that they may have a claim against the trustees they can then mount that claim but this advice will give some protection to the trustees.

10. Accordingly, the court by order makes the following orders:

1. Order pursuant to section 63 of the Trustee Act 1925 (NSW) that the plaintiff is justified in managing and administering the JDB Carr Family Trust No 2 (Trust) pursuant to the terms contained in a letter dated 22 August 1984 from W M Samuels to James David Brownlow Carr as contained in pages 11 to 15 of Exhibit ‘JC-01’ of the affidavit of James David Brownlow Carr affirmed on 19 March 2015 (Letter).

2. An order that the costs of these proceedings be borne by, and paid out of, either the income or capital of the Trust.

3. The court notes that the Trust has been variously described as the ‘JDB Carr Family Trust No 2’, the ‘JDB Carr Trust No 2’ and the ‘No 2 Trust for JDB Carr’.

4. The court notes that pursuant to the Letter:

1. James David Brownlow Carr is entitled to the income of the Trust during his lifetime;

2. the plaintiff has the power to appoint a part, or the whole of the capital of the Trust to James David Brownlow Carr during his lifetime;

3. provided that any children of James David Brownlow Carr survive him and attain the age of twenty-one (21), the children are takers in default of appointment of the capital of the Trust referred to in [4(a)], in equal shares as tenants-in-common.

Decision last updated: 21 September 2015