Application of Karla Marie Tate and Hyun Jong Chung [2015] NSWSC 639

Application of Karla Marie Tate and Hyun Jong Chung [2015] NSWSC 639

The Trustees are justified in exercising the power in clause 20 of the Deed to vary the trust by substituting other persons as beneficiaries from those listed in the Fifth Schedule. They are not required to wind up the trust or pay the corpus to Mrs Salisbury's estate upon her death, as her contingent interest lapsed when she died prior to the distribution date. Trustees have an absolute discretion as provided by the Deed, and the Deed's construction, aided by the legal authorities, supports these conclusions.

Parties
First Plaintiff, Trustee: Karla Marie Tate; Second Plaintiff, Trustee: Hyun Jong Chung
Jurisdiction
Australia
Judgment Date
27 May 2015
Procedural Posture
Judicial Advice Application / Decision on Application for Advice Under Trustee Act 1925 (nsw), S 63
Outcome
Application granted for judicial advice; Trustees affirmed in their construction of Deed and entitled to costs from the Trust Fund.
Legal Topics
Interpretation of Trust Deeds, Powers of Trustees to Vary Trust Objects, Trustee Act 1925 (nsw) S 63, Contingent Beneficial Interests, Winding Up of Trust, Effect of Beneficiary's Death on Trust Property
Succession Law Trusts and Equity Interpretation of Trust Deeds Powers of Trustees to Vary Trust Objects Trustee Act 1925 (nsw) S 63 Contingent Beneficial Interests Winding Up of Trust Effect of Beneficiary's Death on Trust Property

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 4 Authorities cited 10 Party arguments 2 Amounts and remedies 1
Sign in to unlock

Parties

Karla Marie Tate

First Plaintiff, Trustee

Hyun Jong Chung

Second Plaintiff, Trustee

Procedural Posture

Judicial Advice Application / Decision on Application for Advice Under Trustee Act 1925 (nsw), S 63

Legal Issues

  1. 1 Whether clause 20 of the Trust Deed authorises trustees to vary trust objects to substitute other persons as beneficiaries
  2. 2 Whether trustees are required to wind up the trust upon the death of a principal beneficiary
  3. 3 Whether the contingent interest of a deceased beneficiary lapses upon death

Ratio Decidendi

The Trustees are justified in exercising the power in clause 20 of the Deed to vary the trust by substituting other persons as beneficiaries from those listed in the Fifth Schedule. They are not required to wind up the trust or pay the corpus to Mrs Salisbury's estate upon her death, as her contingent interest lapsed when she died prior to the distribution date. Trustees have an absolute discretion as provided by the Deed, and the Deed's construction, aided by the legal authorities, supports these conclusions.

Court Disposition

Application granted for judicial advice; Trustees affirmed in their construction of Deed and entitled to costs from the Trust Fund.

Orders

  • Trustees are justified in exercising the clause 20 power to vary the Trust to substitute new beneficiaries from the Fifth Schedule.
  • Trustees were justified in refusing to treat Mrs Salisbury's death as requiring the winding up of the Salisbury Family Trust or payment of the Trust Fund to her legal personal representatives.