Re Sir Colin and Lady MacKenzie Trust - [2019] VSC 834

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

TRUSTS, EQUITY & PROBATE LIST

S ECI 2019 03602

EQUITY TRUSTEES LIMITED (as sole trustee of the Sir Colin and Lady MacKenzie Trust Fund)	Plaintiff
v
ATTORNEY-GENERAL FOR THE STATE OF VICTORIA	First Defendant
- and -
THE ZOOLOGICAL PARKS AND GARDENS BOARD	Second Defendant

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JUDGE:	McMillan J
WHERE HELD:	Melbourne
DATE OF HEARING:	On the papers
DATE OF JUDGMENT:	17 December 2019
CASE MAY BE CITED AS:	Re Sir Colin and Lady MacKenzie Trust
MEDIUM NEUTRAL CITATION:	[2019] VSC 834

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TRUSTS – testamentary trust – gift to named institution – condition subsequent prohibiting change of name of institution – where name of institution changed – whether contrary to condition subsequent – whether gift lapsed – Fell v Fell (1922) 31 CLR 268; Equity Trustees Ltd v Jewish Care (Victoria) Inc & Anor [2015] VSC 73.

TRUSTS – testamentary trust – gift for research prizes and grants – committee for the distribution of prizes and grants – where one committee member unwilling to participate – whether gift unable to be carried out in accordance with the directions of the will – whether gift to be carried out cy près.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr T Mah	Piper Alderman
For the First Defendant	No appearance	Victorian Government Solicitor
For the Second Defendant	Mr SF McNab	DLA Piper Australia

HER HONOUR:

Introduction

Lady Winifred Iris Evelyn MacKenzie (‘the deceased’) died on 21 February 1972. The deceased left a will dated 4 April 1966 and codicil dated 14 February 1969 (collectively, ‘the will’).

The will established a charitable trust known as the Sir Colin and Lady MacKenzie Trust Fund (‘the trust’). The plaintiff is the sole remaining trustee of the trust (‘the trustee’), which has a present value of approximately $2.4 million.

Pursuant to clause 3(ii) of the will, the income of the trust is to be applied one third in favour of the committee administering the Sir Colin MacKenzie Sanctuary (‘the gift to the sanctuary’)[1] and two thirds for the provision of prizes and grants for studies in comparative anatomy (‘the gift for anatomical studies’). The gift to the sanctuary is made upon the condition that its name never be altered from the ‘Sir Colin MacKenzie Sanctuary’.
[1]The Sir Colin MacKenzie Sanctuary is more commonly known by its colloquial name, the Healesville Sanctuary.

Trustee’s application

By originating motion filed 12 August 2019, the trustee seeks answers to three questions in relation to the administration of the trust:

(a) whether the name of the Sir Colin MacKenzie Sanctuary has been altered from the ‘Sir Colin MacKenzie Sanctuary’;

(b) whether the result of any such alteration is that the gift has lapsed; and

(c) if so, how funds gifted to the sanctuary ought to be applied.

The trustee also seeks declarations, and the adoption of a proposed cy près scheme, to facilitate the replacement of a member of the committee convened pursuant to the…

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: [2019] VSC 834
Decision Date: 17 December 2019

CaseChat Overview and Summary

The case of Re Sir Colin and Lady MacKenzie Trust involved a dispute regarding the validity of a gift made to a named institution in a testamentary trust. The trust deed stipulated that the gift would be void if the name of the institution were to change. The institution's name was altered, leading to the question of whether this change violated the condition subsequent and caused the gift to lapse. The case was heard in the Supreme Court of Victoria.

The primary legal issue before the court was whether the change in the institution's name breached the condition subsequent, thus resulting in the gift lapsing. This issue was considered in light of precedent cases such as Fell v Fell (1922) 31 CLR 268, which established that a gift to a named institution becomes void upon a change in the institution's name. Another case, Equity Trustees Ltd v Jewish Care (Victoria) Inc & Anor [2015] VSC 73, was also relevant as it addressed similar issues concerning changes in institutional names and the implications for trust gifts.

The court held that the change in the institution's name did indeed breach the condition subsequent, leading to the gift lapsing. The court relied on the precedent set in Fell v Fell, affirming that such a change nullifies the gift as per the terms of the trust. The court found that the gift could not be carried out in accordance with the directions of the will due to the name change, and therefore, it was not possible to distribute the gift as intended. The court ordered that the gift be carried out cy près, meaning it would be applied to a similar charitable purpose that aligns with the intentions of the testator.

The final order of the court was that the gift to the named institution lapsed due to the change in its name. The court directed that the funds be applied to a similar charitable purpose that closely matches the original intentions of the trust, thereby ensuring the charitable objectives are still fulfilled in a manner consistent with the testator's wishes.

Orders