The application of M & L Richardson Pty Limited

[2021] NSWSC 105

Supreme Court

New South Wales

Medium Neutral Citation:

The application of M & L Richardson Pty Limited [2021] NSWSC 105

Hearing dates:

18 February 2021

Date of orders:

18 February 2021

Decision date:

18 February 2021

Jurisdiction:

Equity

Before:

Kunc J

Decision:

Judicial advice given that trustee entitled to administer trust in accordance with unexecuted copy of trust deed

Catchwords:

EQUITY — Trusts and trustees — Judicial advice — Lost executed trust deed

Legislation Cited:

Trustee Act 1925 (NSW)

Cases Cited:

Application of Brailey Holdings Pty Limited ACN 001 190 441 [2018] NSWSC 1493

Barp Nominees Pty Limited [2016] NSWSC 990

Maks v Maks (1986) 6 NSWLR 34

Re Porlock Pty Limited [2015] NSWSC 1243

Category:

Principal judgment

Parties:

M & L Richardson Pty Ltd (Plaintiff)

Representation:

Counsel:
D Jarrett (Plaintiff)

Solicitors:
United Law (Plaintiff)

File Number(s):

2020/330763

Publication restriction:

No

ex tempore Judgment (REVISED)

1. This is an application for judicial advice pursuant to s 63 of the Trustee Act 1925 (NSW), brought by M & L Richardson Pty Limited, which is the trustee of the M & L Family Trust (the “Trust”).

2. The problem posed by the present application is a familiar one. The Trust has been administered for a number of years in accordance with the terms of an unexecuted trust deed. However, when the need recently arose to locate the original executed trust deed, no one concerned with the administration of the Trust has been able to find it. The applicant trustee seeks advice that it would be justified in administering the Trust in accordance with the unexecuted copy trust deed.

3. This type of problem has been considered in a series of decisions commencing with that of McLelland J, as his Honour then was, in Maks v Maks (1986) 6 NSWLR 34; Re Porlock Pty Limited [2015] NSWSC 1243 (Young AJA); Barp Nominees Pty Limited [2016] NSWSC 990 (Pembroke J); and my decision in the Application of Brailey Holdings Pty Limited ACN 001 190 441 [2018] NSWSC 1493.

4. The gravamen of those decisions is that the Court will give advice of the kind sought when two matters can be established by clear and convincing proof to the standard that would be required to establish an entitlement for rectification of a written document. The first matter is that there is evidence that the executed deed actually existed to constitute the Trust so that there is no question under the Statute of Frauds. The second is that there is secondary evidence of the terms of the trust deed. In the present case both of these elements are satisfied to the requisite evidentiary standard.

5. In so far as the existence of an original signed trust deed is concerned, the Court has evidence from the service provider which originally arranged for the settlement of the Trust (Australian Company Incorporations Services Pty Limited (ACIS)) that it did indeed establish such a trust in accordance with the unexecuted copy in evidence.

6. Furthermore, there is evidence that the Trust has operated a bank account for many years. There is evidence from the bank of a matter of which I would have been prepared to take judicial notice in any event, which is that the bank would not have allowed a bank account to be opened without having seen at least a copy of the executed trust deed. Unfortunately, the bank has been unable to locate a copy of such a document among its records.

7. These matters and other points of detail set out in the thorough evidence which has been provided provide the clear and convincing proof that the Trust had actually been settled in accordance with the unexecuted copy in evidence. There is also extensive evidence of the searches and enquiries that have been made, including through the now three firms of accountants who have acted for the Trust, for the original executed trust deed. All of those searches have been unsuccessful. Nevertheless, that evidence also makes clear that since about 2009, when the Trust was established, it has been administered in accordance with an unexecuted copy of the trust deed.

8. Continuous administration of the Trust in accordance with an identified unexecuted copy of the trust deed is also sufficient to provide clear and convincing proof of the second element, being the terms of the Trust. I am fortified in that conclusion because, as part of the enquiries that have been made, ACIS has provided from its records what it says is a copy of the original trust deed, albeit unsigned. The evidence is that they do not retain copies of the signed trust deed, but do retain an unexecuted copy of the trust deed as part of their records.

9. For these reasons the Court finds both that the Trust was established in or about 2009 by an executed trust deed and that the terms of the Trust are set out in the unexecuted copy trust deed which appears under tab C, pages 13-53 in Exhibit MR1 to the affidavit of Matthew Richardson of 17 September 2020 (being the unexecuted copy of the trust deed provided by ACIS).

10. The orders of the Court are:

1. The plaintiff, M & L Richardson Pty Limited ACN 137 882 592, pursuant to s 63 of the Trustee Act 1925 (NSW), is justified in managing and administering the trust estate known as the M & L Richardson Family Trust pursuant to the terms exhibited at pages 13 to 53 of Exhibit MR1 of the affidavit of M A Richardson sworn 17 September 2020.

2. The costs of these proceedings be borne by and paid out of the income or capital of the M & L Richardson Family Trust on an indemnity basis.

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Decision last updated: 18 February 2021