Benson v Cook

FINDINGS OF FACT AT FIRST INSTANCE 2 The primary Judge made findings of fact as follows: "From July 1972 until 20 April 1990, the bankrupt was employed by Industrial Sales and Service (TAS) Pty Ltd ('ISAS'). During that employment, the bankrupt was a member of ISAS's superannuation fund and he accrued benefits in that fund. In January 1990, Bridge Wholesale Acceptance Corporation (Australia) Limited ('Bridge') commenced a proceeding in the Supreme Court of Victoria against the bankrupt and R F Benson Pty Ltd. Bridge made a claim for the sum of $222,588.32 plus interest and costs regarding a floor plan bailment agreement concerning a tractor dealership business. ISAS was wound up on 4 June 1990. On account of the termination of his employment, the bankrupt obtained a vested interest in a benefit in the company's superannuation fund in the sum of $96,192.36 Although it was disputed by his counsel, the bankrupt received that sum as an eligible termination payment. Annexed to [the trustee's] first affidavit is a true copy of the declaration of trust of ISAS by which its superannuation fund was established. Clause 13(b) of the declaration of trust provides that if a member of the fund leaves the service of his employer prior to his normal retirement date and such retirement is accepted by the employer as 'early retirement', the benefits held in the scheme in respect of the member are to be transferred to him. That is what happened in this case. The bankrupt left the service of ISAS before his normal retirement age. He was in his forties at the time. In September 1990, the bankrupt authorised Norwich Union Life Australia Ltd ('Norwich') to pay the greater part of the funds which were transferred to him to each of the three corporate respondents as 'roll-over' institutions. This is apparent from the Australian Taxation Office's Statement of Termination Payment Form signed by the bankrupt which authorised Norwich to pay the funds which had been transferred to the bankrupt onto the following entities in the following amounts: · The second respondent[L & G] in the sum of $20,000.00. · The third respondent [Prudential] in the sum of $40,000.00. · The fourth respondent [Mercantile] in the sum of $20,000.00."

CONCLUSIONS AT FIRST INSTANCE 3 His Honour accepted the submission made on behalf of the trustee that the appellant's entitlement to his eligible termination payment was a chose-in-action which belonged to the appellant. However, the chose-in-action attracted no relevant exemption under s 116 of the Act. Section 116(2)(d) of the Act, as it applied at the relevant time, only made reference to policies of life assurance and endowment assurance and not superannuation per se: see N M Superannuation Pty Ltd v Young (1993) 41 FCR 182 at 190, per Hill J. (Although the issue of the application here of s 116(2)(d) was agitated in the notice of appeal, it was not pressed on the hearing of the appeal.) The primary Judge went on to say: "Under s120 of the Act, it must be shown by the trustee that there was a disposition of property of the bankrupt within two years before the commencement of the bankruptcy. The relevant disposition here occurred about one year prior to the date of bankruptcy. Next, it must be shown that the disposition was not in favour of a purchaser for valuable consideration in the context of s120 of the Act. I accept [the trustee's] submission that the respondents, other than the bankrupt, did not give any consideration for the payment to them of the relevant sums. What occurred was that each of those respondents pledged to manage and preserve the funds given to each such entity in return for management fees or charges. The second, third and fourth respondents were not 'buyers' in a commercial sense of the relevant interests passing to them: see Barton v Official Receiver (1986) 161 CLR 75 at 86, per Gibbs CJ, Mason, Wilson & Dawson JJ. I also reject [the appellant's] submission that the funds which were 'rolled-over' were immediately dissipated. What occurred was that the bankrupt became entitled to them and then authorised their investment elsewhere. It is unnecessary to consider whether the payments made to the second, third and fourth respondents were void against the trustee having regard to s121 of the Act, it being plain that the payments were void against the trustee having regard to s120 of the Act." 4 His Honour accordingly declared that each of the payments was void as against the trustee, and ordered that the respondents respectively pay the trustee the amount so paid "plus any further amounts standing to the credit of the [appellant] refer[a]ble to the investment of [the sum paid]."

THE GROUNDS OF THE APPEAL 5 The appellant now presses the following grounds of appeal from the whole of the primary judgment: "2. His Honour wrongly held that on account of the termination of his employment the [appellant] obtained a vested interest in a benefit in the company's superannuation fund. 3. His Honour wrongly held that the [appellant] received the sum of $96,192.36 as an eligible termination payment. 4. … 5. His Honour wrongly held that for the purpose of s.120 of the … Act … the Second, Third and Fourth Respondents did not give any consideration for the payment to them of the relevant sums. 6. His Honour wrongly held that upon the [appellant] receiving the relevant sums, they were not thereupon immediately dissipated, but held that the [appellant] became entitled to the relevant sums and then authorised their investment elsewhere. 7. His Honour wrongly failed to dismiss the [trustee's] claim that pursuant to s.121 of the … Act … the payments were void as against the [trustee]. 8. His Honour wrongly ordered the payment to the [trustee] by the Second, Third and Fourth Respondents of any further amounts standing to the credit of the [appellant] referable to the relevant sums paid to them. 9. His Honour wrongly failed to dismiss the Application on the ground that the evidence did not disclose that the Second, Third and Fourth Respondents in fact held the relevant sums, and hence were not amenable to the orders made." 6 (If it be necessary, the trustee has filed a notice of cross-contention, contending that, in any event, each of the payments was void as against the trustee by reason of the provisions of s 121.)

(a) Section 120 (i) The meaning of "disposition" 7 It will be recalled that the operation of this provision is dependent upon the existence of a "settlement", which includes "any disposition of property" (s 120(8)). Although "property" is widely defined so as to include any form of personal property, there is no statutory definition of "disposition". However, its meaning has been explained in the authorities. 8 In McGain v Commissioner of Taxation (1965) 112 CLR 523, Taylor J held (at 528) that the making of a loan involved a "disposition" of property. This holding was upheld on appeal (see McGain v Federal Commissioner of Taxation (1966) 116 CLR 172 per Barwick CJ, Menzies and Owen JJ at 174). In Roache v Australian Mercantile Land & Finance Co Ltd (No. 2) (1966) 1 NSWR 384, Jacobs JA said (at 386): "In a legal context, disposition means the act of disposing or disposing of … . Disposing of, in this sense, means dealing with definitely or a getting rid of or a getting done with a particular item …. It usually refers in this particular meaning to a making over of an item by way of sale or bargain because then there is a definite dealing with the item and a getting rid of it, a finishing with it." 9 Of course, McGain and Roache arose in other statutory contexts. But the meanings of "settlement" and of "disposition" in the present legislative scheme were considered by the Full Federal Court in Barton v Official Receiver (1984) 4 FCR 380. Lockhart J said (at 395): "In my opinion for there to be a 'settlement of property' within the meaning of s 120 there must be a settlement in the ordinary sense of the word, a transaction in the nature of a settlement, though it may be effected by any disposition. The retention of the property in some sense must be contemplated and not its immediate dispersion. [Emphasis added] The transaction impugned by the respondent was not merely the payment of $170,000 by the bankrupt to the appellant. It was a loan of money upon specific terms that included the repayment of an equivalent sum upon the expiration of twenty years. That is itself sufficient to satisfy the requirement that the property be retained in some sense and not immediately dissipated or consumed. But the transaction went further than that. The exchange of cheques by the appellant, the bankrupt, Cordec and Inexco, the contract of sale and memorandum of transfer of the house and, the deed of loan and the documents relating to the sale of the shares were all part of the one transaction which necessarily required that the money advanced by the bankrupt to the appellant be used forthwith for the purpose of buying the house and the shares. This seems to me to plainly satisfy the definition of a 'settlement of property' for the purposes of s 120. I see no difference for present purposes between the disposition of something other than money and the disposition of money to buy something. The same view was expressed by Vaughan Williams J in Re Vansittart, supra (at 184) and by Stamp J in Morrison [1965] 1 WLR 1498 at 1505." (Emphasis added) 10 An appeal to the High Court was dismissed (see Barton v Official Receiver (1986) 161 CLR 75). Gibbs CJ, Mason, Wilson and Dawson JJ said (at 78): "It is not now disputed that the payment in question was a 'settlement' within the meaning of s.120. Clearly it was, bearing in mind the broad definition of 'settlement of property' in s.120(8) as including 'any disposition of property' and the circumstances in which the payment was made. Although made in the form of a loan, no part of the principal was repayable for twenty years and the purpose of the loan was to enable the appellant to buy property in the form of a house and company shares. There being no contemplation of the immediate dissipation or consumption of the money, the established principles governing the making of a settlement were satisfied: See Williams v. Lloyd; In re Williams (1934) 50 C.L.R. 341 at pp. 364, 375; Re Hyams, Official Receiver v. Hyams (1970) 19 F.L.R. 232 at 247-253)." (Emphasis added) 11 In Re Norgard (Full Federal Court, 16 August 1990, unreported), Northrop and Davies JJ (with whom Lee J agreed), approved the above analysis of Lockhart J in Barton and said (at 12): "It is clear from the use of the word 'settlement' in s.120 and the use of the term 'disposition of property' in s.121, and indeed from the overall content of s.120, that s.120 is not concerned with any disposition of property but is concerned with dispositions of an enduring nature, that is to say, dispositions in the nature of a settlement." 12 See also Re Kastropil; Ex parte Official Trustee in Bankruptcy (1990) 21 FCR 270 per French J at 281 - 284; (appeal dismissed, Full Federal Court, 14 July 1989, unreported). The Victorian Supreme Court of Appeal has followed this line of authority (see Walsh v Salzer (2000) VSCA 228 per Winneke P at [19] - [31]). (ii) The appellant's interest in the ISAS fund 13 Turning to the application of these principles to the present circumstances, the starting point is an analysis of the appellant's interest in the ISAS superannuation fund at the material times. It will be recalled that the relevant sequence of events was as follows: · 1972 - the appellant commences employment with ISAS. · 1976 - ISAS constitutes a superannuation fund, joined by the appellant as member. · January 1990 - Bridge commences proceedings against the appellant. · 20 April 1990 - the appellant's employment with ISAS terminates when it ceases to carry on business. · 4 June 1990 - order made for winding up of ISAS. · 17 September 1990 - at the appellant's direction, Norwich pays amounts of $20,000, $20,000 and $40,000 to L & G, Mercantile and Prudential respectively. · 18 September 1991 - the appellant commits an act of bankruptcy. · 21 July 1992 - sequestration order. 14 The material provisions of the ISAS fund should be noticed. The fund was established as a retirement fund ("the scheme") by a deed by way of declaration of trust made by ISAS in 1976 as employer "in order to provide retirement [and other] benefits for certain of its Employees…". Under the terms of the deed, ISAS "[stood] possessed" of the moneys, policies of insurance, investments and other assets coming into its hands for the purposes of the scheme upon the trusts and subject to the terms conditions and obligations there specified, including provisions to the following effect: · The employer shall effect with Norwich a Retirement Accumulation and Group Life Insurance Policy in order to provide for and secure retirement and life insurance benefits for members; and contributions received into the scheme by the employer shall be applied by way of premiums in respect of the policy (cl 3). · Moneys in the scheme not immediately required for payment of premiums or provision of benefits may be invested by the employer (cl 11). · Should any member become bankrupt, the benefits held in respect of him shall be immediately forfeited to the employer who may in its discretion, in order to relieve hardship, or in the event of the cessation of service by death or otherwise, assign and transfer such benefit or any part thereof to or for the benefit of that member or his or her dependants (cl 18). · If a member shall (a) retire from the service of his Employer on or after his "Normal Retirement Date" (defined for a male as attaining sixty five years) or (b) leave prior to that date where the employer in its discretion accepts an early retirement - the employer shall pay and transfer to the member the whole of the benefits held in the scheme in respect of him (cl 13). · In the event of the termination of the employer's business, the employer shall transfer and assign to its employees who are members the benefits held in the scheme in respect of them and shall transfer to each such member such portion of the moneys investments and other assets in this scheme not otherwise allocated in respect of any member as the employer shall in its discretion consider equitable and thereupon the scheme shall terminate insofar as the members who are employees are concerned (cl 25). 15 What then, in point of legal analysis, was the nature of the appellant's interest, proprietary or otherwise, in the ISAS fund? 16 It is accepted by the parties, correctly, that the ISAS fund was a bona fide superannuation fund in the established sense that it made genuine provision, to arise on an employee's retirement or death or other cessation of employment, of a subvention for the employee, or his or her estate, or persons towards whom he or she may have stood in some kind of relation commonly giving rise to a legal or moral responsibility (see Mahony v Commissioner of Taxation (1967) 41 ALJR 232 per Kitto J at 232). 17 In Re Coram; Ex parte Official Trustee in Bankruptcy v Inglis (1992) 36 FCR 250, a trustee in bankruptcy obtained a declaratory order that on 1 April 1987, a bankrupt became entitled to a payment of a deferred benefit from a superannuation fund, which vested in the trustee upon bankruptcy on 2 July 1987. The appellant had resigned his employment in 1983, before attaining his "Early Retirement Date" which was 1 April 1989. Under the fund's deed, he became entitled to a Deferred Benefit upon reaching Early Retirement Date. The deed contained a provision (cl 12.4 entitled "Protective Trust") similar to cl 18 of the ISAS deed (see above). 18 After referring to well-known observations of Windeyer J in Scott v Commissioner of Taxation (Cth) (No 2) (1996) 40 ALJR 265 at 278 and to those of Kitto J in Mahony (above), O'Loughlin J said (at 254 - 255): "These passages support the proposition that the present right of a member of a superannuation fund is no more than an expectancy. His entitlements are all in the future and are all dependent upon the happening of a prescribed event, of which the most common was the attainment of an agreed retirement age. I am satisfied that the so-called 'Protective Trust' appearing in cl 12.4 of the deed was inserted to protect the inchoate rights of a member of the fund to his future entitlements. This type of clause is quite commonplace in wills and settlements as well as in superannuation funds. Thus the estate of a member of a superannuation fund may be sequestrated or he may be otherwise subjected to the provisions of the Bankruptcy Act 1966 (Cth). Assuming always that the relevant deed contains the appropriate provisions, no part of his benefit in his superannuation fund will vest in his trustee in bankruptcy for distribution among his creditors whilst he remains in employment and a member of the fund. On the other hand, the terms of the trust deed that constitute the superannuation fund can, and often do, employ the trustee of the fund, in the event of bankruptcy or like events, to apply the member's benefits, on maturity, to or for the benefits of the member's dependants. It seems to me therefore that when one has regard to the nature and purpose of a superannuation fund, there can be no room for doubt; upon the bankrupt deciding to resign in 1983, his rights as a member of the fund matured or crystallised into an asset which then and thereafter formed part of his estate. His rights were no longer an entitlement to a future benefit in a superannuation fund; they had been transformed and had become a debt owing to him by the trustees that was payable at a future ascertainable date, viz, 1 April 1987, his 'Early Retirement Date'." (Emphasis added) 19 The nature of the interest of a member of a superannuation fund was further considered by the Full Federal Court (Ryan, Gummow and Lee JJ) in Caboche v Ramsay (1993) 119 ALR 215. There, the primary Judge (Hill J) had made a declaratory order that there was vested in a trustee in bankruptcy a benefit arising from the rules of a superannuation fund of which the appellant was a member. Hill J had held that a forfeiture provision (cl 16) (which was similar to cl 18 of the ISAS deed) was void as an illegitimate restraint on alienation. An appeal to the Full Court was dismissed. Gummow J (Ryan J concurring) noted (at 228) that the trustees of pension funds are in general governed by the ordinary law of trusts, subject to any contrary provisions in the rules or other provisions in the constating instrument. 20 Gummow J went on to say (at 230): "The property forming the fund was settled on the trustees for the benefit of Mr Bond. Upon the constitution of the fund Mr Bond obtained an equitable proprietary interest in the fund, albeit one which did not carry an immediate right to payment. It should be noted that the existence of the power in r 7(2) to deduct amounts from the member accounts to pay expenses of administering the fund does not require any contrary conclusion. Baker v Archer-Shee [1927] AC 844, the effect of which so often has been debated, is at least clear authority to that effect. The interest of Mr Bond was conditional in the sense that no benefit might be paid until certain conditions were satisfied. These conditions are found in rr 9-14 inclusive. Upon the occurrence of any of these conditions, Mr Bond's interest is altered. For example, if Mr Bond were to retire from the employment of an employer but not from the workforce, then under r 9(2) he would obtain two further interests, one being a right to immediate payment of so much of his member account balance as is not required to be preserved, and the other being a further conditional interest in so much of his member account balance as is required by the Standards Act or the regulations to be preserved. The conditions governing the payment of this second amount are contained in r 15." (Emphasis added) 21 In my opinion, it follows for present purposes, that whilst cl 18 had no material operation until the appellant left the service of ISAS (cl 13(b)) or ISAS terminated its business (cl 25), the appellant had an equitable proprietary interest in the fund, although no immediate right to payment. Since ISAS was ordered to be wound up in June 1990, in the absence of any specific evidence of the kind contemplated by cl 13(b), the better inference appears to be that the business of ISAS was "terminated" in or about April 1990 within the meaning of cl 25. The primary Judge held that at about this time, the appellant obtained a vested interest in the fund. I agree with that conclusion, although I prefer to base it on cl 25 rather than cl 13(b).

(iii) Was there a "settlement" within the meaning of s 120 by virtue of the roll-over?

(A) The background 22 Some of the history should be explained. 23 On 27 June 1990, the appellant, as a trustee of the ISAS fund, wrote to Norwich as follows: "I refer to my letter of 5 April 1990 [the letter was not in evidence] which detailed the benefit payments in respect of members of the Fund who had resigned on or before 9 March 1990. I am now able to confirm the Trustees' decision regarding the method to be adopted in the payment of the benefits to the remaining three (3) working Directors. The Trustees confirm that the individual benefits shall comprise the sum of ; (i) the total members accumulated credits ie. 100% plus (ii) a percentage of the Reserve Account (after payment of all expenses to Norwich, SPM Pty. Ltd. $1,195.00 and taxation liability) determined as a ratio of the Member's service to the 31 March 1990 to the combined service of those three (3) directors. Peter Benson from 01.07.72 17.75 years service = 51.20% Robert Benson from 01.11.78 11.4167 years service = 32.93% Paul Benson from 01.10.84 5.5 years of service = 15.87% Benefit Payment Advice forms are following with appropriate instructions as to whom the individual benefits are to be paid (rolled over to) …." (Emphasis added) 24 A form of statement of termination payment submitted by the appellant to the Australian Taxation Office signed by the appellant, dated 22 August 1990, shows Norwich as the paying institution and the appellant as the recipient. The statement also nominates Mercantile, Prudential and L & G as "Roll-over" institutions in the amounts of $20,000, $40,000 and $20,000 respectively. 25 By letter dated 17 September 1990, Spectrum wrote to the appellant as follows: "As advised today in your telephone conversation with Ian Griffiths, an amount of $96,192.36 has been received from Norwich Union Life Australia Ltd as payment from the I.S.A.S. Retirement Fund. In accordance with your instructions the payment has been invested as follows: - Legal and General Personal Super Investment Growth Bond (Stable Units) 20,000.00 - Mercantile Mutual 100% Superannuation Investment Bond Policy (Capital Stable Units) 20,000.00 - Prudential Superannuation Bond (Capital Guaranteed Investment Account) 40,000.00 - … Also, please find attached 1991 Group Certificate issued by Norwich and Statement of Termination Payment. …" 26 It is common ground that the respective amounts mentioned in Spectrum's letter were "rolled over" into superannuation funds conducted by the three institutions mentioned. It will be necessary next to examine the terms of their investment by reference first to L & G's trust deed as follows. 27 The L & G trust deed was made by Legener (Australia) Limited as "Trustee". It recited a desire to establish a superannuation fund ("the Fund") to provide retirement benefits or retirement and death benefits in respect of "Employed Persons" (defined so as to include persons who are "employee(s)"). Its material provisions should be noticed, as follows. 28 Membership is dealt with by providing that any Employed Person under the age of sixty five or such other maximum age as permitted by the "Responsible Authority" (i.e. the relevant Government authority) who applies, or is a member of another like fund or arrangement may be transferred to the Fund with the agreement of the Trustee or the "Insurer" (Legal and General Assurance Society Limited) (cl 3(a)). 29 Policies are dealt with by providing that the Trustee shall effect and maintain a Policy in its own name and on the life of each Member under one of the Insurer's Tables of Life Insurance offered by the Insurer and such Policy may include such additional benefits and/or options as the Insurer is prepared to grant. The Member shall select the Table of Life Insurance and any additional benefits, options or other provisions as he may require and the Insurer is prepared to grant. The Policy shall be for such amount and for such premium payable in such manner as the Trustee arranges with the Insurer (cl 4(a)). In lieu of, or in addition to, effecting a Policy on a Member's life, the Trustee may accept into the Fund on behalf of and at the cost of the Member which it shall be entitled at the cost of the Member to realise and apply the proceeds thereof to purchase a policy (cl 4(b)). The Trustee shall apply each Member's contributions to the Fund (see below) towards payment of the premiums on the Policy on the life of such Member (cl 4(c)). The Trustee shall hold each policy upon trust to be administered according to the provisions of the Trust Deed, but the Trustee shall have no beneficial interest in any Policy (cl 4(d)). 30 Members' contributions are dealt with by providing that an amount equal to the total premium from time to time due under the Policy on the Member's life shall be contributed to the Fund on the dates such premium falls due, by the Member and/or his employer (cl 5). 31 An "Advance Premium Account" is dealt with by providing that any part of the contributions of a Member not immediately required by the Trustee for payment of premiums under a Member's Policy, shall be paid into an "Advance Premium Account" to be maintained by the Insurer to the satisfaction of the Trustee. The Trustee shall keep or cause to be kept an individual account (the "Member's credit") of the share of each Member in the Advance Premium Account (cl 6(a)). The moneys in the Advance Premium Account shall forthwith on receipt be invested by the Insurer as part of an Australian Statutory Fund of the Insurer and the interest earned in respect of each Member's credit shall at least once a year be added to such Member's credit (cl 6(c)). 32 At any given date, the benefit of a Member under the Fund shall consist of the Policy on his life, any other form of investment under cl 4(b), and the amount (if any) of his Member's credit, including any interest (cl 7). 33 Subject to cl 17 (a forfeiture provision - see below), on a Member reaching "Retirement Date" (defined as a date to be selected by the Member not earlier than fifty five years not later than sixty five years) and the Member notifying his retirement from his occupation or employment, the Trustee shall (subject to a "roll-over" proviso not here material) pay or apply his benefit to him in accordance with his direction (cl 8). 34 The Trustee and the Member may agree that the benefit shall, as to whole or part, be payable by way of pension or annuity purchased by the Trustee for the Member (cl 8A). 35 Provision is made for the payment of benefits before Retirement Date in certain circumstances (e.g. where the Trustee is satisfied that the Member is suffering from permanent incapacity or permanent invalidity (cl 9)). 36 Provision is made for benefits after Retirement Date (cl 9A), for benefits on death (cl 11), for loans to Members by the Trustee (cl 12), for conversion to a paid-up policy (cl 13) and for a continuation option (cl 15). 37 As mentioned, cl 17 contained the usual "forfeiture" provision, purporting to apply in the event of a Member's bankruptcy. In the light of Caboche, cl 17 may be treated as having no material operation here. 38 The general management and administration of the Fund is vested in, and is the responsibility of, the Insurer. Subject to this, the Trustee is given certain specific administrative powers and duties, but without making any charge for its services (cl 18). 39 The Trustee may accept from the trustee of another superannuation scheme or fund, or from a Member, a cash transfer value being the Member's entitlement under such other scheme or fund; and the Trustee shall apply that value, either as a single premium under a new or existing Policy on the life of the Member, or if the Insurer permits, as part of a premium (cl 24(a)). 40 With respect to Mercantile's fund, a letter from Mercantile dated 25 February 1994 was in evidence, stating that Mercantile had issued a "Personal Superannuation Bond" to the appellant on 18 September 1990 and that the governing policy document was enclosed. The letter enclosed the Trust Deed of the Mercantile Mutual Life Employed Persons Superannuation Fund dated 29 June 1994, with Mercantile Mutual Custodians Pty Ltd as Trustee and Mercantile Mutual Life Insurance Company Limited as Manager. Except in one respect, the Mercantile instrument is similar in its operation to the L & G document. The exception is that although the Mercantile instruments provide for forfeiture in certain events (cl 14) they do not include bankruptcy after the Superannuation Industry (Supervision) Act 1993 (Cth) applied to the Fund. Although there are differences in the wording of the L & G and Mercantile documents, it is not necessary for our purposes to explain them. 41 Similar comments may be made of the Prudential documentation, also in evidence. 42 It appears then that the L & G trust deed is in a form commonly used in the superannuation industry. 43 In each case, the moneys "rolled over" from the ISAS fund to which the appellant was entitled ($80,000 in all) were, on 17 September 1990, transferred into these three funds. It appears that these were genuine superannuation funds and that the dealings or transactions were bona fide and at arm's length. (B) The meaning of "settlement" 44 In point of legal analysis, did these transfers of funds constitute a "settlement" within the meaning of s 120(1)? 45 In Cabouche, Lee J said (at 248): "[I]f … Bond purported to revest in the fund trustees the retirement benefits to which he had become entitled, the fund trustees to hold that sum thereafter on the terms of the deed, the conclusion would be irresistible that such a divesting by Bond would have been a settlement by him within two years of the commencement of his bankruptcy and void against the trustee pursuant to s 120 of the Bankruptcy Act 1966 (Cth): see Re La Rosa; Ex parte Norgard (1990) 93 ALR 571; Re Hyams; Official Receiver v Hyams (1970) 19 FLR 232." 46 In Re La Rosa, the first of the authorities cited, French J dismissed an application by a trustee in bankruptcy for a declaration that a transaction between the appellant and other parties (involving the sale of an asset by the appellant for $1 million and its immediate repurchase by the appellant for $1,040,000) was void as a voluntary settlement within s 120. French J held that for the purposes of s 120, a "settlement" is a disposition of property contemplating its retention in some form by the donee rather than immediate consumption or dissipation by the donee; and that (not following obiter remarks of Wilcox J in Re Ward (1984) 3 FCR 112) the definition of "settlement" in s 120(8) so as to include "any disposition of property" had not widened the meaning of settlement in previous law, or dispensed with requirement that the settled property be intended, or contemplated, to be retained and enjoyed by the donee for some indefinite period. French J dismissed the application. In the absence of evidence that the appellant intended or contemplated that the net "premium" payment received by the other party would be retained in any way or form, s 120 did not apply. Rather, the payment was a "straight out" payment in order to obtain, for whatever ultimate purpose (probably tax minimisation), the passage of money through the accounts of several trading entities controlled by the appellant (at 589). 47 In Re Hyams, a trustee in bankruptcy sought a declaration that a mortgage given by an appellant to his wife was void. Gibbs J held (at 252) that in s 94 of the Bankruptcy Act 1924 (Cth), the predecessor of s 120, "settlement" was intended to have "a wide signification" and to include the conveyance of interests in property "short of ownership", such as a mortgage. However, not every mortgage or transfer was within s 94. The end purpose must be a disposition of property to be held for the enjoyment of some other person. This did not mean that there shall be any restriction on the donee's power of disposal, but merely that the retention of the property in some sense must be contemplated, and not its immediate dissipation or consumption. 48 Gibbs J said (at 253): "[T]he purpose contemplated was that the mortgage would for an indefinite time be retained by and for the benefit of the respondent. Although the mortgage permitted the respondent to give an immediate demand and call up the debt, there was not the least likelihood that she would do so or that the debt would be repaid by the bankrupt." 49 In my opinion, the transfer of the "rolled-over" funds, effected by Spectrum on 17 September 1990 at the appellant's direction, constituted a "disposition of property" by the appellant within the meaning of s 120(8). It is clear that, by then, the appellant was beneficially entitled to that amount as a chose in action indefeasibly vested in him. He then directed Spectrum to transfer the funds (or choses in action) to the three assurance (superannuation) companies, to be held by them in their respective retirement funds. 50 It will be recalled that in the Full Federal Court in Barton, Lockhart J, in dealing with a loan, could "see no difference for present purposes (i.e. whether there was a s 120(1) 'settlement') between the disposition of something other than money and the disposition of money to buy something" (at 395). It will further be remembered that, in the High Court in Barton, it was no longer disputed that the payment in question (the advance) was a statutory "settlement" (at 78). (C) The application of these principles 51 In my opinion, the reasoning in the Full Federal Court in Barton is applicable here. The appellant's direction by way of disposition of the "rolled-over" amounts may be viewed "as the disposition of money to buy something", namely the rights conferred upon members under the several superannuation trust deeds. Moreover, these were not intended to operate, and could not lawfully operate, as immediate, or even short-term, transactions. They were aimed at providing longer-term, retirement benefits. As was said in Norgard, they were "dispositions of an enduring nature, that is to say, dispositions in the nature of a settlement" (at 12). They were s 120(1) "settlements".

(b) Did the statutory exception apply? 52 The question then is whether the statutory exception expressed within s 120(1) - "a settlement … made in favour of a purchaser or encumbrancer in good faith and for valuable consideration" - applies here. 53 It will be recalled that the primary Judge noted a concession by the trustee, correctly made, I think, that the appellant's "disposition" had been made in good faith. (i) The meaning of "purchasers" 54 The remaining question then is whether, as his Honour held, the three assurance companies' trustees, were not "purchasers" within the meaning of the statute. 55 The meaning of the statutory exception has been considered by a long line of authority in England and in this country. 56 In Re Pope; Ex parte Dicksee [1908] 2 KB 169 it was held that, in order to constitute a person a "purchaser" for valuable consideration within the equivalent English provision, it was not necessary that either money or physical property should be given; the release of a right, or the compromise of a claim, was sufficient to constitute a person a "purchaser". There, a post-nuptial settlement of his own property, executed by a bankrupt within two years of his bankruptcy in favour of his wife and children, in consideration of the wife refraining from taking proceedings against him in the Divorce Court, was held to be within the statutory exception and thus valid against his trustee in bankruptcy. 57 Cozens-Hardy MR said (at 172 - 173): "[I]t is contended that the settlement was not made 'in favour of a purchaser' and 'for valuable consideration.' I am unable to follow this argument. That there was valuable consideration is plain, having regard to the finding of the judge as to the bargain. It is decided by authority, which binds us, that the word 'purchaser' is equivalent to 'buyer' in the sense in which that word is used in commercial transactions - Hance v. Harding - and, on the other hand, that it is something more than a conveyancing term and is not satisfied by a deed, such as an assignment of leaseholds, which might suffice to render the assignee a 'purchaser' within the statute of 27 Eliz. c. 4: Ex parte Hillman, In re Pumfrey. I think it means a person who has given something in consideration of the settlement or, to use the language of Sir James Hannen, a quid pro quo. Now in the present case the wife bargained that she would not commence proceedings in the Divorce Court, her costs in which proceedings would have been payable by the husband whatever the result of the proceedings might have been: see rule 158. This was, in truth, a pecuniary payment from which he was relieved. Moreover, these proceedings might have resulted in an order for alimony. I mention these pecuniary elements, although I do not think it possible to overlook the fact that as part of the consideration for this settlement the husband procured his escape from public exposure in the Divorce Court. I am unable to adopt the view that there must be either money or physical property given by the purchaser in order to bring the case within the exception. In my opinion the release of a right or the compromise of a claim, not being a merely colourable right or claim, may suffice to constitute a person a 'purchaser' within the meaning of s. 47. I am not pressed by the words 'purchaser or incumbrancer,' for I think they only mean that the exception is to apply whether the person taking under the settlement, which by s. 3 includes any conveyance or transfer of property, takes the absolute interest or only a mortgage." (Emphasis added) 58 In Morrison (cited by Lockhart J in Barton (see [11] above)), Stamp J said (at 1505) that in construing the section (the equivalent of s 120(1)), "regard [must be had] to the fact that it is clearly framed to prevent properties from being put into the hands of relatives to the disadvantage of creditors. In this way, as Jessel MR had observed in Ex parte Hillman (1879) 10 ChD 622, the section "falls to be construed in a commercial sense". 59 In Re Densham (A Bankrupt); Ex parte Trustee of the Property of the Bankrupt v The Bankrupt (1975) 1 WLR 1519, Goff J, citing the distinction drawn by Jessel MR in Hillman between "a buyer in the ordinary commercial sense" and "a purchaser in the legal sense…", and having earlier referred to observations of Astbury J in In re Charters (1923) 8 B & CR 94, said (at 1528): "Having regard to the subsequent cases under this section, I think that is what Sir George Jessel M.R. must be taken to have meant, namely, that it must not be purely voluntary. There must be a quid pro quo. Astbury J. then referred to Hance v. Harding (1888) 20 Q.B.D. 732 which was a case of cross-settlements where Lord Esher M.R. said, at p. 737: 'The question whether [the transaction] is protected by section 91 appears to depend on whether the father can in this case be considered a bona fide purchaser for valuable consideration within the section.' Lord Esher M.R. dealt with bona fides and then said: 'Then can he be called a purchaser? He has given something to get something for other persons, viz. the family of his son.' Astbury J. continued (1923) 8 B & C.R. 94, 100. 'Of course, the facts were very different. It was a settlement by the father as well as by the son. Sir James Hannen in Hance v. Harding, 20 Q.B.D. 732, 739 referring to Ex parte Hillman … said Jessel M.R.'s 'language must be interpreted as meaning that the word 'purchaser' must not be treated as a conveyancing term, but must be considered as applying to cases where there is a quid pro quo.''" (Emphasis added) 60 In In re Abbott; Ex parte Trustee of the Property of the Bankrupt v Abbott [1983] 1 Ch 45, the Court of Appeal held that in the present statutory context, the words "purchaser … for valuable consideration" were wide enough to cover a spouse whose claim to a property adjustment had been compromised. 61 Peter Gibson J (with the agreement of Megarry V-C) held (at 54) that "purchaser" meant "a buyer in the ordinary commercial sense, that is … a person providing a quid pro quo…"; and that the consideration given by the purchaser "need not be equal in value to the consideration given by the debtor, though it must be valuable consideration in the commercial sense." 62 Megarry V-C said (at 57): "Plainly 'a good consideration', in the sense of the natural love and affection that a man has for his wife and children, is not enough. Nor is a merely nominal consideration, even though it would suffice to support a simple contract at common law. In the context of the avoidance of settlements by a trustee in bankruptcy, a 'purchaser … for valuable consideration' must be someone who can not only be described as being a 'purchaser' but can also be said to have given a consideration for his purchase which has a real and substantial value, and not one which is merely nominal or trivial or colourable." 63 This approach has been adopted in Australia. Lockhart J said in Barton (at 396): "In my opinion s 120 is intended to prevent the property of a person from being put into the hands of his relatives or friends to the disadvantage of his creditors, and must be considered in a commercial sense; in Re Pumfrey; Ex p Hillman (1879) 10 Ch D 622; in Morrison [1965] 1 WLR 1498 at 1505; in Re Densham [1975] 1 WLR 1519 at 1527; and in Re Windle, supra (at 1637). [Emphasis added] To constitute a purchaser for valuable consideration it is not necessary that either money or physical property should be given; in Re Charters; Ex p Trustee (1923) 3 B & C 94; but a nominal, trivial, colourable or fictitious consideration will not suffice; in Re Abbott, supra. Nor is it necessary that the consideration moving from the purchaser must be equal to that which has been taken out of the debtor's estate and in that sense replaces it; Re Densham, Re Windle and Re Abbott. The expression does not connote a purchaser in the strict sense of a contract for purchase and sale. It is not a conveyancing term. The phrase connotes a purchaser in the ordinary commercial sense who gives consideration which is real and substantial; Re Abbott." 64 In Barton in the High Court, after analysing the English cases, their Honours said (at 86 - 87): "A beneficiary under a settlement is not a purchaser within the meaning of the section unless he has given such valuable consideration as is sufficient in all the circumstances to make him a 'buyer' in a commercial sense of the interest passing to him under the settlement. Unless there is good reason to the contrary, we believe it to be important in legislation of this kind to maintain a construction of the Australian Act which accords with English authority. We would therefore accept Sir Robert Megarry's formulation [in Abbott] and endorse the Full Court's ruling that a 'purchaser … for valuable consideration' within the meaning of s. 120(1) of the Act is one who has given consideration for his purchase 'which has a real and substantial value, and not one which is merely nominal or trivial or colourable'. [Emphasis added] The same approach has been taken in Canada, with the Appeal Division of the Nova Scotia Supreme Court construing a similar provision in the light of citations from Hillman, Morrison… and Windle…." 65 In my opinion, the three assurance (superannuation) trustee companies were "purchasers … for valuable consideration". (And, as has been noted, they acted "in good faith" (see Official Trustee v Mitchell (1992) 38 FCR 364 at 371).) 66 In Abbott, Megarry V-C went on to observe (at 58): "In ordinary parlance, of course, one would not describe an outright payment of Ł9,000 as a 'settlement', any more than one would describe a person as a 'purchaser …for valuable consideration' of that sum because that person in return gives up some litigious claim. But the Act of 1914 has understandably cast its net wide. Under section 42 (4), the payment is a 'settlement' because that word includes 'any conveyance or transfer of property'; and under section 167 'property' includes 'money'." 67 But having so widened the net so as to embrace an expanded notion of "settlement", Parliament must, I think, be taken also to have intended that the concept of "purchaser" or "purchase" would, in line with this expansion, also be expanded, so as to achieve a consistent approach overall. That is, if (as here) Parliament is to be taken to have intended that a payment of money, or a transfer of a chose in action to a superannuation trustee is capable of constituting a statutory "settlement", it is only reasonable to assume that Parliament intended that such a trustee was also capable of qualifying as a "purchaser … for valuable consideration". Any other result would be so unfair and arbitrary as to be presumed not to have been intended. As a matter of statutory interpretation, I would reject such construction in the present context. (ii) Was there "valuable consideration"? 68 The dealings between the relevant parties were at arm's length, on ordinary commercial terms, and, in my opinion, appropriately (in terms of the trustee's promise to manage) characterised as "valuable consideration". On its facts, the case may thus plainly be distinguished from the family arrangement struck down in Barton (and see Official Trustee v Martin (1990) 24 FCR 504). 69 As Lockhart J observed in The Official Trustee in Bankruptcy v Racovitis, Full Federal Court, 28 November 1995, unreported (at 10): "In determining whether there is valuable consideration, it is the reality of the transaction to which regard is to be had. The whole transaction must be looked at to see if valuable consideration has been given: Re Johnston; Ex parte Cole (1984) 3 FCR 32. The Court will go behind a written agreement in order to ascertain the reality of the transaction: Re Trimbole; Ex parte Donnelly, unreported, Beaumont J., 11 July 1986 affirmed by the Full Court of the Federal Court, unreported, 5 November 1986; and Re Douglas; Ex parte Starkey (1987) 15 FCR 475 per Pincus J. at 480." 70 Here the reality at the time of the "roll-over" was that the bankrupt was many years from retirement age, so that unless his entitlement from the ISAS fund on its termination was "rolled-over" into another bona fide superannuationfund, the entitlement would have been taxed. Common sense indicates that, to this extent, there was a strong practical incentive, perhaps a practical compulsion, to "roll-over" the entitlement, an action in fact carried out in this case with the approval of the Australian Taxation Office. Moreover, the dealings in question involved far more than the constitution of a "bare" trust. The contemplated role of the related assurance company, guaranteed by the fund's trustee, was of fundamental practical importance to the superannuation transaction. In return for premiums received, the fund's trustee promised the beneficiary that the assurance company would provide assurance cover. This involved the provision of a real and truly valuable quid pro quo by the fund's trustee. These were not nominal, colourable, abnormal or collusive dealings of the kind aimed at by s 120 (cf. Official Trustee in Bankruptcy v Trevor Newton Small Superannuation Fund Pty Ltd [2001] FCA 1267 at [5]). In my view, they fell within the exception to s 120(1). 71 It must follow that the trustee's claim ought to have been dismissed. The appeal on this aspect should be allowed.

(c) Section 121 72 I agree with Kiefel J that this claim was not established on the evidence.

ORDERS 73 I agree with the orders proposed by Kiefel J. I would add two observations. 74 First, if sought, the trustee should have a certificate under the Federal Proceedings (Costs) Act 1981. 75 Secondly, I would order that the appellant pay the trustee's costs of the directions hearing before me on 28 August 2001, liberty to apply for which stands presently reserved. I certify that the preceding seventy-five (75) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Beaumont.

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

AND: PAUL JOHN COOK (AS TRUSTEE OF THE BANKRUPT ESTATE OF PETER ROBERT BENSON)

KIEFEL J: 76 From about July 1972 the appellant, Peter Robert Benson, was an employee of Industrial Sales and Service (TAS) Pty Ltd ("ISAS"). He was also a director. During the course of his employment, and pursuant to an undated Declaration of Trust, there was established the ISAS (TAS) Retirement Fund, the benefits of which were to be provided by means of a Retirement Accumulation and Group Life Insurance Policy to be effected with Norwich Union Life Insurance Society. ISAS was wound up on 4 June 1990. It would seem, from advices given by the receiver of ISAS to the trustee in bankruptcy, that the appellant's employment had been terminated on 20 April 1990. 77 On 24 July 1990 the appellant notified the Australian Taxation Office of an "Eligible Termination Payment Received", in the sum of $96,192.36, from Norwich Union Life Australia Ltd ("Norwich Union"). The "Roll-over Payment Notification" document advises that $20,000 was the amount to be "rolled-over" to each of "Legal and General Life of Australia Ltd" and "Mercantile Mutual", which may be taken as a reference to the second and fourth respondents. No similar document concerning the third respondent is disclosed, but it is not disputed that $40,000 of the total sum was "rolled-over" into a superannuation fund with which it has a connexion. The transfer or payment of the eligible termination payment ("ETP") was effected on 14 September 1990. Another sum, of just over $16,000, was said by the appellant's then financial planner to have been invested in a "Macquarie Approved Deposit Fund". No orders were sought in connexion with that payment. 78 Prior to these events taking place two creditors had taken action against the appellant. In January 1990 Bridge Wholesale Acceptance Corporation (Australia) Limited commenced proceedings in which the sum of $222,588.32 was claimed against the appellant and others; and on 16 May 1990 Esanda (Wholesale) Pty Ltd obtained judgment against the appellant for an amount in the order of $35,000. On 21 July 1992 a sequestration order was made against his estate. 79 Amendments to the Bankruptcy Act 1966 (Cth)since the time of these transactions have the effect of exempting, from the bankrupt's property which may be divisible among creditors, the interest of a bankrupt in a regulated superannuation fund, within the meaning of the Superannuation Industry (Supervision) Act 1993 (Cth)(s 116(2)(d)(iii)(A)), inserted by Act No 82 of 1993.This is subject to s 116(5), which calculates the value of the property within the exemption. It is not disputed, in the present case, that each of the funds administered by the second to fourth respondents are a regulated superannuation fund. At the time of the transactions in question and the date of sequestration, however, the Act only exempted policies of life insurance, and then only if they had been in force for at least two years. 80 The trustee does not contend that the appellant's interest in the three funds was property to which the trustee was entitled, on behalf of the creditors. Until the date nominated for retirement or death, or the earlier occurrence of a specified circumstance, his interest is of an equitable proprietary nature, one which does not include an immediate right of payment: Caboche v Ramsay (1993) 119 ALR 215, 230 per Gummow J ("Bond's case"); and see also Re Coram; Ex parte Official Trustee in Bankruptcy v Inglis (1992) 36 FCR 250. In these circumstances it is not necessary to consider the application of s 302A of the Act, which renders void provisions in superannuation fund rules which have the effect of cancelling, forfeiting, reducing or qualifying the beneficial interest of a member if they become bankrupt. The section was inserted by Act No 82 of 1993, but is expressed to apply to rules in existence before the commencement of the section: subsection (3). Caboche v Ramsay, to which the section was no doubt a response, had held that such provisions are void as a restraint upon the alienation of property in a circumstance where the member had already become entitled to payment of the monies standing to the credit of his account. The appellant in this case had not become entitled to payment out of the three funds. Indeed the appellant's principal contention is that he never became beneficially entitled to the monies from Norwich Union. 81 Before his Honour, the primary Judge, the trustee contended that the payment into the funds of most of the $96,192.36, at the appellant's direction, amounted to a settlement of property for valuable consideration which was void as against the trustee pursuant to s 120(1) Bankruptcy Act 1966. Alternatively, the transaction amounted to a disposition of property made with intent to defraud creditors, in which case it would be void against the trustee under s 121. Those sections were, at the relevant time, in these terms: "120(1) A settlement of property, whether made before or after the commencement of this Act, not being: (a) a settlement … made in favour of a purchaser or encumbrancer in good faith and for valuable consideration; or … is, if the settlor becomes a bankrupt and the settlement came into operation after, or within 2 years before, the commencement of the bankruptcy, void as against the trustee in the bankruptcy. … (8) In this section, 'Settlement of property' includes any disposition of property. 121(1) Subject to this section, a disposition of property, whether made before or after the commencement of this Act, with intent to defraud creditors, not being a disposition for valuable consideration in favour of a person who acted in good faith, is, if the person making the disposition subsequently becomes a bankrupt, void as against the trustee in the bankruptcy. (2) Nothing in this section shall be taken to affect or prejudice the title or interest of a person who has, in good faith and for valuable consideration, purchased or acquired the property the subject of the disposition or any interest in that property. (3) In this section, 'disposition of property' includes a mortgage of property or a charge on or in respect of property." 82 It has not been suggested that either of the second to fourth respondents acted otherwise than in good faith. The submissions before his Honour, and before this Court, focused upon what had led to the payments or transfers by Norwich Union; whether the second to fourth respondents could be said to have given valuable consideration for the monies received; and whether the appellant's intention in placing the monies with them was to defraud creditors. Those respondents did not seek to make submissions on the appeal, reserving their position only with respect to any question of costs. 83 His Honour, the primary Judge, found that the appellant had received the sum of $96,192.36 as an ETP pursuant to cl 13(b) of the Trust Deed of the ISAS Fund, since he had left the services of ISAS prior to his normal retirement age. Clause 13 provided: "13. If a Member shall - (a) retire from the service of his Employer on or after his Normal Retirement Date or (b) leave the service of his Employer prior to his Normal Retirement Date in circumstances which the Employer in its absolute discretion accepts as early retirement the Principal Employer shall (subject to the provisions of Clause 17 hereof) pay and transfer to that Member the whole of the benefits held in the Scheme in respect of him." 84 It is necessary to refer also to two other provisions of the deed upon which the trustee relied as other possible bases for the entitlement of the appellant to a payment from the fund. 85 Clause 14 provided in relevant parts: "14. If a Member leaves the service of his Employer prior to his Normal Retirement Date other than in the circumstances referred to in paragraph (b) of the last preceding Clause 13 hereof the Principal Employer shall (subject to the provisions of Clause 17 hereof) pay and transfer to that Member the whole or such part of the benefits held in the Scheme in respect of that Member as the Employer shall determine being not less than the aggregate of that part thereof as shall be fairly attributable to contributions which have been made (or are deemed to have been made) to this Scheme and the Previous Scheme by: (a) the Member (b) the Employer in respect of that Member above the minimum Employer's contribution of 5% of that Member's Salary accumulated at 5% compound interest for each year of complete service within the Scheme and the balance of any benefits received or held in the Scheme in respect of that Member shall remain in the Scheme subject to the provisions of Clause 21 hereof …" 86 And cl 25 provided: "25. In the event of the termination of the business of an Employer or of the Employer's business becoming the subject of any absorption amalgamation or sale (unless the new owners of the business shall give notice to the Principal Employer and the Employer concerned and to the Members concerned of their intention to take the place of the Employer as a contributor to the Scheme) then the Principal Employer shall transfer and assign to the Members who are employees of that Employer respectively the benefits held in the Scheme in respect of them and shall transfer to each such Member such portion of the moneys investments and other assets in this Scheme not otherwise allocated in respect of any Member as the Principal Employer shall in its absolute discretion consider equitable AND thereupon this Scheme shall terminate insofar as the Members who are employees of that Employer are concerned and no such Member or any person claiming through under or in respect of that Member shall have any claim against the Employer or the Principal Employer in respect of this Scheme or under the provisions of this Deed …" 87 His Honour held that the appellant became entitled to the funds and then authorised Norwich Union to pay most of them to the three respondents as "roll-over" institutions. His Honour rejected the submission that the effect of the "roll-over" of the funds was to immediately dissipate them. There was, in his Honour's view, a disposition of property, one which was not for valuable consideration. The respondents were not "buyers" in a commercial sense. Rather they had pledged to manage and preserve the funds in return for management fees or charges. Madgwick J has expressed agreement with that view: Official Trustee in Bankruptcy v Trevor Newton Small Superannuation Fund Pty Ltd [2001] FCA 1267. His Honour did not consider it was necessary to determine the question whether s 121 had application and therefore made no finding concerning the appellant's intentions concerning his creditors. 88 It is implicit in the appellant's contention that he at no time became entitled to the monies from Norwich Union, that his only entitlement was to nominate the institution to which they were to be "rolled-over". That would seem to leave the deposit made to the Macquarie Approved Deposit Fund unexplained. In support of his contention the appellant referred to Re Coram, where O'Loughlin J held (at 253) that: "…Until the happening of a prescribed event that will crystallise his right into an actual entitlement, a member of a superannuation fund is neither the legal nor the beneficial owner of the amount that stands to the credit of his account from time to time." 89 This is consistent with the view expressed by Gummow J in Caboche v Ramsay, as to the nature of a member's interest in a fund. 90 There are tax concessions available to funds, and to their members, where the funds comply with certain statutory requirements. One such requirement had regard to the purposes for which a fund is maintained, namely to provide benefits in the event of a member reaching a prescribed minimum age (see s 3(1) of the Occupational Superannuation Standard Act 1987 (Cth)). Such a fund was described by Windeyer J in Scott v Commission of Taxation (No 2) (1966) 40 ALJR 265, 278 as: "… a fund bona fide devoted as its sole purpose to providing for employees who are participants money benefits (or benefits having a monetary value) upon their reaching a prescribed age. In this connexion "fund", I take it, ordinarily means money (or investments) set aside and invested, the surplus income therefrom being capitalized." 91 It is not however suggested that a fund may not provide for payments to be made at an earlier time, in certain specified circumstances. The appellant did not contend that clauses 13, 14 and 25 were invalid in some way. During argument however it seemed that the appellant sought to draw more from Re Coram, to the end that the appellant's true entitlement was to be seen as deferred to his date of retirement. The cases do not disclose any such limitation upon an entitlement to a benefit at an earlier point. 92 The principal question in Caboche v Ramsay concerned forfeiture provisions in the trust deed and whether they were valid. In that process it was necessary for the Court to consider whether the member, Mr Bond, had become absolutely entitled to the monies at a point prior to the retirement date nominated in the deed. It was held that he had become so entitled under the terms of the deed, which spoke of a payment of benefits in the events of cessation of employment or a member retiring from employment, but not the workforce, although their Honours differed as to which provision was apposite to the circumstance of Mr Bond's resignation. In contrast, the deed in Re Coram made provision only for a deferred benefit to be paid in the event of a member's resignation. The only right to an immediate payment arose if the member ceasing employment made an election, and this had not been done (251, 252). His Honour regarded the bankrupt's rights as having been transformed to a debt owing to him, rather than a future benefit (255). 93 In connexion with the ISAS Deed, the appellant then contends that his situation cannot be equated with any of the circumstances referred to in clauses 13, 14 or 25. So far as a discretion is required to be exercised by the employer under cl 13(b), this has not been shown to have taken place. It follows, it is submitted, that he could not have become beneficially entitled to the monies paid by Norwich Union to the respondents. There is some difficulty in such an approach given, in particular, the fact of the payment. If a trustee pays out in breach of the provisions of a trust deed consequences might follow. The trustee and the recipient of the monies might be required to repay them by others having an interest in the fund. This would not arise where the payments are made with the agreement of the beneficiaries and for the purpose of winding up a fund. In the absence of some such challenge any questions of lack of authority would not seem to assume relevance. Nevertheless, the finding of his Honour the primary Judge and the agreements on the appeal necessitate a consideration of the basis for the payments made by Norwich Union. 94 It will be recalled that the receiver's understanding was that the appellant's employment had been terminated prior to the company being wound up. In a letter dated 27 June 1990, expressed to be written by the appellant as "Trustee", he informed Norwich Union as follows: "I refer to my letter of 5 April 1990 which detailed the benefit payments in respect of members of the Fund who had resigned on or before 9 March 1990. I am now able to confirm the Trustees decision regarding the method to be adopted in the payment of the benefits to the remaining three (3) working Directors. The Trustees confirm that the individual benefits shall comprise the sum of: (i) the total members accumulated credits ie. 100 % plus (ii) a percentage of the Reserve Account (after payment of all expenses to Norwich, SPM Pty. Ltd. $1,195.00 and taxation liability) determined as a ratio of the Members service to the 31 March 1990 to the combined service of those three (3) directors. Peter Benson from 01.07.72 17.75 years service = 51.20 % Robert Benson from 01.11.78 11.4167 years service = 32.93 % Paul Benson from 01.10.84 5.5 years of service = 15.87 % Benefit Payment Advice forms are following with appropriate instructions as to whom the individual benefits are to be paid (rolled over to)." 95 Nothing in the letter is inconsistent with the appellant's employment having been terminated. Whilst the directors may not have received any of the benefits from the fund, the company had by this time been wound up. In any event it was in the capacity as employees that their entitlement to benefits arose under the deed. 96 A termination of the appellant's employment might be considered to fall within the events nominated in cl 13(b) and cl 14, which refer to an employee leaving the employment. 97 It is possible that "leave" does not include termination of employment. The former suggests some voluntary action on the part of the employee; "termination" suggests some action on the part of the employer. If this were the case, the deed would not appear to make provision with respect to payment of contributions made by a retrenched or dismissed employee. It is therefore likely that the reference to "leave the service of his Employer prior to his Normal Retirement Date" was intended to be read broadly, and to signify departure. Clauses 13(b) or cl 14 might then be the source of authority for the payments. Clause 13(b) however requires not only that the employer has left prior to retirement, but that the employer exercise its discretion and accept that the circumstances show that early retirement was intended. There is no evidence of any such consideration and none with respect to the appellant's circumstances. In my respectful view a finding that an entitlement arose under cl 13(b) was not open. Clause 14 remains to be considered as an alternative source. 98 A difficulty in the path of a conclusion that cl 14 was involved is that the letter of 27 June 1990 does not suggest that the calculation there undertaken with respect to the payment was one referrable to either of clauses 13 or 14. Further, both clauses appear to assume that the fund is to continue after the payment is made. Clause 14 expressly refers to the balance of the member's benefits, the amount not paid, being held in the scheme. Whilst cl 13 refers to the total benefits being payable, no provision is made for the other monies remaining in the fund. 99 Clause 25 deals with the situation where the fund is to be wound up. It speaks not only of a transfer and assignment of the benefits held but also of a transfer of monies not otherwise allocated. This would appear to accord with what was said, by the letter of 27 June 1990, to have been undertaken. The appellant was effecting a payment out of monies standing to the credit of the members' accounts and the reserve account. In my view cl 25 provided the basis for the payment in fact made. 100 The next aspect of the appellant's argument is whether the monies could be said to have effectively by-passed him. This requires consideration of what is involved, in a legal sense, in the monies as "rolled-over" into other funds. In that regard the appellant contends that the election he made predated, and inferentially therefore qualifies, the payments made to the funds. 101 On 17 September 1990 the appellant's financial planners advised, by letter: "As advised today in your telephone conversation with Ian Griffiths, an amount of $96,192.36 has been received from Norwich Union Life Australia Ltd as payment from the I.S.A.S. Retirement Fund. In accordance with your instructions the payment has been invested as follows:

• Legal and General Personal Super Investment Growth Bond (Stable Units) 20,000.00

• Mercantile Mutual 100% Superannuation Investment Bond Policy (Capital Stable Units) 20,000.00
• Prudential Superannuation Bond (Capital Guaranteed Investment Account) 40,000.00
• Macquarie Approved Deposit Fund (Deposit Units) 16,192.36 $96,192.36

Also, please find attached 1991 Group Certificate issued by Norwich and Statement of Termination Payment." 102 In the "Roll-over Payment Notification" form dated 24 July 1990 provision is made for an application to make a "roll-over" of a payment. It requires various components of the sum to be identified for taxation purposes not here relevant, as does the "Statement of Termination Payment" of 22 August 1990. The Statement also identifies each of the second to fourth respondents as a "roll-over institution". 103 Section 27A(1) Income Tax Assessment Act 1936 (Cth)("ITAA") defines an "eligible termination payment" as including a payment made from a superannuation fund in respect of a taxpayer, where the payment is not the income of the taxpayer. A "roll-over" involves the application of s 27D to the ETP. Section 27D provides for an election to be made by a taxpayer in relation to a qualifying ETP in the year of income in which it is made. The period for "roll-over" is ninety days from payment of the ETP. 104 The combined effects of s 221A and s 221C ITAA require the deduction of income tax from the amount of an ETP, by an employer, unless the payment has been "rolled-over" before it is made. The definition of "employer" extends to those making an ETP. It was therefore in the appellant's interest to roll the sums over into the three funds if he did not wish to have the ETP taxed as income. There was, however, no legal impediment to his receiving the money, nor to his investing it, or part of it, other than with superannuation funds, as he in fact did. 105 The substantial argument which remains to be considered is whether the transaction with the second to fourth respondents can be said to be one involving them as a "purchaser …for valuable consideration". It is a question common to ss 120 and 121. 106 Earlier cases dealing with the meaning of the phrase in the equivalent section in the English bankruptcy legislation held that the word "purchaser" was used in a sense different from, and wider than, its meaning as a conveyancing term: In re Pope; Ex parte Dicksee [1908] 2 KB 169. There the Court of Appeal held (at 172) that it meant "a person who has given something in consideration of the settlement, or, … a quid pro quo". This was later taken to refer to a buyer in "the ordinary commercial sense": In re Abbott [1983] 1 Ch 45, 54. A broader approach would seem to be required to accommodate monies paid by a bankrupt, since they can amount to a settlement within the meaning of the sections: Barton v Official Receiver (1986) 161 CLR 75, 86; Williams v Lloyd (1934) 50 CLR 341, 375. One would not usually speak of monies being purchased. 107 The view expressed in the earlier cases, which focuses upon what has been given in return for the monies, or other property, has informed later decisions including Barton v Official Receiver. Although the Court there held (at 86) that the phrase does not consist of two separate notions (and see also the decision of the Full Court: (1984) 4 FCR 380, 395), it does refer to a purchaser in a commercial sense: "It is true that the earlier decisions to which we have referred focus attention more on the word "purchaser" than on the words "valuable consideration" whilst in the more recent cases the reverse is true. As indicated in the early part of this judgment, we have considerable sympathy with the proposition that the words "purchaser" and "valuable consideration" should be held together as a single concept. One could then accept as of more general application Lord Wilberforce's statement that "valuable consideration" is a term of art which precludes any inquiry as to adequacy but find room in which to give effect to the beneficent purpose of the bankruptcy legislation by construing "purchaser" broadly in a commercial sense. A beneficiary under a settlement is not a purchaser within the meaning of the section unless he has given such valuable consideration as is sufficient in all the circumstances to make him a "buyer" in a commercial sense of the interest passing to him under the settlement. … We would therefore accept Sir Robert Megarry's formulation and endorse the Full Court's ruling that a "purchaser … for valuable consideration" within the meaning of s. 120(1) of the Act is one who has given consideration for his purchase "which has a real and substantial value, and not one which is merely nominal or trivial or colourable": In re Abbott [1983] Ch., at p. 57." 108 The case to which the Court there referred, In re Abbott, concerned the payment of monies, from the proceeds of sale of the matrimonial home, by a bankrupt to his wife in exchange for her relinquishing her property claim in divorce proceedings. The wife was held to be a purchaser for valuable consideration in the ordinary commercial sense "that is to say a person providing a quid pro quo" (at 54). 109 It is accepted that the second to fourth respondents are trustees of the funds into which the monies were placed and that they are responsible for their further investment. It was also assumed that they would receive something, by way of fees or charges, for their role. The letter of 17 September 1990 discloses that a bond or policy issued with respect to the monies received from Norwich Union and that units were held by the appellant in particular types of investments. The description of one or more of them implies a guarantee of repayment of the monies initially paid in. The deeds or rules governing the funds, which provide the conditions relating to members' rights to benefits, also require a policy to be maintained upon the life of its members, the premiums for which are paid from contributions. 110 It may be accepted that the appellant has invested the monies with the three respondents and that they are thereafter reinvested. In my view, with respect, that observation does not take one far in the enquiry to be undertaken, as to whether the respondents were purchasers for valuable consideration. An investment connotes the expectation of a profit from the utilisation of monies. What must be determined under the sections is whether anything was given in exchange for the monies and, if so, whether it is sufficient. 111 In determining what, if any, consideration has been given for the monies the Court "is bound to consider the broad effect of the arrangement embodied in the deed, and should not confine itself, in any narrow sense, to the technical language of the document": Official Trustee in Bankruptcy v Mitchell (1992) 38 FCR 364, 370; Century 21 (South Pacific) Pty Ltd (In Liquidation) v Century 21 Real Estate Corporation (1996) 136 ALR 687, 695. This would, in my respectful view, accord with the approach taken by the Court to the transaction in Barton v Official Receiver. Here the appellant's rights can be seen to have been altered by the transaction. In lieu of the money to which he was entitled he now has future rights with respect to the fund and rights arising from his contracts with each of the respondents. The respondents have corresponding obligations which will require the repayment to the appellant of his initial investment together with an amount representing the monies earned by the fund relative to the investment. On any view it would seem to me that something more than a nominal consideration has been provided for the monies. It follows that neither s 120 nor s 121 can have application. 112 I add that a finding that the appellant intended to defraud creditors, which would have been necessary if s 121 were to apply, would not seem to me to be open on the evidence. Whilst such an intention may be proved by inference, it is not made out by showing that the actions of a bankrupt were to reduce the assets available to creditors: Cannane v J Cannane Pty Ltd (In Liq) (1998) 192 CLR 557, 565-567 [10] and [14]. The appellant's decision to "roll-over" the funds here might be explained, in part at least, by considerations of the income tax he would otherwise have to pay. Moreover there is no evidence that he had any particular understanding about whether doing so would put them beyond the reach of his creditors.

CONCLUSION 113 In my view the appeal should be allowed; the orders of his Honour the primary Judge set aside and in lieu thereof, it be ordered that the trustee's claims be dismissed. The trustee should pay the costs of the appeal and the proceedings below. I certify that the preceding thirty-eight (38) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Kiefel.

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

AND: PAUL JOHN COOK (AS TRUSTEE OF THE BANKRUPT ESTATE OF PETER ROBERT BENSON)

PRUDENTIAL CORPORATION AUSTRALIA LIMITED (ACN 066 649 241)

REASONS FOR JUDGMENT HELY J: 114 The second respondent was the trustee of the Legal & General Employed Persons Superannuation Fund ("the L & G Fund"). A letter of 17 September 1990 from Spectrum Financial Planners Pty Ltd to the appellant asserts that $20,000 has been invested in "Legal & General Personal Super Investment Growth Bond (Stable Units)". 115 The Trust Deed by which the L & G Fund was established provides for the admission of persons as members of the Fund, and for the trustee to effect and maintain a policy of insurance in its own name on the life of each member of the Fund. The trustee holds each policy upon trust to be administered according to the provisions of the Trust Deed but the trustee has no beneficial interest in any policy [(Cl 4(d))]. The policy is to be effected with Legal & General Insurance Ltd in its capacity as insurer of the Fund, or such other company as shall be substituted as insurer. The general management and administration of the Fund is the responsibility of the insurer. 116 The Trust Deed for the L & G Fund further provides for the member to contribute to the Fund an amount equal to the premium due from time to time under the policy on the member's life. At any given date, the benefit of a member under the Fund consists of the policy on his life and any other credits referred to in Clause 7 of the Trust Deed. The member's benefit is payable on a member reaching retirement date as defined in the Deed. Provision is made for payment of stipulated benefits in other circumstances. 117 A letter from Legal & General dated 31 March 1994 stated that it enclosed a copy of "Mr Benson's Bond Document", but a copy of that document has not been included in the appeal papers. The letter advised that as at 26 March 1994, the appellant holds 17,568.19 Stable Fund Units valued at 156.09c each which provide a balance of $27,422.19. 118 On 29 November 2000 Colonial Mutual Superannuation Pty Ltd ("Colonial") wrote to the Federal Court advising that as a result of a merger of statutory funds it had assumed liability for policy number 560408-P, originally issued by the Legal & General Life of Australia Ltd, apparently with respect to the appellant. The letter continued: "The only contribution made towards policy number 560408-P was $20,000, which was invested on 20 September 1990. The value of the policy as at 28 November 2000 was $38,237.17." 119 The third respondent was the trustee of the Prudential Personal Retirement Fund ("the Prudential Fund"). The letter of 17 September 1990 earlier referred to asserts that $40,000 has been invested in "Prudential Superannuation Bond (Capital Guaranteed Investment Account)". The Prudential Bond Certificate provides that the certificate, together with the conditions of the Prudential Superannuation Bond, form the basis of a contract of life insurance between the Prudential Assurance Company Limited and the policy owner. The policy owner is the third respondent, and the "life insured" is the appellant. 120 The Trust Deed of the Prudential Fund is relevantly structured in a similar manner to the Trust Deed of the L & G Fund, inasmuch as it provides for the admission of persons as members of the Prudential Fund; and for the making of contributions by members to the Fund, to be applied by the trustee to acquire and maintain a life insurance policy with Prudential Assurance Company Limited, with the policy proceeds funding the payment of the benefits provided for in the deed. The trustee is empowered (Cl 6.3) to continue, surrender, vary or otherwise deal with the policy in such manner as it thinks fit in order to administer the fund in accordance with its rules. 121 On 29 November 2000 Colonial wrote to the Federal Court advising that as a result of the merger of statutory funds it has assumed responsibility for policy number A306160 originally issued by Prudential Assurance Company Ltd apparently with respect to the appellant. The letter continued: "The only contribution made towards policy number A306160 was $40,000, which was invested on 20 September 1990. The value of the policy as at 28 November 2000 was $64,122.47." 122 The fourth respondent was the trustee of the Mercantile Mutual Life Employed Persons Superannuation Fund ("the Mercantile Fund"). The letter of 17 September 1990 earlier referred to asserts that $20,000 has been invested in "Mercantile Mutual 100% Superannuation Investment Bond Policy (Capital Stable Units)." 123 The Trust Deed of the Mercantile Fund also provides for the admission of persons as members of the Fund; and for the making of contributions by members of the Fund, to be applied by the trustee in the payment of premiums on policies of insurance in which the member is the life insured, and in which the trustee has a legal or equitable interest, with the policy proceeds ("the members benefit") to be applied in the payment of benefits provided for by the Deed. The assets of the Fund are held on trust for the objects and purposes of the Deed (Cl 2.2). A member has no right or interest in his Members Benefit except as provided by the Deed [(Cl 18(a))]. 124 A letter from Mercantile Mutual of 25 February 1994 includes the following: "The policy account at 24 February 1994 is $30,303.32 with the number of units applicable being 14,733.4695. This policy is currently invested in a capital stable investment portfolio." A letter from Mercantile Mutual of 29 November 2000 records that the account balance as at 30 June 2000 is $39,161.90. 125 The issue is whether the payments made on behalf of the appellant to the trustees of the three superannuation funds were settlements of property within the meaning of s 120 of the Bankruptcy Act 1966 (Cth) ("the Act") in the form which that section took at the relevant time, and void as against the Trustee in Bankruptcy. 126 The first question is whether the payments in question were dispositions of the property of the appellant. I agree, with respect, with the conclusions reached by Beaumont and Kiefel JJ in this respect. In the jargon of the industry, the monies may have been "rolled over" from one superannuation fund to another. But this does not mean that the monies in question were not the property of the appellant. 127 The second question is whether the payments in question were settlements of property within the meaning of s 120 of the Act. Section 120 provided that a settlement of property, not being a settlement made in favour of a purchaser in good faith and for valuable consideration is void as against the Trustee in Bankruptcy if made within two years before the commencement of the bankruptcy. If there was a settlement of property in the circumstances of the present case, it occurred within the statutory period. 128 "Settlement of property" includes any disposition of property: s 120(8). The authorities establish that a disposition of property is not a settlement, unless made with the intention that it will be retained by the recipient and not immediately dissipated or consumed: Re La Rosa; Ex parte Norgard v Rocom Pty Ltd (1990) 21 FCR 270, 281; Norgard v Rocom (Northrop, Davies and Lee JJ, 16 August 1990, unreported); Walsh v Salzer Constructions Pty Ltd [2000] VSCA 228. 129 Here, it was not intended that the trustees of the Funds would retain the payments in question. The payments were to be applied in paying up the premium on a policy of insurance to be issued to the trustee on the life of the appellant. Nonetheless a "disposition of money to buy something" may give rise to a settlement of property for the purposes of s 120: Barton v Official Receiver (1984) 4 FCR 380, 395 per Lockhart J. In Re Vansittart; Ex parte Brown [1893] 1 QB 181 a gift of jewellery by a person who later became bankrupt to his wife was held to be a settlement. Vaughan Williams J said at 184 that the result would have been the same if the bankrupt had given his wife money to buy herself a present. His Lordship said: "It will be observed that in the case of In re Player, where the transfer of the shares was held to fall within the section, the actual gift was of money to buy the shares." 130 The subject matter of the settlement is thus the insurance policies issued to the trustees of the Funds on the life of the appellant. The policies were enduring investments effected for the benefit of, and at the direction of the appellant. Clearly enough it was intended that these policies would be retained by the trustees, and not immediately dissipated or consumed by them. 131 The primary judge appears to have accepted that there was a settlement of property, as he rejected a submission that the funds which were "rolled over" were immediately dissipated: "What occurred was that the bankrupt became entitled to them and then authorised their investment elsewhere." 132 The third question is whether each trustee was a "purchaser ... for valuable consideration" of the property passing to it under the settlement, it being accepted that the trustees acted in good faith. 133 The meaning of the expression "purchaser ... in good faith and for valuable consideration" was considered by the High Court in Barton v Official Receiver (1986) 161 CLR 75. The Court held that the three elements - "purchaser", "good faith" and "valuable consideration"- tend to run one into the other, and that the elements of "purchaser" and "valuable consideration" overlap considerably (at 79). The history of the legislation suggests that the element of "purchaser" adds something to the requirement that the disposition be for valuable consideration, as the requirement that there be a purchaser as well as valuable consideration was introduced by s 91 of the Bankruptcy Act 1869: see In re Pope (1908) 2 KB 169. 134 In Barton v Official Receiver (1986) 161 CLR 75the High Court endorsed the notion that s 120 must be approached in a commercial sense. The Court's conclusion was expressed in the following passages (at 86): "A beneficiary under a settlement is not a purchaser within the meaning of the section unless he has given such valuable consideration as is sufficient in all the circumstances to make him a 'buyer' in a commercial sense of the interest passing under the settlement. ... ... 'a purchaser ... for valuable consideration' within the meaning of s 120(1) of the Act is one who has given consideration for his purchase 'which has a real and substantial value, and not one which is merely nominal or trivial or colourable' ..." The Court noted that earlier decisions tended to focus attention more on the word "purchaser" than on the words "valuable consideration", whilst in the more recent cases, the reverse is true. The Court expressed considerable sympathy with the proposition that the words "purchaser" and "valuable consideration" should be held together as a single concept. 135 The primary judge's finding on this question was as follows: "... the respondents, other than the bankrupt, did not give any consideration for the payment to them of the relevant sums. What occurred was that each of those respondents pledged to manage and preserve the funds given to each such entity in return for management fees or charges. The [trustees] were not 'buyers' in a commercial sense of the relevant interests passing to them: see Barton v Official Receiver (1986) 161 CLR 75 at 86 per Gibbs CJ, Mason, Wilson and Dawson JJ." Madgwick J reached a similar conclusion in Official Trustee in Bankruptcy v Trevor Small Superannuation Fund [2001] FCA 1267 at 40. 136 In my view, "what occurred" on the undisputed evidence to which I have earlier referred, is that the payments in question were applied at the direction of the appellant in payment of premiums due on policies of insurance issued to the trustees of the Funds on the life of the appellant. The trustees of those Funds did not provide any monetary consideration for the issue of the policies to them, but this does not necessarily mean that valuable consideration was not otherwise provided. 137 The matter relied upon as constituting the provision by the trustees of valuable consideration for the acquisition of the life policies is the rights which flow from membership of the fund including the promise of provision of benefits in defined circumstances to the appellant or his representatives. But the rights of the appellant and the obligation of the trustee in that respect flow from the terms of the deeds by which the trusts are constituted. The terms of those deeds may provide the explanation for the settlement of the life policies on the trustees, without necessarily amounting to the provision of valuable consideration for that settlement. 138 The policies in question are settled on the trustees, on the terms of the Trust Deeds. Whilst there is reference in the correspondence to which I have referred to "units", there is nothing in the appeal papers or in the judgment at first instance which establishes that the appellant has some different or other entitlement vis-ŕ-vis the trustees of the Funds than as beneficiary of the relevant trust. Corin v Patton (1988) 13 NSWLR 15 at 29; (1990) 169 CLR 540 at 577 confirms that a trustee who promises to receive and hold property transferred to him as a bare trustee does not thereby give valuable consideration for the property transferred. Here the trustees are more than bare trustees, but the benefits which the appellant derives from membership of each of the three Funds relied upon as constituting the provision of valuable consideration by the trustees, flow from the terms of the constating deeds. 139 In Tooheys Ltd v Commissioner of Stamp Duties (1960) 60 SR 539 Walsh J said at 548: "An acceptance of a trust and an agreement to hold the trust property upon the terms of the trust and to administer it accordingly, do not constitute the giving of consideration by the trustees for the property so accepted. If it were so, every trust would have to be regarded as created for full consideration." On appeal, (1961) 105 CLR 602 at 616 Dixon CJ said: "The placing of the trust fund in the trustee's hands was no consideration for the present or future equitable interests created." 140 The observations of Walsh J were endorsed by Gibbs CJ in D.K.L.R. Holding Co (No 2) Pty Ltd v The Commissioner of Stamp Duties (NSW) (1982) 149 CLR 431 at 442 and by the Full Court of the Supreme Court of Victoria in B L & M Grollo v Comptroller of Stamps (Vic) [1983] 1 VR 445 at 450. 141 The appellant has an interest in each of the trust funds of an equitable proprietary nature, albeit one which does not carry an immediate right to payment: Caboche & Bond v Ramsay (1993) 119 ALR 215 at 230. The benefit which accrues to the appellant by virtue of the settlement flows from the terms of the Trusts on which the policies were settled, rather than from the provision by the trustees of valuable consideration for the acquisition of the policies in question. I agree, with respect, with the conclusions of Marshall and Madgwick JJ that the trustees were not "buyers" in a commercial sense of the interests in the policies passing to them under the settlements. 142 In my opinion, the appeal should be dismissed. I certify that the preceding twenty-nine (29) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Hely.

Counsel for the Appellant: Mr R S Lancy

Solicitor for the Appellant: IFS Fairley Solicitors

Counsel for the First Respondent: Mr G Bigmore QC, Mr M Galvin

Solicitor for the First Respondent: Gadens

Counsel for the Second, Third & Fourth Respondents: Mr M N C Harvey

Solicitor for the Second, Third & Fourth Respondents: Clayton Utz

Date of Hearing: 29 August 2001

Date of Judgment: 30 November 2001