Tratter v Aware Super

The matter of Tratter v Aware Super was heard by the Federal Court of Australia and involved a dispute over the apportionment of a death benefit from a superannuation fund. The applicant, who had been nominated by the deceased member to receive the death benefit, sought to have the decision of the Australian Financial Complaints Authority (AFCA) remitted for further determination, arguing that the AFCA had erred in affirming the Trustee's decision to allocate the death benefit 70% to the deceased member's former spouse and 30% to the deceased member's mother. The applicant contended that the AFCA had failed to consider whether the Trustee's decision was fair and reasonable in its operation in relation to the applicant and had not provided adequate grounds for its determination.

The central legal issues the court had to decide were whether the AFCA had applied the correct test in reviewing the Trustee's decision and if the AFCA's reasons for its determination were adequate. The applicant argued that the AFCA had asked itself the wrong question by focusing on whether the Trustee's decision was open to them, rather than whether the operation of the decision was fair and reasonable in all the circumstances. The applicant also claimed that the AFCA had not provided sufficient grounds for its determination that the Trustee's decision was fair and reasonable.

The Court found that the AFCA had addressed the correct question in its determination and had adequately considered the competing positions of the applicant and the deceased member's former spouse. The Court held that the AFCA's reasons were sufficient to demonstrate that it had considered the nature of the dependency between the deceased member and each of the potential beneficiaries. The Court further found that the Trustee's decision to allocate the death benefit in the proportions it did was within the range of decisions that were open to the Trustee and was therefore fair and reasonable. The Court dismissed the applicant's appeal, finding no error in the AFCA's determination.

The final orders of the Court were that the application is dismissed and there is no order as to costs. The dismissal of the application meant that the decision of the AFCA affirming the Trustee's apportionment of the death benefit was upheld.