Telstra Super Pty Ltd v Flegeltaub [2000] VSCA 180

Court of Appeal (Vic)|2000-09-28|Before: ORMISTON, CALLAWAY and BATT, JJ.A.

TRUSTS - Superannuation - Entitlement to benefit on "Total and Permanent Invalidity" - Meaning of definition, especially the words "unreasonable refusal to submit to treatment" - Whether trustee exercising a discretion - Extent of trustee's duties in forming opinion as to question of fact.

The facts and circumstances relating to this appeal appear in the judgment of Callaway, J.A. Although it is a matter of some difficulty about which I had some doubts, I agree, for the reasons he has stated, in the interpretation of the clause of the trust deed which he has reached.

Each side has agreed, whatever be the result, that the matter should be remitted to the trustee for its decision according to the construction which the Court places upon the terms of this clause. In a number of senses that is unsatisfactory inasmuch as a beneficiary has come to the Court to seek an interpretation of a deed of trust which, at least in the broadest sense, was thought uncertain in its operation, although the trustee considered and considers itself correct as to the application of the terms of the clause to the particular circumstances of the respondent. Unfortunately, the terms of the trust deed leave so many matters to the opinion of the trustee in various ways that the only consequence of the present dispute must be that it be remitted to the trustee to consider the respondent's entitlement according to law.

The parties had hoped, though in rather different ways, that the Court might express its views as to how the trustee should conduct any further enquiry into the respondent's entitlement, at least so as to obviate the necessity for any further application to the Court.

There are many reasons why I am loath to enter upon any such discussion. It is not that I would wish to express disagreement with the valuable observations of Callaway, J.A. or with those of Batt, J.A. in his judgment. It is simply that I am unwilling to embark upon a general discussion, in a case where it is not strictly necessary, in relation to a further consideration of the question when so many matters relating to the review of trustees' decisions have not been finally settled. Hardly any of the decisions cited and which were decided in the last 20 years or so have been decisions of appellate courts and trial judges have been struggling to deal with disputes which have arisen out of circumstances quite different from those which were raised in earlier authorities. One particular problem is the extent to which courts will examine the exercise of a discretionary power by a trustee where the trustee is a company set up by an employer for the purpose of a pension or superannuation fund. The starting point in many discussions has been the judgment of McGarvie, J. in Karger v. Paul[1], but that, as most later judgments have recognised, related to the exercise by a trustee of a power to pay part or whole of the capital to a life tenant. The observations which his Honour made in relation to the exercise of that kind of discretion have been followed in numerous cases but in many of which the trustee's task was quite different. I see for the present no reason to cavil with what the learned judge said in that case; indeed, it has been applied on many occasions and enthusiastically adopted and discussed in two textbooks, one well-known and the other an erudite new work on the subject of powers. In particular, it is cited in a number of places in Scott on Trusts (4th ed. 1988) in relation to the control of discretionary powers, the "reasonableness of trustees' exercise of judgment" and "where the trustee fails to use his judgment".[2] Likewise it is cited, and indeed discussed in some detail, in Thomas on Powers (1998), especially on the question of a donee's duty to take account of relevant considerations and the like and the judicial review of the exercise by donees of powers and discretions, in relation to each of which it seems that the learned author assimilates donees of powers with trustees.

I can well understand why the courts are unwilling to examine the exercise of powers by donees or trustees where there are no effective criteria for the choice to be made and where there may not even be an obligation to exercise them. Powers of advancement and the power (or duty) to choose between a spouse (including possibly a former spouse) and children where a death benefit has to be paid under a policy or scheme are two subjects where it is largely futile to examine the reasons for the exercise of a discretion, so that Karger v. Paul would be directly apposite.

I am less content with analyses of that kind where the matter left to a trustee is the forming of an opinion or the reaching of satisfaction as to the qualifications of a beneficiary for a particular benefit, such as an invalidity benefit, under a pension or superannuation trust. It seems to have been assumed since the decision by McLelland, J. in Rapa v. Patience[3] that similar restrictions to those discussed in Karger v. Paul should also apply to the formation of more arguably "discretionary" opinions under superannuation deeds. His Honour referred to para.187.3 of Scott, but, with due respect, it is equally important to look at the learned author's discussion of a more general kind in paras.187 and 187.2 where, in discussing the reasonableness of trustee's exercise of judgment, the learned author says that a test such as is suggested by Callaway, J.A. in the last sentence of his paragraph 26 is applicable where a trustee is given that kind of discretion whether to pay a benefit to a beneficiary[4]. I would add only that in the more general discussion in para.187 of Scott a contrast is drawn between the limits which might fairly be placed on a trustee's discretion as discussed in the decisions of Monds v. Stackhouse[5], Re Raven[6] and Re Wynn[7] with the less restrictive approach expressed by the House of Lords in the Scottish appeal Dundee General Hospitals v. Walker[8].

I would prefer not to resolve these matters at present, although, I would incline to favour, at the least, the test suggested by Callaway, J.A.[9] that the Court is entitled to infer a breach of a trustee's obligations where a decision is "one which no reasonable trustee could make on the material which was before it".

With those qualifications I would agree with the judgment of Callaway, J.A. and with the orders proposed by him.

This case concerns the construction of certain clauses in a superannuation trust deed and the trustee's duties in relation to them. The respondent was a Member[10] of the Telecom Superannuation Scheme, which is a scheme established and maintained under a deed made between Australian Telecommunications Corporation (as it then was) as Principal Employer and the appellant as Trustee. The deed provides that headings are for convenience only and do not affect its interpretation, so I shall omit them when I quote relevant provisions. I shall not set out the definitions of "Employer", "Employee", "Fund", "Member", "Rehabilitation Programme" and "Work". They are as one would expect and nothing turns on them.

"Subject to part 2.4 [which relates to preservation of Employer Financed Benefits], if a Member ceases to be an Employee before attaining the age of 60 years because of Total and Permanent Invalidity, there is payable to the Member from the Fund a lump sum benefit of an amount equal to the benefit which would have been payable under clause 2.3.2 if the Member had died on the Date of Invalidity."

"Date of Invalidity" is defined in clause 2.1.2 as follows:

"'Date of Invalidity' means in relation to a Member and a state of invalidity or disablement giving rise to a benefit under this Deed the date on which the Member ceased to be an Employee or any other date agreed between the Trustee and the Principal Employer from time to time either generally or in any particular case for the purposes of the whole or any particular provision of this Deed."

"Total and Permanent Invalidity" is also defined in clause 2.1.2. That definition reads:

"'Total and Permanent Invalidity' means in relation to a Member disablement as a result of which - (a) unless otherwise agreed between the Trustee and the Principal Employer from time to time either generally or in any particular case, the Member has been continuously absent from all active Work for a period of at least six months and has been required by the Employer to participate in a Rehabilitation Programme; and (b) in the opinion of the Trustee after consideration of any information, evidence and advice provided to the Trustee by the Employer and any other information, evidence and advice the Trustee may consider relevant, the Member has ceased to be an Employee and is unlikely ever to engage in any gainful Work for which the Member is for the time being reasonably qualified by education, training or experience, but - (1) Total and Permanent Invalidity does not include disablement the existence or continuation of which, in the opinion of the Trustee after consideration of any information, evidence and advice provided to the Trustee by the Employer and any other information, evidence and advice as [sic] the Trustee may consider relevant, is attributable to a material extent to deliberate action or inaction by any person for the purpose of causing a benefit to become or to continue to be payable from the Fund, including without limitation what the Trustee considers to be an unreasonable refusal to submit to treatment; and (2) a Member who is required by the Employer to participate in a Rehabilitation Programme will not be considered to have suffered Total and Permanent Invalidity unless the Member participates in that Programme to the satisfaction of the Trustee." (Emphasis added.)

The respondent ceased to be an Employee before attaining the age of 60. She claimed that that was so because of Total and Permanent Invalidity and, accordingly, that she was entitled to the lump sum benefit referred to in clause 2.3.3. Her claim was rejected both by a committee of the appellant and by its board of directors in the circumstances described by the learned trial judge.[11] I gratefully adopt his Honour's summary of the facts and issues and say at once that I should have reached the same conclusions, for similar reasons to those his Honour gave at [1-45], [55] and [64-73] of

his judgment,[12] but for an aspect of the construction of the definition of "Total and Permanent Invalidity" that emerged for the first time on the hearing of the appeal.

It is desirable that the appeal be decided as quickly as possible because not only the determination of the respondent's claim, but also the processing of other similar claims, have been deferred pending its resolution.

Putting to one side paragraph (a) of the definition of "Total and Permanent Invalidity" and the reference in paragraph (b) to the Member's having ceased to be an Employee, the first question to be answered, in applying the definition, is whether there is "disablement as a result of which ... in the opinion of the Trustee ... the Member ... is unlikely ever to engage in any gainful Work for which the Member is for the time being reasonably qualified by education, training or experience". Mr Maclean submitted that those words imported, among other things, considerations similar to those discussed by Smithers, J. in Dragojlovic v. Director-General of Social Security[13]. A Member is not unlikely ever to engage in any gainful Work, so the submission proceeded, if he or she refuses treatment that has a 50% or better prospect of success unless the refusal is itself the product of the disablement (as it might well be in the case of psychiatric illness), is based on bona fide religious grounds or is otherwise justified. I do not accept that submission. It reads far too much into the words of paragraph (b), at all events when the paragraph is read as a part, and only a part, of the whole definition. The problem of unreasonable refusal to submit to treatment is expressly addressed in paragraph (1) and, as we shall see in due course, solved in a comprehensive fashion.

The possibility was also explored in the course of argument that, in some cases, a refusal to submit to treatment might mean that the unlikelihood of a Member's ever engaging in any gainful Work is not "as a result of" disablement but as a result of the refusal. That problem would not arise where both the disablement and the refusal were contributory causes of the unlikelihood. In that case the disablement might mean that the Member satisfied paragraph (b) but the refusal might mean that the Member fell within the exception in paragraph (1). That leaves a case where the refusal is of such overwhelming significance that, in terms of causation, the unlikelihood results only from the refusal. If one had regard solely to authorities relating to causation, there might be such a case, but the question is what is meant by the words "disablement as a result of which" in this definition. I accept Mr Burnside's submission that, even in such a case, the refusal of treatment is still refusal of treatment for the disablement and the link between the opening words of the definition and paragraph (b) would not be broken. The refusal of treatment would fall to be considered, if at all, under paragraph (1).

On the facts as found by Byrne, J., unreasonable refusal to submit to treatment is the only basis on which the appellant could properly have denied the respondent's claim, so the critical question relates to the words I have italicized in paragraph (1): what is it that "includ[es] without limitation what the Trustee considers to be an unreasonable refusal to submit to treatment"?

One possible answer is that it is simply "deliberate action or inaction by any person". That is the view that Byrne, J. took and it is undoubtedly the natural meaning of the words. It has the consequence that, even if there is an unreasonable refusal to submit to treatment, it must still be "for the purpose of causing a benefit to become or to continue to be payable from the Fund" if the exception in paragraph (1) is to apply. His Honour remitted the respondent's claim to the appellant to be reconsidered on that basis, whence this appeal. (There is also a cross-appeal and a notice of contention, but the issues became greatly confined as the argument proceeded.) There are, however, two difficulties with that construction. The first is that it means that the italicized words are logically otiose. An unreasonable refusal to submit to treatment is a species of deliberate action or inaction. Paragraph (1) would therefore have the same meaning and effect if the italicized words were omitted. One always strains against a construction that attributes no effect at all to a distinct part of a clause that was evidently inserted with deliberation. Nevertheless I do not think that the first difficulty on its own would justify a departure from the natural meaning of the words used in paragraph (1).

It is the second difficulty, in combination with the first, that is to my mind decisive. The conduct referred to in the first part of paragraph (1) is conduct that was stigmatized in the course of the argument as either fraudulent or improper. (The latter description is more accurate.) The Member, or perhaps another person, engages in deliberate action or inaction for the purpose of securing a benefit. Unreasonableness is disparate from impropriety. The draftsman might well have desired to mention the commonest case of deliberate action or inaction for the purpose of securing a benefit and considered that it would be a refusal to submit to treatment. On that footing, even though the italicized words are logically otiose, they might serve a useful purpose by expressly referring to the commonest case. But why would the draftsman limit the reference to an unreasonable refusal to submit to treatment? If the refusal is, and is required to be, for the purpose of securing a benefit, it is beside the point that it is unreasonable.

Mr Burnside endeavoured to meet the second difficulty by saying that an unreasonable refusal to submit to treatment might, in some circumstances, be a basis for inferring that the refusal was for the purpose of securing a benefit but the purpose would still be determinative. I do not think that that overcomes the combined objections that the italicized words would be logically otiose and that unreasonableness is a disparate concept.

Standing back from individual words and phrases in the definition, one can see the train of thought that led to paragraphs (b) and (1). The definition is intended to be applied by non-lawyers. That is one of the reasons it should be given its natural meaning wherever possible. It is not difficult to understand the question posed by paragraph (b), namely whether, as a result of disablement, a Member is unlikely ever to engage in any gainful Work, but an answer to that question is insufficient to draw the line in the right place. On any view, those who should not be entitled to a benefit would be so entitled if paragraph (b) were given its natural meaning but were left unqualified. The qualifications are addressed in paragraph (1). The draftsman dealt first with deliberate action or inaction for the purpose of securing a benefit and then with unreasonable refusal to submit to treatment. Prima facie they are different topics and different reasons for exclusion.

Those considerations lead me to the other possible answer to the question posed at the end of [ 16]. It is that what "includ[es] without limitation what the Trustee considers to be an unreasonable refusal to submit to treatment" is the whole of the antecedent concept, namely "deliberate action or inaction by any person for the purpose of causing a benefit to become or to continue to be payable from the Fund". In other words, the draftsman is saying that the disqualifying conduct to which reference has already been made includes without limitation what the Trustee considers to be an unreasonable refusal to submit to treatment. That is preferable to reading paragraph (1) as if it made an unreasonable refusal dependent for its relevance on an improper purpose. All that is required is to construe the word "including" as meaning "which shall be deemed to include". That is a short step that I am prepared to take.

Accordingly I do not think that it is necessary for the appellant to be of opinion, in the case of an unreasonable refusal to submit to treatment, that that refusal was also for the purpose of causing a benefit to become or to continue to be payable from the Fund. It would be sufficient to bring the respondent's claim or a like claim within the exception in paragraph (1) of the definition of "Total and Permanent Invalidity" that the appellant considered that there had been an unreasonable refusal to submit to treatment.[14]

In the present case it may have been open to the appellant, on the material available to it at material times, to consider that the respondent had unreasonably refused to submit to treatment. I do not stay to consider whether it was open, because Mr Maclean very fairly conceded that, in the circumstances of this case, the respondent's claim should be reconsidered by the board in the light of the Court's decision and any material that the respondent now desires to place before the directors. It was common ground that the appellant could consider new material if it throws light on the respondent's circumstances at the relevant time in the past.[15] I say nothing about the committee, because the case was argued on the footing that it was the decision of the board that mattered.

The only other live issue relates to the appellant's duties in reconsidering the respondent's claim pursuant to clause 2.3.3 and the definition of "Total and Permanent Invalidity".

It has often been assumed that the duties of a trustee in such a case are the same as the duties of a trustee exercising a discretion of the kind considered by McGarvie, J. in Karger v. Paul[16]. There was much debate before us as to whether that assumption was justified. An obligation, even a fiduciary obligation, to form an opinion as to a question of fact, even a fact like unlikelihood, where a person is entitled to a payment if the opinion is favourable is obviously different from an "absolute and unfettered"[17] discretion[18] to make a payment.[19] I am reluctant to think that the learned judges who have applied Karger v. Paul to definitions like the definition with which we are concerned overlooked that distinction. (Byrne, J. expressly adverted to it[20].) It is more likely that they considered that the trustee's duties in such a case could be expressed in the same words, albeit in relation to a different subject matter.

I have spoken of the duties of a trustee because the appellant desires to know what its duties are. The authorities speak of the grounds on which a trustee's decision may be successfully challenged. In practice they are the same, for the extent of those grounds is the extent of the duties that equity will enforce.[21] They were summarized by McLelland, J. in Rapa v. Patience[22] as follows:

"The grounds on which the performance by trustees of functions such as these[23] may be successfully challenged are those applicable generally to the exercise by trustees of discretionary powers, helpfully discussed by McGarvie J in Karger v. Paul [1984] VicRp 13; [1984] VR 161. As encapsulated by his Honour in that case there are three such grounds and in some circumstances a fourth. They are, first, that the discretion was not exercised by the trustees in good faith, second, that the discretion was not exercised upon real and genuine consideration (which includes consideration of the wrong question - see Scott on Trusts 3rd ed. Vol. 3, para. 187.3), third, that the discretion was not exercised in accordance with the purposes for which it was conferred and, fourth, where the trustees have disclosed (otherwise than in the course of the proceedings in which the discretion is challenged) the reasons for the exercise of their discretion, that those reasons are not sound."

In the case of an obligation to form an opinion, a court may infer a breach of duty if the decision is one which no reasonable trustee could make on the material which was before it.[24]

The duties implicitly identified in Karger v. Paul are, therefore, first, to act in good faith; secondly, to give real and genuine consideration to the right question; and, thirdly, to act for a proper (as opposed to an extraneous) purpose.

Karger v. Paul was concerned with a discretion to make a payment of capital to a life tenant.[25] This deed imposes a fiduciary obligation to form certain opinions, for example, whether a Member is unlikely ever to engage in any gainful Work for which the Member is for the time being reasonably qualified or whether the existence or continuation of disablement is attributable to a material extent to deliberate action or inaction for the purpose of causing a benefit to become or to continue to be payable from the Fund or whether there has been an unreasonable refusal to submit to treatment. It matters not that the italicized words in paragraph (1) use the verb "considers". That connotes the formation of an opinion in the manner previously described. Its use avoided the necessity of saying "what, in the opinion of the Trustee after consideration of any information, evidence and advice provided to the Trustee by the Employer and any other information, evidence and advice the Trustee may consider relevant, is an unreasonable refusal to submit to treatment".

A trustee considering a question such as whether there has been an unreasonable refusal to submit to treatment must act in good faith and upon real and genuine consideration of that question and not for an extraneous purpose. The language of the three duties implicitly identified in Karger v. Paul may therefore be applied to the trustee's task.[26] The difference lies in the way in which those duties work out in practice. There is likely, for example, to be a difference in practice between giving real and genuine consideration to the question whether to make a payment of capital to a life tenant and giving real and genuine consideration to a question of fact such as whether there has been an unreasonable refusal to submit to treatment.

It would be unwise to give hypothetical examples of the ways in which the requirements of good faith, real and genuine consideration and proper purpose may be instantiated. It is sufficient to concentrate on the gravamen of the respondent's complaint. She is concerned that the reason the appellant has denied her claim is a view on its part that she has unreasonably refused to submit to treatment. She desires to correct what she believes to be misinformation in the possession of the appellant or information wrongly interpreted by it and to place material before it to allay its concern. It is not difficult to imagine that there may be cases, of which this appears to be one, where a bona fide performance of a trustee's task would lead it to give a person in the position of the respondent an opportunity of the kind she desires. As the words beginning "after consideration ..." in each of paragraphs (b) and (1) recognize, one cannot ordinarily decide a question of fact in good faith and give it real and genuine consideration without conducting some investigation and in some cases that will entail making an inquiry of a person who is willing to provide information and is in the best position to do so.[27] It is not a matter of natural justice but bona fide inquiry and genuine decision making.[28]

Mr Burnside proposed to argue that, in the case of a fiduciary obligation to form an opinion on a question of fact, at all events where a person is entitled to a payment if the opinion is favourable, there was also, or might be, a duty to give reasons. If so, that would entail another and much more radical difference between a trustee deciding such a question of fact and a trustee exercising a discretion of the kind referred to in Karger v. Paul. The question was not agitated below and the respondent did not seek a direction from Byrne, J. that the appellant give reasons for its decision, nor was any such relief sought in the notice of cross-appeal. In those circumstances we discouraged counsel from developing the argument. This case is not a suitable vehicle to decide the point, nor would it be just to give such a direction against the background of its procedural history. In saying that, I do not wish to give any encouragement to the notion that reasons could be directed but, as counsel was effectively stopped, it is inappropriate to say any more.

For these reasons, which I have kept as brief as possible because of the requirement of expedition, I would allow the appeal by omitting paragraph 1 from the order made by Byrne, J. on 2nd May 2000. In view of the concession, it is unnecessary to decide the validity or effect of the committee's determination or of the board resolutions referred to in that paragraph. It is sufficient that the question of the respondent's entitlement be remitted to the appellant for determination in accordance with the trust deed as construed by the Court of Appeal. I would dismiss the cross-appeal and hear counsel on the question of costs.

I agree with Callaway, J.A., whose reasons for judgment I have had the advantage of reading in draft. I would reserve for another day the question whether the decision of a trustee of a superannuation fund as to the entitlement of a person to a benefit under the fund, whether or not that decision be committed to the trustee in terms of its being of a certain opinion or being satisfied of a fact or considering that a fact exists, can be challenged on any grounds other than those stated in Karger v. Paul[29], such as failure to direct itself correctly in law over and above addressing itself to the correct question, failure to take into account all relevant factors and taking into account an irrelevant factor[30]. Such grounds smack very much of administrative law[31]. That is an area of law far removed from the law of trusts. On the other hand, as the reasons of Callaway, J.A. in this case and statements in other cases[32] make clear, a decision of a superannuation fund trustee such as is now under consideration is different in kind from, and arises in a context different from that of, the exercise of a discretion by a trustee of a trust for bounty or charity.

That the opinion of a superannuation fund trustee bearing upon a person's entitlement to a benefit may be challenged if it is one which no reasonable trustee could make on the material before it is shown in the reasons of Callaway, J.A. I would add a reference to Edwards v. The Hunter Valley Co-op. Dairy Co. Ltd.[33], a case concerning a superannuation plan conducted, it would seem, by the employer and with benefits secured by disability insurance, in which at p.77,536 McLelland, J. pointed out that in the field of insurance it is well established that where under a contract of insurance an element of the insurer's liability is expressed in terms of the satisfaction or opinion of the insurer, the insurer is obliged to act reasonably in considering and determining that matter. Amongst the cases which his Honour cited was the well known decision in Braunstein v. Accidental Death Insurance Co.[34]. McLelland, J.'s decision was followed in Chammas v. Harwood Nominees Pty. Ltd.[35], a superannuation case with benefits secured by insurance, in which the defendant was the trustee of the fund which self-insured.

[2] See Vol. III paras.187, 187.2 and 187.3.

[3] Unreported, Supreme Court of New South Wales, 4 April 1985.

[4] The test in Scott is expressed (at p.33) as enabling "the Court [to] control the trustee in the exercise of a power where he acts beyond the bounds of a reasonable judgment".

[9] And supported by Windeyer, J., although without citing supporting authority, in Maciejewski v. Telstra Super Pty. Ltd. [No. 2] [1999] N.S.W.S.C. 341.

[10] Whether she is still a "Member" as defined in clause 1.1.1 of the trust deed depends on whether she has been paid all the benefits to which she could become entitled.

[11] Flegeltaub v. Telstra Super Pty. Ltd. [2000] VSC 107 (Byrne, J.).

[12] I should not have regarded paragraphs (1) and (2) of the definition of "Total and Permanent Invalidity" as provisos but simply as exceptions or, as Windeyer, J. said in Maciejewski v. Telstra Super Pty. Ltd. (No. 2) [1999] NSWSC 341 at [9], exclusions: cf. Piesse_, The Elements of Drafting_ (5th edition 1976) at 36-38 and 89-95; (9th edition 1995) at 27-28 and 86-89. A Member would have a right to proffer information to the Trustee commensurate with the latter's duties, but I do not think Byrne, J. intended to suggest otherwise at [20]. I express no opinion on the delegation point or whether the definition imports the exercise of a "Power" as defined by the trust deed or at all. The issues associated with Karger v. Paul [1984] VicRp 13; [1984] V.R. 161 and temporal questions are considered below.

[13] [1984] FCA 6; (1984) 1 F.C.R. 301. The key passages are set out in Flegeltaub v. Telstra Super Pty. Ltd. at [22].

[14] The reasonableness of a refusal to submit to treatment is not determined solely by the likelihood of its being successful. An operation that is more likely than not to be successful may entail risks that a reasonable person is not willing to take. Moreover, there may be many factors bearing on reasonableness in this context, including religious belief and the aetiology of the refusal, especially if it is the disablement itself.

[15] Compare Maciejewski v. Telstra Super Pty. Ltd. (No. 2) at [10-12].

[17] Karger v. Paul at 163 line 48 and 166 line 47. It was conceded that, even if the appellant was exercising a discretion, it was not "absolute and uncontrolled": cf. Esso Aust. Ltd. v. Australian Petroleum Agents' and Distributors' Association (unreported, Supreme Court of Victoria, 5th October 1993) at 22.

[18] In the former case there may still be a discretion in the widest sense of that word: cf. Coal and Allied Operations Pty. Ltd. v. Australian Industrial Relations Commission [2000] HCA 47 at [19, last sentence]. "Category 3" in Mettoy Pension Trustees Ltd. v. Evans [1990] 1 W.L.R. 1587 at 1614 was described as comprising "any discretion which is really a duty to form a judgment as to the existence or otherwise of particular circumstances giving rise to particular consequences". (Emphasis added.)

[19] Compare Singer v. Berghouse [1994] HCA 40; (1994) 181 C.L.R. 201 at 210-211; Mitchell v. R. [1996] HCA 45; (1996) 184 C.L.R. 333 at 346 and Attorney-General v. Breckler (1999) 197 C.L.R. 83 at [24].

[20] Flegeltaub v. Telstra Super Pty. Ltd. at [18] and [55].

[21] This is not, perhaps, an exact statement, but it is sufficiently accurate for present purposes.

[22] Unreported, Supreme Court of New South Wales, 4th April 1985 at 11. We were informed that this is regarded in New South Wales as the seminal decision on the subject and were referred to a number of cases in which it has been applied.

[23] The function that is relevant for present purposes was to consider whether they were of opinion that the plaintiff's injury was sufficiently serious to render him unlikely to resume work or attend to any gainful profession or occupation for which he was reasonably fitted or could have been reasonably fitted by education, training and experience.

[24] Maciejewski v. Telstra Super Pty. Ltd. (No. 2) at [14-15] and [21].

[25] Similarly Esso Aust. Ltd. v. Australian Petroleum Agents' and Distributors' Association was concerned with a discretion to make a payment. It was not a superannuation case.

[26] It is not necessary, in order to decide the present case, to consider whether that language is sufficient, or appropriate, in every case of a fiduciary obligation to form an opinion as to a question of fact.

[27] Compare Maciejewski v. Telstra Super Pty. Ltd. [No. 1] (1998) 44 N.S.W.L.R. 601 at 605 and Maciejewski v. Telstra Super Pty. Ltd. (No. 2) at [21].

[28] Compare Thomas on Powers (1998) at ss 6-239 - 6-243A.

[30] Matters stated in Harris v. Lord Shuttleworth [1994] ICR 989 at 999.

[31] Compare, for example, Avon Downs Pty. Ltd. v. FC of T [1949] HCA 26; (1949) 78 C.L.R. 353 at 360; FC of T v. Brian Hatch Timber Co. (Sales) Pty. Ltd. [1972] HCA 73; (1972) 128 C.L.R. 28; Kolotex Hosiery (Australia) Pty. Ltd. v. FC of T [1975] HCA 5; (1975) 132 C.L.R. 535; DC of T v. Richard Walter Pty. Ltd. [1995] HCA 23; (1995) 183 C.L.R. 168 at 188 (where the word "discretion" appears); and Minister for Immigration and Ethnic Affairs v. Wu Shan Liang[1996] HCA 6; (1996) 185 C.L.R. 259 at 275-276.

[32] For example, Vidovic v. Email Superannuation Pty. Ltd. (unreported, Supreme Court of New South Wales, Bryson, J., 3 March 1995) at p.11; Dillon v. Burns Philp Finance Ltd. (unreported, Supreme Court of New South Wales, Bryson, J., 20 July 1988) at pp.15-16; Minehan v. AGL Employees Superannuation Pty. Ltd. [1998] ACTSC 114; (1998) 134 A.C.T.R. 1 at para.55; and Mettoy Pension Trustees Ltd. v. Evans [1990] 1 W.L.R. 1587 at 1610. See also Lord Browne-Wilkinson, Equity and its Relevance to Superannuation Today (Leo Cussen Institute, 1992) and J.A. Riordan, Superannuation, Disablement and Trustee's Discretion, (1993) 67 Law Institute Journal 932.

At a glance

Court

Decision date

Before

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Judgment (76 paragraphs)

Parties