Scott MacRae Investments Pty Limited & Anor v Baylily Pty Limited & Ors

Scott MacRae Investments Pty Limited & Anor v Baylily Pty Limited & Ors - [2010] NSWSC 174 - NSWSC 2010 case summary — Zoe

[11]

There is also the evidence required by Rule 13.1(b) : Mr Mitchell's second affidavit, par 15. Decision 23 It is critical to appreciate that the power given to the court to grant judgment upon admissions is discretionary. However the Court is not bound to act upon them: see Termijtelen v Van Arkel [1974] 1 NSWLR 525, at 528F (per Hope JA), regard must be had "to all the circumstances of the case" (citing In re Wright), at 529A. Moreover, it will not permit the applicant to supplement those 'admissions' with evidence (Termijtelen at 528F, citing Wagstaff v Fitzpatrick (1922) 39 WN (NSW) 137). 24 The defendants have pressed upon the Court a finding that the admission referred to is not one which the Court is bound to accept as true. Their contention is that in fact it has not been proven and the knowledge of the relevant facts is not within that of Baylily or any other of the defendants. Their contention is that, at most, the admission was contingent upon an event which the plaintiffs have not seen fit to satisfy: the bringing forward of evidence to demonstrate the making of the appointment and the acceptance by SMI of the trusteeship. 25 The defendants' contention is further that the circumstances of the case, (especially the document in which the admissions are said to be found), indicate ambiguity and are in relation to matters (the making of declarations) upon which the Court must itself receive evidence. The proposition is that the plaintiffs claim to be in a position to prove their entitlements and do not resile (by the very structure of the Amended Motion, which includes resort to UCPR 13.1) from so doing. They contend that the plaintiffs should not be entitled to co-mingle their applications. 26 They further contend that on any view, the alleged admissions are insufficient to support the totality of the relief claimed in the Amended Notice of Motion. Decision 27 There is no doubt but that the decision on the plaintiffs' essential claims to relief is a difficult one in the current circumstances. There is a long line of authority in support of the proposition that declaratory relief is ordinarily granted as final relief in a proceeding. : In Warramunda Village Inc v Pryde [2001] FCA 61, (2001) 105 FCR 437, the Full Court of the Federal Court of Australia noted (at [8]):

Parties

Applicant/Plaintiff:

Scott MacRae Investments Pty Limited & Anor

Respondent/Defendant:

Baylily Pty Limited & Ors

Legislation Cited (6)

First Corporate Law Simplification Act 1995(Cth)

Acts Interpretation Act 1901(Cth)

Corporations Act 2001(Cth)

Fringe Benefits Tax Assessment Act 1986(Cth)

Trustee Act 1925(NSW)

Evidence Act 1995(NSW)

Cases Cited (16)

CITATION : Scott MacRae Investments Pty Limited & Anor v Baylily Pty Limited & Ors [2010] NSWSC 174

Australian Broadcasting Commission v Australian Performing Right Association Ltd (1973) 129 CLR 99; (1973) 47 ALJR 526 Baylily Pty Ltd, Re [2010] NSWSC 6 Bluescope Steel Ltd (formerly BHP Steel Ltd) v Australian Workers' Union, NSW [2004] NSWIRComm 222; (2004) 137 IR 176 Friend v Brooker [2009] HCA 21; (2009) 239 CLR 129 Hide and Skin Trading Pty Ltd v Oceanic Meat Traders Ltd (1990) 20 NSWLR 310 CASES CITED : Lemery Holdings Pty Limited v Reliance Financial Services Pty Limited [2008] NSWSC 1344 Macedonian Orthodox Community Church St Petka Incorporated v His Eminence Petar The Diocesan Bishop of The Macedonian Orthodox Diocese of Australia and New Zealand [2008] HCA 42; (2008) 237 CLR 66 Meehan v Glazier Holdings Pty Limited (2002) 54 NSWLR 146 Termijtelen v Van Arkel [1974] 1 NSWLR 525 Wagstaff v Fitzpatrick (1922) 39 WN (NSW) 137 Warramunda Village Inc v Pryde [2001] FCA 61, (2001) 105 FCR 437 Wright, In re [1895] 2 Ch 747

7 The High Court of Australia recently considered the operation of s 63 in Macedonian Orthodox Community Church St Petka Incorporated v His Eminence Petar The Diocesan Bishop of The Macedonian Orthodox Diocese of Australia and New Zealand [2008] HCA 42; (2008) 237 CLR 66. At [74] the Court said the following: "[74] A necessary consequence of the provisions of s 63 of the Act is that a trustee who is sued should take no step in defence of the suit without first obtaining judicial advice about whether it is proper to defend the proceedings. In deciding that question a judge must determine whether, on the material then available, it would be proper for the trustee to defend the proceedings. But deciding whether it would be proper for a trustee to defend proceedings instituted about the trust is radically different from deciding the issues that are to be agitated in the principal proceeding. The two steps are not to be elided. In particular, the judicial advice proceedings are not to be treated as a trial of the issues that are to be agitated in the principal proceedings."

13 Baylily submits that in endeavouring to discern the parties' intent, and in construing the meaning of the words used, a document will be given a commercial, reasonable and rational operation: Australian Broadcasting Commission v Australian Performing Right Association Ltd [1973] HCA 36; (1973) 129 CLR 99 at 109; Hide and Skin Trading Pty Ltd v Oceanic Meat Traders Ltd (1990) 20 NSWLR 310. Baylily contends that the appointment as trustee of a company of which Scott MacRae is the sole director and shareholder is invalid for the following reasons: 1. There was no requirement to include such a restriction on the power of appointment because the so-called "obvious" intention of the sub-clause was to prevent the appointor from being able personally to control the trust completely and absolutely. That intention would have been frustrated or defeated in the events that have occurred in the present case if the appointment of Scott MacRae Investments Pty Ltd as trustee were permitted to remain valid and effective.

19 Baylily's arguments appear to me to be not so much reasons why its proposed interpretation of the Trust Deed should be adopted as complaints about the most likely result of their natural and ordinary meaning. They assume an intention or purpose to deprive an appointor of the power to appoint a corporation, of which he or she may be a sole director and shareholder, simply because the degrees of control exercised by a trustee personally or through the medium of such an entity are likely to be identical. The intention assumed is not obvious in the way suggested. The obvious intention was to prohibit an appointor appointing himself or herself or itself. Nothing going beyond that emerges as obvious to me. Corporations have a distinct legal character, an unremarkable fact recently reaffirmed in Friend v Brooker [2009] HCA 21; (2009) 239 CLR 129. Scott MacRae is not Scott MacRae Investments Pty Ltd and Scott MacRae Investments Pty Ltd is not Scott MacRae.

In other words, s 9(7) gives the new trustee a statutory cause of action to recover the property: see Lemery Holdings Pty Limited v Reliance Financial Services Pty Limited [2008] NSWSC 1344 at [52]-[53] (Brereton J).

(1973) 129 CLR 99

(1973) 47 ALJR 526

(2004) 137 IR 176

(2009) 239 CLR 129

(1990) 20 NSWLR 310

(2008) 237 CLR 66

(2002) 54 NSWLR 146

(2001) 105 FCR 437

[2004] NSWIRComm 222

[2001] FCA 61

Cited By (1)

Scott MacRae Investments Pty Ltd & Anor v Baylily Pty Ltd & Anor

At a glance

Court

Decision date

Before

Source

Judgment (15 paragraphs)

Parties

Legislation Cited (6)

Cases Cited (16)

Cited By (1)