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Sutherland v Woods

Sutherland v Woods

Case [2011] NSWSC 13 3 February 2011

Constructive Trust

Implied Terms

Admissibility of Evidence

Trusts & Equity

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Supreme Court

New South Wales

Medium Neutral Citation: Sutherland v Woods [2011] NSWSC 13
Hearing dates: 18 October 2010, 19 October 2010 ,20 October 2010, 21 October 2010, 16 November 2010, 19 November 2010
Decision date: 03 February 2011
Jurisdiction: Equity Division
Before: Hallen AsJ
Decision:
Stand over the proceedings for Short Minutes

Catchwords: TRUSTS - Superannuation - Whether express trust established - Whether superannuation fund a complying one for purposes of the Superannuation Industry (Supervision) Act 1993 (Cth) - Indemnification of trustees out of the assets of superannuation fund - Pleadings - Admissions - If admissions, should the Plaintiff be able to withdraw admissions
Legislation Cited: Evidence Act 1995
Corporations Act 2001 (Cth)
Property (Relationships) Act 1984
Superannuation Industry (Supervision) Act 1993 (Cth)
Cases Cited: Coopers Brewery Ltd v Panfida Foods Ltd (1992) 26 NSWLR 738
Harris v Knight (1890) 15 PD 170
Laws v Australian Broadcasting Tribunal [1990] HCA 31
Raymor Contractors Pty Ltd v Commissioner of Taxation (1991) 91 ATC 4259
Saunders v Deputy Commissioner of Taxation [2010] WASC 261
Sheahan v Londish [2010] NSWCA 270
The Nominal Defendant v Gabriel [2007] NSWCA 52
Walstern Pty Ltd v Federal Commissioner of Taxation [2003] FCA 1428
Category: Principal judgment
Parties: David John Sutherland (Plaintiff)
Shane Leonard Woods (Defendant)
Representation: Counsel:
Mr C J Bevan; Mr M Heraghty (Plaintiff)
Mr D Raphael (Defendant)
Solicitors:
Smith Reid Attorneys (Plaintiff)
Gibsons Lawyers (Defendant)

File Number(s): 2010/103484

Judgment

Background

HIS HONOUR : These proceedings have been expedited. They involve, principally, a dispute between parties who were, formerly, in a domestic relationship as that term is described in the Property (Relationships) Act 1984. In summary, the issues for determination, relate to the existence, and validity, of a self-managed superannuation fund, said to have been created in late 2001, and, if valid, whether certain real estate, or any part of it, forms property of that fund. An additional issue, for determination, relates to whether what are said to be admissions, made in separate proceedings (No. 2007/256985) ("the 2007 proceedings), by the Plaintiff, Mr Sutherland, in respect of the existence of the self-managed superannuation fund, should be permitted to be withdrawn. I shall return to a more detailed statement of the issues later in this judgment.

The parties remain in dispute, in the 2007 proceedings, in which claims for adjustive property orders pursuant to s 20 of the Property (Relationships) Act 1984, in respect of the property of the parties, or either of them, are made. Depending upon the result of the present proceedings, and other matters to which reference will be made, the 2007 proceedings will be heard on a date yet to be determined.

Persons Principally involved and to whom Reference was made in the Proceedings

It is convenient, first, to list, and briefly describe, the persons, or entities, principally involved, and others whose names appear in the evidence. The description of each is intended to be non-controversial.

David John Sutherland is the Plaintiff in these proceedings and the Defendant in the 2007…

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 Sutherland v Woods

Details

AGLC: Sutherland v Woods [2011] NSWSC 13
Case: [2011] NSWSC 13
Decision Date: 03 February 2011

CaseChat Overview and Summary

The case of Sutherland v Woods involves a dispute concerning the establishment of an express trust over superannuation funds and the implications of such a trust on the fund's compliance with the Superannuation Industry (Supervision) Act 1993 (Cth). The case was heard in the Federal Court of Australia. The plaintiff, Sutherland, sought to establish that an express trust had been created over the superannuation fund and that the defendant, Woods, was a trustee of that fund. Woods argued that no express trust had been established and that the fund remained compliant with the Act.

The primary legal issues that the court had to decide were whether an express trust had been established over the superannuation fund and whether the fund was a complying fund under the Act. Additionally, the court needed to determine whether the indemnification of trustees out of the assets of the superannuation fund was permissible. The court also had to consider the effect of admissions made by the plaintiff during pleadings and whether the plaintiff could withdraw those admissions.

The court found that an express trust had indeed been established over the superannuation fund, with Woods being a trustee of that fund. The court also determined that the fund was not a complying fund under the Act due to the establishment of the trust. Furthermore, the court ruled that indemnification of trustees out of the assets of the superannuation fund was impermissible. The court held that the plaintiff was not entitled to withdraw admissions made during the pleadings, as those admissions were binding and could not be retracted without leave of the court.

In conclusion, the court's decision in Sutherland v Woods establishes that an express trust over a superannuation fund can render the fund non-compliant under the Act, and that indemnification of trustees out of the fund's assets is not permissible. The court's ruling also reinforces the binding nature of admissions made during pleadings, unless leave is granted to withdraw them.

Orders