Beck v Henley [2014] NSWCA 201

Beck v Henley [2014] NSWCA 201

Where trust property is divisible and two adult beneficiaries are absolutely and indefeasibly entitled to equal shares, one may direct the trustee to transfer his aliquot share over the opposition of the other unless there are special circumstances amounting to actual prejudice, such as a quantified loss of value. Mere breaking up of control or loss of a measure of control does not constitute sufficient prejudice. Appeal dismissed because no evidence established actual loss, and the established line of authority supports this outcome.

Jurisdiction
Australia
Judgment Date
27 June 2014
Procedural Posture
Appeal / Judgment
Outcome
Appeal dismissed with costs
Legal Topics
['rights of Beneficiaries' 'judicial Advice to Trustee' 'rule in Saunders V Vautier' 'duty of Impartiality' 'distribution of Shares in Private Company']
['trusts'] ['rights of Beneficiaries' 'judicial Advice to Trustee' 'rule in Saunders V Vautier' 'duty of Impartiality' 'distribution of Shares in Private Company']

Case Brief

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Procedural Posture

Appeal / Judgment

Legal Issues

  1. 1 ['Whether an adult beneficiary absolutely and indefeasibly entitled to half of trust property comprising shares in a private company can direct the trustee to transfer half of such shares over the opposition of another beneficiary' "Whether 'special circumstances' exist to defeat the power under the rule in Saunders v Vautier and prevent such distribution" 'Whether the breaking up of a control parcel of shares constitutes sufficient prejudice']

Ratio Decidendi

Where trust property is divisible and two adult beneficiaries are absolutely and indefeasibly entitled to equal shares, one may direct the trustee to transfer his aliquot share over the opposition of the other unless there are special circumstances amounting to actual prejudice, such as a quantified loss of value. Mere breaking up of control or loss of a measure of control does not constitute sufficient prejudice. Appeal dismissed because no evidence established actual loss, and the established line of authority supports this outcome.

Court Disposition

Appeal dismissed with costs

Orders

  • ["Appellant to pay respondents' costs" "No further order as to trustee's costs; UCPR r 42.25 applies"]