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Sharp v Maritime Super Pty Ltd

Sharp v Maritime Super Pty Ltd

Case [2013] NSWSC 389 19 April 2013

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Supreme Court

New South Wales

Medium Neutral Citation: Sharp v Maritime Super Pty Ltd [2013] NSWSC 389
Hearing dates: 5 April 2013
Decision date: 19 April 2013
Jurisdiction: Equity Division
Before: Ward JA
Decision:
Order for payment of interest by way of equitable compensation for breach of trust. Costs awarded in favour of the plaintiff, in part on an indemnity basis.

Catchwords:
EQUITY - claim for equitable compensation - whether breach of trust in failing properly to investigate claim for total and permanent disablement benefit - failure correctly to apply Rule in Trust Deed as to entitlement to benefit
COSTS - offer of compromise - whether judgment or order no less favourable to the plaintiff than the terms of the offer in circumstances where decision on principal judgment was to remit determination of plaintiff's entitlement to a benefit to the trustee
Legislation Cited: Civil Procedure Act 2005 (NSW)
Superannuation (Resolution of Complaints) Act 1993 (Cth)
Superannuation Industry (Supervision) Act 1993 (Cth)
Trustee Act 1925 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)
Cases Cited: Alcoa of Australia Retirement Plan Pty Ltd v Frost [2012] VSCA 238
Bankstown Football Club Ltd v CIC Insurance Ltd (unreported, 17 December 1993)
Canson Enterprises Ltd v Boughton& Co [1991] 3 SCR 534; (1991) 95 DLR (4th) 129
Finch v Telstra Super Pty Ltd [2010] HCA 36; (2010) 242 CLR 254
Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397
Gilberg v Maritime Super (No. 2) [2009] NSWCA 394
HIH Casualty & General Insurance v Insurance Australia (No 2) [2006] VSC 128
Lahoud v Lahoud [2011] NSWCA 405
Maciejewski v Telstra Super Pty Ltd [1999] NSWSC 341
Miwa Pty Ltd v Siantan Properties Pte Ltd (No 2) [2011] NSWCA 344
Morgan Equipment Co v Rodgers (1993) 32 NSWLR 467
O'Halloran v R T Thomas & Family Pty Ltd 45 NSWLR 262
State of New South Wales v Dueeasy Pty Ltd (1992) 9 BCL 148
TramountanaArmadora S.A. v Atlantic Shipping Co S.A. [1978] 2 All ER 870
Tuftevski v Total Risks Management Pty Ltd [2009] NSWSC 1021
Category: Consequential orders
Parties: Ben Sharp (Plaintiff)
Maritime Super Pty Ltd (Defendant)
Representation: Counsel:
B W Rayment QC with M J Gollan (Plaintiff)
R A Cavanagh SC (Defendant)
Solicitors:
Firths - The Compensation Lawyers (Plaintiff)
King & Wood Mallesons (Defendant)

File Number(s): 11/147892

Judgment

HER HONOUR: On 7 November 2012, I handed down reasons for judgment ([2012] NSWSC 1350) in proceedings involving a dispute between a member of a superannuation scheme (Mr Ben Sharp) and the trustee of that scheme (Maritime Super Pty Ltd) in relation to Mr Sharp's claim for payment of a total and permanent disablement benefit (calculated as a lump sum of $453,000). The trustee had maintained that Mr Sharp was not entitled to such a benefit on the basis that his employment had not come to an end solely on the ground (or grounds) that his physical or mental condition at that time was…

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 Sharp v Maritime Super Pty Ltd

Details

AGLC: Sharp v Maritime Super Pty Ltd [2013] NSWSC 389
Case: [2013] NSWSC 389
Decision Date: 19 April 2013

CaseChat Overview and Summary

The plaintiff, Sharp, sought equitable compensation from Maritime Super Pty Ltd, a trustee of a superannuation fund, for alleged breaches of trust, including failing to properly investigate a claim for a total and permanent disablement benefit. The case was heard in the Federal Court of Australia. The core issue was whether the trustee's failure to correctly apply the Rule in the Trust Deed, concerning the entitlement to the benefit, constituted a breach of trust warranting equitable compensation. Another significant point was whether the offer of compromise should result in costs being awarded in a manner no less favourable to the plaintiff than the terms of the offer, given the court's decision to remit the determination of the plaintiff's entitlement to the trustee.

The court examined the trustee's obligations under the Trust Deed and considered whether the failure to properly investigate the claim constituted a breach of trust. It was noted that the trustee had an obligation to follow the Rule in the Trust Deed correctly, and any deviation from this could be considered a breach. The court also assessed whether the offer of compromise should influence the costs order in favour of the plaintiff. The court found that the trustee's failure to correctly apply the Rule in the Trust Deed did indeed constitute a breach of trust. However, regarding the costs, the court held that the offer of compromise did not warrant a costs order no less favourable to the plaintiff than the terms of the offer.

In conclusion, the court held that the trustee's failure to correctly apply the Rule in the Trust Deed did constitute a breach of trust, which warranted equitable compensation. However, the court determined that the offer of compromise did not justify a costs order that was no less favourable to the plaintiff than the terms of the offer. The matter concerning the plaintiff's entitlement to the benefit was remitted to the trustee for further determination.

Orders