Category Archives: Trusts

Korda v Australian Executor Trustees (SA) Limited [2015] HCA 6

ON 4 MARCH 2015, the High Court of Australia delivered Korda v Australian Executor Trustees (SA) Limited [2015] HCA 6 (4 March 2015).

http://www.austlii.edu.au/au/cases/cth/HCA/2015/6.html

The High Court allowed an appeal against a decision of the Victorian Court of Appeal, declaring that the respondent was not entitled to certain monies that were payable to a forest company (“the third appellant”) under Land Sale Contracts and a milling company (“the fourth appellant”) pursuant to a tree Sale Agreement. The Court held that the proceeds of the sale of at the timber and land scheme payable to the third and fourth respondent were not subject to an express trust in favour of the scheme of investors.

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Baumgartner v Baumgartner [1987] HCA 59 | 10 December 1987

ON THIS DAY IN 1987, the High Court of Australia delivered Baumgartner v Baumgartner [1987] HCA 59; (1987) 164 CLR 137 (10 December 1987).

http://www.austlii.edu.au/au/cases/cth/HCA/1987/59.html

The parties had lived together in a de facto relationship. They pooled their earnings to meet all outgoings of the joint relationship, including mortgage payments over the family home purchased with the husband as the only registered proprietor.

After about four years the relationship came to an end. The wife sought a declaration that she held an interest in the property in trust. The husband asserted that only he held the legal title to the house.

The court held that the wife held a beneficial interest in the property by way of constructive trust.

Per Mason CJ, Wilson and Deane JJ at 149:

“The case is accordingly one in which the parties have pooled their earnings for the purposes of their joint relationship, one of the purposes of that relationship being to secure accommodation for themselves and their child. Their contributions, financial and otherwise, to the acquisition of the land, the building of the house, the purchase of furniture and the making of their home, were on the basis of, and for the purposes of, that joint relationship. In this situation the appellant’s assertion, after the relationship had failed, that the Leumeah property, which was financed in part through the pooled funds, is his sole property, is his property beneficially to the exclusion of any interest at all on the part of the respondent, amounts to unconscionable conduct which attracts the intervention of equity and the imposition of a constructive trust at the suit of the respondent.”

The High Court declared that the parties hold beneficial interests in the property of 55% to the husband and 45% to the wife, subject to adjustments.

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Bofinger v Kingsway Group Limited [2009] HCA 44 | 13 October 2009

ON 13 OCTOBER 2009, the High Court of Australia delivered Bofinger v Kingsway Group Limited [2009] HCA 44 (13 October 2009).

The High Court held that guarantors of a secured loan may recoup contributions they made to the repayment of the loan to a first mortgagee from the remaining surplus securities before the surplus is applied to repay any second or subsequent mortgagee with security over the same property, even if the guarantors have also guaranteed the second or subsequent loans. The guarantors were found the be subrogated to the first mortgagee. Upon repayment of the first loan, first mortgagee had a fiduciary obligation to in good conscience provide the guarantors with the surplus funds and remaining properties.

On the principle of unjust enrichment and how it applies to subrogation, Gummow, Hayne, Heydon, Kiefel and Bell JJ said at [85]:

“The appeal to this Court in Friend v Brooker [63], which concerned the equitable doctrine of contribution, was correctly conducted on the footing that the concept of unjust enrichment was not a principle supplying a sufficient premise for direct application in a particular case. The same is true of the equitable doctrine of subrogation. The oral submissions for the Solicitors correctly recognised this.”

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Commonwealth Bank of Austrlalia v Love & Anor [2014] VCC 887

ON 27 JUNE 2014, the County Court of Victoria delivered Commonwealth Bank of Austrlalia v Love & Anor [2014] VCC 887 (27 June 2014).

http://www.austlii.edu.au/cgi-bin/sinodisp/au/cases/vic/VCC/2014/887.html?stem=0&synonyms=0&query=Commonwealth%20Bank%20of%20Australia

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NSW Trustee and Guardian v Ralph Stern [2014] NSWSC 808

ON 28 MAY 2014, the Supreme Court of NSW delivered NSW Trustee and Guardian v Ralph Stern [2014] NSWSC 808 (28 May 2014).

http://www.austlii.edu.au/au/cases/nsw/NSWSC/2014/808.html

Justice Hammerschlag delivered a judgment providing opinion, advice or direction under s63(1) of the Trustee Act 1925 with respect to trusts established by orders of Justice Ward on 7 May 2010 concerning Carol Judy Jennifer Sekers and others.

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Bofinger v Kingsway Group Limited [2009] HCA 44

ON 13 OCTOBER 2009, the High Court of Australia delivered Bofinger v Kingsway Group Limited [2009] HCA 44 (13 October 2009).

The High Court held that guarantors of a secured loan may recoup contributions they made to the repayment of the loan to a first mortgagee from the remaining surplus securities before the surplus is applied to repay any second or subsequent mortgagee with security over the same property, even if the guarantors have also guaranteed the second or subsequent loans. The guarantors were found the be subrogated to the first mortgagee. Upon repayment of the first loan, first mortgagee had a fiduciary obligation to in good conscience provide the guarantors with the surplus funds and remaining properties.

On the principle of unjust enrichment and how it applies to subrogation, Gummow, Hayne, Heydon, Kiefel and Bell JJ said at [85]:

“The appeal to this Court in Friend v Brooker [63], which concerned the equitable doctrine of contribution, was correctly conducted on the footing that the concept of unjust enrichment was not a principle supplying a sufficient premise for direct application in a particular case. The same is true of the equitable doctrine of subrogation. The oral submissions for the Solicitors correctly recognised this.”

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Baumgartner v Baumgartner [1987] HCA 59

ON 10 DECEMBER 1987, the High Court of Australia delivered Baumgartner v Baumgartner [1987] HCA 59; (1987) 164 CLR 137 (10 December 1987).

http://www.austlii.edu.au/au/cases/cth/HCA/1987/59.html

The parties had lived together in a de facto relationship. They pooled their earnings to meet all outgoings of the joint relationship, including mortgage payments over the family home purchased with the husband as the only registered proprietor.

After about four years the relationship came to an end. The wife sought a declaration that she held an interest in the property in trust. The husband asserted that only he held the legal title to the property.

The court held that the wife held a beneficial interest in the property by way of constructive trust.

Per Mason CJ, Wilson and Deane JJ at 149:

“The case is accordingly one in which the parties have pooled their earnings for the purposes of their joint relationship, one of the purposes of that relationship being to secure accommodation for themselves and their child. Their contributions, financial and otherwise, to the acquisition of the land, the building of the house, the purchase of furniture and the making of their home, were on the basis of, and for the purposes of, that joint relationship. In this situation the appellant’s assertion, after the relationship had failed, that the Leumeah property, which was financed in part through the pooled funds, is his sole property, is his property beneficially to the exclusion of any interest at all on the part of the respondent, amounts to unconscionable conduct which attracts the intervention of equity and the imposition of a constructive trust at the suit of the respondent.”

The High Court declared that the parties hold beneficial interests in the property of 55% to the husband and 45% to the wife, subject to adjustments.

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Sydney, Australia

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Hospital Products Ltd v United States Surgical Corporation [1984] HCA 64

ON 25 OCTOBER 1984, the High Court of Australia delivered Hospital Products Ltd v United States Surgical Corporation [1984] HCA 64; (1984) 156 CLR 41 (25 October 1984).

http://www.austlii.edu.au/au/cases/cth/HCA/1984/64.html

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Sydney, Australia

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