EQUITY – TRUSTS AND TRUSTEES – POWERS, DUTIES, RIGHTS AND
LIABILITIES OF TRUSTEES – GENERAL MATTERS – RULES
GOVERNING EXERCISE
OF DISCRETION – where the first and second respondents are the trustees of
Source
Original judgment source is linked above.
Catchwords
EQUITY – TRUSTS AND TRUSTEES – POWERS, DUTIES, RIGHTS ANDLIABILITIES OF TRUSTEES – GENERAL MATTERS – RULESGOVERNING EXERCISEOF DISCRETION – where the first and second respondents are the trustees ofa self-managed superannuationfund (the Fund) – where the terms ofthe Fund provide that the trustees have absolute discretion in distributing theresidual death benefitunder the Fund to the dependants under the Fund –where the trustees made inquiries of all of the dependants under the Fund– where the trustees decided, in essence, to split the residual deathbenefit under the Fund equally between two of the dependants– where thetwo dependants had differing levels of need – where the applicants seekthe Court’s review of the trustees’decision and that the decisionbe remitted to the trustees – whether common law principles are applicableto a review unders. 8(1) of the Trusts Act 1973 (Qld) – whetherthe Court is permitted to examine the extent of and nature of the inquiries made
by trustees in gathering information
for the exercise their discretion –
whether the trustees are subject to a higher standard to properly inform
themselves because
the Fund is a superannuation fund – whether the
trustees exercised real and genuine consideration in making their
decision
Trusts Act 1973 (Qld), ss. 8(1), 94(1)
Superannuation Industry (Supervision) Act 1993 (Cth), s.
10
Alcoa of Australia Retirement Plan Pty Ltd v Frost [2012] VSCA 238
(2012) 36 VR
618, considered
Attorney-General (Cth) v Breckler (1999) 197 CLR 83,
considered
Burns v Burns [2008] QSC 173, explained
Finch v
Telstra Super Pty Ltd [2010] HCA 36
(2010) 242 CLR 254, distinguished
Gisborne v
Gisborne (1877) 2 App Cas 300, explained
Hennessey v Perpetual
Trustees Queensland Ltd [2000] QSC 311, followed
Karger v Paul
[1984] VicRp 13
[1984] VR 161, applied
Owies v JJE Nominees Pty Ltd (2022) 22
ASTLR 89, distinguished
Re Roper’s Trusts (1897) 21 Ch D 272,
cited
Re Whitehouse [1982] Qd R 196, considered
Tierney v King
[1983] 2 Qd R 580, considered
Vance v MIM Holdings Ltd [1999] QSC 210, considered
Judgment (98 paragraphs)
[1]
EQUITY - TRUSTS AND TRUSTEES - POWERS, DUTIES, RIGHTS AND LIABILITIES OF TRUSTEES - GENERAL MATTERS - RULES GOVERNING EXERCISE OF DISCRETION - where the first and second respondents are the trustees of a self-managed superannuation fund (the Fund) - where the terms of the Fund provide that the trustees have absolute discretion in distributing the residual death benefit under the Fund to the dependants under the Fund - where the trustees made inquiries of all of the dependants under the Fund - where the trustees decided, in essence, to split the residual death benefit under the Fund equally between two of the dependants - where the two dependants had differing levels of need - where the applicants seek the Court's review of the trustees' decision and that the decision be remitted to the trustees - whether common law principles are applicable to a review under s. 8(1) of the Trusts Act 1973 (Qld) - whether the Court is permitted to examine the extent of and nature of the inquiries made by trustees in gathering information for the exercise their discretion - whether the trustees are subject to a higher standard to properly inform themselves because the Fund is a superannuation fund - whether the trustees exercised real and genuine consideration in making their decision
[1] This proceeding was commenced by way of originating application by Paul Francis Williams (Paul) and Mark Anthony Williams (Mark) (together, the applicants), who seek, in summary, a review and directions by the Court under sections 8(1) and 94(1) of the Trusts Act 1973 (Qld) (Trusts Act) in respect of a determination made by the trustees of the Boosey Doherty Superannuation Fund (the Fund) as to the payout of the residual death benefit of Anthony Vincent Williams (Anthony / the Deceased) under the Fund.
[2] At the time of the determination, the trustees of the Fund were James Robba and Morgan Lane, the first and second respondents (the Trustees). The trust deed confers upon the Trustees an absolute discretion to pay out the residual death benefit to one or more of a member's dependants. The only potential recipients of the benefit are the four children of the Deceased and the second wife of the Deceased.
[3] The Trustees made a decision to pay 50% of the residual death benefit (less $750) to Gayle Dianne Williams (Gayle), the Deceased's second wife (the third respondent), and the balance of the residual death benefit to Peter John Williams (Peter), one of the Deceased's children (the Determination).
[4] For ease of reference, I will refer in this judgment to relevant people by their first names, without intending any disrespect.
[5] The applicants say that the Determination is subject to review by the Court because the Trustees failed to exercise real and genuine consideration in making the Determination, specifically by failing to properly consider the greater interests and needs of Peter as compared to Gayle. The applicants ask for the Determination to be set aside and remitted to the Trustees with appropriate directions as to what ought be taken into account when remaking a decision.
[17]
[7] Some preliminary matters were raised at the commencement of the hearing of the proceeding.
[8] First, the proceeding was originally commenced against the Trustees only, but at the outset of the hearing an application was made to join Gayle to the proceeding as a third respondent. That application was ultimately not opposed, I considered that it was appropriate to join Gayle as a respondent, and I made orders joining Gayle to the proceeding as the third respondent. The hearing therefore proceeded against the Trustees and Gayle. Gayle has chosen not to play any active role in the proceeding.
[9] Second, the originating application sought directions under section 94(1) of the Trusts Act, essentially to authorise the Trustees to pay out the residual death benefit in accordance with the review conducted under section 8(1) or for the sole benefit of Peter. Counsel for the applicants accepted at the hearing that the relief sought under section 94(1) goes no higher than that sought under section 8 and, consequently, did not press for relief under section 94(1). I consider that approach correct. Section 8(1) of the Trusts Act provides:
[18]
"Any person who has, directly or indirectly, an interest, whether vested or contingent, in any trust property or who has a right of due administration in respect of any trust, and who is aggrieved by any act, omission or decision of a trustee or other person in the exercise of any power conferred by this Act or by law or by the instrument (if any) creating the trust, or who has reasonable grounds to apprehend any such act, omission or decision by which the person will be aggrieved, may apply to the court to review the act, omission or decision, or to give directions in respect of the apprehended act, omission or decision; and the court may require the trustee or other person to appear before it and to substantiate and uphold the grounds of the act, omission or decision which is being reviewed and may make such order in the premises (including such order as to costs) as the circumstances require."
[19]
[10] The terms of section 8 conferring power upon the Court to "review the act, omissions or decision" and to "make such order in the premises ... as the circumstances require" permit the Court to set aside a decision made by a trustee of a trust and remit the decision to the trustee for reconsideration. The parties agreed that if I were to find that the Determination should be set aside, the appropriate course would be to remit the decision to the Trustees.[1]
"Where in the opinion of the court any sale, lease, mortgage, surrender, release or other disposition, or any purchase, investment, acquisition, retention, expenditure or other transaction is expedient in the management or administration of any property vested in a trustee, or would be in the best interests of the persons, or the majority of the persons, beneficially interested under the trust, but it is inexpedient or difficult or impracticable to effect the disposition or transaction without the assistance of the court, or it or they can not be effected by reason of the absence of any power for that purpose vested in the trustee by the trust instrument (if any) or by law, the court may by order confer upon the trustee, either generally or in any particular instance, the necessary power for the purpose, on such terms, and subject to such provisions and conditions (if any) as the court may think fit, and may direct in what manner any money authorised to be expended, and the costs of any transaction, are to be paid or borne, and as to the incidence thereof between capital and income."
[21]
[12] In brief, section 94 allows the Court to make orders conferring power upon a trustee to deal with trust property for the expedient management or administration of the property or the best interests of the beneficiaries under the trust. The relief sought by the applicants in this case is for the Determination to be remitted back to the Trustees. It is not necessary for the Court to confer a power upon the Trustees. Therefore, I consider that the relief sought would be appropriately granted under section 8(1) and it is not necessary for me to consider the orders sought under section 94(1) any further.
[22]
[13] The factual background relevant to the proceeding is largely uncontentious.
[23]
[14] The Fund was constituted by a deed dated 1 July 2009 (the Deed). Clause 1.1 of the Deed describes the Fund as being a superannuation fund. The reference schedule to the Deed sets out the initial trustees and members of the Fund as being Anthony and his first wife, Margaret Patrice Williams (Margaret).
[15] Margaret predeceased Anthony. Anthony passed away on 28 December 2021.
[16] The total value of the residual death benefit in the Fund at the time of Anthony's passing appears to comprise about $550,000 (being commercial premises at Benalla with that approximate value).
[17] After Anthony's passing, the applicants were the trustees of the Fund. On 14 July 2023, Martin SJA ordered that the applicants be removed as trustees of the Fund and that the Trustees be appointed.
[18] On 26 September 2023, Paul wrote to the Trustees via email confirming that the only dependants of Anthony at that time were Gayle, and Anthony's four children, Mark, Paul, Peter and Louise Marie Hart (nee Williams) (Louise).
[24]
[19] The Trustees sought information as to the needs and circumstances of each of the dependants and received material in response. In September 2023, email communications took place between the Trustees and Paul requesting documents and information regarding the Fund.
[20] On 13 October 2023, the Trustees' lawyer wrote a letter to all five dependants under the Fund requesting that each dependant "provide to our clients particulars of any facts or matters that you would like our clients to consider in determining whether to exercise their discretion to apply the death benefit to you or to any other Dependent [sic]".[2]
[21] In November 2023, more specific requests for information were made by the Trustees' lawyer via email to Paul, Mark and Louise, such as each person's financial status, assets and liabilities, needs such as medical needs, employment and income, details of Anthony's estate and its value to the dependant, and any special circumstances. When some responses were given, the Trustees' lawyer asked more specific questions - for example, whether Louise owned any real property, more details concerning a property left to Peter from Anthony's estate, and each of the dependants' financial dependency.
[22] More specifically, in November and December 2023, detailed information was provided by Mark to the Trustees about Peter's health conditions, including the circumstances of and requirements of Peter's accommodation arrangements, and letters from occupational therapists, nurses and a mental health clinician describing Peter's health conditions and needs.
[23] On the material before the Court, Gayle's and Peter's circumstances can be described in a summary way as follows.
[25]
[24] Gayle was 63 years old at the time the Trustees made requests for information. She was a widow and unable to work due to her health, having been diagnosed with ovarian cancer in December 2020 then undergoing surgery in 2021 and 2023. She owned a house unencumbered worth $570,000, a car worth $15,000 and had approximately $12,500 in bank accounts. She had some $66,000 in liabilities for legal fees. She was receiving full pension.
[25] The applicants contended, and I generally accept, that there was no suggestion on the material that Gayle was not capable of being self-sufficient from the financial resources available to her. However, I note that the information provided to the Trustees indicated that Gayle's total weekly expenses exceeded her net weekly income. Prior to Anthony's death, he had been transferring Gayle an allowance of $1,000 per fortnight to help cover her costs of living.
[26]
[26] Peter is diagnosed with schizoaffective disorder. He was and remains entirely dependent on NDIS and family support. His schizophrenia is treatment-resistant and will never fully subside. He will have ongoing care requirements and challenges with accommodation; he needs a stable place to live in the Alfred hospital catchment area.
[27] In oral submissions, the applicants drew the Court's attention to the following aspects of evidence in support:
[27]
(a) Leila Miller, an occupational therapist, wrote that "throughout my career, I have seldom encountered an individual as debilitated by their disability, impacting his day-to-day functionality across all aspects of his life". She also noted that the condition is persistent and Peter gets little relief from the condition. She further noted that Peter is living in supported accommodation in Melbourne, and provided that "future accommodation for Peter requires secured accommodation, either privately owned or rental, 2 bedrooms, 2 bathrooms to allow support staff to provide 24-hour support and guidance for Peter. It is extremely important Peter is provided with this type of accommodation, for his well-being, independence and safety".[3]
(b) Andrew Campbell, a registered psychiatric nurse and a registered NDIS provider, wrote that Peter experiences derogatory auditory hallucinations that cause him significant distress on a daily basis, and that "his illness is unresponsive to assertive treatment and his symptoms are continual". Mr Campbell further notes that Peter is in temporary supported accommodation and that "it is vital that the provision of a 2-bedroom apartment or unit is sought as a matter of urgency to offer the prospect of stable accommodation. Peter must stay linked with the area mental health service and have continued support via the NDIS".[4]
(c) Brad Morton, Peter's support worker and a mental health nurse, supports the above two accounts and writes "Peter does not get any significant relief from his symptoms" and that he "will require lifelong intensive support and treatment for his mental illness".[5]
(d) Oliver Hill, Peter's case manager at the Alfred Hospital, supports this account and indicates that "it is anticipated Peter will require care and support for the remainder of his life ... To secure ongoing accommodation would remove one of the most pronounced stressors faced by people with chronic mental illness and where possible this accommodation should be located near his existing mental health and family supports".[6]
[28]
[28] In an email to the Trustees dated 15 December 2023, Mark pointed out that "Gayle had 2 years of limited financial dependency on [Anthony]. My brother Peter has had 43 years of total dependency."[7]
[29] By Anthony's will, Peter was left a property. The true value of that property was not certain on the material. In Gayle's submissions to the Trustees, provided to the Trustees on 2 November 2025, the value of that property was estimated to be $531,000. In an email from Mark to the Trustees dated 6 November 2025, the value of the property was said to be $450,000 with a mortgage against it for a $90,000 loan.[8]
[29]
[30] The correspondence indicates that Anthony's children wrote to the Trustees claiming that Gayle was disentitled to the Fund entirely because she allegedly illegally withdrew money from the Fund for her own benefit. That submission - that Gayle is disentitled to the Fund altogether - was not advanced by the applicants in the proceeding and therefore is not for me to deal with, except insofar as the applicants rely on the underlying allegations as a factor in submitting that the Determination should be reviewed. It is a factor I will consider.
[30]
[31] On 17 May 2024, the Trustees advised each of the dependants by letter of the Determination. The letter provided that the Trustees had exercised their discretion and determined that the residual death benefit under the Fund would be paid out as follows:
[31]
(a) 50% of the residual death benefit (less the sum of $750) to Gayle;
(b) the balance of the residual death benefit to Peter.
[32]
[32] The letter noted that the reduction of $750 from Gayle's share was to account for half the funds she had previously obtained on 3 January 2022 from the Fund's bank account, that totalled $1,500.
[33]
[33] On 6 June 2024, the applicants' solicitors requested, by way of letter, that the Trustees review the Determination on the basis that inadequate consideration had been given to the needs of Peter. The letter requested that "at least 95% of all available benefits, if not 100% of all available benefits, be accorded to Mr Peter Williams". The letter outlined Peter's mental health issues and need for care.[9]
[34] On 10 September 2024, Wilson J made a direction that the Trustees were authorised to pay out the residual death benefit under the Fund in accordance with the Determination, unless the applicants commenced a proceeding to set aside or otherwise challenge that determination on or before 15 November 2024. This proceeding was then commenced on 15 November 2024.
[34]
[35] The Deed provides by clause 15.1 (emphasis added):
[35]
"Subject to the Superannuation Conditions, the Trustees in the exercise of the authorities, powers and discretions hereby vested in them have an absolute and uncontrolled discretion and may exercise or enforce or delegate (by power of attorney or otherwise) all or any of the authorities, powers or discretions from time to time or may refrain from exercising all or any of such authorities, powers or discretions from time to time and their decision as to the interpretation and effect of this Deed is final and binding on all parties."
[36]
[36] The Deed further provides by clause 24.4 (emphasis added):
[37]
The benefits payable to or in respect of Members, Dependants and Personal Representatives in accordance with the Deed must be paid or applied to or for the benefit of such one or more of those Beneficiaries in the form of lump sums, pensions or annuities as provided in the Rules and in such manner as the Trustees may in their absolute discretion decide provided that such payments do not cause the Fund to fail to satisfy the Superannuation Conditions, nor conflict with paragraph 3.2 and is subject to any valid notice given to the Trustees by a Member pursuant to paragraph 24.6."
[38]
[37] The Schedule to the Deed set out the rules relating to the membership of the Fund, the kinds of benefit provided by the Fund, and the circumstances of payment of benefits under the Fund. Relevantly, clause 4.1 of the rules provided (emphasis added):
[39]
(a) If a Member dies before payment or commence of payment of a benefit under rule 3, the amount of the Member's Benefit will be held by the Trustees on trust, subject to this Rule 4 and the SIS Act**, for the benefit of one or more of the Member's Dependants in the shares and proportions as the trustees, in their absolute discretion, determine**.
[40]
[38] "Beneficiary" is a term defined in the Deed as meaning "a Member, Dependant or other persons entitled to receive a benefit under this Deed".
"dependant, in relation to a person, includes the spouse of the person, any child of the person and any person with whom the person has an interdependency relationship".
[42]
[40] It is not in dispute that Gayle, Mark, Louise, Paul and Peter are dependants of Anthony and therefore beneficiaries within the meaning of the Deed. There is also no contention that Anthony has any other dependants.
[43]
[41] There is dispute between the parties as to what legal principles are applicable:
[44]
(a) in the Court's review of a discretionary decision under section 8 of the Trusts Act; and
(b) in the Court's review of a discretionary decision in respect of a superannuation fund.
[43] The Trustees referred the Court to the test at common law for reviewing a trustee's decision made pursuant to an absolutely discretionary discretion. On the other hand, the applicants submitted that the Court's powers of review under section 8 of the Trusts Act are broader than at common law and the test under section 8 is different.
[44] It is convenient to start with the principles at common law put forth by the Trustees.
[45] The starting point, in the Trustees' submission, is Karger v Paul[1984] VicRp 13; [1984] VR 161 (Karger v Paul), in which McGarvie J wrote of a trustee's "absolute and unfettered discretion" at 163:
[47]
"with one exception, the exercise of a discretion in these terms will not be examined or reviewed by the courts so long as the essential component parts of the exercise of the particular discretion are present. Those essential component parts are present if the discretion is exercised by the trustees in good faith, upon real and genuine consideration and in accordance with the purposes for which the discretion was conferred. The exception is that the validity of the trustees' reasons will be examined and reviewed if the trustees choose to state their reasons for their exercise of discretion."
[48]
[46] I do not consider - and nor is it contended - that there is any material difference between the wording of "absolute and unfettered" in Karger v Paul and the wording of "absolute and uncontrolled" or simply "absolute" used in this case.
[47] The above passage, in effect, exhaustively outlines four limbs by which a court will be permitted to review an exercise of a trustee's absolutely discretionary power:
[49]
(a) if the discretion was not exercised in good faith;
(b) if the discretion was not exercised upon real and genuine consideration;
(c) if the exercise was not in accordance with the purposes for which the discretion was conferred;
(d) if the trustee chose to state their reasons for the exercise of the discretion.
[50]
[48] The applicants' submissions in this case advance only the second limb for review, namely that the Trustees did not exercise their discretion upon real and genuine consideration in making the Determination.
[49] Similar principles were adopted by the plurality of the High Court (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ) in Attorney-General (Cth) v Breckler (1999) 197 CLR 83 (Breckler) at [7]:
[51]
"Where a trustee exercises a discretion, it may be impugned on a number of different bases such as that it was exercised in bad faith, arbitrarily, capriciously, wantonly, irresponsibly, mischievously or irrelevantly to any sensible expectation of the settlor, or without giving a real or genuine consideration to the exercise of the discretion. The exercise of a discretion by trustees cannot of course be impugned upon the basis that their decision was unfair or unreasonable or unwise. Where a discretion is expressed to be absolute it may be that bad faith needs to be shown. The soundness of the exercise of a discretion can be examined where reasons have been given, but the test is not fairness or reasonableness."
[52]
[50] The applicants disputed the accuracy of the second last sentence in the above passage. The decision of the Court (Kyrou, Niall and Walker JJA) in Owies v JJE Nominees Pty (2022) 22 ASTLR 89 (Owies) at [88] was referred to as support for the proposition that bad faith is not a finding necessary for a review of a trustee's decision where the trustee has an absolute discretion:
[53]
"In Wareham v Marsella[2020] VSCA 92; (2020) 61 VR 262, this Court accepted the above summary from Breckler as authoritative. However, the Court rejected a submission, based on the penultimate sentence, that, in the context of an absolute and unfettered discretion, a failure to give real and genuine consideration to a relevant matter will not impugn the exercise of power in the absence of a finding of bad faith. The Court noted that the submission was flatly inconsistent with Karger".
[54]
[51] The High Court in Breckler cited Gisborne v Gisborne(1877) 2 App Cas 300 (Gisborne), seemingly referring from the passage from Lord Cairns at 305 that:
[55]
"the trustees are not merely to have discretion, but they are to have 'uncontrollable,' that is, uncontrolled, 'authority'. Their discretion and authority, always supposing that there is no mala fides with regard to its exercise, is to be without any check or control from any superior tribunal".
[56]
I consider that statement to mean that a trustee exercising an absolute discretion in bad faith will always result in that exercise being subject to judicial scrutiny, but it is not the only way for a trustee's exercise of discretion to be subject to judicial scrutiny. In other words, Lord Cairns in Gisborne identified lack of bad faith as being one "essential component part" of the exercise of a discretion, while McGarvie J in Karger v Paul identified two others. Therefore, I agree with the view taken by the Court in Owies.
[57]
[52] In any event, neither party in this case contended that bad faith needed to be shown for the Court to impugn a decision made in the exercise of an absolute discretion, and my decision proceeds on the basis that I do not need to find that the Determination was an exercise of discretion in bad faith to be able to review the Determination under section 8 of the Trusts Act.
[53] The applicants submitted that the starting point for considering the operation of the Court's power to review under section 8 of the Trusts Act is the decision Re Whitehouse[1982] Qd R 196 (Re Whitehouse). In that case, Macrossan J wrote at 203-204:
[58]
"It seems to me that the power of the court under s. 8 to review a trustee's acts and decisions is one which should not be narrowly construed. By this I mean that the jurisdiction should not be read down or unduly confined. On the other hand, I think it would be wrong to suggest that although the jurisdiction to undertake a review is wide, the court would lightly interfere with a discretionary decision made by a trustee. The courts will continue to bear in mind that discretionary trust powers are vested in trustees for the purpose of decision by them and the traditional reluctance to interfere with their decisions will, for good reason, continue. If, notwithstanding this reluctance, a proper case is made out, then I do not doubt that the court has wide power. ... The practical limitation upon the court's power under s 8(1) ... (arises) out of the traditional reluctance of the courts to interfere with the discretionary acts of private trustees and out of the very good reasons for that approach. I agree that a heavy onus lies upon a person seeking a review of a trustee's decision."
[59]
[54] Then, referring to Re Whitehouse, Matthews J (with whom Kelly and Macrossan JJ agreed) in Tierney v King[1983] 2 Qd R 580 (Tierney v King) said at 583:
[60]
"the object of [section 8 of the Trusts Act] is not the substitution of a Judge's opinion for that of a trustee. The applicant carries a heavy onus of satisfying the Judge that there is a good reason for adoption of such a course and that the trustee has not exercised that "sound discretion" referred to by Fry J in Re Roper's Trusts(1879) 21 Ch D 272".
[61]
[55] In Re Roper's Trusts, Fry J held that a court has the power to control a trustee's discretion (and exercise the discretion itself) where the trustee "has not exercised a sound discretion".[10]
[56] The applicants further referred to the decision of Chesterman J in Burns v Burns[2008] QSC 173. His Honour set out the above passages from Re Whitehouse and Tierney v King with approval, before continuing:
[62]
"[32] The 'traditional reluctance' of the courts to interfere with an exercise of discretion by a trustee was described by the High Court (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ) in Attorney-General for the Commonwealth v Breckler & Ors (1999) 197 CLR 83 at 99-100. Their Honours said, quoting from the judgment of Heerey J in Wilkinson v Clerical Administrative and Related Employees Superannuation Pty Ltd[1998] FCA 51; (1997) 79 FCR 469 at 480:
[63]
Where a trustee exercises a discretion, it may be impugned on a number of different bases such as that it was exercised in bad faith, arbitrarily, capriciously ... , wantonly, irresponsibly ... , mischievously or irrelevantly to any sensible expectation of the settlor ... , or without giving a real or genuine consideration to the exercise of the discretion ... . The exercise of a discretion by trustees cannot of course be impugned upon the basis that their decision was unfair or unreasonable ... or unwise ... . Where a discretion is expressed to be absolute it may be that bad faith needs to be shown ... . The soundness of the exercise of a discretion can be examined where reasons have been given, but the test is not fairness or reasonableness ...
[64]
The grounds for challenge to the exercise by trustees of the powers reposed in them, particularly if the trustees gave no reasons for their decision, were limited ... . The circumstances in which relief could be obtained ... were accurately summarised in Wilkinson ... . ... They did not extend to cases where the decision of the trustee was criticised as unfair or unreasonable ... or unwise ...
[65]
[34] The applicant does not contend that the trustee, Duncan, has acted in bad faith or other than diligently and conscientiously in the exercise of the discretion conferred on him by the will. His complaint is that the manner in which Duncan proposes to exercise the discretion does not accord with the testatrix's letter of instruction that Ian's wishes be respected in the administration of the trust and Adrian's expressed wish that Ian be the recipient of the trust estate.
[66]
[35] Such a complaint falls squarely within that class of case in which it is said the trustee's decision was unfair, or unreasonable, or unwise. These are beyond the review of the courts. Section 8 does not change the position. Ian's complaint cannot be accepted.
The duty of supervision on the part of this court will thus be confined to the question of the honesty, integrity and fairness with which the deliberation has been conducted, and will not be extended to the accuracy of the conclusion arrived at, except in particular cases.
[69]
[37] It is the 'accuracy of the conclusion' the applicant complains of here. To make out a 'particular case' an applicant must demonstrate cogent reasons for interfering with the discretion: see Re Koczorowski[1974] Qd R 177 at 185-6 per Dunn J. I apprehend that the phrase calls to mind those cases where the result of the discretion is plainly unreasonable or unjust giving rise to an inference that the discretion has miscarried or been affected by some impropriety."
[70]
[57] Based on this decision, the applicants submit that the scope of review under section 8 of the Trusts Act is broader than at common law, and that, while it is not sufficient to invoke the Court's review if the decision is merely unfair or unreasonable or unwise, it is sufficient to show that the decision is "plainly unreasonable or unjust" and that there are cogent reasons for the Court's interference with the decision.
[58] For the following three reasons, I do not accept the applicants' submission that the test under section 8 is broader (or easier to satisfy) than that at common law.
[59] First, the leading cases on section 8 continuously emphasise that it is not a light decision for a court to interfere with a discretionary decision made by a trustee, that a heavy onus lies on a party who seeks review of a trustee's decision, and that this is rooted in the courts' traditional reluctance to interfere with trustees' decisions at common law, which reluctance continues in the application of section 8: see Re Whitehouse at 203-204; Tierney v King at 583; Burns v Burns at [32]-[35]. None of these cases suggest that section 8 amends or departs from the common law. In fact, there is some suggestion in Burns v Burns at [35] that section 8 does not change the courts' "traditional reluctance" to interfere with a trustee's discretion. Accordingly, I do not consider that any of these cases are inconsistent with the principles laid out in .
[71]
"I regard it as an inherent requirement of the exercise of any discretion that it be given real and genuine consideration. To borrow a phrase from a passage quoted in Partridge v The Equity Trustees Executors and Agency Co Ltd(1947) 75 CLR 149, at p. 164, there must be the 'exercise of an active discretion'. It has been held that when the occasion for the exercise of a discretionary power has arisen, trustees, while not bound to exercise the discretion, are bound to consider whether it ought in their judgment to be exercised: Klug v Klug[1918] 2 Ch 67; In re Gulbenkian's Settlement [1970] AC 508, at p. 518. I think that it goes without saying that they must give real and genuine consideration. It seems to me that it is in this sense only that the Court can examine whether the trustees gave 'proper' consideration to the exercise of the discretion. The language used in this area has not always been distinguished by its precision: see Hardingham and Baxt, Discretionary Trusts, 1975, p. 92. The courts will examine whether a discretion has been exercised irresponsibly, capriciously or wantonly: Lutheran Church of Australia South Australia District Incorporated v Farmers Co-operative Executors and Trustees Ltd[1970] HCA 12; (1970) 121 CLR 628, at p. 639. This is another way of saying that there may be an examination as to whether trustees have exercised their discretion on real and genuine consideration: Pilkington v Inland Revenue Commissioners[1964] AC 612, at p. 641; [1962] 3 All ER 622."
[72]
[65] McGarvie J also considered what evidence the court may have regard to when considering whether there has been a failure to comply with the essential components of an exercise of discretion (at 164 (emphasis added)):
[73]
"For the plaintiff it was submitted that in this case the Court should examine whether the trustees gave fair and proper consideration to the exercise of the discretion and that the plaintiff should succeed in the action if they did not. In my view, in this case it is open to the Court to examine the evidence to decide whether there has been a failure by the trustees to exercise the discretion in good faith, upon real and genuine consideration and in accordance with the purposes for which the discretion was conferred. As part of the process of, and solely for the purpose of, ascertaining whether there has been any such failure, it is relevant to look at evidence of the inquiries which were made by the trustees, the information they had and the reasons for, and manner of, their exercising their discretion. However, it is not open to the Court to look at those things for the independent purpose of impugning the exercise of discretion on the grounds that their inquiries, information or reasons or the manner of exercise of the discretion, fell short of what was appropriate and sufficient. Nor is it open to the Court to look at the factual situation established by the evidence, for the independent purpose of impugning the exercise of the discretion on the grounds that the trustees were wrong in their appreciation of the facts or made an unwise or unjustified exercise of discretion in the circumstances. The issues which are examined by the Court are limited to whether there has been a failure to exercise the discretion in good faith, upon real and genuine consideration and in accordance with the purposes for which the discretion was conferred. In short, the Court examines whether the discretion was exercised but does not examine how it was exercised."
[74]
[66] In the Trustees' submission, the above passage indicates that the Court is not allowed to criticise or examine the inquiries that were made or not made by a trustee. Rather, the Court's function is limited to reviewing whether the trustee gave real and proper consideration to the exercise of the discretion based on the information possessed.
[67] I accept the Trustees' submission in this respect. My understanding of the above passage is that the Court may examine the inquiries that were in fact made by the trustee to determine whether the inquiries demonstrate that the trustee exercised real and genuine consideration. But it is not for the Court to criticise the inquiries which were made or identify with any specificity what inquiries should have been but were not made. This is consistent with the general reluctance of courts to not interfere with the discretion of a trustee where a trustee has expressly been given wide power to make decisions - to conclude otherwise would, in my view, err too close to a court substituting its own processes and decision for that of the trustee.
[68] Against that conclusion, the applicants rely on the decision in Owies. I do not consider anything in Owies to be inconsistent with the conclusion I have reached. In setting out the principles that govern the requirement to give real and genuine consideration, the Court in Owies wrote at [97] (emphasis added):
[75]
"Although the validity of the outcome of an exercise of power is not to be assessed by notions of fairness or reasonableness, the process must be one in which the trustee is able to exercise the power in a manner that is just, in the sense of it not being arbitrary or capricious, and it must accord with the purpose of the trust. Often that will require ensuring that the trustee is adequately informed so as to put itself in a position to properly exercise the power. As Callaway JA said in Telstra Super Pty Ltd v Flegeltaub, '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. It is not a matter of natural justice but bona fide inquiry and genuine decision making.'"
[76]
[69] That passage indicates that, to give real and genuine consideration, a trustee may be required to conduct investigations. It does not say anything about examining the content of those investigations or the adequacy thereof.
[70] The Court went on to make findings consistent with that premise. The facts of Owies are materially different to the present case and involved circumstances where there was no evidence that the relevant material had been put before the trustee at all. Owies concerned a family trust with five beneficiaries - two parents and their three children - where income under the trust was distributed at the end of each financial year, and two of the children had not received any distributions at all over the course of nine years. The Victorian Court of Appeal noted that the trustee had not made inquiries of those two children, and, given the strained relationship between them and the rest of the family, the fact that the two children had been in contact with the parents was an insufficient basis to infer that the trustee came into possession of information about those children's financial circumstances. The present case is distinguishable. The Trustees here had directly made inquiries about Peter's circumstances as well as asked for all information that may be relevant to their decision-making. In Owies, the fact that no inquiries had been made at all of two of the beneficiaries, alongside a number of other factual considerations specific to that case (such as the amount and regularity of the distributions) provided reason to conclude that the trustee had not given real and genuine consideration to the exercise of the discretion. The Court examined the absence of inquiries, not the substance of the inquiries.
[71] Therefore, I do not consider Owies to support a position that a court can examine the substance of inquiries that were in fact made to determine whether real and genuine consideration has been given.
[72] I appreciate that the matter is finely balanced and the point at which a court may traverse from the former permissible exercise into the latter impermissible exercise may at times be difficult to determine. For the purposes of this case, however, I consider that it is not for me to decide whether the inquiries that were made by the Trustees (which on their face were significant and detailed) were sufficient or what supplementary inquiries they could or should have made.
[77]
"Notwithstanding the heavy onus which the applicant bears if his case is simply to reverse a discretionary decision of trustees (as opposed to identifying some error in the question which the trustees set for themselves or in their failure to consider material which was properly before them), I believe the plaintiff ought to be allowed to pursue his claim. To do so, however, it will be necessary for the plaintiff to specifically plead his reliance upon s.8 of the Trusts Act and to identify the circumstances upon which he relies for a review under that decision."
[78]
[74] I do not consider that statement to be inconsistent with my conclusion or with the principles expressed in Karger v Paul. The case refers to impugning a trustee's decision where there is a failure to consider the material that was in fact properly before the trustee. That goes no higher than the real and genuine consideration requirement taken from Karger v Paul and does not indicate that trustees have any additional obligation to obtain any particular material that is not before them.
[79]
[75] The applicants further submitted that, because the Fund is a superannuation fund, decisions made in respect of it should be subject to a higher level of scrutiny than a standard trust fund. The applicants referred to Finch v Telstra Super Pty Ltd[2010] HCA 36; (2010) 242 CLR 254 (Finch) to support the proposition that the standard of real and genuine consideration to which trustees of a superannuation fund are held is higher than the standard for the trustee of a standard trust. In particular, the Court in Finch (French CJ, Gummow, Heydon, Crennan and Bell JJ) wrote at [36]:
[80]
"Thus the public significance of superannuation and the close attention paid to it through statutory regulation support the conclusion that the decisions of superannuation trustees are not likely to be largely immunised from judicial control without clear contrary language in the relevant trust document. Decisions like those which the Trustee made in this case are not discretionary decisions in the sense used in Karger v Paul."
[81]
"There is no doubt that under Karger v Paul principles, particularly as they have been applied to superannuation funds, the decision of a trustee may be reviewable for want of 'properly informed consideration'. If the consideration is not properly informed, it is not genuine. The duty of trustees properly to inform themselves is more intense in superannuation trusts in the form of the Deed than in trusts of the Karger v Paul type. It is extremely important to the beneficiaries of superannuation trusts that where they are entitled to benefits, those benefits be paid. Here, for example, the applicant was claiming a Total and Permanent Invalidity benefit to support himself for the rest of his life. His claim depended on the formation of an opinion by the Trustee about the likelihood that he would ever engage in 'gainful Work': that was not a mere discretionary decision."
[82]
[77] This analysis was adopted in Alcoa of Australia Retirement Plan Pty Ltd v Frost[2012] VSCA 238; (2012) 36 VR 618 at [57] per Nettle JA (as his Honour then was) (Redlich JJA and Davies AJA generally agreeing), where his Honour added (emphasis added):
[83]
"The trustee [of a superannuation trust] is under a duty to give 'properly informed consideration' to the application and, because 'it is extremely important' to the beneficiaries of superannuation trusts that where they are entitled to benefits, those benefits be paid', there is a 'high duty' on trustees to make such inquiries as they may reasonably consider relevant in order properly to determine the application."
[84]
[78] The Trustees in this case do not appear to argue against the proposition that if this higher standard of duty to give real and genuine consideration applies, then the Court may review whether the inquiries made by the Trustees were sufficient. As such, the relevant question for determination is whether the Fund is properly characterised as a superannuation fund such that the "higher duty" identified in Finch is applicable.
[79] For the reasons that follow, in my view, no higher duty applies in these circumstances where, although the Fund is a superannuation trust, the Determination concerns a payout of a residual death benefit from the Fund to discretionary beneficiaries as opposed to distributing a benefit to a member.
[80] It is convenient to begin by broadly noting that the factual circumstances of Finch - which heavily underpinned the legal reasoning - are materially distinguishable from the facts of this case. In Finch, the applicant was a beneficiary of a superannuation trust fund. He sought a benefit for total and permanent invalidity (TPI) under the fund, particularly under a clause of the deed that provided that a certain lump sum benefit was payable to members of the fund if they ceased to be an employee because of TPI. "Total and permanent invalidity" was then defined under the deed, relevantly, as a disablement as a result of which, (a) the member has been continuously absent from all active work for at least six months; 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". The High Court considered whether the trial judge was correct to conclude that the trustee had not made sufficient inquiries in making the determination to not pay the benefit.
[81] The "more intense" duty of superannuation trustees to properly inform themselves set out in Finch was premised upon and qualified by the form of the deed and the type of decision that was to be made in that case. As was submitted by the Trustees in this case - which I accept - Finch draws a distinction between, (a) decisions that require the trustee to form an opinion, and (b) decisions that are truly discretionary. In other words, there is a distinction between beneficiaries who "have a beneficial interest", "although the precise form and quantum of [their] beneficial interest [may be] contingent on particular events", and beneficiaries who are the "object of a discretionary power of appointment". contemplates that a higher duty of inquiry applies to the former, going on to explain that beneficiaries of superannuation funds have an entitlement to be paid. The applicant was "entitled as of right to a benefit provided the beneficiary satisfies any necessary condition of the benefit" and the opinion to be formed by the trustee as to whether those requirements were satisfied was "not a mere discretionary decision". The inquiries the trustee was obligated to make concerned information that was reasonably necessary for the trustee to reach that opinion with real and genuine consideration. Indeed, the provision that required the trustee to form an opinion expressly obliged the trustee to consider "any information, evidence and advice the Trustee may consider relevant".
[85]
(a) that the applicant was a member of a particular superannuation fund as a result of his employment with Telstra, which was partly publicly owned and a very large employer of labour;[14]
(b) that a person's superannuation fund is of great personal significance. The Court noted that superannuation is often a person's greatest asset other than their real property; superannuation forms part of the remuneration of employees; membership of superannuation fund might be compulsory; and that a member's interests in their superannuation is not a matter of mere bounty and is something for which they have exchanged value through their work;[15]
(c) that superannuation funds are of great public significance and closely regulated by statute.[16]
[86]
[85] In my view, many of these considerations are not particularly relevant when the distribution under a superannuation fund concerns not distributions made to the member who has an entitlement in the fund, but rather the distribution of a residual death benefit to dependants. Against this the applicants submitted that the payout of the residual death benefit in the Fund is itself a significant decision because it deals with significant assets earned and accumulated by Anthony over his lifetime. While this is true, the fact remains that the dependants in this case do not have the same entitlement to those assets as Anthony himself did as a member. Borrowing the words of the Court in Finch, the interests of the dependants here are "a matter of mere bounty, or potential enjoyment of another's benefaction",[17] as is the usual case for discretionary beneficiaries. And, through the execution of the Deed, Anthony had agreed that in the absence of such entitlement the way his assets were to be dealt with was at the absolute and unfettered discretion of the Trustees.
[86] This is supported by the comments in Finch that "the public significance of superannuation and the close attention paid to it through statutory regulation are not likely to be largely immunised from judicial control without clear contrary language in the relevant trust document".[18] I note first that the public significance of this particular superannuation fund is arguably less pertinent where the fund is self-managed and the only members were Anthony and Margaret, compared to a large-scale employer like Telstra. In any case, and more importantly, here there is clear contrary language in the relevant trust document that was not present in Finch. The power of the trustees to pay out the residual death benefit was "absolute and unfettered". That language, in my view, is sufficiently clear to indicate that the court's jurisdiction to review is limited to what is permissible in respect of discretionary trusts at common law or pursuant to section 8 of the Trusts Act.
[87]
[90] The applicants' submissions effectively proceeded on two limbs:
[88]
(a) first, that the outcome of the Determination was so unreasonable that it gives rise to a finding that the Trustees failed to give real and genuine consideration;
(b) second, that the Trustees' decision-making process gives rise to a finding that they failed to exercise real and genuine consideration, namely by failing to conduct adequate inquiries.
[89]
[91] As to the first limb, the applicants submit that Peter's financial need was so much greater than Gayle's that a decision to split the Fund equally could not have been the result of real and genuine consideration, and the Trustees did not properly turn their minds to Peter's circumstances.
[92] I am not satisfied that the outcome of the Determination demonstrates want of real and genuine consideration by the Trustees. Undoubtedly Peter had and has very significant needs. But Gayle also has needs. Both of them could benefit from the Fund. It was known to the Trustees that Peter had been left a property under Anthony's will, specifically "for his ongoing future care".[19] Peter appeared to have the support of his family. It was also known to the Trustees that Gayle was a widow, had little funds in her bank accounts, and had her own ongoing health problems. Both the relevant dependants had some level of financial need, albeit differing levels of need. By splitting the benefit in half as between Gayle and Peter only, each of them would receive approximately $250,000 (after making an allowance for costs), which is not an insignificant amount of money.
[93] I accept that the decision could have been made differently by a reasonable mind. But the outcome does not demonstrate that the Trustees made the decision without turning their minds to and carefully considering the material before them about Peter's and Gayle's competing circumstances.
[94] Insofar as the applicants rely on the allegation that Gayle had illegally withdrawn money from the Fund for her own benefit, I do not consider that this changes the position. The Trustees were not and did not have the responsibility to act as a court; any knowledge they had of the situation was allegation only. In the absence of a conclusive determination of any wrongdoing, I consider the Trustees were able to give the allegations little weight, if any.
[95] As to the second limb, the applicants submit that the Trustees failed to conduct adequate inquiries. On the Karger v Paul test, this is not made out. It is clear and uncontentious that the Trustees, through their lawyers, did in fact conduct inquiries about the needs of both Peter and Gayle, as well as all the other dependants. The Trustees first contacted all of the dependants and asked them to provide information generally relevant to the distribution of the residual death benefit. Over the course of weeks' worth of emails, the Trustees then contacted Paul, Mark and Louise asking for more specific details of their and Peter's financial needs and personal circumstances. This is again factually distinct from , where inquiries were not made of some of the beneficiaries at all.
[90]
[100] In summary, I find that that has been no lack of real and genuine consideration given by the Trustees in making the Determination. There are no proper grounds upon which the Court may review the Determination. The originating application is dismissed. I will hear from the active parties in relation to the costs of the proceeding.
[91]
[2] Affidavit of Peter William Muller sworn 14 January 2025 (CDI 5-8), ex PWM-1, p 28 (Muller Affidavit).
[92]
[3] Affidavit of James Robba sworn 13 January 2025 (CDI 4), ex JR-1, pp 20-23 (Robba Affidavit).
[93]
[8] Muller Affidavit, ex PWM-1, p 183 (Muller Affidavit).
[94]
[9] I note that this letter is addressed to a "Mr Peter Robba", described as the "Trustee" of the Boosey Doherty Superannuation Fund. It appears to be accepted by all parties that this is a typographical error and the letter was intended to be addressed to and was in fact delivered to Mr James Robba via an email address provided by him: Robba Affidavit, ex JR-1, pp 38-40.
[6] For the reasons that follow, the originating application is dismissed. There are no proper grounds for the Court to review the Determination.
Karger v Paul
[60] Second, insofar as Chesterman J in Burns v Burns envisages that the test is where "the result of the discretion is plainly unreasonable or unjust" on the basis of "cogent reasons", that is qualified by the words "giving rise to an inference that the discretion has miscarried or been affected by some impropriety". I construe that to mean that cases where cogent reasons are demonstrated for interfering with a trustee's discretionary decision may involve cases in which the result of the discretion is plainly unreasonable or unjust, and such result may be considered for the purpose of giving rise to an inference that the discretion was not properly exercised. I do not consider his Honour to have meant that the outcome of a trustee's decision being plainly unreasonable or unjust is in itself sufficient to permit the Court's interference. I therefore also do not consider the decision in Burns v Burns to be inconsistent with the principles in Karger v Paul; the miscarriage or impropriety referred to can manifest in the form of an absence of one of the three essential component parts of the exercise of discretion identified by McGarvie J.
[61] Third, this Court in Hennessey v Perpetual Trustees Queensland Ltd[2000] QSC 311 appears to set out and apply the principles in Karger v Paul in determining an application for review under section 8(1) of the Trusts Act: see at [13]-[16] per White J. I see no reason to depart from that approach in this case.
[62] Subject to consideration of the more specific principles which may apply to superannuation funds, I consider that the common law principles, including as expressed in Karger v Paul, are appropriate to apply to this proceeding for the purposes of section 8 of the Trusts Act.
[63] The applicants only contend that one of the three limbs of Karger v Paul has not been met, namely that the Trustees have failed to exercise real and genuine consideration in making the Determination.
[64] An issue arises then arises as to what "real and genuine consideration" means. In Karger v Paul, McGarvie J explained (at 164):
[73] For completeness, I note that the applicants pointed to decisions that indicated that courts may review a trustee's decision where the trustee fails to consider material that is properly before it, referring to Vance v MIM Holdings Ltd[1999] QSC 210, in which Jones J wrote at [16] (emphasis added):
[82] In light of that context, I consider that, as the law presently stands, the higher duty to be informed from Finch applies only to decisions made under superannuation funds such as whether a member is entitled to a benefit under the fund - that is, where the trustee is obliged by the trust deed to form an opinion rather than exercise a discretion. Without that obligation, there can be no basis for the court to require trustees to make particular inquiries.
[83] The applicants submitted that, if this be the position, the Determination was a decision that was not only discretionary but should be properly characterised as requiring the Trustees to form an opinion. I do not accept that submission. There were no requirements or guidelines in relation to paying out the residual death benefit under the Fund, save for the Trustees having absolute discretion in determining the shares and proportions received by each dependant. Unlike in Finch, there is nothing in the Deed requiring the Trustees to form any opinion in paying out the residual death benefit, let alone any corresponding requirement to base that opinion on relevant information, evidence or advice. Accordingly, the dependants were truly discretionary beneficiaries and the Trustees were not subject to a more stringent duty to be informed from Finch.
[84] Further and relatedly, the factual context and policy considerations underpinning the higher duty as espoused in Finch are not present to the same extent in this proceeding. The reasoning in Finch focused upon the specific nature of superannuation entitlements in relation to their members, for example:
[87] The decision in Alcoa does not change this position. The applicant in that case was also seeking a payment of a total and permanent disablement benefit under a superannuation fund, of a similar nature to the benefit sought under Finch. That trust deed also required the trustee to form an opinion "after consideration of" certain material. Indeed, I note that in the passage from Alcoa excerpted at paragraph 77 above, Nettle JA wrote that the high duty imposed on superannuation trustees was because of the importance of ensuring that beneficiaries are properly paid benefits to which they are entitled - an entitlement which does not exist for any of the dependants in this case.
[88] For completeness, I note that the High Court in Finch expressly left open the question of whether the Karger v Paul principles are applicable to trustees of superannuation funds without any qualification. Subject to the heightened duty of real and genuine consideration, the applicants here did not contend that the Karger v Paul principles cannot or should not apply to any superannuation trust. I do not consider it appropriate for me to determine that possible issue in this case.
[89] I proceed on the basis that the correct test to apply is the one from Karger v Paul, relevantly whether the Trustees gave real and genuine consideration when making the Determination, which does not permit me to consider whether the inquiries actually made by the Trustees were sufficient.
Owies
[96] In the course of submissions, the applicants pointed out information that the Trustees did not have and could have sought, such as an alleged large amount of money that Gayle had but did not disclose, an expensive car she had allegedly owned, and exactly how much money Peter needed to be able to purchase secure accommodation. While this is true, the fact remains that the Trustees made many inquiries as to the needs and circumstances of the dependants. The inquiries ultimately could have been more comprehensive. But I am satisfied on the material before me that the Trustees asked for and were provided with enough information to gather an adequate understanding of each of the dependants' positions in relation to the Fund. Under the test in Karger v Paul, there is no absence of real and genuine consideration. Rather, it appears to me that the Trustees made a conscious effort to inform themselves of and give due regard to relevant information.
[97] Even if I am wrong in that the more stringent duty from Finch applies such that the Court is allowed to impugn the inquiries made by the Trustees, I am not satisfied that that duty was not discharged by the Trustees. As I have said, the Trustees communicated to all the dependants and asked relevant and specific questions about each of their financial circumstances over the course of a couple of months. They had enough information to make a reasoned decision as to how to distribute the residual death benefit. Even a "more intense" duty for superannuation trustees to "properly inform themselves" and to "make such inquiries as they may reasonably consider relevant" would not require the Trustees to ask every single question that may be relevant.
[98] I make one further observation about the applicants' specific submission that the Trustees had to make inquiries about exactly how much money Peter needed to satisfy his main financial need, namely accommodation suited to his health conditions. I am not satisfied that the applicants have proven that the Trustees did not in fact turn their minds to this consideration. The applicants submitted that, by splitting the benefit in half between Peter and Gayle, there is no reason for the Court to be satisfied that the Trustees had even turned their minds to Peter's needs. By contrast, my view is that there is nothing in the material which indicates (even by way of inference) that the Trustees did not turn their minds to Peter's needs, and the applicants have not discharged their burden of proof in this respect.
[99] Finally, the applicants submitted that the Trustees had a duty to resolve the conflicting information presented to them regarding the value of the property left to Peter in Anthony's will. As outlined above, Gayle's submissions described the property as having "an estimated value of $531,000". Mark then informed the Trustees that the property had been valued at $450,000, less the encumbrance upon the property. I do not consider this to be a significant enough discrepancy that reasonably required the Trustees to carry out any more investigation. The values were approximations only, and it could reasonably have been the case that Gayle's submissions did not account for the mortgage. It was sufficient to inform the Trustees of Peter's general financial situation to know that he had been left a property valued somewhere in the order of $450,000 to $550,000 that was subject to a mortgage of approximately $90,000. Though not pointed out by the parties, I note also that different valuations were provided as to the value of the property owned by Gayle - Gayle's submissions indicated that her property was worth $570,000,[20] while Mark's email indicated that it was worth $400,000 to $425,000.[21] In my view, this would support an inference that Mark's estimations of the value of real property were generally lower and Gayle's were generally higher. In circumstances where the information provided was not supported by expert evidence and appeared only to be approximations, I consider that the discrepancies in these values were not significant enough to oblige the Trustees to resolve them.