Segelov v Ernst and Young Services Pty Ltd

The Federal Court of Australia was asked to determine whether a trustee had a duty to inform a beneficiary of their entitlement once it had been determined, and whether the trustee had a duty to ensure the beneficiary received the benefit of any distribution. The case was brought by a beneficiary of a discretionary trust, Mr Segelov, against the trustee, Ernst and Young Services Pty Ltd. Mr Segelov argued that the trustee failed to inform him of his entitlement to a distribution and failed to ensure he received the benefit of that distribution.

The court was required to consider whether the trustee had a duty to inform the beneficiary of their entitlement once it had been determined, and whether the trustee had a duty to ensure the beneficiary received the benefit of any distribution. The court needed to consider the relevant statutory provisions, case law, and the terms of the trust deed. The court also needed to consider whether the trustee had breached their duty to the beneficiary, and if so, what remedies were available to the beneficiary.

The court found that the trustee had a duty to inform the beneficiary of their entitlement once it had been determined, and a duty to ensure the beneficiary received the benefit of any distribution. The court held that the trustee had breached their duty to the beneficiary by failing to inform him of his entitlement and failing to ensure he received the benefit of the distribution. The court found that the breach of duty caused the beneficiary to suffer loss, and awarded the beneficiary damages in the amount of $200,000. The court also ordered the trustee to pay the beneficiary's costs of the proceeding.