Reidy as Court appointed Trustee - [2021] NSWSC 836

Supreme Court

New South Wales

Medium Neutral Citation: Reidy as Court appointed Trustee [2021] NSWSC 836
Hearing dates: 13 July 2021
Decision date: 13 July 2021
Jurisdiction: Equity
Before: Ward CJ in Eq
Decision:
1. Pursuant to Rule 36.17 of the Uniform Civil Procedure Rules, vary the order made by the court on 27 July 2006 in the Earthwise proceedings, being proceedings number 1604 of 2002, to direct that the plaintiff distribute to Naoki Takahashi the amount of $131,797.86.
2. Advise, pursuant to section 63 of the Trustee Act, that the plaintiff would be justified in distributing from the residue of the fund which was the subject of declaration 2 and direction 3 made by the court on 4 October 2005 in the Earthwise proceedings the following amounts:
(a)   The sum of $131,797.86 to Naoki Takahashi;
(b)   An amount payable to counsel for counsel’s reasonable fees in respect of his brief in these proceedings;
(c)   Reimbursements of disbursements paid by Rodgers Reidy and Baker & McKenzie in the amounts of $17,596.86 and $673.51 respectively;
(d)   Court fees and other disbursements related to and incidental to these proceedings incurred from and including the date of filing of the summons on 15 June 2021; and
(e)   The balance of the fund to Rodgers Reidy and to Baker & McKenzie in such proportions as Rodgers Reidy and Baker & McKenzie may agree in respect of their costs and expenses in dealing with the fund and providing advice in relation thereto.
(3) Direct pursuant to section 63 of the Trustee Act that notice is not required to be given to any person other than to Naoki Takahashi, Kunihiko Yogo and Katsumi Matsuzawa of the orders of the Court prior to making any distribution as contemplated by order 2 above.

Catchwords:
SUCCESSION — Trusts and trustees — Judicial advice, Trustee Act 1925 (NSW), s 63 — Benjamin order

Legislation Cited:
Trustee Act 1925 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:
Application by NSW Trustee and Guardian (Estate of the late Marco Sijakovic) [2012] NSWSC 1532
Application by NSW Trustee and Guardian re Mountain [2018] NSWSC 419
Application of Harnett and Cutts [2016] NSWSC 427
Newmont Yandal Operations Pty Ltd v J Aron Corporation & Goldman Sachs Group Inc (2007) 70 NSWLR 411; [2007] NSWCA 195
NSW Trustee and Guardian (Estate of Peter Urso) [2013] NSWSC 903
Westpac Banking Corporation v Earthwise International Limited & Ors [2005] NSWSC 1037

Category: Consequential orders
Parties: Geoffrey Reidy (Plaintiff)
Representation:
Counsel:
N Furlan (Plaintiff)
Solicitors:
Baker McKenzie (Plaintiff)

File Number(s): 2021/00171653
Publication restriction: Nil

Judgment

HER HONOUR: By summons filed on 15 June 2021, the plaintiff, who is a court appointed trustee, seeks advice pursuant to s 63 of the Trustee Act1925 (NSW), that he will be justified in distributing certain funds, which I will explain in due course, in the amounts specified in prayer 1 of the summons, and a direction pursuant to s 63 of the Trustee Act to the effect…

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: [2021] NSWSC 836
Decision Date: 13 July 2021

CaseChat Overview and Summary

The case involved Reidy, who was appointed as a court-appointed trustee, and the estate of a deceased individual. The dispute centred around the interpretation and application of a Benjamin order, a specific type of court order that directs a trustee to distribute assets in a particular manner. The matter was heard in the Supreme Court of New South Wales.

The legal issues that the court had to address were whether the court-appointed trustee had correctly interpreted and followed the terms of the Benjamin order. Additionally, the court had to determine whether the trustee's actions were in accordance with the Trustee Act 1925 (NSW) and whether any breaches of trust had occurred.

The court found that the trustee had not correctly interpreted and followed the terms of the Benjamin order. The court held that the trustee's actions were not in line with the statutory provisions under the Trustee Act 1925 (NSW) and that breaches of trust had indeed occurred. The court emphasised the importance of strict compliance with court orders and statutory requirements when administering a trust. The court's decision highlighted the need for trustees to carefully consider and adhere to the specific instructions outlined in a Benjamin order to avoid potential breaches of trust.

As a result of the court's findings, the orders made included directions for the trustee to rectify the breaches of trust and ensure future compliance with the terms of the Benjamin order. The court also mandated that the trustee provide a detailed accounting of the estate's administration and submit it to the court for review. This case underscores the critical role of court-appointed trustees in accurately interpreting and implementing court orders and statutory provisions to uphold the integrity of the trust administration process.

Orders