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Re Uncle's Joint Pty Ltd

Re Uncle's Joint Pty Ltd

Case [2014] NSWSC 321 24 March 2014

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Supreme Court

New South Wales

Medium Neutral Citation: Application of Uncle's Joint Pty Ltd ACN 148 176 792 & Anor [2014] NSWSC 321
Hearing dates: 21 March 2014
Decision date: 24 March 2014
Jurisdiction: Equity Division - Duty List
Before: Brereton J
Decision:
Decline to give judicial advice. Summons dismissed.

Catchwords: EQUITY - trusts and trustees - applications to the court for advice and authority - advice sought as to whether trustees justified in defending proceedings which impugn their appointment and resorting to trust assets to fund defence - whether impugned trustees have standing to seek advice - held, they do - where there appear to be reasonable prospects of defence succeeding - where dispute is in substance dispute between beneficiaries - whether advice should be given - held, unfair and unjust to permit trustees to have recourse to trust fund - held, advice declined.
Legislation Cited: (NSW) Trustee Act 1925 s 63
Cases Cited: Alsop Wilkinson (a firm) v Neary [1996] 1 WLR 1220
Application of Frost and Fallon [2011] NSWSC 591
Application of Macedonian Orthodox Community Church St Petka Inc (No 2) (2005) 63 NSWLR 441
Arena Management Pty Ltd (Rec & Mgr Apptd) v Campbell St Theatre Pty Ltd [2011] NSWCA 128
Armitage v Nurse [1998] Ch 241
Fay v Moramba Services Pty Ltd [2010] NSWSC 725
Frost v Bovaird [2012] FCAFC 60; 203 FCR 95
Kation Pty Ltd v Lamru Pty Ltd; Lewis v Nortex Pty Ltd (In Liq) [2009] NSWCA 145
Lombe v Wagga Leagues Club Ltd (2006) 56 ACSR 387
Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar the Diocesan Bishop of Macedonian Orthodox Diocese of Australia and New Zealand (2008) 237 CLR 66
Maloof v Uncle's Joint Pty Ltd [2014] NSWSC 210
Miller v Cameron (1936) 54 CLR 572
National Trustees Executors and Agency Company of Australasia Ltd v Barnes (1941) 64 CLR 268
Re Application of Macedonian Orthodox Community Church St Petka Inc (No 3) [2006] NSWSC 1247
Re Lenyco Pty Ltd [2010] NSWSC 1094
Category: Principal judgment
Parties: Uncle's Joint Pty Ltd ACN 148 176 792 (First Applicant)
Darren Adam Pernice (Second Applicant)
Representation: Counsel:
Mr P Herzfeld (Applicants)
Solicitors:
Stacks/The Law Firm (Southern Highlands)

File Number(s): 2014/ 86483

Judgment

The applicants Uncle's Joint Pty Ltd and Darren Adam Pernice are defendants in other proceedings in this court - respectively, proceeding 2013/360586 and proceeding 2013/360672 (together, "the trust proceedings") - in which Frances Rita Maloof (Frances), Tiba Clementine Maloof (Tiba) and Sarah Mariel Maloof (Sarah) (together, "the plaintiffs"), contend that each applicant has not been duly appointed as and is not the trustee of, respectively, the CJ Maloof Family Trust ("the CJM Trust") and the Einasleigh Trust. By this application, the applicants seek advice pursuant to (NSW) Trustee Act 1925, s 63, as to whether they would be justified in defending the claims against them in the trust proceedings; and, if so, whether they would be justified in using the resources of the relevant trust to do…

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 Uncle's Joint Pty Ltd

Details

AGLC: Application of Uncle's Joint Pty Ltd ACN 148 176 792 and Anor [2014] NSWSC 321
Case: [2014] NSWSC 321
Decision Date: 24 March 2014

CaseChat Overview and Summary

The case of Re Uncle's Joint Pty Ltd involved the trustees of a company who were seeking advice and authority from the court. The trustees were being challenged in their appointment and were considering using trust assets to fund their defence. The trustees were asking the court to advise them on whether they were justified in doing so and whether they had the standing to seek such advice. The central legal issues before the court were whether the trustees had the right to use trust funds to defend their appointment and whether the court should give advice in these circumstances.

The court considered the matter of whether the trustees had standing to seek advice, which they found they did, as they were in fact the trustees of the trust. However, the court also needed to consider whether it was appropriate to give advice in this case. The court held that it was not fair and just to permit the trustees to have recourse to the trust fund for this purpose. The court found that there appeared to be reasonable prospects of the trustees successfully defending the proceedings against them. However, the court also noted that the dispute was in substance a dispute between the beneficiaries and not between the trustees and the beneficiaries. Given these circumstances, the court declined to give advice to the trustees.

The court declined to give advice to the trustees on the basis that it would be unfair and unjust to permit the trustees to have recourse to the trust fund. The court found that the dispute was in substance a dispute between the beneficiaries, and not between the trustees and the beneficiaries. The court held that it would be inappropriate to give advice in these circumstances. The court did not make any orders in relation to the proceedings, as it declined to give advice to the trustees. Instead, the court left the matter to be resolved between the beneficiaries.

Orders