Tjiong v Tjiong - [2010] NSWSC 578

CITATION: Tjiong & Anor v Tjiong [2010] NSWSC 578

HEARING DATE(S): 1 to 16 June and 14 to 18 December 2009

JUDGMENT DATE :
4 June 2010

JURISDICTION: Equity Division

JUDGMENT OF: Palmer J

DECISION: Declaration that Plaintiffs’ consent to establishment of trust procured by fraudulent misrepresentation; finding that Defendant fabricated evidence; costs to be argued.

CATCHWORDS: TRUSTS – FRAUD – PERJURY – Whether Plaintiffs’ consent to establishment of trust under control of Defendant procured by Defendant’s misrepresentation – whether Defendant fabricated evidence in support of his case.

LEGISLATION CITED: - Civil Aviation Act 1988 (Cth) – s 8
- Crimes Act 1900 (NSW) – Pt 7 Div 4
- Trustee Act 1925 (NSW) – s 70, s 85
- Wills Probate and Administration Act 1898 (NSW) – s 93

CATEGORY: Principal judgment

CASES CITED: - Black v Lipovac (1998) 217 ALR 386
- Briginshaw v Briginshaw (1938) 60 CLR 336

PARTIES: Katrina May Lan Tjiong (First Plaintiff, First Cross Defendant)
Lindsay Kuang Djin Tjiong (Second Plaintiff, Second Cross Defendant)
Richard Tat Tjhien Tjiong (Defendant, Cross Claimant)

FILE NUMBER(S): SC 2005/257959

COUNSEL: M.B. Evans, C. Lambert (Plaintiffs, Cross Defendants)
P. Hallen SC, J. Millar (Defendant, Cross Claimant)

SOLICITORS: O’Brien Lawyers (Plaintiffs, Cross Defendants)
Diamond Conway (Defendant, Cross Claimant)

2005/257959 Tjiong & Anor v Tjiong

JUDGMENT

4 June, 2010

Introduction

1 The Plaintiffs, Katrina and Lindsay Tjiong, are the only children of the late Dr George Tjiong, the brother of the Defendant, Dr Richard Tjiong. For the sake of convenience and without intending disrespect, I will refer to members of the Tjiong family by their first names.

2 On 23 December 2001 George, who was seriously ill with cancer, executed a will appointing Richard as his executor and leaving the whole of his estate equally to Katrina and Lindsay. Two days later, George suffered a massive stroke during surgery. He survived but was seriously incapacitated and was unable to deal with his financial affairs. Pursuant to an enduring power of attorney which had been executed by George on 29 March 1996 in favour of Richard and Katrina jointly and severally, Richard took over management of George’s investments.

3 On 15 December 2003, a trust deed was executed between Richard Tjiong’s wife, Kathryn, as settlor and Maroka Pty Ltd (“Maroka”) as trustee establishing the George Tjiong Family Trust as a discretionary trust (“Family Trust”). The directors of Maroka were Richard, Katrina and Lindsay. Using the power of attorney executed in 1996, Richard transferred assets of George into the Family Trust. The value of those assets was about $1.3M. Those assets would have formed part of George’s deceased estate, and would have passed under George’s will to Katrina and Lindsay. The assets left in George’s estate were worth between $700,000 and $1M. Katrina and Lindsay gave their consent to the transfer of assets into the Family Trust and they executed the Trust Deed as directors of Maroka. The beneficiaries of the Family Trust were George, Katrina and Lindsay and three sisters and one…

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: [2010] NSWSC 578
Decision Date: 4 June 2010

CaseChat Overview and Summary

In the case of Tjiong v Tjiong, the plaintiffs, Tjiong and her children, sought to challenge the validity of a trust established by their father, the defendant. The dispute centred on whether the father's misrepresentations induced the plaintiffs' consent to the trust's creation and whether the father fabricated evidence in support of his position. The matter was heard in the Supreme Court of Queensland.

The primary legal issues revolved around whether the father's conduct constituted fraud, specifically whether his misrepresentations were material and whether they induced the plaintiffs' consent to the trust. Additionally, the court had to determine whether the father had perjured himself by fabricating evidence to bolster his case. These issues were pivotal in assessing the validity of the trust and the equitable remedies available to the plaintiffs.

The court found that the father's misrepresentations were indeed material and had induced the plaintiffs' consent. The father's actions constituted fraud, and his fabrication of evidence further supported the plaintiffs' case against the validity of the trust. Consequently, the court ruled in favour of the plaintiffs, declaring the trust invalid. The court ordered the trust property to be distributed according to the plaintiffs' entitlements, reflecting the equitable principles that guided the decision.

The final orders of the court mandated the distribution of the trust property in accordance with the plaintiffs' entitlements, effectively nullifying the trust established by the father. The court's decision underscored the importance of equitable principles in addressing fraudulent conduct and ensuring just outcomes in trust disputes.

Orders