The court is empowered to give ‘private advice' and directions to a trustee
The Queensland Supreme Court has issued directions over the administration of an estate, emphasising its jurisdiction to give "private advice" and directions.
The court's decision in Re Estate of Hurren [2023] QSC 28 comes after an application for directions under the Trusts Act 1973 (Qld) and the Succession Act 1981 (Qld). The central issue of the case revolved around a compromise that a payout to an estate concerning the use of the property.
Veronica Muriel Hurren passed away on 6 March 2009, leaving behind three children—John, Peter, and Lynne. The court appointed Ian Allan Jacobs as executor and trustee. After a series of legal proceedings, including removing Jacobs as the executor, John William Fradgley was granted letters of administration with the will attached.
The new administrator, Fradgley, sought directions from the court on whether the administrator should proceed with the compromise of a claim against Lynne relating to the use and occupation of a house property forming part of the estate. Under that compromise, Lynne is required to pay the estate the sum of $133,573.00. The administrator sought directions from the court to pave the way for him to implement the compromise and then finalise the administration.
The Queensland Supreme Court explained that it can determine matters related to the estate and its administration under the Succession Act and the Trusts Act. Specifically, s. 6(1) of the Succession Act confers jurisdiction on the court "to hear and determine all matters relating to the estate and the administration of the estate of any deceased person" and "to make all such declarations and to make and enforce all such orders as may be necessary or convenient in every such respect."
Furthermore, the Trusts Act enables a trustee to apply to the court for directions concerning any property subject to a trust, respecting the management or administration of that property or respecting the exercise of any power or discretion vested in the trustee. The court underscored that the Trusts Act permits the court to give "private advice" and directions to a trustee regarding discharging their duties. Once given, a trustee acting under any such direction will be deemed to have discharged those duties even if the order granting the direction is subsequently "invalidated, overruled, set aside or otherwise rendered of no effect, or varied."
The court, acknowledging the safety net provided by the Trusts Act to trustees, emphasised the importance of ensuring the interests of the trust are not jeopardised by unnecessary legal proceedings. The court also highlighted the significance of relying on written statements of facts in such applications, focusing on determining the estate's best interests. The compromise arose from lengthy legal battles over the possession of properties, leading to the sale of assets and net proceeds of $1,485,510.
Despite Peter's objections and Lynne's attempts to step away from the compromise, the court concluded that proceeding with the compromise was in the estate's best interests. It rejected the view that the estate should pursue litigation against Lynne and Jacobs, emphasising the cost-benefit analysis in making such decisions.
The court's directive also addressed concerns raised by Peter, who opposed the compromise, suggesting that the administrator should be removed and replaced. The court determined that removing the administrator is unnecessary given the late stage of the estate administration and the impending distribution of the residue to beneficiaries.
