Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar Diocesan Bishop of Macedonian Orthodox Diocese of
[2008] HCA 42(2008) 82 ALJR 1425
(2008) 249 ALR 250
(2008) 1 ASTLR 1
(2008) 237 CLR 66
(Decision by: Kiefel J)
Macedonian Orthodox Community Church St Petka Inc
vHis Eminence Petar Diocesan Bishop of Macedonian Orthodox Diocese of
Judges:
Gummow ACJ
Kirby J
Hayne J
Heydon J
Kiefel J
Legislative References:
Law of Property Amendment Act 1859 (UK) - s 30
Law of Property Amendment Act 1860 (UK) - s 9
Trustee Act 1898 (NSW) - s 20
Supreme Court Procedure Act 1900 - s 10-12; Sched r 2
Charitable Trusts Act 1853 (UK) - s 16
Charitable Trusts Act 1993 (NSW) - s 6(1)(b)
Evidence Act 1995 (NSW) - Pt 3.10, Div 1
Trustee Act 1925 (NSW) - s 63
Judgment date: 7 August 2008
Decision by:
Kiefel J
[192] The factors which the Court of Appeal of the Supreme Court of New South Wales [186] considered that Palmer J had not taken into account, in deciding to give advice to the Association (the trustee), [187] are identified in the judgment of Gummow ACJ, Kirby, Hayne and Heydon JJ. [188] Principal amongst them is the opinion that it is inappropriate to use proceedings brought under s 63 of the Trustee Act 1925 (NSW) for adversarial purposes.
[193] The members of the Court of Appeal accepted that a previous decision of that Court [189] holds that an application under s 63 is not to be regarded as adversarial because parties who are served with its process are adversaries and because there is an element of contest concerning the advice sought. [190] Their Honours considered that proceedings may become adversarial and the advice sought inappropriate to be given and that this had occurred in the present case. Their Honours differed somewhat in their reasoning to this conclusion. Ipp JA, [191] with whom Giles JA agreed, [192] was of the view that the proceedings had been used to determine rights as between the parties and this was reflected in the decision of Palmer J. The advice sought by the Association was of an essentially adversarial nature. [193] The nature of the advice was coloured by the issues in the Main Proceedings, [194] where an important issue is whether the Association has breached the trust. [195] Hodgson JA was also of the view that the proceedings had been rendered adversarial because the advice concerned the position of the Association as trustee, because it was not disinterested in the advice sought and was seeking to use trust property. [196]
[194] The views expressed by their Honours in the Court of Appeal might be taken to involve a limitation upon the power given by s 63, which is to say the jurisdiction of the Supreme Court to give advice. [197] However their Honours appear to have dealt with the matter on the basis that Palmer J's discretion miscarried [198] rather than by reference to any jurisdictional bar.
[195] Proceedings provided for by s 63 do not involve the determination of a controversy, but rather the giving of advice or direction to a trustee with respect to questions of the kind referred to in the section. Section 63 is an exception to a Court's ordinary practice of deciding disputes between competing litigants, as Palmer J observed. [199] But his Honour's orders were not determinative of the parties' rights. The advice given was as to whether, and upon what terms, proceedings should be pursued in order to finally determine the controversy as to the terms of the trust upon which the Association held property. The advice was advice respecting the interpretation of the trust instrument and was therefore within power. The interests of the parties and the liability of the Association as trustee were to be determined, but in the Main Proceedings.
[196] It may be inferred that their Honours in the Court of Appeal considered that the connection of the advice to the pursuit, or defence, of the Main Proceedings to be so important a factor as to foreclose the giving of such advice. I agree with the plurality that the discretion is not to be exercised by reference to some such overriding consideration. [200] In exercising the discretion the Court should be guided by the scope and purposes of the section. The principal purpose of the section, and the opinion, advice or direction given under it, is the protection of the interests of the trust. Another purpose is the protection of a trustee who is acting in that regard and upon advice. [201] Securing the latter purpose may ensure the attainment of the principal purpose, by removing the concern of a trustee about exposure beyond their usual indemnity.
[197] It is apparent from the reasons of Palmer J that his Honour considered that it was in the interests of the trust that the uncertainty as to the terms of the trust should be resolved, once and for all. [202] The correctness of that view cannot be doubted, particularly given that the trust is for a charitable purpose. The issues relating to the trustee in the Main Proceedings should be seen in this perspective. They assume a lesser importance than the attainment of the principal object of the section. His Honour expressed himself as satisfied that opinions of counsel demonstrated that there were sufficient prospects of success to warrant the Association defending the question of construction.
[198] The questions that are identified by s 63 as the subject of the advice of the Court may predictably arise in the context of litigation where a trustee is accused of breach of trust. If the litigation may resolve a question to which s 63 refers, and it is in the interests of the trust estate to do so, the trustee should be protected in achieving that resolution. That the trustee may also benefit from a determination, as would here be the case if the Association's version of the terms of the trust were upheld, is not to the point. It may be appropriate that the Court condition the advice or limit the access to the trust estate to the costs of determination of the dispute in question. It was not necessary in this case to altogether refuse to give the advice or direction sought.
[199] I agree that, in determining to give the advice sought, Palmer J did not fail to address relevant questions, for the reasons given by the plurality. His Honour was well aware of the issues relating to the Association in the Main Proceedings and of the impact of orders for costs upon the trust estate, to the extent that the parties contended for. His Honour was entitled to determine the application on facts which had not been tested in litigation. The summary nature of the proceedings under s 63 will often require a Court to proceed in this way. The extent of the information available to the Court and its apparent reliability are factors going to the exercise of the discretion to give the advice. I also agree, notwithstanding the plaintiff's contention to the Court of Appeal, that O 6 of Palmer J's orders allows for revocation of his Honour's orders only with respect to their future operation. [203]
[200] There is no substance to the matters raised in the notice of contention. I agree with the reasons of the plurality in this regard. It was for these reasons that I joined in the orders pronounced by the Court on 7 August 2008.