Brady Street Developments Pty Ltd v M E Asset Investments Pty Ltd [2013] NSWSC 1755

Brady Street Developments Pty Ltd v M E Asset Investments Pty Ltd [2013] NSWSC 1755

The appointment of Mr Hawach as appointor under the trust deed constituted a breach of fiduciary duty due to conflict between his fiduciary obligations and his interest as a potential beneficiary. The claim of estoppel by Mr El Sayed failed due to lack of reasonable reliance or factual foundation. The deed of 28 September 2011 is valid and effective to remove Mr Fayad as appointor, and the plaintiff remains trustee. Mr El Sayed, as an object of a discretionary power, had standing in this case to seek declaratory relief due to special circumstances. The later deed purporting to remove the trustee is invalid. The caveat lodged by M E Asset Investments Pty Ltd must be removed.

Jurisdiction
Australia
Judgment Date
20 December 2013
Procedural Posture
Principal Judgment / Final Judgment After Trial
Outcome
Partial relief granted to the plaintiff and first cross-claimant; second cross-claimant's claim dismissed.
Legal Topics
['discretionary Trusts' 'fiduciary Duty' 'appointor Powers' 'standing of Object of Discretionary Power' 'declarations' 'estoppel' 'solicitor Conflicts']
['equity' 'trusts' 'property Law'] ['discretionary Trusts' 'fiduciary Duty' 'appointor Powers' 'standing of Object of Discretionary Power' 'declarations' 'estoppel' 'solicitor Conflicts']

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Procedural Posture

Principal Judgment / Final Judgment After Trial

Legal Issues

  1. 1 ["Whether the deed dated 28 September 2011 is valid and effective; whether the plaintiff remains the trustee of the BSD Trust; whether Mr Hawach's appointment as appointor under the trust deed breached his fiduciary duty; whether Mr El Sayed has standing as an object of a discretionary power; whether equitable estoppel was established; whether various trust-related deeds are effective or void"]

Ratio Decidendi

The appointment of Mr Hawach as appointor under the trust deed constituted a breach of fiduciary duty due to conflict between his fiduciary obligations and his interest as a potential beneficiary. The claim of estoppel by Mr El Sayed failed due to lack of reasonable reliance or factual foundation. The deed of 28 September 2011 is valid and effective to remove Mr Fayad as appointor, and the plaintiff remains trustee. Mr El Sayed, as an object of a discretionary power, had standing in this case to seek declaratory relief due to special circumstances. The later deed purporting to remove the trustee is invalid. The caveat lodged by M E Asset Investments Pty Ltd must be removed.

Court Disposition

Partial relief granted to the plaintiff and first cross-claimant; second cross-claimant's claim dismissed.

Orders

  • ["A declaration that the deed titled 'Deed of Resignation, Appointment and Acknowledgement' dated 28 September 2011 is valid and effective." "A declaration that the deed titled 'Deed of Variation' between Osman Fayad, Khaled El Sayed and M E Asset Investments Pty Ltd is invalid and of no effect." 'A declaration that...