Bartlam v Union Trustee Company of Australia Limited [1946] HCA 1

Bartlam v Union Trustee Company of Australia Limited [1946] HCA 1

Commission to the trustee company under s. 17 of the Trustee Companies Act 1928 (Vict.) is to be calculated in respect of income ascertained periodically in accordance with ordinary accountancy principles: profit shown on live-stock accounts and gross sale proceeds of produce are credited, with deduction of working and management expenses; receipts representing replacement of working or circulating capital are not income, and certain administrative costs, outgoings, and taxes are not deductible in this calculation.

Parties
Appellant; Defendant: Bartlam; Respondent; Plaintiff: Union Trustee Company of Australia Ltd.; Defendants; Respondents: Lena Ethel Bartlam (representing the beneficiaries) and co-executors
Jurisdiction
Australia
Procedural Posture
Appeal / On Appeal From the Supreme Court of Victoria (full Court), High Court Judgment
Outcome
Appeal allowed
Legal Topics
Trustee Companies, Commission Entitlement, Administration of Estates, Accounting for Income and Capital
Trusts and Estates Company Law Trustee Companies Commission Entitlement Administration of Estates Accounting for Income and Capital

Case Brief

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Parties

Bartlam

Appellant; Defendant

Union Trustee Company of Australia Ltd.

Respondent; Plaintiff

Lena Ethel Bartlam (representing the beneficiaries) and co-executors

Defendants; Respondents

Procedural Posture

Appeal / On Appeal From the Supreme Court of Victoria (full Court), High Court Judgment

Legal Issues

  1. 1 Whether the trustee company's commission under s. 17 of the Trustee Companies Act 1928 (Vict.) is to be calculated on gross income, net income, or some other basis in relation to income received from carrying on a business as executor or trustee.

Ratio Decidendi

Commission to the trustee company under s. 17 of the Trustee Companies Act 1928 (Vict.) is to be calculated in respect of income ascertained periodically in accordance with ordinary accountancy principles: profit shown on live-stock accounts and gross sale proceeds of produce are credited, with deduction of working and management expenses; receipts representing replacement of working or circulating capital are not income, and certain administrative costs, outgoings, and taxes are not deductible in this calculation.

Court Disposition

Appeal allowed

Orders

  • Discharge so much of the Supreme Court order as declared the trustee company entitled to commission on all amounts other than capital receipts received by it without deducting any expenses or outgoings.
  • Declare that in respect of income derived from carrying on the testator's business, income for commission is to be ascertained according to ordinary accountancy principles: (a) annual or other proper periods; (b) credit profit from live-stock accounts, gross sale proceeds of produce, and debit working/management...