Mansfield (Trustee), in the matter of Frugtniet v Frugtniet

1. The final hearing in this matter was completed on 26 June 2025 whereupon I formally reserved judgment.
2. To be delivered simultaneously with these reasons for judgment are reasons for judgment finally determining the relief sought in this case. Those reasons, which I shall refer to as the dispositive reasons, were almost ready for delivery when, on 4 July 2025, my Associate received an email from the respondents indicating that they wished to apply to reopen their case. I delayed publication of my dispositive reasons and made timetabling orders to deal with the application to reopen. These are now my reasons why that application should be dismissed. I refer to the parties in the same manner here as in the dispositive reasons.
3. The orders sought by the respondents in their interlocutory application are as follows:
   1. That the proceedings be reopened.
   2. That the purpose for reopening the matter is for admitting further evidence.
   3. That the Trust Deed between Brian Frugtniet and Jerome Frugtniet dated 2 September 2014, now duly stamped pursuant to the Duties Act 1997 (NSW), be admitted into evidence as Exhibit "BF-7" annexed to the affidavit of Brian Frugtniet sworn 4 July 2025 as set out in this application.
   4. That the Applicants [sic] be granted leave to file and rely upon supplementary written submissions limited to the relevance and admissibility of the stamped trust deed.
   5. Such further or other orders as this honourable Court deems appropriate.
4. As is apparent from my dispositive reasons, on the final day of the hearing I rejected the tender of a document that on its face appears to be an unstamped trust deed dated 2 September 2014 (the Trust Deed). That was essentially because I was not satisfied that the duty payable on the Deed would be paid with the result that I was not satisfied that the Deed should be admitted given its exclusion under s 304 of the Duties Act 1997 (NSW). The application to reopen is an effort by the respondents to get around the rejection of the Deed and to now have it admitted. That is on the basis that the duty payable on the Deed has now purportedly been paid and the Deed has been stamped.
5. The first affidavit relied on in support of the reopening application is an affidavit by Brian Frugtniet dated 4 July 2025. Brian states in the affidavit that the Deed is now "stamped", having been "stamped after the close of the case", and is therefore now admissible. Annexed to the affidavit, amongst a number of extraneous and irrelevant documents, are copies of the following:

(1) A "Duties Notice of Assessment" from Revenue NSW "Electronic Duties Returns" dated 30 June 2025 indicating an amount of $1,030.14 (being $500 for duty plus $530.14 for interest) payable by 7 July 2025; and

(2) A notice from St George Bank showing the transfer of $1,030.14 on 30 June 2025 to Revenue NSW in respect of "Stamping of Trust Deed dated 2 SEPTEMBER 2014 between BRIAN OWEN REGINALD FRUGTNIET and JEROME BRYAN FRUGTNIET".

1. The second affidavit relied on in support of the reopening application is an affidavit by Brian dated 9 July 2025. The affidavit contains what are essentially submissions in relation to the previous affidavit and the application. Relevantly, it includes a response to the contents of a letter dated 7 July 2025 from Mr Mansfield's solicitor which states that Mr Mansfield's "tax colleagues at Deloitte" estimated that the stamp duty (including penalties and interest) payable on the Trust Deed to be in the order of $150,000. Brian's response is that this assertion is without evidentiary foundation.
2. Mr Mansfield relies on an affidavit deposed to by him dated 11 July 2025. The affidavit, relevantly, states the following:

(1) Steve Paterson, a partner of Deloitte in its Tax Services division, had advised that, on the information available, if the purported Trust Deed were to be stamped by the Office of State Revenue (OSR), it may attract ad valorem duty of $73,490 and penalty interest of at least $78,200. Further penalties may be imposed by the OSR, but that would not be known until the OSR had conducted a review of the Trust Deed and any supporting evidence and submissions.

(2) Revenue NSW allows certain documents to be submitted and processed under its automated Electronic Duties Returns (EDR) service but requires other documents to be processed through its eDuties service. The latter service allows applicants to submit duties applications (not otherwise permitted to be submitted through EDR) which are subsequently considered through a more detailed and non-automated process. It requires considerable factual evidence to be presented and considered by the OSR before a decision on duty can be made.

(3) Mr Paterson has advised that the documents annexed to Brian's affidavit show that the Trust Deed was mistakenly submitted by the respondents and processed through the EDR service which explains why a nominal amount of duty appears to have been charged on the document.

1. Annexed to Mr Mansfield's affidavit is a copy of a publication by Revenue NSW titled "Duties Document Matrix" which confirms the differences between the EDR and eDuties services deposed to by him. Section 1 of the matrix identifies "Duties Act transactions which must be processed on EDR". Amongst those are documents described as "Discretionary Trust Deed" for the establishment of a trust relating to non-dutiable property or to unidentified property with reference to s 58 of the Duties Act. That is the closest description possibly applicable to the Trust Deed that the respondents seek to tender, although it is an incorrect description because that Deed is in relation to identified dutiable property. For that reason, it could not validly be submitted through the EDR service.
2. Section 2 of the matrix identifies "Duties Act transactions which must be lodged with Revenue NSW through the eDuties portal". Amongst the documents listed there is a "Declaration of trust over dutiable property" with reference to ss 8 and 11 of the Duties Act - those are the sections applicable to the Trust Deed as explained in the dipositive reasons at [34]. Also listed is an "Acknowledgement of trust" with reference to s 8AA of the Duties Act - which is an alternative possibility in respect of the Trust Deed as explained in the dispositive reasons at [35]. That confirms what Mr Mansfield states in his affidavit, namely that the Trust Deed in question is required to be submitted through the eDuties service and not the EDR service. It is apparent from the documents annexed to Brian's affidavit of 4 July that the Deed was erroneously submitted through the EDR service. That explains why only nominal duty of $500 was raised on the document.
3. In the result, I am satisfied that the Trust Deed has not been properly stamped and that it is not admissible under s 304 of the Duties Act. For the reasons given in my dispositive reasons, I remain unsatisfied that the duty payable on the Deed will be paid. I accept that a considerable amount of duty, of the order of that advised by Mr Paterson, is payable on the Deed (assuming it to be genuine).
4. For those reasons, the central underlying basis to the reopening application fails and the application must be dismissed.
5. In any event, given the considerable delays in the matter by the respondents and the lengthy opportunity that they have had to have the Trust Deed stamped - as documented in the written submissions submitted on behalf of Mr Mansfield at [7]-[12] which I accept, as an exercise of discretion I would not be inclined to reopen the proceeding. At some point, enough is enough; the case must be brought to an end. That point was reached on 26 June.
6. In the result, the respondents' interlocutory application dated 9 July 2025 should be dismissed with costs.

I certify that the preceding thirteen (13) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Stewart.