Gillespie v Gillespies Cranes Nominees Pty Ltd (No 2) [2022] NSWSC 1286

Special circumstances exist justifying a representative order appointing Robert Gillespie as the plaintiff to bring derivative actions on behalf of the Gillespie Family Trust against the trustee and certain beneficiaries for breach of trust; alternatives to derivative action are impractical; a company law derivative action is not a necessary prerequisite; the representative order will be made subject to Robert’s undertaking to account to the Trust for any distribution he personally received, with liberty to apply for directions as to joinder and amendment.

Parties: Applicant/first Defendant: Gillespies Cranes Nominees Pty Ltd; Plaintiff/first Respondent/applicant: Robert Gillespie; Second Respondent/second Defendant/first Applicant: Helen Ann Gillespie; Third Respondent/third Defendant/second Applicant: Peter Timothy Gillespie; Fourth Respondent/fourth Defendant/third Applicant: JPD Equipment Pty Limited; Fifth Respondent/fifth Defendant/fourth Applicant: GCN Operations Pty Limited; Sixth Respondent/sixth Defendant/fifth Applicant: Gilljo Pty Limited; Seventh Respondent/seventh Defendant/sixth Applicant: Ainley Pty Limited; Eighth Respondent: Betty Gillespie; Ninth Respondent: David John Gillespie
Jurisdiction: Australia
Judgment Date: 23 September 2022
Procedural Posture: Equity—interlocutory Application/procedural / Interlocutory—orders on Motion for Representative Derivative Action; Costs
Outcome: Representative order granted; motions for summary dismissal/strike out dismissed; costs orders made; directions for pleading amendments.
Legal Topics: Derivative Action in Trust Proceedings, Representative Orders, Breach of Trust, Corporate Trustee, Discretionary Trust, Costs Orders, Case Management—pleading Amendments

Equity Trusts Derivative Action in Trust Proceedings Representative Orders Breach of Trust Corporate Trustee Discretionary Trust Costs Orders +1 more

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Parties

Gillespies Cranes Nominees Pty Ltd

Applicant/first Defendant

Robert Gillespie

Plaintiff/first Respondent/applicant

Helen Ann Gillespie

Second Respondent/second Defendant/first Applicant

Peter Timothy Gillespie

Third Respondent/third Defendant/second Applicant

JPD Equipment Pty Limited

Fourth Respondent/fourth Defendant/third Applicant

GCN Operations Pty Limited

Fifth Respondent/fifth Defendant/fourth Applicant

Gilljo Pty Limited

Sixth Respondent/sixth Defendant/fifth Applicant

Ainley Pty Limited

Seventh Respondent/seventh Defendant/sixth Applicant

Betty Gillespie

Eighth Respondent

David John Gillespie

Ninth Respondent

Procedural Posture

Equity—interlocutory Application/procedural / Interlocutory—orders on Motion for Representative Derivative Action; Costs

Legal Issues

1 Whether special circumstances exist to justify a representative order permitting a beneficiary to bring derivative proceedings on behalf of a discretionary family trust
2 Whether representative order should be conditional on indemnity or security for costs
3 Appropriate parties for joinder in derivative actions concerning trust distributions and breaches

Ratio Decidendi

Court Disposition

Representative order granted; motions for summary dismissal/strike out dismissed; costs orders made; directions for pleading amendments.

Orders

Plaintiff authorised to prosecute representative derivative actions on behalf of the Gillespie Family Trust in respect of specified distributions and transactions (claims 1–5) against listed defendants and recipients.
Plaintiff to give undertaking to Court to account for any trust distributions received by him if claim of breach of trust succeeds.