Burns v Burns[2008] QSC 173

SUPREME COURT OF QUEENSLAND

[1] The late Mary Burns died on 7 May 2007 leaving a will dated 22 September 2003.  She was survived by four adult sons whom it is convenient, if impolite, to designate by their Christian names –Duncan, Adrian, Roderick and Ian.  Probate of her will was granted to Duncan and Ian, the executors named in her will, on 31 July 2007.

[2] The testatrix’s will made equal provision for her four sons but did not make absolute gifts.  Rather the will established four trusts:  one, in effect, for each son, his children and grandchildren.  The trustees were, in the case of each trust, two of her sons.  The trusts were identical in terms save for the identity of the trustees.

[3] The dispute which has arisen concerns the trust created by cl 6 of the will, ‘the Adrian Ormond Burns testamentary trust ...’.  The will relevantly provided:

‘3.My Trustees shall hold the whole of my estate after paying my funeral and testamentary expenses for division equally into the following four Testamentary Trust Funds:

iv)The Adrian Ormond Burns Testamentary Trust Fund.

6.I APPOINT DUNCAN HAMILTON ORMOND BURNS and ADRIAN ORMOND BURNS as Trustees of the Adrian Ormond Burns Testamentary Trust Fund.

11.In relation to the Adrian Ormond Burns Testamentary Trust fund, the Trustees shall:

(a)Invest the fund as authorised by law or any clause in this my Will;

(b) i)pay all or part of the income, all or part of the Capital or all or part of the capital accretions to any one or more of:

1.Adrian Ormond Burns;

2.The children of Adrian Ormond Burns;

3.The grandchildren of Adrian Ormond Burns;

4.The brothers of Adrian Ormond Burns;

5.The children of the brothers of Adrian Ormond Burns.

From such part of the capital or income thereof in the shares and amounts and at such times as my Trustees in their discretion think fit without any obligation to make payments for all or any of them nor to ensure equality amongst those to whom payments are made;  and

    v)Distribute the balance of the Fund If any, not later than 80 years from the date of my death.

[4] On the same day she executed her will the testatrix wrote to the trustees of each of the four testamentary trusts appointed by the will.  The letters were in identical terms.  She wrote to the trustees of the Adrian Ormond Burns Testamentary Trust:

‘In relation to the above Trust referred to in my Will, I hereby direct you that notwithstanding that the Trust is a Discretionary Testamentary Trust, the primary beneficiaries are Adrian Ormond Burns, his children and grandchildren and that his wishes are to be adhered to in administering the Trust and the other beneficiaries being his brothers, the children of his brothers are only to receive any capital or income in the event of the death of Adrian Ormond Burns and all of his children and all of his grandchildren.’

[5] The late Adrian Burns was a disappointment to his parents.  He led a dissolute, profligate and undisciplined life.  Though lustful he never married and died childless in his home in November 2007.  His body was found on 29 November 2007.  He had last been seen alive on 23 November 2007. 

[6] On 5 June 2007 Adrian executed a will which appointed the Public Trustee of Queensland executor and trustee of his estate, the whole of which was bequeathed to his brother Ian.

[7] Since Adrian’s death there has been only one trustee of the Adrian Burns Testamentary Trust (‘the Adrian Trust’), namely his brother Duncan, who proposes to distribute the assets of the Adrian Trust equally between the trustees of the testamentary trusts of the surviving brothers to be held by them on the terms of those trusts.  Ian objects to this proposal.  He would prefer Duncan to distribute the trust’s assets to him in accordance with Adrian’s wishes as expressed in his will.

[8] By an originating application filed 18 April 2008 Ian sought the following orders:

‘1.Pursuant to s 8 Trusts Act 1973 (‘the Act’) the Court review and order Duncan Burns to justify the following decisions made by him as trustee of the Adrian ... Trust ...:-

(a)The refusal to appoint a second trustee to replace the late Adrian ... Burns;

(b)A decision to pursue recovery of the amount of approximately $190,000 paid to Zafron Enterprises Pty Ltd ... (‘Zafron’);

(c)A decision to distribute the Trust’s (property) to Ian, Duncan and Roderick Burns rather than to the estate of the late Adrian ... Burns.

2.Further or in the alternative ... an order pursuant to s 80 Trusts Act ... appointing Ian Burns or such other person as the Court thinks fit a further trustee, in addition to Duncan Burns, to replace the late Adrian ... Burns as a trustee of the Adrian ... Trust ...

3.Directions between the applicant and the first respondent in their capacities as co-executors for the final administration of the estate of the late Mary Burns ...’

[9] The Public Trustee of Queensland was made second respondent to the application but it played no part in the proceedings, indicating it would abide any order the Court might make.

[10] Adrian was both annoyed and frustrated by the terms of his mother’s will.  He refused to accept that his share of the estate was not an absolute gift to him and devised means to take possession of what he regarded as his share of the estate.  One of those means was an attempt to alter the terms of the will by a ‘Deed of Settlement’.  This document was drafted by Adrian after he had sought advice from the Public Trustee and perhaps a solicitor employed by Messrs Hawthorn Cuppidge & Badgery. 

[11] The Deed was sent to Mr Gall, the testatrix’s solicitor, and his three brothers on
9 July 2007.  It read:

‘11.  In relation to the Adrian Ormond Burns Testamentary Trust Fund, the Trustees shall:

a)  Invest the fund as authorised by law or any clause in this my Will;

b)  Pay all or part of the income, all or part of the capital or all or part of the capital accretions to any one or more of:

1.  Adrian Ormond Burns;

2.  The children of Adrian Ormond Burns;

3.  The grandchildren of Adrian Ormond Burns;

4.   The benefisuranies as per the will of Adrian Ormond Burns

From such part of the capital or income thereof in the shares and amounts and at such times as my Trustees in their discretion think fit without any obligation to make payments for all or any of them nor to ensure equality amongst those to whom payments are made;  and

v)  Distribute the balance of the fund, if any, upon my Death

12.  I DIREC that my Trustees shall have the following additional powers to those granted or vested in them by law, equity or statute and that my ...’

The balance of the Deed is irrelevant.

[12] The Deed was never executed but not for that reason alone is it ineffective.  It could only have taken effect as a variation to the terms of the Adrian Trust established by Mrs Burns’ will.  Such a variation would have required the consent of all beneficiaries, or the order of the Court.  The beneficiaries’ consent could never have been obtained.  Some of the second classes of beneficiaries, the children of Roderick, are infants.  There is one beneficiary in the third class, a grandchild of Duncan, who is also an infant.  Those classes of beneficiary, the children and grandchildren, are not closed.  Indeed grandchildren may be born over the course of the next two or three decades. 

[13] The proposed variation was inimical to the interests of all beneficiaries.  It would permit the trustees of the Adrian Trust to pass the trust property to persons other than the beneficiaries of the trusts established by the will.  It is the case that the late Adrian Burns’ nominated beneficiary in his will was his brother Ian who was himself one of the named beneficiaries, but had the variation been effected and Adrian survived he could have made different testamentary dispositions.

[14] It is inconceivable in these circumstances that the Court would vary the trusts as Adrian wished.

[15] The second means by which Adrian sought to obtain the trust estate was more effective, though less honest.  He intercepted two cheques drawn in favour of the trustees of the Adrian Trust and deposited them to the credit of his own personal bank account. 

[16] On 10 October 2007 the testatrix’s solicitors, on behalf of her estate, drew a cheque in the sum of $112,779.40 in favour of ‘Adrian Ormond Burns Testamentary Trust’.  The cheque was the means by which a distribution of the estate to the Adrian Trust was to be made.  It represented part of the proceeds of sale of some property of the testatrix.

[17] On 6 November 2007 the solicitors drew another cheque in the sum of $94,166.66, also payable to ‘Adrian Ormond Burns Testamentary Trust’.  This too represented the sale of the testatrix’s property and was a partial distribution of the estate in favour of the Adrian Trust.

[18] Adrian took possession of both cheques from the solicitors but did not bank either into the bank account maintained by the trustees of the Adrian Trust.  Instead he paid them into his own account with HSBC.  Thereafter he drew two cheques, one for $100,000 and the other for $90,000, both payable to Zafron, of which he was sole director and shareholder.  It operated a bank account which presently has a credit balance of $190,023.31. Under the terms of Adrian’s will his shares in Zafron pass to Ian.

[19] The evidence established a misappropriation of trust monies by Adrian and their receipt by Zafron which is fixed with the knowledge of its sole director as to the origin of the deposits and the mechanism by which they were obtained.  See Endresz v Whitehouse [1998] VR 461 and Mor Lea Professional Services Pty Ltd v Richard Walter (1999) FCR 217.

[20] The trustee of the Adrian Trust appears to have an unassailable claim to the monies in Zafron’s account. 

[21] The relief sought in the application will not give the applicant, Ian, what he wants.  It is evident that he wishes the Court to order that Duncan, as trustee of the Adrian Trust, distribute its property in accordance with Adrian’s will.  This is apparent from his counsel’s submissions and from the manner in which the application was argued.  What the application seeks is, however, not that order but rather an order that Duncan ‘justify’ his decision to distribute Adrian’s trust property equally between the brothers. 

[22] The justification, or explanation, had already been given in correspondence.  He wrote to his brothers on 3 February 2008:

‘Other than Ian being the beneficiary of his estate I am not aware of any specific wishes Adrian had.

There appear to be three ... options ...

Firstly, on the assumption that Adrian did not have any children;  reassign the benefits of mother’s will equally between us the three surviving children.

Secondly, use the money to benefit others ... in the form of a donation to a ... worthy cause ...

Thirdly, declare the trust monies to be part of Adrian’s estate and pass the funds to Ian as the sole beneficiary.

From my perspective I believe mother and father’s intention were that their children should equally share the estate and that our own children will benefit or otherwise in due course from the day in which we have managed our affairs.  That being the case my suggestion is to recover the monies in Adrian’s trust account and have it redistributed equally three ways between the three of us.’

[23] He wrote again on 8 March 2008:

‘My recollection is that mother and father wished to give all of their sons the means to succeed in life rather than just pass on an inheritance.  ...  I also understand it was always their intention that any windfall gain we came by at the end of their death would be equally distributed.

I understand mother’s rationale for establishing  the trusts arose directly from her concern at the time to protect Adrian from his existing and future creditors, others who might make claims on his estate such as ... somebody who befriended him specifically for gain and also himself from making ill-considered investments ... .  I also understand she was pleased that the testamentary trust mechanism allowed the benefits to remain in the family bloodline.  She established trusts for each of us, rather than just Adrian to ensure equity. ...  In my view anything other than an equal allocation to the three brothers is guaranteed to significantly damage the family relationship.’

[24] The explanation was repeated by Duncan’s oral testimony – see T45.30-T46.8;  T57.49-.55.

[25] He believes that equality is fair as between the surviving children of the testatrix and consonant with her wishes as revealed by her will.  Additionally an absolute gift of part of the estate to a particular beneficiary is inconsistent with the tenor of the will which was to hold the estate, in its four equal parts, in trust for the benefit of three generations of descendants. 

[26] Despite the form of the application, the applicant wishes to challenge that reasoning and contend that Duncan’s discretion should be exercised in accordance with Adrian’s wishes as indicated by his will and the inchoate Deed of Settlement, together with the letter of instruction from the testatrix to the trustees of the Adrian Trust, urging them to act in accordance with his wishes.

[27] Because the matter is clear and in order to resolve a dispute between brothers I will deal with what I apprehend is the real contest rather than the contest described by the application. 

[28] The Adrian Trust was discretionary.  The trustees were to invest the trust fund and were to pay all or part of the income and all or part of the capital to any one or more of the beneficiaries in the five defined classes as they thought fit.  The discretion is extremely wide. 

[29] Section 8 of the Trusts Act provides:

‘Any person who has ... an interest ... in any trust property ... and who is aggrieved by any ... decision of a trustee ... or who has reasonable grounds to apprehend any such ... decision by which the person would be aggrieved, may apply to the court to review the ... decision, or to give directions in respect of the ... decision;  and the court may require the trustee ... to substantiate and uphold the grounds of the ... decision ... and may make such order ... as the circumstances require.’

[30] Speaking of the ambit of the jurisdiction conferred by s 8 Macrossan J said in Re Whitehouse [1982] Qd R 196 at 203-4:

‘... The power of the court under s 8 to review a trustee’s ... decision is one which should not be narrowly construed. ... The jurisdiction should not be read down or unduly confined.  On the other hand ... it would be wrong to suggest ... 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 decision 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 ... .  ...  The heavy onus lies upon a person seeking a review of a trustee’s decision.’

[31] This approach to the section was approved by the Full Court in Tierney v King [1983] 2 Qd R 580 at 583.  Matthews J (with whom Kelly and Macrossan JJ agreed) said:

‘... Although the right to review a decision conferred by s 8 ... should not be unduly confined the object of the section is not the substitution of a judge’s opinion for that of a trustee.  The applicant carries the 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 In Re Roper’s Trusts 1879 21 Ch D 272.’  (The reference should be to 11 Ch D)

[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 (1997) 79 FCR 469 at 480:

‘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 ...’

[33] In the same case Kirby J said at 115:

‘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 ...’

[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. 

[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.

[36] According to Lord Chancellor Truro in Re Beloved Wilkes’ Charity (1851) 42 ER 330 at 333:

‘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.’

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. 

[37] The notion behind the expression is, I think, the same as that described by Dixon, Evatt and McTiernan JJ in their judgment in House v The King (1936) 55 CLR 499 at 505:

‘It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the Appellate Court may infer in the same way there has been a failure properly to exercise the discretion ...’.

[38] Ian’s only ground for impugning the conclusion is the one I mentioned:  that it was not exercised in accordance with Ian’s wishes which the testatrix wished the trustees to respect.

[39] Herein lies another difficulty for the applicant.  The course of action proposed by Duncan is not unreasonable or unjust.  It is, on the contrary, a perfectly rational, reasonable and sensible exercise of the discretion conferred on him with respect to the disposition of Adrian’s Trust’s estate.  Adrian having died without issue, the division of the trust property equally between the beneficiaries of the other three testamentary trusts is eminently fair.  ‘Equality is equity’, as the maxim puts it.  It is a very common form of testamentary dispositions by parents in favour of their children.  It is consistent with the late Mrs Burns’ wishes as expressed by her will which treated the four sons equally. 

[40] Of course had Duncan decided otherwise and proposed to distribute the estate as Adrian apparently wished, that decision too would have been rational, reasonable and sensible. 

[41] Neither decision would have pleased all of the brothers.  Each decision would leave one, or two, worse off than the other.  In that sense the decision entrusted to Duncan was a difficult one but it was his to make and it is no ground of objection that he did not prefer Ian’s position. 

[42] The only basis for Ian’s case is that the proposed exercise of discretion is said to be contrary to the instruction penned by the testatrix when she executed her will.  But a proper reading of the instruction does not assist the applicant.

[43] The purpose of the instruction is, I think, obvious.  There were four such letters each addressed to the trustees of the four testamentary trusts.  Each was a plea to those trustees to exercise their powers for the benefit of the particular son named as the first beneficiary in each trust, and his descendants, according to his wishes.  The concern of the testatrix was, obviously, that the trustees not apply the income or capital of (say) Adrian’s trust to Duncan or Roderick or Ian, or their children.  The testatrix meant, and hoped, that the property held in trust for the Adrian Trust would benefit Adrian and any children or grandchildren he might have.

[44] But that concern ceased to be relevant when Adrian died childless.  There were no beneficiaries in the first three classes named in the Adrian Trust instrument.  The only remaining beneficiaries were Adrian’s brothers and their children.  There were no beneficiaries with respect to whom the instruction could apply.

[45] This construction is apparent from the very words of the instruction.  It concludes:

‘... The other beneficiaries being his brothers, the children of his brothers are only to receive any capital or income in the event of the death of Adrian ... and all of his children and all of his grandchildren.’

[46] The instruction that:

‘... The primary beneficiaries are Adrian ... his children and grandchildren and that his wishes are to be adhered to in administering the trust ...’

terminated when there were no beneficiaries of the class described:  ‘Adrian, ... his children and ... his grandchildren.’

[47] There is a second reason why the instruction cannot operate as the applicant contends.  On its face it is a constraint or fetter on the discretion conferred on the trustees by the terms of the will.  That conferred a wide discretion to apply any income or capital to any of the beneficiaries including Adrian’s brothers, nephews and nieces.  The instruction purports to limit the discretion by excluding those beneficiaries as a proper object of the application of trust property.  Such a fetter is invalid.

[48] According to The Law of Trusts by Underhill and Hayton 16th ed (p 690):

‘... It is trite law that trustees cannot fetter the future exercise of powers vested in trustees ex officio ... .  Any fetter is of no effect.  Trustees need to be properly informed of all relevant matters at the time they come to exercise their relevant power.’

[49] Meagher and Gummow in Jacobs Law of Trusts in Australia 6th ed para 1616 say:

‘Trustees must exercise powers according to circumstances as they exist at the time.  They must not anticipate the arrival of the proper period by ... undertaking beforehand as to the mode in which the power will be exercised in futuro.’

[50] Professor Finn (as his Honour then was) in his work Fiduciary Obligations wrote (para 51):

‘Equity’s rule is that a fiduciary cannot effectively bind himself as to the manner in which he will exercise a discretion in the future.  He cannot by some antecedent resolution, or by contract with ... a third party – or a beneficiary – impose a “fetter” on his discretions.’

[51] Finkelstein J summarised the position succinctly in Fitzwood Pty Ltd v Unique Goal Pty Ltd (in liquidation) (2001) FCA 1628 at 121 in these terms:

‘Speaking generally, a trustee is not entitled to fetter the exercise of discretionary power ... in advance:  Thacker v Key 1869 LR 8 Eq 408;  In Re Vestey’s Settlement (1951) Ch D 209.  If the trustee makes a resolution to that effect, it will be unenforceable, and if the trustee enters into an agreement to that effect, the agreement will not be enforced (Moore v Clench (1875) 1 Ch D 447), though the trustee may be liable to damages for breach of contract ...’.

[52] For these several reasons the challenge to Duncan’s discretion fails.

[53] The next contention to consider is the complaint that Duncan has not appointed a trustee to replace Adrian.  Again the relief sought is an order that Duncan justify his decision rather than an order that the Court appoint another trustee pursuant to s 80, or that the Court order Duncan to appoint one pursuant to s 12 of the Act.  Nevertheless the application was argued on the basis that one or other of those orders should be made.

[54] The applicant properly concedes that there is no ‘strict legal requirement’ that a second trustee be appointed, citing s 16 of the Act which allows a sole surviving trustee to exercise the powers given to two or more trustees, and s 12(2)(c) which provides that it is not obligatory to fill up the original number of trustees. 

[55] Nevertheless it is submitted that the law’s preferred position is that there be more than one trustee, principally, it seems, to lessen the temptation a trustee might experience when dealing with trust property.  The authors of Principles of the Law of Trusts, Ford and Lee, wrote (para 8210):

‘It is also inadvisable to leave a trust with less than two trustees, although it is not possible to insist on this by statutory means as trustees can die.  A trust can subsist without a trustee at all.  Nevertheless a person in the position of sole trustee should always take immediate steps to bring about the appointment of at least one co-trustee.  In the first place it is unsuitable that the assets of a trust should be committed to the care of only one person because it is a position of great temptation to commit fraud;  and in the second place the functioning of a trust can be seriously impaired by the death of a sole trustee because of the disruption of affairs that must inevitably follow that event.’

[56] Duncan explained in evidence that his decision not to appoint an additional trustee follows his decision to distribute the assets of the Adrian Trust as soon as possible and to wind up the trust.  There will then be no further functions for the trustee to perform and the trust obligations will cease to exist.  The reasoning appears unexceptionable and the two grounds advanced by Ford and Lee for a plurality of trustees have little force in the contemplated circumstances.

[57] What is really behind this aspect of the application is Ian’s desire that he be appointed trustee to replace Adrian.  Duncan will not contemplate such an appointment because it will give rise to an immediate deadlock between the two trustees as to the exercise of their powers.  The appointment would paralyse the administration of the trust and require applications to the Court for directions with attendant expense.  Moreover, such an appointment would put Ian in an immediate and clear position of conflict between his interest in promoting the effectuation of Adrian’s testamentary wishes and his duty to exercise the trustees’ powers impartially as between beneficiaries.

[58] For this reason it is inappropriate to make an order pursuant to s 80 of the Act for the appointment of another trustee.  That section allows the Court to appoint a new trustee or trustees whenever it is expedient to do so and it is found inexpedient, difficult or impracticable to do so without an order.  It would not be expedient to appoint Ian for the reason I have mentioned and Duncan’s decision not to appoint a further trustee but to move quickly to wind up the trust is entirely justifiable.

[59] The remaining point of contention is Duncan’s decision to pursue recovery of the sum of $190,000 from Zafron.  The applicant seeks an order, pursuant to s 8 of the Act, interdicting Duncan’s decision.

[60] This aspect of the application is extraordinary, indeed impudent.  It has no basis other than Ian’s self-interest in obtaining the benefit of Adrian’s breach of trust through his succession to Adrian’s shares in Zafron.  Duncan, as trustee has a duty to recover the misappropriated trust property for the benefit of the beneficiaries.  See Trustees of the Christian Brothers in Western Australia v Attorney-General (WA) [2006] WASC 191 at 37.  The order sought would preclude Duncan from discharging that duty as trustee to recover the misappropriated trust funds from a recipient who took them with full knowledge of the misappropriation.  Duncan is, of course, as co-trustee, liable for the misappropriation should the beneficiaries bring a suit against him.  The order sought would prevent him from discharging his duty and expose him to liability to the beneficiaries for not doing so.  The claim is one which should never have been advanced.

[61] The application also seeks directions with respect to the final administration of the late Mrs Burns’ estate.  There remains a sum of money to be distributed to the Adrian Trust but there is no reason why the payment should not be made and no disagreement between the executors of the will and the trustee which requires the Court’s assistance.

[62] There remains only the question of costs.  The applicant submits that the appropriate order is that the costs of both parties be assessed on the indemnity basis and paid from the estate.  Duncan as first respondent seeks an order that the applicant, Ian, pay the costs of the application which has been wholly unsuccessful. 

[63] The applicant’s submission is that he was obliged to approach the Court for directions because of some uncertainty in the terms of the will and/or the testatrix’s instruction to Adrian’s trustees as to the proper exercise of their discretion;  and the resolution of a tension between those documents and Adrian’s will and draft Deed of Settlement.  Reference was made to the Law of Costs by Dal Pont, para 10.24 to the effect that:

‘From time to time it has been held that a person responsible for drafting the document should bear the costs of litigation which poor drafting has encouraged ... and this has been most often exemplified in proceedings relating to the construction of wills and trusts.  So that if “the testator and his draftsman have drawn up a document of such a character that no-one could ... be quite sure of its meaning”, the costs of all parties ... come out of the estate.’

[64] This is not such a case.  There is no ambiguity or uncertainty about the will or the terms of the trusts.  The instruction was irrelevant to the exercise of the trustee’s discretion with respect to Adrian’s Trust estate:  on its own terms and because of its effect as a fetter on that discretion.  Moreover there was no conflict that I could discern between the instruction and the expression of Adrian’s wishes.  On the contrary they were complementary.

[65] There was a straightforward will and a proposed exercise of discretion by the surviving trustee of a testamentary trust which on its face was fair and reasonable, though not to the applicant’s liking.  The opposition to the proposed exercise of discretion has its basis in the applicant’s self-interest and nothing more.  He sought unsuccessfully to challenge the trustee’s exercises of power.  His failure was not due to some nice construction of a difficult document but because the application had no merits.  In the circumstances the appropriate order is that the applicant pay the first respondent’s costs of and incidental to the application, to be assessed on the standard basis.  The application is dismissed.