Schedule 3 Standard form trust instrument for trust over institutional private trust land
Schedule 3 Standard form trust instrument for trust over institutional private trust land
(Clause 69 (1))
Private Institutional Trust Instrument made at [insert location] on [insert date]
Trustees—
The Trustees are detailed in the Schedule to this Instrument (together, the Trustees).
As Trustees for—
[Insert institution] of [insert address] (the Institution).
Background
The Institution wishes the Trustees to care for, maintain and manage the Land in accordance with this Instrument.
The Trustees have consented to act as trustees of the Land in accordance with this Instrument.
The Trustees of Schools of Arts Enabling Act 1902 (NSW) previously provided for the appointment and operation of the Trustees.
The Trustees of Schools of Arts Enabling Act 1902 (NSW) has been repealed by the Crown Land Management Act.
This Instrument is in the form of the standard form trust instrument referred to in clause 22 of Schedule 7 to the Crown Land Management Act.
Operative provisions
Part 1 Definitions and interpretation
1.1 Definitions
In this Instrument, unless the context otherwise requires—
Board means the board comprised of the Trustees at a meeting duly convened as a Board meeting at which a quorum is present in accordance with Part 12.
Cash includes cheques, bank cheques, deposits at call and moneys standing to the credit of any bank account of the Trustees (held in that capacity).
Commencement Date means the later of—
(a) the date the Trustees adopt this Instrument, or
(b) the date the Minister publishes a notice in the Gazette that authorises the adoption of this Instrument in accordance with clause 22 (5) of Schedule 7 to the Crown Land Management Act.
Crown Land Management Act means the Crown Land Management Act 2016 (NSW).
Event of Insolvency means—
(a) a controller, administrator, receiver and/or manager or similar officer is appointed in respect of a person or any asset of a person, or
(b) a liquidator or provisional liquidator is appointed, or
(c) an order is made for the bankruptcy of an individual or their estate under any Insolvency Provision, or
(d) anything analogous to anything referred to in paragraphs (a)–(c), or
(e) a person is, or admits in writing that it is, or is declared to be, or is taken under any applicable law to be (for any purpose), insolvent or unable to pay its debts.
Financial Year means each period of 12 months ending on 30 June.
Government Agency means—
(a) a government or government department or other body, or
(b) a governmental, semi-governmental or judicial person.
Income means the net income of the Trust determined in accordance with relevant accounting principles and practices.
Income Tax Exemption means an endorsed tax exemption in respect of all Income of the Trust granted by the Australian Taxation Office.
Insolvency Provision means any law relating to insolvency, liquidation, winding up or bankruptcy.
Institution means [insert name of Institution].
Land means [insert Lot(s) and Deposited Plan(s) of the lands managed by the Trust], being land reserved, dedicated, granted or held for the purposes of the Institution and known as [insert any street address or other name or identifier].
Minister means the Minister administering the Crown Land Management Act.
Previous Trustees means the trustees appointed before the Commencement Date pursuant to the Trustees of Schools of Arts Enabling Act 1902 (NSW).
Property includes the Land and any movable or immovable property such as cash (including deposits at call and moneys to the credit of any bank account of the Trustees held in that capacity), and any beneficial interest in any of the foregoing.
Purpose has the meaning given in clause 3.1.
Schedule 1 means Schedule 1 to this Instrument, which identifies certain administrative powers of the Trustees.
Schedule 2 means Schedule 2 to this Instrument, which identifies the trustees forming the Trustees, as amended from time to time in accordance with clause 10.3.
Tax includes all income tax, withholding tax, stamp and other duties, goods and services tax and other taxes, levies, imposts, deductions and charges whatsoever as well as interest on them and penalties with respect of them (if any) and charges, fees or other amounts.
Trust means the trust established pursuant to this Instrument.
Trust Property means all Property for the time being held by the Trustees upon the terms of the Trust including—
(a) any further Property as is from time to time provided to or settled upon the Trust, and
(b) any proceeds of any of the foregoing.
Trustees means trustees of the Trust.
Vesting Day means the first to occur of—
(a) the 79th anniversary of the Commencement Date of this Instrument, and
(b) the date on which the Trust terminates in accordance with the terms of this Instrument.
1.2 Interpretation
In this Instrument, unless the context indicates a contrary intention—
(a) a reference to any document or agreement is to that document or agreement as amended, novated, varied or replaced from time to time, and
(b) a reference to any legislation or to any section or provision of legislation includes any statutory amendment and all ordinances, by-laws, regulations and other statutory instruments issued under that legislation, and
(c) words importing the singular include the plural and vice versa, and
(d) headings are for convenience only and do not affect interpretation.
Part 2 The Trust
2.1 Appointment of trustees
From the Commencement Date, the Trustees are appointed as the trustees of the Trust to hold the Trust Property on trust for the Purpose and on the terms and conditions set out in this Instrument.
2.2 Acceptance
The Trustees accept the appointment as trustees of the Trust and declare that they hold the Trust Property on trust for the Purpose on the terms and conditions set out in this Instrument.
2.3 Application of Trust Property
(1) Subject to the following, the Trust Property will be applied solely in furtherance of the Purpose.
(2) Nothing in this clause should be read as limiting the Trustee’s power to take any action under or in accordance with clause 4.1 (2) (b), (c) or (d) or 4.2.
2.4 Name of the Trust
The Trust will be known as the “[insert name]” or such other name as the Trustees determine from time to time.
Part 3 Purpose
3.1 Trust’s purpose
The Trustees must hold the Trust Property and the Income of the Trust Property derived in each Financial Year on trust for the purpose of—
(a) improving, maintaining and managing the Land, and
(b) furthering the objectives of the Institution, and
(c) such other purposes as determined by the Trustees provided that the purposes are consistent always with paragraphs (a) and (b).
3.2 Purpose is primary
To the extent permitted by law, clause 3.1 is primary to, and prevails over, any other power, obligation or duty of the Trustees and any other provision of this Instrument.
Part 4 Trustees
4.1 Powers
(1) Subject to this Instrument, and having regard to the Purpose, the Trustees have all the powers in respect of the Trust Property that they could exercise if they were the absolute and beneficial owners of the Trust Property.
(2) Without limiting subclause (1), the Trustees may from time to time—
(a) sell, lease, mortgage or otherwise dispose of the Land or any part the Land, and
(b) grant a licence in respect of the Land or any part of the Land, and
(c) develop the Land or any part of the Land, or enter into an agreement for the development of the Land or any part of the Land, and
(d) grant any easement, covenant or other dealing in respect of the Land or any part of the Land, and
(e) do the other administrative matters set out in Schedule 1, and
(f) do such other matters, such as the granting of consents or authorisations necessary or ancillary to the matters described in paragraphs (a)–(d) above.
(3) Without limiting subclause (1), the Trustees may enter an agreement with the Minister for the Land to be transferred to the Crown in accordance with Schedule 7 to the Crown Land Management Act.
(4) Without limiting subclause (1), the Trustees may from time to time exercise the following additional powers—
(a) to invest the Trust Property in the manner set out in clauses 4.2 and 4.3, and
(b) to raise and collect funds, to invite and receive contributions, to accept contributions by way of gifts or grants, and
(c) to pay any Tax incurred by or in respect of the Trust, and
(d) to apply for endorsement as an Income Tax Exemption, and
(e) to exercise the powers set out in Schedule 1, and
(f) to exercise any express and implied powers conferred upon the Trustees by any legislation,
subject to the provisions of this Instrument, in particular Part 3, and any restrictions contained in any legislation or other law as it relates to trusts.
(5) If, by reason of—
(a) changes in the law affecting the operation of the Trust for the Purpose, or
(b) changes in the law affecting the Trust Property, or
(c) any omission or error in the scope of this clause,
the better administration of the Trust supports the Trustees being given further administrative or other powers, then the Trustees may amend the provisions of this Instrument to the extent as may be necessary, provided always that nothing in this clause can permit any amendment that is not consistent with the Purpose.
4.2 Investment
Without limiting the powers in clause 4.1 and subject to the other provisions of this Instrument, the Trustees may invest, pay or apply the Trust Property in any manner they deem fit, including—
(a) investment of any asset of the Trust Property in any form of investment, and
(b) sale, transfer, disposal, surrender, termination, release or renewal of any investment comprised in the Trust Property, and
(c) purchase or acquisition of any Property, and
(d) purchase, transfer, lease, including any operating lease, sublease, licence, hire, or create any security interest over, any Property, and
(e) purchase insurance.
4.3 Investment assessment
In the exercise of any investment power, including the investment powers set out in clause 4.2, the Trustees must act prudently and with due caution and have regard to all relevant risks and other matters, so far as they are appropriate to the circumstances of the Trust.
4.4 Nothing contrary to Purpose
The Trustees will not have or exercise powers in relation to any dealing or use whatsoever with the Trust Property that is not in accordance with the Purpose.
Part 5 Application of Income
5.1 Distribution
Until the Vesting Day, the Trustees will in each Financial Year disburse, pay or apply all or any part of the Income of the Trust Property for the Purpose in the proportions that the Trustees think fit.
5.2 Accumulation
The Trustees may, in a Financial Year, accumulate and retain for any period that they think appropriate for the furtherance of the Purpose but not greater than a period permitted by law, all or any part of the Income of the Trust Property derived during that Financial Year.
Part 6 Trustee’s obligations
6.1 Trustee’s obligations
The Trustees must—
(a) act continuously as Trustees until they have resigned or vacated their roles, and
(b) exercise reasonable care, skill and diligence in carrying out their functions and exercising rights and performing their obligations under this Instrument in the utmost good faith having regard to the Purpose, and
(c) comply with any applicable law relating to accumulation of trust income in the exercise of any power under this Instrument, and
(d) except as provided in this Instrument, not dispose of, encumber or part with possession of the Trust Property, and
(e) subject to being indemnified to their satisfaction, institute, prosecute, defend and compromise any legal, administrative and arbitral proceedings related to its obligations as trustees, in such places and jurisdictions as the Trustees think fit, and
(f) retire when required to do so under this Instrument, and
(g) act in accordance with the decisions of the Board, unless such decisions constitute a breach of this Instrument or a breach of law.
Part 7 Proceedings of Trustees
7.1 Systems and procedures
The Trustees may establish rules, policies, systems and procedures to assist with determining whether to apply any part of the Trust Property to any fund, authority or institution in accordance with the Purpose, and may amend or revoke any such rules, policies, systems and procedures subject to the terms and conditions in this Instrument.
7.2 Records and accounts
The Trustees must keep accurate minutes, records and accounts of their trusteeship and all receipts and outgoings, including such records required by law and as to ensure that the Trust Property is at all times distinct and identifiable from any other Property not subject to the Trust and have the accounts audited from time to time as determined by the Trustees.
Part 8 Liability of Trustees
8.1 Limitation of liabilities of Trustees
The Trustees are not, subject to the provisions of this Instrument, liable for any liability, loss, costs or expenses caused or contributed to by any act or omission of the Trustees including without limitation—
(a) anything done by them in good faith in reliance upon any instrument, except when they have reason to believe that the instrument is not genuine and not to have been passed or signed by the proper parties, and
(b) any failure to do anything because they are prevented or hindered from doing it by law, and
(c) payments made by them in good faith to a Government Agency, and
(d) a failure by any person to carry out an agreement with the Trustees in relation to the Trust, and
(e) a failure to comply with this Instrument in circumstances where it has become impossible or impracticable to do so because of an Event of Insolvency of any person.
Part 9 Remuneration of Trustees
9.1 Fees and payment of bona-fide costs and expenses
Subject to the provisions of this Instrument, the Trustees may reimburse themselves out of the Trust Property only for reasonable liabilities, costs or expenses which they incur in their capacity as trustees of the Trust Property.
9.2 Limitation
The Trustees are not entitled to any reimbursement or indemnity from the Trust Property for costs, expenses and liabilities—
(a) arising from or in connection with any bad faith, fraudulent or illegal act or omission, negligence or wilful or reckless disregard of the terms of this Instrument by the Trustees, or
(b) incurred by the Trustees other than in their capacity as trustees of the Trust Property.
Part 10 Appointment and retirement of Trustees
10.1 Retirement for cause
A Trustee must immediately retire as a trustee of the Trust if—
(a) an Event of Insolvency occurs in respect of that Trustee and that Trustee becomes insolvent in his or her personal capacity, or
(b) a Trustee fails or neglects to carry out or satisfy any duty imposed on the Trustee by this Instrument.
If a Trustee fails to so retire, the other Trustees will have the right to immediately remove that Trustee.
10.2 Resignation of Trustees
A Trustee may resign from office by providing 60 days (or such lesser period as is agreed) prior written notice of the proposed resignation.
10.3 Appointment of Trustees
On retirement or removal pursuant to clause 10.1, or resignation of a Trustee pursuant to clause 10.2, the Trustees will be entitled to appoint a successor. On the removal or appointment of a Trustee under this clause, Schedule 2 may be updated (to identify any new Trustee or the removal of any Trustee), without the need for this Instrument or any amending document to be executed.
10.4 Trust Property to be vested in new Trustee
Each Trustee on retirement, resignation or removal, vests the Trust Property or causes it to be vested in such new Trustee, will deliver to such new Trustee all books, documents, records and other property whatever relating to the Trust Property, and must execute and deliver any documents and do every other thing that is necessary or desirable to effect the appointment of the new Trustee.
10.5 New Trustee to execute deed
Each new Trustee will execute a deed in the same form as this Instrument by which the new Trustee will undertake all the obligations of a retiring Trustee under this Instrument.
Part 11 Termination
11.1 Term of the Trust
The Trust begins on the Commencement Date and ends on the Vesting Day, unless terminated earlier in accordance with clause 11.3.
11.2 Realisation of the charitable Trust Property
(1) As soon as practicable after the Vesting Day or winding up of the Trust, the Trustees will realise the remaining Trust Property in accordance with subclause (2).
(2) The proceeds of realisation of the Trust Property and any net income of the Trust Property for the relevant Financial Year will be applied in the following order of priority—
(a) in payment of or provision for the debts, costs, charges, liabilities, expenses, claims and demands incurred or anticipated by the Trustees,
(b) in payment to the Trustees of any moneys owing to the Trustees under this Instrument.
11.3 Winding up of the Trust
The Trust terminates if any of the following occur—
(a) the Land is transferred to the Crown in accordance with Schedule 7 to the Crown Land Management Act,
(b) the Trust Property does not contain any Property for a period exceeding 12 months,
(c) the Trust Property consists of no material Property.
Part 12 Meetings of Trustees
12.1 Meetings
The Trustees are to meet together (as the Board) for the purposes of satisfying their obligations under this Instrument. The Board—
(a) is to consist of Trustees, and
(b) is to conduct and record its activities by passing resolutions of a majority of the Trustees, and
(c) requires a quorum of 50 percent of the Trustees present (including the Chair, but excluding any Trustee excluded due to a conflict of interest), and
(d) must record any conflicts of interest and the Chair will determine if a conflict of interest requires a Trustees to be excused from participating on the voting for any resolution, and
(e) must meet 11 times per year, or at such other times as the Board determines, and
(f) may delegate its functions to any person.
12.2 Appointment of Chair
One of the Trustees may be selected by the Board as Chair of the Board. The Board may remove the Chair and appoint another of the Trustees as Chair, at such times as the Board considers appropriate. The Chair may appoint an acting Chair from time to time.
12.3 Minutes
Before each meeting of the Board, the agenda for the meeting and the minutes and actions of any previous meeting are to be circulated at least one week prior to the Board meeting.
Part 13 Amendments to the Trust
13.1 Amendments
The Trustees may by deed amend, vary, add or delete any provision of this Instrument if—
(a) in the opinion of the Board, it is necessary or expedient to comply with the provisions of any law or the requirement of any relevant Government Agency, or
(b) in the opinion of the Board it—
(i) is made to correct a manifest error or ambiguity or is of a formal technical or administrative nature only, or
(ii) will enable the provisions of this Instrument to be more conveniently or advantageously administered, or
(iii) is otherwise expressly authorised by this Instrument.
13.2 Limitation on variations
No alteration, variation or modification to the Trust will be capable of being made if it—
(a) varies or revokes this clause, or
(b) makes any Trustee a beneficiary under the Trust or capable of becoming a beneficiary, or
(c) has the effect that the trust upon which the Trust Property is held is deemed not to be for the Purpose, or
(d) varies or revokes the definition of Purpose.
Part 14 Limited recourse
14.1 Limitation on Trustee’s liability
The Trustees enter into this Instrument only in their capacity as trustees of the Trust and in no other capacity. A liability incurred by a Trustee acting in their capacity as a trustee of the Trust arising under or in connection with this Instrument is limited to and can be enforced against that Trustee only to the extent to which it can be satisfied out of the Trust Property. This limitation of a Trustee’s liability applies despite any other provision of this Instrument (other than clause 14.3) and extends to all liabilities and obligations of the Trustees in any way connected with any representation, warranty, conduct, omission, agreement or transaction related to this Instrument.
14.2 Claims against Trustees
No party may sue the Trustees in respect of liabilities incurred by the Trustees acting in their capacity as trustees of the Trust in any capacity other than as trustees of the Trust, including seeking the appointment of a receiver (except in relation to the Trust Property), a liquidator, an administrator, or any similar person to the Trustees or prove in any liquidation, administration or arrangements of or affecting the Trustees (except in relation to the Trust Property).
14.3 Breach of Trust
The provisions of this Part will not apply to any obligation or liability of the Trustees to the extent that it is not satisfied because under this Instrument or by operation of law there is a reduction in the extent of the Trustee’s indemnification out of the Trust Property as a result of the Trustee’s fraud, negligence or wilful default.
14.4 Acts or omissions
No act or omission of the Trustees will be considered fraudulent, negligent or a wilful default for the purpose of clause 14.3 to the extent to which the act or omission was caused or contributed to by any failure by any person appointed by the Trustees under this Instrument (other than a person whose acts or omissions the Trustees are liable for in accordance with this Instrument) to fulfil its obligations in relation to the Trust or by any other act or omission of any such person.
Part 15 Governing law and jurisdiction
15.1 Governing law and jurisdiction
This Instrument is governed by and will be construed in accordance with the laws of New South Wales.
Part 16 Miscellaneous
16.1 Notices
Every notice, direction or other communication of any nature whatsoever required to be served, given or made under or arising from this Instrument—
(a) must be in writing, and
(b) is served, given or made in relation to a party if it is—
(i) delivered to the last known address of that party (or at such other address as may be notified in writing by that party to the other party from time to time), or
(ii) posted by prepaid registered post to such address, and
(c) is deemed to be given, served or made—
(i) in the case of prepaid registered post, on the fifth business day after posting, and
(ii) in the case of delivery by hand, on delivery.
16.2 Severability of provisions
Any provision of this Instrument that is illegal, void or unenforceable will be ineffective to the extent only of such illegality, voidness or unenforceability without invalidating the remaining provisions.
Schedule 1 Administrative powers
Pursuant to clause 4.1 (4) (e), the Trustees may from time to time exercise the following additional powers—
(a) to organise and co-ordinate activities in furtherance of the Purpose and to procure financial assistance in this respect, and
(b) to hire, employ or enter into contracts of services with any person, corporation, Government Agency or other organisation on such terms as the Trustees deem fit in furtherance of the Purpose, and
(c) to open and operate bank accounts including placing monies on fixed deposit, and
(d) to enter into agreements and contracts in any manner and on such conditions as the Trustees may deem necessary in pursuance of the Purpose, and
(e) to sign and to execute agreements, contracts and any other deed or instrument or in relation to and for the purpose of the Trust, and
(f) to act in any other legitimate manner in order to realise the Purpose, and
(g) to sue and settle any claim or proceedings or submit any claim for mediation or arbitration or appeal, and
(h) to make rules and regulations for the management and administration of the Trust Property or any part of it and for matters connected with the Trust and its objects, and
(i) generally to do all such other lawful business and things as are incidental to or conducive to the attainment of all or any of the Purpose.
Schedule 2 Trustees
| Name of Trustee | Contact details of Trustee |
| [Include full name of each Trustee] | [Include telephone and/or email address of the Trustee concerned] |
| | |
| | |
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