BHP Billiton Ltd v Schultz

Judgment

1. This is an application for judicial advice by the trustee of a trust known as the Hope Margaret Hancock Trust ("the Trust"). The trustee, Bianca Hope Rinehart, seeks advice on a proposed appeal against judgments by the Court in proceedings she has brought on behalf of the Trust.
2. The proceedings in this Court are part of a long-running and large scale campaign of litigation between members of the Rinehart family. The family members are Georgina Hope ("Gina") Rinehart, to whom I will refer as Mrs Rinehart, and her four children, John Langley Hancock (formerly Rinehart), Bianca Rinehart (the trustee), Hope Rinehart Welker and Ginia Hope Frances Rinehart. I will, for convenience and without intending any disrespect, refer to Mrs Rinehart's children by their first names.
3. The campaign of litigation has involved proceedings in the Federal Court and the Supreme Court of Western Australia as well as this Court. The litigation is principally focussed on the affairs of Hancock Prospecting Pty Ltd ("HPPL"). HPPL is the holding company for the mining business established by Mrs Rinehart's father, Langley George Hancock. Mrs Rinehart owns approximately 77 per cent of the shares in HPPL. The Trust owns the remaining 23 per cent. The Trust's shareholding was in 2014 estimated to be worth $5 billion.
4. Bianca Rinehart was appointed as trustee of the Trust by Brereton J (as his Honour then was) in May 2015: Hancock v Rinehart [2015] NSWSC 646. The proceedings in this Court were commenced in March 2017 following advice given by Rein J: Application of Rinehart [2017] NSWSC 282. The judgments which Bianca wishes to challenge was given by Ward CJ in Eq in February and March this year: Rinehart v Rinehart [2020] NSWSC 68 (which was the principal judgment) and Rinehart v Rinehart (No 2) [2020] NSWSC 235 (which relevantly dealt with costs). References in the balance of this judgment to the judgments of Brereton J, Rein J and the Chief Judge are references to those judgments.
5. The judgment of Brereton J describes at [1]-[43] the history of the Trust; HPPL and its corporate structure; and the events which led to Bianca Rinehart's appointment as trustee. A summary for the purposes of this judgment follows.
6. The Trust was established by Mr Hancock in December 1988. Mrs Rinehart became the trustee on his death in December 1992. The beneficiaries of the Trust are Mrs Rinehart's four children. Each has a one-quarter share in it.
7. The terms of the Trust were initially set out in a written deed of trust executed by Mr Hancock in December 1988. The terms were amended (pursuant to a power granted to the Trustee in the initial deed of trust) by deed poll executed by Mrs Rinehart in April 1995.
8. The proceedings before Justice Brereton were brought by John Hancock. All of the family members were party to them. John sought his mother's removal as trustee on the basis of alleged breaches of trust.
9. Just before the hearing began, Mrs Rinehart sought to be discharged in accordance with the Trustees Act 1962 (WA), s 77(2)(a). The main issue became who should be appointed to replace her. The relevant orders made by Brereton J were: 1. Pursuant to (WA) Trustees Act 1962, s 77(2)(a), the second plaintiff Bianca Hope Rinehart be appointed trustee of the Hope Margaret Hancock Trust ("the Trust") in place of the first defendant Georgina Hope Rinehart who wishes to be discharged, upon her undertaking to the Court that she will: (a) provide regular statements of Trust assets and accounts to the beneficiaries; (b) retain suitably qualified lawyers, accountants and or financial advisors to advise and assist her in managing the affairs of the Trust where necessary; (c) not sell, or give a transfer notice in respect of, any of the Trust's shares in the fourth defendant Hancock Prospecting Pty Limited, without either the consent of all the beneficiaries of the Trust, or the advice of the court; (d) not commence or continue proceedings on behalf of the Trust in a court, tribunal or arbitration without the advice of the court, provided that this does not preclude the commencement of proceedings for urgent interim relief; (e) unless she is of the opinion that in any particular case it would be contrary to the interests of the trust to do so, consult the beneficiaries before seeking the advice of the court and disclose to the court the views of the beneficiaries when seeking such advice. 2. Pursuant to (WA) Trustees Act, s 78, the assets and property of the Trust vest in the said Bianca Hope Rinehart as such trustee.
10. I will return in due course to Brereton J's reasons for appointing Bianca as the trustee and for requiring the undertakings in order 1.
11. Directly or indirectly, the claims made in the proceedings in this Court which were the subject of the Chief Judge's judgments concern complaints about the corporate governance of HPPL and the way in which its affairs are being managed. I will refer to the proceedings as the "corporate governance proceedings".
12. There are two main complaints in the corporate governance proceedings. First, the level of dividends paid by HPPL is said to be too low. Secondly, it is alleged that Mrs Rinehart has been conducting the affairs of HPPL for her own personal benefit rather than for the benefit of the company as a whole (and thus, not in the interests of the Trust as a shareholder).
13. The plaintiff in the proceedings is Bianca as trustee for the Trust. The first defendant is Mrs Rinehart. The second defendant is HPPL. The third and fourth defendants are two longstanding senior executives of HPPL.
14. In summary, there are four main claims in the proceedings. They are claims: (1) against Mrs Rinehart for equitable compensation for breach of trust, the alleged breach of trust being the failure to ensure that HPPL pay a proper level of dividends; (2) against Mrs Rinehart for compensation for misuse of HPPL's funds; (3) against HPPL for breach of its articles of association, the alleged breach being the failure to pay dividends; and (4) against HPPL and Mrs Rinehart for oppression, the relief sought being orders for the payments of increased dividends and for changes to the governance structure of the company.
15. In the proceedings Bianca also makes two ancillary claims for relief under the Corporations Act 2001 (Cth). They are applications: (5) for access to records of HPPL under s 247A; and (6) for leave under s 237 to bring proceedings in the name of HPPL against Mrs Rinehart (to vindicate claim (2) above).
16. The complaints which are the subject of the proceedings go back a long way. Complaints of this nature were first raised by John in 2004, as described by Brereton J in his judgment. This resulted in all of the parties to the corporate governance proceedings eventually becoming party to a settlement deed known as the Hope Downs Deed. Bianca, Hope and Ginia were also parties to the Deed.
17. Clause 20 of the Deed contains a broadly drawn clause requiring the parties to submit any disputes between them to arbitration. The clause was the subject of proceedings in the Court of Appeal of this State: Rinehart v Welker (2012) 95 NSWLR 221 and later in the Full Federal Court: Hancock Prospecting Pty Ltd v Rinehart (2017) 257 FCR 442 which was followed by a further appeal to the High Court: Rinehart v Hancock Prospecting Pty Ltd (2019) 93 ALJR 582.
18. The corporate governance proceedings are procedurally complex. In the hearing which led to the Chief Judge's February judgment, her Honour was faced with what she described as "a panoply" of motions. These included: (a) a motion by Bianca for leave under the Corporations Act, s 237, to proceed against Mrs Rinehart in the name of HPPL and for orders under the Corporations Act, s 247A, for the inspection of documents (referred to by her Honour as motion (ii)); (b) motions by both HPPL (motion (i)) and Mrs Rinehart (motion (vii)) for orders referring the disputes the subject of the proceedings to arbitration and staying any further claims as an abuse of process; and (c) a counter-motion by Bianca to restrain HPPL and Mrs Rinehart from pursuing their arbitration and stay motions (motion (viii)).
19. In her February judgment, the Chief Judge effectively upheld the arbitration and stay motions by Mrs Rinehart and HPPL. The orders made by her Honour, and which are the subject of the application before me: 1. referred all claims the subject of the proceedings, except the application under s 247A, to arbitration (order 1); 2. stayed the balance of the claims until completion of the arbitration (order 2); and 3. stayed Bianca's motions (ii) and (viii) (order 3).
20. Relevantly for the purposes of the application before me, in her March judgment her Honour: (4) ordered that Bianca pay the costs of Mrs Rinehart's and HPPL's motions, on an indemnity basis, payable forthwith (order 7); and (5) ordered that costs already ordered against Bianca concerning a notice to produce be payable forthwith (order 9).
21. Counsel were instructed to prepare an opinion on the prospects of an appeal against these orders. The opinion was delivered on 11 May. The proceedings were commenced on 13 May, and orders were made by the Court (Williams J) to allow an application for leave to appeal to be filed so as to preserve the Trust's appeal rights pending the determination of this application.
22. The application came before me on 1 September. Counsel appeared for Bianca and opened the application. I thought the application raised a number of issues which had not been canvassed in counsel's submissions. After some debate, I adjourned the proceedings to enable counsel to address those issues. The further hearing took place on 24 September.
23. One of the issues which I raised with counsel concerned Bianca's obligation to consult with the other beneficiaries before seeking advice from the Court (see Brereton J's order 1(e), quoted at [9] above). The background to this was as follows.
24. Following the Chief Judge's February decision, Bianca emailed her siblings that she wished to appeal and would be seeking judicial advice. In response, Ginia's solicitors wrote to Bianca's solicitors drawing attention to the fact that Bianca had retained the same solicitors for the purpose of the corporate governance proceedings as she had retained for the purposes of other proceedings where she was advancing claims in her own personal interest. The inconsistency between the position taken by Bianca in those other proceedings and the position taken by her as trustee of the Trust had been referred to by the Chief Judge in her February judgment at [106]-[107].
25. Ginia's solicitors stated that advice should be obtained from an independent law firm before any substantive step was taken to prosecute an appeal. Specifically, independent advice should be obtained before any step was taken towards obtaining judicial advice. Solicitors acting for Hope wrote to Bianca's solicitors to similar effect.
26. Further correspondence ensued which culminated in letters from Bianca's solicitors to Ginia's solicitors and Hope's solicitors on 20 April. In those letters, Bianca's solicitors made it clear that she intended to proceed with an application for judicial advice to allow her to appeal, and did not propose to retain a separate firm of solicitors to represent the Trust for that purpose. There was no further response to these letters.
27. Bianca wrote again to her siblings on 14 May to advise them of the commencement of the judicial advice proceedings, and again on their being set down for hearing (which happened on 29 May). Then on 19 August, Bianca sent a further email advising that submissions and a statement of facts had been filed with the Court. Bianca's email stated that these documents were confidential and would not be provided to her siblings unless they asked for them and provided a confidentiality undertaking.
28. The only sibling to respond was Ginia. On 21 August she emailed Bianca stating that she was happy to sign the confidentiality undertaking and would like to see the documents. Bianca responded by sending her a form of confidentiality undertaking. An undertaking was provided to Bianca's solicitors at her request on 24 August.
29. For reasons which are not explained in the material before me, there was no response from Ginia or her solicitors before the application came before me on 1 September. But the statement of facts and submissions were very lengthy and any meaningful comment on them would have required legal assistance. Not much time had been allowed for that. Furthermore, the obligation imposed on Bianca by the undertaking was to consult with the beneficiaries before seeking judicial advice. It was clear that Bianca had never actually asked her siblings whether they thought an appeal was a good idea.
30. After I had raised this point with counsel for Bianca at the hearing, Bianca sent a further email to her siblings inviting them to comment. This eventually resulted in an email from John on 18 September stating that he supported the appeal and the grant of judicial advice accordingly. There was no response from Hope. Ginia and her solicitors signed confidentiality agreements and were provided with the statement of facts and submissions. Those documents were, however, redacted. The redacted material included the summary of counsel's advice as to prospects.
31. On 22 September, Ginia's solicitors wrote to Bianca's solicitors enclosing written submissions which had been prepared by counsel for Ginia. Those submissions noted the redactions in the material provided to Ginia. The position formally taken was that Ginia neither consented to nor opposed the application for advice to appeal. But the submissions argued that if the Court did give the advice sought, it should only be on terms that the appeal proceedings were conducted by an independent law firm.
32. The covering email stated that Ginia's legal representatives did not consider it necessary to be represented at the hearing on 24 September but they were willing to do so if the Court required it. But if so counsel for Ginia had other commitments and would be unable to attend on that day.
33. This put the Court in a difficult position. The Court had no way of judging whether Ginia's interests required some further submission be made. On the other hand, the supplementary written submissions from Bianca's counsel arrived only shortly before the hearing, and after the letter from Ginia's solicitors.
34. In the circumstances, I thought it best to allow a further period of time for Ginia's legal representatives to reply to the supplementary submissions if they wished. This resulted in a further written submission from counsel for Ginia which was provided to the Court on 2 October.
35. It is convenient to deal first with the remaining issues which I raised with counsel at the hearing on 1 September and which were the subject of supplementary submissions. I will then give my conclusions on the application.

The Court's power under the Trustee Act, s 63

1. Brereton J noted ([2015] NSWSC 646 at [52]) that in the proceedings before him the Court was exercising cross-vested jurisdiction under the WA trustee legislation (Trustees Act 1962 (WA)): Jurisdiction of Courts (Cross-vesting) Act 1987 (WA), s 4; Jurisdiction of Courts (Cross-vesting) Act 1987 (NSW), s 9. The orders which I have already quoted were expressly made pursuant to the provision of the WA Act governing the discharge of trustees.
2. The WA Act contains a provision concerning judicial advice. It is s 92: 92 Directions, trustee may ask Court for (1) Any trustee may apply to the Court for directions concerning any property subject to a trust, or respecting the management or administration of that property, or respecting the exercise of any power or discretion vested in the trustee. (2) Every application made under this section shall be served upon, and the hearing thereof may be attended by, all persons interested in the application or such of them as the Court thinks expedient.
3. In the present application, however, counsel for Bianca relied on the equivalent provision of the NSW trustee legislation. It is s 63 of the Trustee Act 1925 (NSW), which relevantly provides: 63 Advice (1) A trustee may apply to the Court for an opinion advice or direction on any question respecting the management or administration of the trust property, or respecting the interpretation of the trust instrument. (2) If the trustee acts in accordance with the opinion advice or direction, the trustee shall be deemed, so far as regards the trustee's own responsibility, to have discharged the trustee's duty as trustee in the subject matter of the application, provided that the trustee has not been guilty of any fraud or wilful concealment or misrepresentation in obtaining the opinion advice or direction. (3) Rules of court may provide for the use, on an application under this section, of a written statement signed by the trustee or the trustee's Australian legal practitioner, or for the use of other material, instead of evidence. (4) Unless the rules of court otherwise provide, or the Court otherwise directs, it shall not be necessary to serve notice of the application on any person, or to adduce evidence by affidavit or otherwise in support of the application. … (8) Where the question is who are the beneficiaries or what are their rights as between themselves, the trustee before conveying or distributing any property in accordance with the opinion advice or direction shall, unless the Court otherwise directs, give notice to any person whose rights as beneficiary may be prejudiced by the conveyance or distribution. (9) The notice shall state shortly the opinion advice or direction, and the intention of the trustee to convey or distribute in accordance therewith. (10) Any person who claims that the person's rights as beneficiary will be prejudiced by the conveyance or distribution may within such time as may be prescribed by rules of court, or as may be fixed by the Court, apply to the Court for such order or directions as the circumstances may require, and during such time and while the application is pending, the trustee shall abstain from making the conveyance or distribution. (11) Subject to subsection (10), and subject to any appeal, any person on whom notice of any application under this section is served, or to whom notice is given in accordance with subsection (8), shall be bound by any opinion advice direction or order given or made under this section as if the opinion advice direction or order had been given or made in proceedings to which the person was a party.
4. At the hearing on 1 September I asked whether the application should be made under WA Act s 92 rather than NSW Act s 63. In their supplementary submissions counsel argued that it would make little practical difference but that s 63 was the appropriate enactment. Counsel accepted however that WA Act s 92 was on any view available to the Court.
5. In support of their submission, counsel referred me to statements made by Rein J in his earlier judicial advice judgment. Counsel also relied on a statement by Stevenson J in another application generated by the dispute between the parties. But as I will show, the point was not argued either before Rein J or Stevenson J. And my researches have shown that, although not referred to by counsel, there is authority on the question.
6. As we will see, there are actually two questions about the application of s 63 in the present case. The first is whether, as a matter of construction, s 63 applies to the trustee of a trust where the proper law of the trust is that of Western Australia. The second is whether, if s 63 does purport to extend so far, that is within the constitutional power of the New South Wales parliament.
7. The first question of course depends ultimately upon the proper construction of the relevant provisions of the Trustee Act. But where (as here) the Act's provisions do not expressly answer the question, that answer may be influenced by the common law principles governing trusts in the conflict of laws. I will address that in a moment.
8. The second, constitutional, question is illustrated by the High Court judgment in Permanent Trustee Co (Canberra) Ltd v Finlayson (1968) 122 CLR 338. That was a death duties case. The deceased left a small amount of property in NSW and most of her estate in the ACT. The assets in NSW and the assets in the ACT were the subject of separate wills, and separate grants of probate to separate executors. Under NSW death duties legislation, death duty was payable on the entire estate of the deceased, whether located in NSW and ACT. The NSW assets were insufficient to meet the death duty claimed so the Commissioner of Stamp Duties made a claim in the ACT against the ACT executor.
9. The High Court held that as a matter of construction the NSW enactment creating a debt applied to the NSW executor, not the ACT executor. But the Court continued (at 343, citation omitted): even if by an explicit and unqualified provision the Act had required that the duty be deemed to be a debt of the deceased, it could not be so deemed, by virtue of that provision, in a court applying Territory law. Moreover the law of the Territory contains nothing to give any provision of the New South Wales Act an operation in the Territory, and it makes no provision of its own as to New South Wales death duty.
10. The Court stated that the full faith and credit provision of the Australian Constitution (s 118) did not apply. After analysing the NSW legislation the Court stated (at 345, emphasis added): the case is simply one of a liability cast upon the New South Wales executor to pay out of the real and personal estate vested in it an amount of money assessed in a particular manner. Nothing is or could validly be provided by the New South Wales Act to place the Territory executor under a corresponding liability to make a payment out of the Territory property, or to affect in any way the law of the Territory as to the course to be followed in the administration of the property there situated.
11. The later High Court decision of Gosper v Sawyer (1985) 160 CLR 548 concerned the power of the NSW Industrial Relations Commission, under a NSW statute, to review and vary any "contract or arrangement" under which work was done by a person "in any industry". That power extended to the review and variation of any "collateral arrangement".
12. An application was made to the Commission by an employee who had been employed under a NSW employment contract. Under the terms of the employee's employment, he had been required to join a superannuation fund in Victoria. The employee sought to have the Commission set aside or vary some of the terms of the superannuation fund as they applied to him.
13. The Court (Gibbs CJ, Wilson and Dawson JJ) was prepared to assume that the employee's superannuation entitlements were a "collateral arrangement" for the purposes of the NSW statute. But their Honours said (at 561, footnote omitted): [T]he Fund in the present case is governed by a trust created in Victoria and (as cl 34 of the trust deed states) is governed by the law of Victoria. A New South Wales statute could not constitutionally have the effect of altering the law of Victoria as to the administration of a Victorian trust (see Permanent Trustee Co (Canberra) Ltd v Finlayson) and if [the NSW enactment] purported to have that effect it would be a nullity by the law of Victoria.
14. In the end, their Honours read the power down anyway. The NSW Act was interpreted so that it did not permit the Commission to vary the benefits to NSW employees under superannuation funds governed by foreign (including, for this purpose, interstate) law.
15. Turning to trusts in the conflict of laws, the starting point is that this Court's jurisdiction over the administration of trusts, which derives from the old Chancery jurisdiction and to which I will refer as the "inherent equitable jurisdiction", is personal. It exists whenever the trustee is within the reach of the Court's authority. Equity acts in personam and can enforce the trustee's obligations with respect to the administration of the trust whether or not the trust was established under the local law: Ewing v Orr Ewing (1883) 9 App Cas 34.
16. For the purposes of exercising this jurisdiction, the "validity, interpretation and effect" of a trust instrument is determined according to the proper law of the trust. If the trust instrument specifies the applicable law, the court will give effect to that, so far as local law permits, unless perhaps the choice of law in the trust instrument is colourable. Otherwise the proper law is the law with which the trust has the closest and most real connection: see Davies, Bell, Brereton, Douglas, Nygh's Conflicts of Laws in Australia (LexisNexis Butterworths, 10th ed, 2020) at [34.19].
17. In the present case, HPPL's business is based in Western Australia and the settlor, Mr Hancock, appears to have been a Western Australian resident. In any event the deed poll of September 1995 expressly provides that: The Deed and the Trust are governed by the laws of Western Australia.
18. Counsel submitted however that there was a close connection with NSW. According to the statement of facts in support of the application, the trust is "partly administered" in New South Wales. Apparently its accountants are based here. Counsel also pointed out that the proceedings which are the subject of the application being conducted in this Court and the lawyers acting for Bianca are based in Sydney.
19. Before going to cases on the giving of advice to trustees of foreign trusts, I will refer to other comparable lines of authority concerning the administration of foreign trusts. The first line of authority concerns the exercise of a local statutory power to vary the terms of a foreign trust.
20. Such a question was considered by Ungoed-Thomas J in the English Chancery Division in Re Ker's Settlement Trusts [1963] Ch 553. The case concerned a marriage settlement which had been executed in Northern Ireland. The parties involved later moved to England and applied to have the trust varied under the Variation of Trusts Act 1958 (UK).
21. Ungoed-Thomas J assumed that the proper law of the trust was that of Northern Ireland. The Act provided that it did not extend to Northern Ireland. But his Lordship interpreted the Act as conferring power on the English courts to vary the terms of trusts throughout the United Kingdom.
22. His Lordship relied on the decision in Forsyth v Forsyth [1891] P 363. That was a case in the Probate Division concerning the Court's statutory power (Matrimonial Causes Act 1859 (UK)) to vary a matrimonial settlement consequent upon divorce. The parties had been married in Scotland but moved to England and later obtained a divorce there. The legislation was held to empower the English court to vary a marriage settlement of the parties which was, or at least may have been, made under the law of Scotland.
23. Re Paget's Settlement [1965] 1 WLR 1046 was another case in England under the Variation of Trusts Act. The settlor of the trust in question had been a wealthy American heiress living in England. The assets of the trust came from America and the trust was administered in New York. It was not clear whether the trust in question was governed by English law or the law of New York. Cross J assumed for the purposes of the application that New York law applied, and it was therefore necessary for the Act to apply to foreign trusts.
24. His Lordship noted that in Ker the contrary view had not been argued. Nor had it been argued by any party before him. Nevertheless his Lordship thought it unnecessary to call upon the Attorney General to present the contrary argument. He acknowledged that the Matrimonial Causes Act did not refer to any territorial limitation whereas the Variation of Trusts Act did. But he said that there were two considerations which weighed very strongly with him: The first is that the question what is the proper law of a settlement is often very difficult. Normally, in these cases, all counsel who appear before the judge are anxious that the jurisdiction should be exercised and so, unless the judge were prepared to decide the question without any argument on the other side, he would always have to invoke the assistance of counsel for the Attorney-General. Another reason for not confining this jurisdiction to settlements governed by English law is that the court would then be unable to vary a settlement made (say) in 1920 and governed by (say) Australian law, even though the beneficiaries, the trustees and the trust property had been for many years in this country. It would be unfortunate if the court had no jurisdiction in such a case.
25. In Faye v Faye [1973] WAR 66 Lavan J of the Supreme Court of Western Australia had to consider an application to vary the terms of a trust which had originally been established in England. At the time of the application the assets of the trust were in Australia, the trustees were resident in Australia and the trust was being administered in Australia (the judgment does not identify whether this was Western Australia or elsewhere in Australia). His Honour followed the decision in Ker and Paget, holding that the Western Australian statutory power of variation (Trustees Act 1962 (WA), s 90) applied.
26. The English case of Chellaram v Chellaram [1985] Ch 409 concerned the court's power to replace the existing trustees of a trust and appoint new ones. The trusts in question were discretionary family settlements established by members of a wealthy Indian family with extensive assets outside India. The trust property consisted of shares in companies incorporated in Bermuda and the trusts had been intended to be administered (and had in fact been administered) from London.
27. The trustees in office at the time of the application, and whose removal was sought, were family members. They had been born and were domiciled in India, but visited London frequently. They were all served in England, either personally or through solicitors who had instructions to accept service.
28. Counsel for the defendants argued that the proper law of the trusts was that of India. Counsel submitted that an English court could not remove the trustees of an Indian settlement. Counsel also pointed out that the trust property was not in England and contended that the English court had no power to make a vesting order with respect to foreign property.
29. Scott J observed that the defendants had been validly served in England. In that sense jurisdiction was not in issue. His Lordship assumed for the purpose of the argument that the trusts were governed by Indian law. He acknowledged that the Indian trustee legislation provided for the removal and replacement of trustees, but that power was not available to an English court. His Lordship also acknowledged that a vesting order could not effectively be made with respect to foreign property. But an in personam order could be made against the trustees requiring them to resign and vest the trust assets in new trustees (at 428).
30. Counsel for the plaintiffs argued that English law applied as the place where the trust was being administered. Counsel relied upon a distinction drawn by Dicey & Morris (10th 1980) between the "validity, interpretation and effect" of a settlement and its "administration". While the former is governed by the proper law of the settlement, the suggestion was that the latter is governed by the law of the place where administration takes place.
31. His Lordship rejected this distinction. He concluded that except to the extent otherwise provided by the settlement, its administration, to the extent that it involved the rights and duties of the trustee, was likewise governed by the proper law.
32. But this did not mean that if the proper law of the trusts was Indian law, that law would govern the application to remove and replace the trustees. His Lordship went on (at 432): The function of English courts in trust litigation is to enforce or protect the rights of the beneficiaries which bind the conscience of the trustee defendants. The identification and extent of those rights is a matter for the proper law of the settlement, but the manner of enforcement is, in my view, a matter of machinery which depends upon the powers enjoyed by the English courts. Among the powers available to English courts is the power to order the removal of trustees and the appointment of new ones. This power is, in my view, machinery which, under English domestic law, can be exercised by English courts where necessary in order to enable the rights of beneficiaries to be enforced or protected. The exercise of the domestic power does not, in my view, depend upon whether the rights of the beneficiaries are enjoyed under domestic settlements or foreign settlements, or on whether the trust property is situated in England or abroad. The locality of the trust property will, however, determine whether the removal can be achieved by an in rem order or whether an in personam order is appropriate. Accordingly, except where rights conferred by the settlement are under consideration, the removal of trustees and the appointment of new ones is not, in my judgment, a matter to be governed by the proper law of the settlement. Nor, in my opinion, is it a matter governed by the law of the place where the administration of the settlement has taken place. It is, in my judgment, a matter to be governed by the law of the country whose courts have assumed jurisdiction to administer the trusts of the settlement in question.
33. In Re Webb (1992) 57 SASR 193 the Supreme Court of South Australia was asked to exercise two of its powers concerning the affairs of trusts. One was the power, in the Court's inherent equitable jurisdiction, to order that the trustees furnish accounts. The other was a power conferred on the Court by South Australian statute to appoint an inspector to investigate the administration of the trust.
34. The trusts in question had been established under the will of a testator who died domiciled in the Northern Territory. Probate of his will had been granted to the executors there in 1984. The estate had been fully administered but the executors continued to hold the property as trustees, and the trusts were to last until 2005. The trustees were a solicitor and an accountant in South Australia and the trusts were being administered there.
35. King CJ considered the statutory power first (at 195-196), concluding that it was available even if the trusts were governed by Northern Territory law. The statute provided that it could be exercised in relation to "any trust". King CJ said (at 195): Despite the breadth of their natural meaning, the words "any trust" must be subject to some restriction. The legislative competence of the Parliament of South Australia could not extend to making laws with respect to the administration of trusts having no connection with South Australia. In the present case, however, the trustees are resident in and carry on professional practice in South Australia and are administering the trusts in this State. I have no doubt that it is within the legislative competence of the Parliament of this State to legislate for the investigation of trust administration which is occurring in this State. I see no reason why the meaning of the wide words "any trust" should be subject to any restriction beyond what is required to conform to the legislative competence of the Parliament. They are apt to apply to trusts administered in South Australia wherever those trusts may have been created and wherever the assets may be.
36. His Honour then turned to the application for orders requiring the trustees to furnish accounts. His Honour concluded (at 195-196) that the power to make such orders was available to the Court as an incident of its ordinary equitable jurisdiction in personam, relying on the law stated in Ewing. It was not necessary to consider what law applied to the administration of the trusts, a question which his Honour pointed out (at 197) was "quite distinct from the issue of jurisdiction".
37. His Honour added that the constitutional limitation identified in Gosper did not arise. He said (at 197): This Court is concerned only with the jurisdiction of the Supreme Court of this State to require trustees administering a foreign trust in this State to perform their obligations under the foreign trust, and to make orders authorised by South Australian law for that purpose.
38. Prior J did not go quite so far. His Honour considered (at 202-203, 204) that the Court should follow the view of Scott J in Chellaram that the administration of a trust is generally to be governed by the proper law of the trust (for international trusts, that is the position established by the Hague Convention: see Nygh at [34.24]). But whatever the proper law might be, the jurisdiction of the Court, based on the trustees' presence in South Australia, was unassailable (at 201, 204).
39. It remained to be seen whether the proper law of the trusts in question was that of the Northern Territory, rather than South Australia (at 203-204). If so, it would then be necessary to decide whether the Court's statutory powers applied (including whether they could apply to a Northern Territory trust as "domestic machinery" in accordance with the distinction drawn by Scott J in Chellaram) and to consider any constitutional limitation which arose (at 205).
40. The third member of the Court, Bollen J, considered that the outcome of the case was determined by the authority of Ewing (at 200).
41. Salkeld v Salkeld (No 2) [2000] SASC 296 was another case concerning a statutory power to vary trusts. The trust in question had been established in New South Wales and most of its assets were there. An application was made to the Supreme Court of South Australia for a variation under the South Australian trustee legislation (Trustee Act 1936 (SA), s 59C).
42. The judgment does not indicate what the connecting factor was to South Australia, but the Court's jurisdiction was not questioned. There was however no equivalent power of variation under the corresponding New South Wales legislation.
43. Nevertheless Perry J held that the trust could be varied under the South Australian statute. His Honour cited four authorities in support of this conclusion. They were Ker, Paget, Faye and the judgment of King CJ in Webb.
44. In Re BTA Institutional Services Australia Ltd & BNY Trust (Australia) Registry Ltd [2009] NSWSC 1294 Brereton J gave judicial advice in a case involving a number of trusts. His Honour said at [5]: The Security Trustees are incorporated and resident in Australia, and carry on their business in New South Wales and act as trustee of the relevant trusts in New South Wales. The governing law of all the transaction documentation, other than the Ireland Master Trust Deed, is the law of New South Wales. The governing law of the Ireland Master Trust Deed is the law of England, but as the trusts under it are administered in New South Wales, the provisions of the (NSW) Trustee Act are apt to apply [In the Estate of Webb (deceased) (1992) 57 SASR 193, 195-6 (King CJ)].
45. In Re Constantinou [2013] 2 Qd R 219 judicial advice was sought from the Supreme Court of Queensland concerning trusts established under the will of a testator who had died domiciled in Papua New Guinea (strictly speaking, the will trusts had not at the time the application was made actually come into existence; the administration of the estate was incomplete). Most of the testator's assets were in Papua New Guinea although some assets were in Queensland. It was not immediately apparent what the proper law of the trusts was, although the Court went on to decide that it was Papua New Guinea law.
46. Dalton J recorded that the application was made under the judicial advice provision of the Queensland trustee legislation (Trusts Act 1973 (Qld), s 96). Her Honour said that initially she had doubts about her jurisdiction to hear the application given the foreign elements involved in it. The applicant executor was resident in and domiciled in Papua New Guinea, "but by bringing this action in personam he submits to the jurisdiction of this Court" (at [223]).
47. Dalton J noted that the other parties who had been joined were either resident in Queensland or had submitted to Queensland jurisdiction, and that the application was not caught by the rule that a court has no jurisdiction over actions to determine the title to foreign land. Her Honour concluded from this that she had jurisdiction and cited "the discussion and authorities cited in" Webb (at [223]).
48. In Re Dion Investments Pty Ltd [2013] NSWSC 1941, Young AJ was asked to give judicial advice concerning a trust established in Papua New Guinea. At [32]-[33] his Honour stated that s 63 was wide enough to cover advice in such a case, referring to Webb and BTA. His Honour also referred to the inherent equitable power in personam and gave Constantinou as an illustration of the exercise of that power to give advice. He then referred to Salkeld. He concluded at [37] that the Court had "some jurisdiction, at least" to give advice with respect to the administration of a PNG trust.
49. Nygh states (at [34.38], footnotes omitted): [The court] may vary the trusts as authorised by the law of the forum, and it may give judicial advice to the trustees. In support of the proposition concerning variation, the learned authors refer to Salkeld, Ker and Dion. In support of the proposition concerning judicial advice, they refer to BTA and Dion.
50. Before proceeding further, I should mention a third source of power to give judicial advice apart from s 63 and s 92.
51. In Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar The Diocesan Bishop of The Macedonian Orthodox Diocese of Australia and New Zealand (2008) 237 CLR 66 at [37]-[42] the High Court traced the history of the judicial advice procedure: see also [61]-[62]. Judicial advice began as part of the inherent equitable jurisdiction, but at first was only available where a full order for administration was made. Then it became possible for advice to be given separately under what the Court described as the "originating process procedure". At around the same time specific statutory provisions such as NSW s 63 and WA s 92 were enacted.
52. It follows that, alongside the statutory power given by s 63, the Court retains the power to give judicial advice as part of its inherent equitable jurisdiction. That inherent power to give advice would nowadays be exercised in administration proceedings under Uniform Civil Procedure Rules 2005 (NSW) ("UCPR") Part 54: Macedonian Orthodox Church at [42]. This explains why in Dion Young AJ treated Constantinou, despite the mention of the Queensland statutory advice provision, as an illustration of the exercise of inherent equitable power to give advice to a foreign trustee.
53. I now come to the statements of Stevenson J and Rein J referred to by counsel for Bianca in their submissions.
54. The decision of Stevenson J, Rinehart v Rinehart (No 3) [2016] NSWSC 1645, concerned documents under an order for preliminary discovery made on the application of Bianca and John. They sought the release of their Harman undertaking so as to allow the documents to be used for the purposes of other proceedings. In particular, one of the stated objectives was for Bianca to obtain judicial advice, as trustee of the Trust, with respect to the position she should take in those other proceedings.
55. In this regard, Stevenson J referred to the judgment of Brereton J. At [8] he said: The terms of Ms Bianca Rinehart's appointment as trustee of the Trust require her to obtain judicial advice under s 63 of the Trustee Act 1925 (NSW) as to whether she would be justified in defending the Federal Court proceedings and/or commencing proceedings against Mrs Gina Rinehart and Hancock Prospecting in relation to the alleged underpayment of dividends in Hancock Prospecting.
56. In the end, his Honour made the order sought. But there was no opposition to the order from any party. There was no occasion for Stevenson J to consider the basis upon which Bianca would be obtaining advice, and he did not do so.
57. In the judgment of Rein J in the judicial advice application his Honour referred to the principles laid down in the Macedonian Orthodox Church case concerning judicial advice applications. He said at [14]: I do not regard s 92 (1) of the WA Act as involving any different test, and I shall proceed to consider the matter as an application under s 63 of the Act.
58. At [27] his Honour said: I am satisfied that this is the appropriate Court from which to seek advice because: (a) It was this Court in which the proceedings to have Gina removed as trustee were heard and this Court which appointed Bianca. (b) Brereton J required Bianca to provide an undertaking to "the Court" that she would obtain advice of "the Court" before commencing proceedings and the reference to "the Court" is one which I take to be a reference to this Court. (c) This Court has heard the trustee's application for documents [this was a reference to an application consequent upon Mrs Rinehart's removal as trustee to deliver up documents to Bianca as her successor]. (d) The Trust's accountants are based in New South Wales, and the [Federal Court proceedings] have been commenced in the NSW Registry of the Federal Court (rather than the Perth Registry). (e) None of the beneficiaries have objected to the jurisdiction of this Court to hear the application for advice, although they have been made aware of the application.
59. I agree with Rein J that it is appropriate for Bianca's application for judicial advice to be made to this Court. The terms of Brereton J's order may even require that. But this Court has undoubted power to give such advice, both under its inherent equitable jurisdiction and its cross-vested WA jurisdiction. The question is whether advice can, or should, be given under s 63. This issue was not before Stevenson J and does not appear to have been argued before Rein J.
60. If it is correct to say that a statutory power to vary the terms of a trust can be exercised over a foreign trust, then, subject to any difference in statutory language, it would readily follow that a statutory power to give judicial advice could likewise be exercised so as to give advice to the trustee of a foreign trust. But I think that there is room for argument about the correctness of the Australian decisions (Faye and Salkeld) on the variation of trusts.
61. In the first place, the decisions cut across the general principle that it is the proper law of the trust which governs the rights and obligations of the trustee and the beneficiaries: see Heydon and Leeming, Jacobs' Law of Trusts in Australia (LexisNexis Butterworth, 8th ed, 2016) at [28-08]. Secondly, the decisions do not consider the constitutional limitation on the power of States to legislate so as to govern the administration of foreign trusts, as recognised by the High Court in Gosper. That case was not cited in Salkeld and post-dated the decision in Faye.
62. Nor do I think that Faye and Salkeld derive any support from the Full Court decision in Re Webb. Rather the reverse. The powers of the Court to order the production of accounts, and the power to employ an inspector, were not powers which affected the substantive rights and obligations of the trustee and the beneficiaries. They fitted readily within the category of "mechanical" powers identified by Scott J in Chellaram.
63. Furthermore, in Re Webb there was no doubt that the trust was being administered, and exclusively administered, in South Australia. In the present case, all that is alleged is that the Trust is being "partially" administered in New South Wales. On analysis, that means no more than that the trustee is using the Courts of this State to pursue litigation and the trustees' professional advisers, both lawyers and accountants, are based here.
64. It is not always easy to identify the place where a trust is being administered, but it seems to me that it is a matter of principle it must be the place where decisions are made about the management of the trust property. In the present case, Bianca is the sole trustee and there is no evidence that she lives in New South Wales. Even if it is possible to say that a trust is partially administered in one location and partially in another, I am not satisfied that the Trust is even partially being administered here. If it were necessary to fix the location of the administration of the Trust for the purposes of these proceedings, I would suppose that its most likely location would be Western Australia where its principal asset is located.
65. That would not matter if, however, this is a case of the Court's "mechanical powers" being exercised. I think that that would be an apt label for the exercise of the Court's inherent jurisdiction to give judicial advice. But s 63 has one feature which goes beyond the inherent jurisdiction and makes the "mechanical" label a questionable one.
66. That feature is subsection (2). In effect the subsection exonerates a trustee who obtains and follows advice from liability for breach of trust, provided that the trustee has made proper disclosure to the Court. It has no equivalent in WA s 92.
67. A trustee who has obtained and followed judicial advice is, in the inherent equitable jurisdiction, usually protected from any later claim for breach of trust. But the protection is not absolute. The question for the court considering the later claim for breach of trust is whether the trustee has acted properly and reasonably. Ultimately that will depend upon the stringency of the trustee's obligations under the terms, and proper law, of the trust. It is conceivable, if unlikely, that a trustee who has obtained and followed judicial advice could still fail to establish an entitlement to indemnity.
68. Arguably then, s 63(2) has a substantive effect. If it applies to advice given to the trustee of a foreign trust, it may purport to confer an immunity which would not exist under the proper law of the trust. Subsection (11) may also have substantive effect, although it is not relevant in the present case.
69. For s 63 to apply as a matter of construction, the applicant must be a "trustee" for the purposes of the Act. There are some potential limitations to the width of that term.
70. The first is that for the purposes of the legislation, the term "trustee" includes the legal representative of a estate, either executor or administrator. This is probably confined to an executor or administrator holding office by virtue of NSW law: see Finlayson, already discussed above, and Commissioner of Succession Duty v Hargrave (1972) 3 SASR 118 (in Webb, Bollen J considered that Hargrave had to be overruled, but that was not the view of the other members of the Court).
71. Secondly, the term "trustee" includes the NSW Public Trustee (now called the NSW Trustee and Guardian) and a "trustee company". The definition of "trustee company" is: Trustee company means an incorporated company authorised by Act of Parliament of this State to act as trustee in New South Wales.
72. It is notable that the definition of "trustee" does not expressly include the public trustee of another State or a trustee company operating under the laws of another State. The definition of trustee is inclusive but this may be some indication that the Parliament did not contemplate that advice could be obtained by an interstate trustee under a trust governed by interstate law.
73. There is also the general provision in the Interpretation Act 1987 (NSW), s 12(1)(b). That provides, as a prima facie rule of construction of New South Wales Acts, that: A reference to a locality, jurisdiction or other matter or thing is a reference to such a locality, jurisdiction or other matter or thing in and of New South Wales.
74. Arguably, the reference to a trust in s 3 of the Trustee Act would be a "matter or thing" and accordingly the reference would be to a trust "in and of New South Wales". That would arguably mean a trust constituted under the law of New South Wales. Even if it meant a trust administered in New South Wales it might not apply in the present case.
75. The substantive effect of s 63 was not raised in BTA or Dion. Nor were the construction points to which I have referred.
76. In these circumstances, I think there is room to argue over whether s 63 really does apply when the Court is asked to give advice to a foreign trustee, especially if the trust's seat of administration is also outside New South Wales. There is also room to argue over whether the apparently substantive effect of s 63 could, as a matter of constitutional validity, extend to such a foreign trust. But for reasons I will now give, in the end I do not need to decide whether s 63 applies, or can validly apply, in the present case.
77. The Court is faced with a situation in which, on any view, the power under WA s 92 (and the inherent equitable power) is available. There is in my view an analogy with the way in which the High Court exercises its power of remitter in cases where there are competing jurisdictions where different substantive laws will, or may, be applied. In Pozniak v Smith (1982) 151 CLR 38, the Court stated that in such a case the Court should generally exercise the power of remitter to ensure the case is determined by the court of the State "whose law has given rise to the cause of action". In BHP Billiton Ltd v Schultz (2004) 221 CLR 400, Gummow J (with whom Hayne J agreed) applied this principle to the transfer of proceedings under the Cross-Vesting Act: see at 445 [100]-[101]. See also Callinan J at [242].
78. In my view, a similar approach should be followed where the Court has a choice of exercising its own jurisdiction and cross-vested jurisdiction of another state. The Court should make the choice so that the jurisdiction it exercises corresponds with the relevant proper law. In the present case, that would be Western Australia. I propose to deal with the application as one under WA s 92.

Requirement for judicial advice

1. In the ordinary case, the trustee of a trust is free to prosecute or defend proceedings without obtaining judicial advice first. A failure to obtain advice does not deprive the trustee of the power to act. Its significance lies in its effect on the trustee's right of indemnity.
2. If the trustee is to charge to thee trust the costs of the litigation (including, if the litigation is unsuccessful, costs payable to the other party), then the trustee's action must have been proper and reasonable. Otherwise the charging of the costs will be a breach of trust.
3. As the High Court explained in the Macedonian Orthodox Church case at [69]-[74], the judicial advice procedure allows the trustee in effect to have this question determined in advance. If the trustee's actions are sanctioned by judicial advice, usually the trustee will be protected against any future allegation that those actions amounted to a breach of trust. But in order to obtain this protection the trustee will have to demonstrate that there is sufficient justification to bringing or defending the proceedings as he or she intends to do.
4. In the usual case, however, the trustee is still not required to obtain advice. If the trustee does not obtain judicial advice but succeeds, the trustee will usually be entitled to indemnity. Even if the trustee fails, the trustee may nevertheless be entitled to recover the costs out of the assets (although, it seems, this would be rare). In short, there is nothing to stop the trustee from acting at his or her own risk as to costs.
5. But this case is different. The effect of Brereton J's order is that Bianca was required to undertake to obtain judicial advice. This caused me to ask counsel whether, in the circumstances, the usual test for the grant of judicial advice should apply.
6. In their supplementary submissions, counsel referred me to the reasons why Brereton J imposed the requirement of judicial advice. It arose out of the issue before his Honour about who was to be appointed as trustee in Mrs Rinehart's place.
7. On behalf of Mrs Rinehart, it had been proposed that a professional trustee company be appointed. One factor against this was that his Honour considered that, given Mrs Rinehart's past conduct, it was important to have a trustee who would be prepared to stand up to her. His Honour was not satisfied that a trustee company, although independent, would do so: see at [373]. Other difficulties were the cost, and the risk that if the trust property were vested in a trustee company, pre-emptive rights affecting HPPL's business might be triggered.
8. At [319] his Honour noted that Bianca's appointment would not risk triggering the pre-emptive rights. He continued: She would act voluntarily, without remuneration, thus not detracting from income available for distribution to the beneficiaries. She has demonstrated the ability robustly to assert the rights of the Trust against the former trustee and against HPPL. Her consent is unconditional, but she is prepared to accept any conditions the court might impose. While her status as a beneficiary presents some risk of a conflict of interest and duty, in the context of this trust and the remaining functions of the trustee, the risks are remote, and can sufficiently be mitigated by imposing a condition that judicial advice or consent be obtained before significant decisions are made (such as giving a transfer notice, or commencing litigation).
9. Counsel for Mrs Rinehart had proposed as a further alternative that if Bianca were appointed as the trustee, she should be assisted by an independent accountant or lawyer appointed as advisory trustee under the WA Act (see at [330] for a description of the relevant statutory provision). But his Honour also considered that this was unnecessary, as the beneficiaries would be "more comforted" by a requirement to obtain judicial advice.
10. His Honour's reasoning underlines the unusual circumstances in which this application is made. The limitations on Bianca's power as trustee were not imposed as ends in themselves. They were a means of reconciling the conflicting merits of the candidates as they then appeared to Brereton J. In my view they are not set in stone.
11. In their submissions, counsel for Bianca stressed how valuable the Trust is. Counsel submitted that the costs of an appeal, although substantial, would be small in the scheme of things. In these circumstances, I thought that if it was simply a question of power, and Bianca was determined to appeal, the Court could probably accommodate her. What I had in mind was that the Court could release the undertaking sufficiently to allow Bianca to pursue the appeal at her own risk.
12. But in response counsel made it clear that if Bianca does want advice that she would be justified in pursuing an appeal, so that she can rely on the advice for an indemnity if the appeal fails. Accordingly I have approached the application on the usual basis that the trustee is seeking the court's imprimatur for the proposed appeal.

Judicial advice concerning appeals

1. In their initial submissions in support of the application, counsel relied on what Palmer J said in Application of Macedonian Orthodox Church St Petka Inc (No 3) [2006] NSWSC 1247 at [80]: In a judicial advice application in which the trustee asks whether it is justified in prosecuting or defending litigation, all the Court does is to reach a view as to whether the Opinion of Counsel satisfies it that there are sufficient prospects of success to warrant the trustee in proceeding with the litigation. Counsel's Opinion must address the facts necessary to support the legal conclusions reached and must demonstrate that the propositions of law relied upon for those conclusions are properly arguable. Whether, in the light of Counsel's Opinion, there are "sufficient" prospects of success calls for another judgment, founded upon such considerations as: - the nature of the case and the issues raised; - the amounts involved, including likely costs; - whether the likely costs to be incurred by the trustee are proportionate to the issues and the significance of the case; - the consequences of the litigation to the parties concerned; ...
2. This passage was quoted by the High Court in the Macedonian Orthodox Church case at [162]. In his judgment in the earlier judicial advice application, Rein J said (at [33]): As Macedonian makes clear, the Court on an application for judicial advice is expressing only a view as to whether the trustee is justified in bringing or defending an action. It follows that the Court is not called on to express a view as to the ultimate outcome or indeed as to whether any of the allegations which found the claims or the defence will be made out in the proceedings after due consideration of all of the relevant evidence tendered by the parties.
3. Counsel did not in their submissions refer to any authority on judicial advice for appeals. At the hearing on 1 September, I raised with counsel whether the court should take the same approach as Palmer J had described for cases at first instance. In particular, I was interested in whether all I had to consider so far as counsel's opinion was concerned was whether it demonstrated that an appeal was "properly arguable".
4. In their supplementary submissions, counsel for Bianca referred me to three Australian decisions in which judicial advice was sought for the bringing of an appeal. The decisions referred back to the judgment of Hammond J, sitting in the High Court of New Zealand, in Re O'Donoghue [1998] 1 NZLR 116. In that judgment Hammond J stated (at 121-122) that a trustee: [D]oes not have a limitless ability to resort to the law: his function is to assert the interest of the beneficiaries only to a point where there is a judicial ruling on something that is properly required, such as the construction of a fairly debatable point in an instrument, or whether the trustee ought to take a certain course. And, it has been said that a trustee has to have very good grounds before that trustee can justify an appeal, especially if costs were awarded against the estate in the Court below (see for instance Smith v Beal (1894) 25 OR 368).
5. The first Australian decision to which I was referred was Frost and Fallon [2011] NSWSC 591, a decision of Ward J (as the Chief Judge then was). That was an application by the executors of a deceased estate for judicial advice that they would be justified in appealing against a Federal Court judgment at first instance denying them a right of indemnity out of the estate (which was being administered in bankruptcy).
6. Her Honour said at [69]: The question … is whether it is appropriate for the executors to pursue the proposed appeal. That involves an assessment as to whether there is a reasonable basis or reasonable grounds for the appeal and as to whether they would be acting reasonably in so doing having regard to their responsibilities as executors. An indication of the kind of circumstance where an executor (or trustee) would not be justified in commencing or defending proceedings can be seen from the cases in which indemnity for the costs of those proceedings has been denied.
7. At [70] her Honour referred to various cases in which indemnity had been refused. One of those was Re O'Donoghue, which she described as a case in which the trustee had "commenced proceedings without good grounds".
8. At [71] her Honour quoted a passage from the judgment in Re O'Donoghue which included the passage I have set out above. She continued at [72]: Here, it is not for me to express any opinion on the merits of the appeal sought to be propounded by the executors; rather it is necessary to assess whether there are reasonable and arguable grounds for the appeal that has been instituted such that it would be proper and appropriate for the executors to prosecute that appeal. (Indeed, Re O'Donoghue suggests that there should be very good grounds established for the prosecution of an appeal, at least where a costs order has already been made against the estate).
9. Her Honour's decision was that there were "reasonable grounds" for the proposed challenge to the Federal Court judgment (at [76]). She gave the advice sought.
10. I was next referred to another decision of the Chief Judge, given this year in Re Attia [2020] NSWSC 94. That was an application by an administrator ad litem for advice that he would be justified in bringing appeals against three judgments given in different proceedings in this Court.
11. At [92]-[93] her Honour repeated, in substance, what she had said in Frost at [69]-[71], including the quoted passage from Re O'Donoghue. She continued at [94]: Thus the question is whether there are reasonable and arguable grounds for the appeals that have been instituted such that it would be proper and appropriate for Mr Attia in all the circumstances to prosecute the appeals (those circumstances including the likely cost of so doing and the likely consequences if the appeal(s) were to be allowed).
12. Her Honour went on to observe that counsel's opinion on the proposed appeals read more like a submission in support of the appeal than a dispassionate advice on whether to pursue it. She analysed the grounds of appeal and concluded that they lacked sufficient substance to sustain an appeal, or otherwise did not justify an appeal in the estate's interest. The application was refused.
13. The third Australian decision to which I was referred was LM Investment Management Ltd v Drake [2020] QSC 265, a very recent judgment of Callaghan J. The application was for advice authorising an appeal against a judgment of another judge of the Queensland Supreme Court sitting at first instance. It was made by a company receiver rather than a trustee, but it was made in the inherent equitable jurisdiction and his Honour proceeded on the basis that the applicable principles were the same as for trustees.
14. Callaghan J referred to Frost and Attia, referring in particular to the passage from the Chief Judge in Frost at [72], quoted at [133] above, about it being "not for her" to express any opinion on the merits of the appeal: at [32]. He continued (at [33], footnote omitted): I acknowledge, with respect, her Honour's view that it is not for me to express a view as to the merits of any appeal. The identification of reasonable grounds will not do that. And an assessment as to the prospects of success need not do that either - although care must be taken with the way in which that assessment is expressed. As already noted, I am not exercising appellate jurisdiction. It follows that there cannot be an expectation that the issues will be canvassed as exhaustively as will be the case should an appeal be heard.
15. His Honour reviewed the notice of appeal, concluding that the stated grounds were arguable. But this did not necessarily mean that pursuit of the appeal would be "justified" so as to attract favourable judicial advice. This required a conclusion that there were "sufficient" prospects of success. For this purpose his Honour turned to the opinion from counsel provided in support of the application.
16. The opinion in question had been provided by counsel who had unsuccessfully conducted the trial. His Honour considered that this could present a difficulty. He pointed out that there was a natural desire on trial counsel's part to be vindicated on appeal. At [79] he continued: in the context of an application like this, the persuasive value of the opinion cannot rise above its source. And in such an application the Court will necessarily be wary about acting on opinion that can never be certified as completely objective. Since it is the Supreme Court that is being asked to advise that a certain course is "justified", it seems to me reasonable to ask whether that which the applicant has placed before me represents "best practice" in this case. For the purposes of justifying appellate litigation of the kind contemplated, in my view "best practice" involves securing advice that is "independent" in the sense that it comes from someone who has had no previous legal or intellectual investment in the case. It should come from someone whose reasoning can be exposed as the product of dialectic in which competing contentions have been scrutinised, free from any pre-existing impressions or conclusions.
17. In these circumstances, his Honour found it difficult to determine whether there were sufficient prospects of success. It was also unclear from the evidence whether the relevant defendants would be able to satisfy the claim if it succeeded on appeal. In the result, the application was refused, although his Honour noted that this would not prevent a further application being made which filled the gaps in the evidence.
18. After referring to these decisions, counsel for Bianca went on to analyse the decision of Hammond J in O'Donoghue. It was a case about a trustee's entitlement to indemnity for legal costs. The trustee failed to obtain indemnity because the costs had been unreasonably incurred.
19. The Ontario case of Smith v Beal to which Hammond J referred was also about a trustee's indemnity. An insolvent trader made a settlement in favour of his creditors. The plaintiff, Smith, claimed to be a creditor. His claim was rejected by the trustee, acting in accordance with the wishes of the committee of inspection elected by the creditors.
20. Smith brought a claim in the Queen's Bench Division to establish his status as creditor which failed at first instance. Smith successfully appealed to a Divisional Court consisting of three judges, and obtained a judgment in his favour. Acting on a resolution of the committee of inspection, the trustee appealed to the Court of Appeal. That appeal failed.
21. Smith then brought a claim in the Chancery Division against the trustee for maladministration. The major issue was whether the trustee was entitled to indemnity for his costs of the Queen's Bench Division proceedings (including, presumably, the costs awarded in favour of Smith).
22. At first instance in the Chancery Division Smith's claim was rejected and the trustee was found entitled to indemnity. Smith appealed to a Divisional Court. The appeal on the indemnity issue was dismissed.
23. The Chancellor (Sir JA Boyd) said (25 OR 376-377, citations omitted): The only point about which I hesitate is as to the costs incurred in the appeal from the Divisional Court by the trustee, which was dismissed. This action was after taking counsel's opinion, and with the express sanction of the creditors, and if they have control of the estate as the majority, I do not see how to draw a distinction as to these costs, except it be by limiting the right of the assignee to be recouped out of the share of the funds applicable to the contesting creditors. The English and Irish cases are very strong against allowing a trustee to charge the costs of an unsuccessful appeal against the fund.
24. Meredith J referred to the general rule that a trustee, unless guilty of misconduct, is entitled to full indemnity from the trust for expenses incurred in administering the trust. His Lordship continued (25 OR 382, citations omitted): I have no doubt the general rule covers this case down to the costs of the appeal to the Court of Appeal, at all events; but as to those costs the cases seem to throw considerable doubt upon the assignee's right to them; to, show that he should have been satisfied with the adverse judgment, and to have, perhaps, taken indemnity from those who desired to carry the case further. But in all those cases the judgment was in the first instance adverse to the trustee; here the judgment in the first instance was in his favour; here there is greater freedom of and more opportunity for appeals; the costs are less; the result before the end is reached perhaps considerably more uncertain. Whatever might have been my conclusion upon this question if it had come before me in the first instance, I cannot say that the learned trial Judge erred in this respect, and so must agree in affirming his judgment wholly upon this branch of the case.
25. Counsel for Bianca pointed out that neither Re O'Donoghue nor Smith v Beal was a judicial advice case. This is correct but as the Chief Judge pointed out in Frost at [69] (quoted at [131] above), decisions on a trustee's right to indemnity after the event do provide some guidance on what expenditure the court should authorise by way of judicial advice.
26. Counsel also pointed out that Re O'Donoghue did not involve an appeal. The proposition that "very good grounds" were needed for a trustee to appeal was obiter. And although Smith v Beal did involve an appeal, the trustee was not deprived of indemnity for his costs.
27. Counsel referred me to some of the English and Irish decisions upon which Boyd C and Meredith J relied in Smith v Beal. It is not necessary to summarise those decisions here. None of them was a judicial advice case, and none of them stated the proposition about "very good grounds" in terms.
28. Counsel submitted, based on their analysis of the authorities, that there was no real support for Hammond J's proposition that "very good grounds" were required for an appeal. While the proposition was quoted in the decisions of the Chief Judge and of Callaghan J, it was not apparently the subject of any argument; and in none of the decisions was it actually applied so as to decide the application. Indeed, on counsel's submission, the approach in the Chief Judge's decisions, at least, seemed to accept that the court should not make a judgment on the merits of an appeal any more than it would make a judgment on the merits of a claim at first instance.
29. In the Macedonian Orthodox Church case at [55]-[58] the High Court emphasised that the power in s 63 should not be read down by implications not found in the express language of the Act. All that is required is that there should be a "question respecting the management or administration of the trust property". The statutory criterion is no different for an appeal than it is for first instance proceedings. Clearly there can be no special rule which applies in every case where judicial advice is sought involving an appeal.
30. But it is equally true that no absolute rule exists where advice is sought concerning the bringing of proceedings at first instance. The statement of principle used by Palmer J is widely applied but it represents a practice which the Court usually follows rather than a rule which is to be applied in all circumstances. In Re Rosewood Research Pty Ltd (No 2) [2014] NSWSC 1226 at [17], Darke J described it as a "guideline". Ultimately, the degree of scrutiny which the Court gives the opinion presented by counsel may vary, depending on the circumstances.
31. Sometimes judicial advice is sought about proceedings involving the trustee where there is a question about the terms of the trust or the scope of the trustee's duties and powers. In such cases it can be in the trust's interest that the doubt should be resolved. For a charitable trust that may even be a matter of public interest. That interest may be sufficient to justify the expense of the litigation: see the Macedonian Orthodox Church case at [71]-[73].
32. In such a case the beneficiaries have no interest in any particular outcome. Unless the judgment gives rise to some further uncertainty, it is unlikely that an appeal will be appropriate. This seems to me to have been the sort of situation to which Hammond J was referring in Re O'Donoghue.
33. The situation in Smith v Beal was different. The dispute was about Smith's entitlement to participate in the distribution of the trust property. His claim did not affect the size of the trust estate. In substance the dispute was between Smith and the other creditors whose status as creditors was no in doubt. Had there not been numerous creditors, the trustee might have been expected to stand aloof. This may account for the apparent concern by Boyd C and Meredith J about the costs of the further appeal once Smith's status as a creditor had been established.
34. In my view the same considerations do not apply where the trustee obtains advice to bring a monetary or proprietary claim against a third party which is unsuccessful and then seeks advice sanctioning an appeal. If the claim succeeds the trust estate will be increased. That is equally true at both stages. Obviously the fact of an adverse judgment at first instance may call for additional care in considering whether the claim is truly maintainable. But in principle the question when considering an appeal is the same as it when considering a claim at first instance: whether there is a sufficient prospect of success to warrant the incurring of costs by the trustee's lawyers and the risk of an adverse costs order if the trustee is unsuccessful.
35. Counsel for Bianca argued that where the trustee has been unsuccessful, the costs order might itself provide an additional financial justification for an appeal. I do not agree with this submission. The decision to authorise proceedings by way of judicial advice must take account of the downside to the trust, including the possibility of an adverse costs order. If the proceedings at first instance have already been authorised by the grant of judicial advice, that was because the risk was considered worth running. The subsequent incurring of costs as a result of an adverse result cannot usually, in my view, be seen as itself being a justification for appeal.
36. Counsel also addressed the observations of Callaghan J about the desirability of obtaining advice on the application from independent counsel not involved in the trial. Counsel submitted that there is no rule that the advice must be independent before an appeal will be sanctioned. Counsel observed that in Frost the opinion was given by trial counsel and this did not prevent judicial advice being given in favour of the proposed appeal.
37. Callaghan J expressly stated ([2020] QSC 265 at [79]) that advice from independent counsel is not a condition of advice being granted. In the present case, it is not necessary to consider the circumstances in which advice will be forthcoming even when "best practice" has not been followed. At the same time the absence of independent advice clearly may be a relevant factor. The Chief Judge's decision in Attia illustrates the type of deficiencies which can emerge and defeat the application when the advice is a work of advocacy rather than dispassionate analysis.

Decision

1. The orders which are the subject of the proposed appeal arose from applications made to the Court by way of notice of motion. As will be seen, one of the reasons the Chief Judge gave for awarding indemnity costs against Bianca on the arbitration and stay motions was that she did not seek judicial advice before resisting those motions.
2. Clearly, not every procedural step which may be taken by a trustee must first be the subject of a separate application for judicial advice. Advice initially given to the trustee to prosecute the proceedings must carry with it some level of authorisation for ancillary steps. Counsel argued that Bianca was entitled to defend the arbitration and stay motions by Mrs Rinehart and HPPL without the need to obtain further advice. But it is not necessary to decide now whether that is correct. Counsel did not extend the argument to an appeal from the Chief Judge's decision. The Court was asked to give judicial advice authorising the appeal proceedings on a stand-alone basis.
3. I have already referred to the beneficiaries' positions on the proposed appeal. Bianca and John are in favour. After some grumbling about the course Bianca took in opposing the arbitration and stay applications, Hope has gone silent. Ginia neither supports nor opposes the proposed appeal, but says that if it is to take place at all the Trust should be represented by solicitors independent of Bianca.
4. Bianca (both in the statement of facts and in submissions made on her behalf by counsel) rejects the imposition of such a condition. Bianca's solicitors, Yeldham Price O'Brien Lusk ("YPOL"), acted in the application for judicial advice before Rein J in 2017 and have acted in the corporate governance proceedings since then. Bianca's position is that any change of representation in those proceedings would disadvantage the Trust because of the loss of the knowledge and experience built up by YPOL.
5. The statement of facts also noted that it would have been obvious to all concerned that YPOL were acting and no point was taken about it until after the Chief Judge delivered her judgment. Nor was the point pursued when judicial advice was obtained from Lindsay J in May this year which enabled Bianca to appeal an earlier judgment of the Chief Judge (that judgment is not relevant for present purposes: it concerned Mrs Rinehart's delivery up of documents dating back to her time as the trustee of the Trust).
6. The statement of facts (and counsel for Bianca, in their submissions) went on to raise an apprehension that, in taking the position she has taken in this application, Ginia might be doing Mrs Rinehart's bidding. Brereton J recorded in his judgment that Ginia was financially dependent upon her mother and was her chosen successor as the controller of HPPL. The statement of facts recorded that Bianca "continues to be concerned" that Ginia (and Hope, who also apparently reconciled with her mother before Brereton J's judgment) are in league with Mrs Rinehart. The contention was that this affected the extent to which Ginia's and Hope's stated wishes should be taken into account.
7. But counsel for Ginia rejected this. They pointed out, correctly, that there is no direct evidence of any collusion and the statements by Brereton J now go back more than five years.
8. Bianca may genuinely believe that it is in the Trust's interests to pursue an appeal against the Chief Judge's decision. But the contrary view, based on the resulting delay and risk of further adverse costs orders, is also open. I am not satisfied that Ginia is acting otherwise than in good faith. It hardly needs to be said that Bianca has no greater interest in the Trust than Ginia does. I see no reason to discount the submissions made on her behalf.
9. I have summarised the Chief Judge's orders which are the subject of the present application at [19]-[20] above. The substantive orders provided for the claims other than the claim for access to documents under s 247A to be referred for arbitration, and for the s 247A claim to be stayed. I will deal first with the proposed appeal against the substantive orders and return later to the question of costs.
10. The Chief Judge concluded that all of the claims other than the s 247A claim were arbitrable, and were caught by cl 20 of the Hope Downs Deed. This meant that those claims had to be referred to arbitration; the Court had no discretion in the matter.
11. While her Honour concluded, with some hesitation, that the s 247A claim was arbitrable, she decided that it was not covered by cl 20. However, her Honour considered that, in the exercise of the Court's discretion, that claim should be stayed. This was because it overlapped with the claims being referred to arbitration, and it was undesirable to have parallel court and arbitration proceedings. Also, and independently, her Honour considered that the s 247A claim was an abuse of process because of inconsistency between that claim and claims being advanced by Bianca in the Federal Court proceedings.
12. All of these points had been contested by counsel for Bianca at the hearing before the Chief Judge. In the opinion they produced for the purpose of this application counsel contended that her Honour's adverse conclusions on the points were arguably incorrect.
13. There had been an extensive debate before her Honour about the proper scope of cl 20 of the Hope Downs Deed. The view of the Full Federal Court (upheld in the High Court) was wider than that earlier taken by the Court of Appeal. Her Honour concluded that the Court of Appeal's approach (which would otherwise have been binding on her at first instance) had been impliedly overruled by the High Court. Counsel argued that this was arguably wrong, and the Court of Appeal approach continued to apply. Counsel acknowledged, however, that even on that approach there would still be room to argue about whether cl 20 applied or not.
14. There was another point about the application of cl 20. Before the Chief Judge it was contended on behalf of Bianca that the clause did not apply to claims made by her in her capacity as a trustee. The Chief Judge did not rule on this one way or another, deciding that it was for the arbitrator to determine. Counsel's opinion contended that this was incorrect. But again counsel acknowledged that if this argument succeeded, so that the reach of the clause had to be determined by the court, that would not be the end of the argument. The court might come to the conclusion that on its true construction the clause did apply to Bianca's trust claims (a view with which the Chief Judge apparently had some sympathy: see [2020] NSWSC 68 at [197]-[199]).
15. On the s 247A claim, counsel contended that the Chief Judge had arguably been wrong to think that there was an inconsistency in Bianca's position, and wrong in any event to stay the claim. Counsel acknowledged however that her Honour's decision was a discretionary one which made it harder to challenge on appeal.
16. As this abbreviated description shows, the issues raised in counsel's opinion were extensive and complicated. Before the Chief Judge Mrs Rinehart and HPPL were separately represented and the hearing took place over seven different days. Counsel told me that the hearing would take at least two days. If the appeal failed, the further cost to the Trust (including costs orders in favour of both Mrs Rinehart and HPPL) would be well over $500,000.
17. I accept that there may be arguable grounds of appeal from the judgment of the Chief Judge. I do not need to decide whether it is necessary to go further and analyse the likelihood of success on those grounds. The problem is whether it is in the interests of the Trust to agitate them in the first place.
18. The claims against Mrs Rinehart and HPPL may potentially be very valuable to the Trust. But the Chief Judge's decision does not prevent those claims being pursued. It only requires that they be pursued by way of arbitration.
19. Counsel suggested that there could be "perceived forensic benefits" in pursuing the claims against Mrs Rinehart and HPPL in court rather than by way of arbitration. Counsel did not specify what those benefits might be. I find them hard to see (especially when confining attention to the Trust's interests) and harder still to quantify in financial terms. The result is that they cannot realistically be weighed up against the additional costs which would be incurred as a result of an unsuccessful appeal.
20. Clearly Mrs Rinehart thinks that her interests would best be served by a private arbitration of the dispute. That does not mean that the Trust's interests will be best served by reflexive opposition to that course.
21. At first sight, the s 247A application appears to be in a different category. Usually the proper administration of a trust requires access to information about its assets. Counsel submitted that Bianca was plainly justified in maintaining the s 247A claim on appeal, in aid of her rights (and obligations) as trustee of the Trust.
22. But this point was addressed by the Chief Judge. At [36] she said: [M]y conclusion that Bianca's s 247A application should be stayed is because, as I understand it, the hearing of that application will or is likely to involve a public airing of the matters the subject of the bargained-for confidentiality and, to the extent that the documents sought are relevant to the matters to be referred to arbitration, it will be open to Bianca to seek production of documents in the context of the arbitration. If, however, there are particular, limited categories of documents required by Bianca for the purpose of her administration of the HMH Trust, as its trustee (other than for the purposes of the prosecution of the claims the subject of this proceeding), then it may be that this would not give rise to the same difficulty and hence I do not rule out the possibility of entertaining an isolated s 247A application were that to be unconnected to the disputes the subject of the matters now to be referred to arbitration (and were it unlikely to involve the airing of factual disputes of that kind).
23. It is clear that the Chief Judge's decision that the s 247A application was an abuse of process focussed on the particular application before the Court. Her Honour concluded that the application was in effect ancillary to the main claims being made in the corporate governance proceedings. The decision does not prevent Bianca from making some other application for documents needed for the ongoing administration of the Trust.
24. I repeat that Bianca is not merely seeking to place herself in the position of being able to appeal at her own risk; she is seeking the imprimatur of the Court for doing so. That would mean, in all likelihood, that if the appeal fails all the parties' costs will come out of the Trust's assets. I am not satisfied there is sufficient benefit in a successful appeal to justify the delay and the expense if the appeal fails.
25. In particular, I do not think that the costs (no doubt heavy) incurred as a result of resisting the arbitration and stay applications by Mrs Rinehart and HPPL are themselves a justification for mounting an appeal. The prospects of success are not (and were not claimed by counsel to be) strong enough for that type of argument to come into play.
26. This conclusion means that there is no basis for challenging the costs orders made by the Chief Judge, so far as they concern the party-party costs of the arbitration and stay applications. Those costs must follow the event.
27. But her Honour's orders went further than this. She ordered that Bianca pay the costs of the arbitration and stay applications on an indemnity basis, and that those costs be payable forthwith.
28. As I have mentioned, in deciding to award indemnity costs, her Honour observed that Bianca did not obtain judicial advice before embarking on the course of resisting the arbitration and stay applications. Her Honour made this point at [141].
29. Counsel for Bianca challenged this aspect of her Honour's reasoning. Among other things, counsel argued that while the failure to obtain judicial advice might be relevant to Bianca's right to indemnity for her costs out of the assets of the Trust, it could not be relevant to the award of party-party costs.
30. Furthermore, counsel submitted that her Honour's reasoning assumed that the possibility of a stay application being made was not considered by Rein J in giving judicial advice. But there was no evidence on this question before her Honour, because the material before Rein J had been confidential. Counsel submitted that the assumption was unwarranted and this was a further ground for challenging the indemnity costs aspect of the order.
31. Given that judicial advice was obtained, it is very likely that the party-party costs awarded against Bianca on the application will be the subject of an indemnity from the assets of the Trust. The indemnity costs component is less clear. If Bianca behaved unreasonably in resisting the application, there may be an argument that she should not be protected from the consequences of doing so. Especially is this so if judicial advice was should have been, but was not, obtained.
32. It is not possible to determine this question in the present application. That would require a factual enquiry into the reasonableness of Bianca's conduct as trustee. It would be necessary to join the affected parties, who are the other beneficiaries of the Trust, so that they could present evidence and make submissions. It seems to me that the proper vehicle for the determination of such an issue would be administration proceedings under Part 54: see, for example, Olsen v James [2020] NSWSC 1015.
33. I am therefore not in a position to determine in this application whether the Trust will actually be required to bear the indemnity component of the costs awarded by the Chief Judge. But there is at least a risk that it will. It follows that there may be a financial benefit to the Trust from an appeal. Pursuing an appeal on the costs issue would also not result in any relevant delay as it would not interfere with the conduct of the arbitration.
34. The position is comparable with a case where a claim is made against the trust by a third party which succeeds at first instance and advice is sought about an appeal. As I have indicated above, in such a case I do not think that the appellate nature of the proposed proceedings creates any additional barrier. The question is simply whether the proposed argument is tenable and there is sufficient justification, in the interests of the Trust, for pursuing the appeal.
35. There are however some complications. I have already mentioned the uncertainty about whether the indemnity component of the costs ordered will come out of the Trust. And her Honour mentioned other factors in support of the indemnity costs award.
36. Furthermore, I do not know how much the indemnity costs component of the costs order against Bianca is likely to be worth. And the application before me was premised on an appeal on the substantive issues as well as the costs issue. I do not know how lengthy and expensive an appeal limited to the costs point would be.
37. In the circumstances, I think the best course is to adjourn the application so that Bianca's legal advisers can consider whether to press on with an application for advice, limited to the indemnity costs component of the Chief Judge's orders. If counsel consider that the benefit to be gained and the prospects of success are such as to warrant the cost of an appeal on that point then they can present the supplementary information needed in order to justify that evaluation.
38. Finally, there are her Honour's orders concerning the payment of costs forthwith. I have not considered this in any detail because it seemed to me unlikely that this issue on its own would justify an appeal. The costs order will carry interest from the date on which it is made (Civil Procedure Act 2005 (NSW), ss 101(4)-(5)) so whether it is immediately enforceable or not is unlikely to make much difference in terms of eventual quantum. But if Bianca's legal advisers consider that there is some issue of principle in her Honour's decision which would justify the inclusion of this point, then they may address that as part of any supplementary application.
39. These conclusions make it unnecessary, at least for the moment, to deal with the submission by counsel for Ginia that Bianca should be independently represented in any appeal. Nevertheless I will comment on it briefly.
40. In retrospect it certainly seems unfortunate that YPOL have acted for Bianca both as trustee and in her personal capacity. While one of the reasons Brereton J appointed Bianca was for her to stand up to Mrs Rinehart in the interests of the Trust, that did not require that the Trust's solicitors act for her in her personal capacity as well. The inconsistencies in approach between the different proceedings to which the Chief Judge referred illustrate the problem.
41. Having said that, the only issue actually raised in these proceedings is whether YPOL should act on the appeal. Given my conclusions, if there is any appeal at all the issues will be very narrow. For the reasons advanced by counsel for Bianca, changing horses at this point might not be in the Trust's interest. The Court might also agree (although this seems to me to be less likely) that any objection has been waived by conduct.
42. But these are the sort of issues which require proper factual investigation and full argument. They should not be resolved in proceedings of the present type, which are ill-suited to factual debate. If Ginia (or Hope) wishes to pursue the point, I think that, like the question of costs indemnity, it should be pursued in administration proceedings in which all parties may participate in the usual way, and which would enable the whole issue (that is, including whether YPOL should be acting for the Trust at all) to be canvassed.

Orders

1. The orders of the Court are:
2. Order that the proceedings be adjourned until 23 November 2020, or such other date as may be arranged with my Associate, for the plaintiff to consider this judgment.

---

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 16 November 2020