Equity and Trusts

LAW5EQT 2023

Equity and Trusts

Research Assignment

Purpose

This assignment is a problem question that requires you to find and analyse case law and communicate a reasoned legal opinion on the likely outcome if it goes to court.

The purpose of this assignment is to add an extra layer of professional skill onto your legal analytical skills: research. Whether you go into practice as a lawyer, policy analyst or political adviser you will benefit from the skill of being able to answer completely novel legal questions. In this problem you will be faced with a situation that is not covered in the course materials. You will head out into the forests of the law reports and come back with the best answer you can find.

Instructions

The problem question is 35% of your total mark in the subject.

The assignment is due at 11:59pm on Monday 2 October.

This is an open-book exercise. You may consult any written sources but not materials prepared by other students or discuss the assignment with other students or any other person.

The use of generative AI, such as ChatGPT, is prohibited for this assessment.

The assignment is a research exercise, which means that you will need to find materials beyond what are provided in the textbooks and LMS. For example, you will need to use case law databases like CaseBase and FirstPoint to find cases that are relevant as persuasive or binding authorities.

Any queries about the assignment that can be answered will be answered on the LMS Q&A forum so everyone has the same information. Please do not ask your tutors questions related to the assignment.

There is a word limit of 2,500 words, with a 10% leeway permitted in excess. The word limit includes everything but the cover page, footnotes and bibliography. This means headings are included in the word count. Your argument should not be carried out in footnotes, so do not use this as a method of expanding the word limit. Be concise. The assignment is able to be completed to a very high quality well within the word count.

To be concise and effective, spend more words on the critical issues and less words on the background concepts. The critical issues can be identified by working out what the defendants best arguments are for defeating the plaintiffs claim(s). If the plaintiff has multiple claims then spend more time on those that the defendant will have the most difficulty countering.

Referencing: students should follow the Australian Guide to Legal Citation, 4th edition, available at http://www.law.unimelb.edu.au/mulr/aglc. La Trobes short guide to the AGLC is available through the library at http://latrobe.libguides.com/law. Particular points I want to emphasise from past years include:

Use footnotesCase names can be written in the text, but the rest of the reference should be in the footnote.

If you do not look at the primary source say as cited in or as quoted in, then the source you found it in. For example: Re Badens Deed Trusts [1971] AC 424, as quoted in HAJ Ford and William A Lee, Principles of the Law of Trusts (Law Book, 2nd ed, 1990) 91.

Use pinpoint references to paragraphs (or pages) as much as possible.

Do not quote lecturer or tutor comments. If you cannot find a source for what the lecturer has said anywhere after a reasonable search you may email the lecturer.

Lawyer websites and blogs have a very uncertain reliability. They are most useful to cite as evidence of what some in the profession are doing or saying, but are no replacement for your own interpretation of the primary legal sources.

You should include a reference list or bibliography.

Reread the Guide to Clear Legal Writing available on the LMS and through the law Libguide: https://latrobe.libguides.com/law.

Include a cover page that clearly states your name, your student number, your tutors name and tutorial group (time). You must also accurately state the number of words of your answer on the cover sheet of your paper.

Submission

Your answers must be submitted via the Turnitin Link under the Mid-semester Assessment Tab on the LAW5EQT subject page on the LMS by the due date.

Extensions. You may apply for an extension by emailing me up to 48 hours before the due time. When applying you should include relevant evidence such as an LAP, medical certificate or statutory declaration. I can approve extensions of up to 5 days. For longer extensions you will need to apply for special consideration.

Special Consideration

I encourage you to apply for an extension before the due date rather than applying for special consideration after the due date.

You may apply for special consideration through the special consideration website:

https://www.latrobe.edu.au/students/admin/forms/special-considerationSpecial consideration is specifically intended to support students who experience serious short-term, adverse and unforeseen circumstances that substantially affects their ability to complete an assessment task to the best of their potential.

For examples of the types of grounds that will be accepted for special consideration, and those that will not, see the following website:

https://www.latrobe.edu.au/students/admin/forms/special-consideration/allowable-reasonsIf your special consideration application is accepted you may be offered an alternative special assignment in the final exam period. University policy is that no mark adjustments may be offered.

Feedback

You will be provided feedback through turnitin where you submit your work. The anticipated return time is 15 working days after you submit your assignment.

The assessment criteria is provided in a separate document. I recommend that you look at this closely because it is quite specific in what we want to see from your research.

LAW5EQT Research Assignment

Sigmund Jung is locked in a dispute with his daughter, Bren Brown. Five years ago Sigmund and Bren entered into a partnership contract to start a marketing business. Sigmund had been in mid-level marketing in Melbourne for 30 years before their agreement, while Bren had made a name for herself in London for a few years as a creative phenomenon. Bren has two half-sisters: Eckhart, who is Sigmunds son with a different mother, and Tony, who is Brens mothers son with a different father.

For three years Bren and Sigmunds partnership was a success financially and creatively. However, two years ago their relationship started to break down. Sigmund accused Bren of being self-involved and not sticking to the plan that they had (somewhat) agreed at the start. Bren accused Sigmund of resenting her creative success and being a out-of-touch gen X-er. Eventually, their relationship deteriorated to the point that Bren dissolved the partnership. After negotiating the end of the partnership, and a brief appearance in court, they entered into a written settlement agreement to the effect that Sigmund owed Bren $4 million.

The problem is that now Sigmund is refusing to pay Bren the $4M he owes her. He has told her that she can make him bankrupt, but that he has no money to pay her. Bren doesnt believe this as she knows that her Dad lives in an expensive mansion in Toorak, drives three fancy cars, and has frequently talked about his investments worth millions. Bren does some investigating and discovers that the Toorak mansion and his financial investments are all registered in Sigmunds name as sole owner. However, when Bren confronts Sigmund about this he hands her a trust deed (see below) and says, I hold all those assets as sole trustee for the Sigmund Jung Trust, therefore, beneficially they are not my assets. He also gives Bren a series of written and signed resolutions from over 10 years ago that record that Sigmund declared he held those assets upon the terms as set out in the Sigmund Jung Trust Deed.la

Bren confers with you, her lawyer. You correctly advise her on the laws of debt and bankruptcy. First, because Sigmund owes Bren a debt, Bren is entitled to enforce that debt by seizing property and property rights that Sigmund owns beneficially. Second, that making Sigmund bankrupt achieves a similar result by having a trustee in bankruptcy seize the property that Sigmund owns to distribute to his creditors. Third, that if Sigmund is made bankrupt, any property held by the bankrupt in trust for another person cannot be taken by the trustee in bankruptcy to pay creditors.

It is your task to provide an objective analysis of Bren and Sigmunds legal position. As Brens lawyer you want to address the best creative arguments and counterarguments that will result in Bren being able to obtain $4M from Sigmund. You also need to anticipate and address the best creative arguments and counterarguments that Sigmunds lawyers will be preparing for him.

As in the assessment criteria, this is a research assignment, which means that you must research and analyse relevant material beyond the course materials to pass the assignment.

RELEVANT PROVISIONS OF SIGMUND JUNG TRUST DEED

INTRODUCTION

The Trustees hold the sum of ten dollars upon the terms and with and subject to the powers and discretions set out in this deed.

The Trustees hold any additional property that is transferred to them, or declared to be held by them as such, on the terms and with and subject to the powers and discretions set out in this deed.

2. DEFINITIONS AND INTERPRETATION

2.1 Definitions ...

Discretionary Beneficiaries means:

(a) the Principal Family Member;

(b) the Final Beneficiaries;

(c) the issue of any Final Beneficiary;

(d) any wife, husband, widow, widower, former wife or former husband for the time being of any Beneficiary described in paragraphs (a) to (c) of this definition;

(e) any trust ... which includes ... any Beneficiary;

(f) any person appointed pursuant to cl 7.1(a), but does not include any person who has been removed from the class of Discretionary Beneficiaries pursuant to clause 7.1(b).

Final Beneficiaries means the child or children of the Principal Family Member born or adopted before the Vesting Day.

Principal Family Member means Sigmund Jung.

Trustees means the Principal Family Member, subject to any variation under cl 17.

Vesting Day means: (a) the day upon which the period of eighty years from the date of this deed expires, being a date within the perpetuity period permitted to be specified by virtue of section 6 of the Perpetuities Act 1964, and the perpetuity period applicable to the Trust created by this deed is specified accordingly; or (b) such earlier day as the Trustees may by deed appoint.

2.2 Interpretation: In this deed: (a) the plural includes the singular and the singular includes the plural (b) the interpretation of this deed in cases of doubt is to favour the broadening of the powers and the restricting of the liabilities of the Trustees;

4. INCOME DISTRIBUTION

4.1 Distribution: The Trustees may, after payment of all expenses and other charges to be met from income, and after making or retaining out of, or charging against, the income of the Trust Fund any payments, reserves or other provisions for any of the purposes of the Trust: (a) pay or apply all or any part of the income of the Trust Fund to or for such one or more of the Discretionary Beneficiaries who are then living or in existence;

6. DISTRIBUTION OF CAPITAL BEFORE THE VESTING DAY

6.1 The Trustees may at any time:

(a) pay or apply all or any part of the capital of the Trust Fund to or for such one or more of the Discretionary Beneficiaries who are then living or in existence;

(b) appropriate all or any part of the capital of the Trust Fund for such one or more of the Discretionary Beneficiaries who are then living or in existence contingently upon the reaching of a specified age or the happening of a specified event.

7. APPOINTMENT AND REMOVAL OF DISCRETIONARY BENEFICIARIES

7.1 Power to appoint and remove Beneficiaries: The Principal Family Member may, by deed, before the expiry of the Trust Period:

(a) appoint any person to become a member of the class of Discretionary Beneficiaries ...

(b) remove any person from the class of Discretionary Beneficiaries

10. DISTRIBUTION ON THE VESTING DAY

10.1 Distribution of capital: The Trustees shall hold the Trust Fund on the Vesting Day upon trust:

(a) for such of the Discretionary Beneficiaries or such one or more of them to the exclusion of the other or others of them in such shares as the Trustees may by deed appoint on or before the Vesting Day;

(b) in respect of such of the Trust Fund as may not be validly appointed on or before the Vesting Day, for such of the Final Beneficiaries who are then living, and, if more than one, as tenants in common in equal shares and if any Final Beneficiary dies before the Vesting Day leaving issue living on the Vesting Day such issue shall take per stirpes and, if more than one, as tenants in common in equal shares all the interest in the Trust Fund which such deceased Final Beneficiary would have taken had such deceased Final Beneficiary been living on the Vesting Day;

(c) if none of the Final Beneficiaries nor any of their issue are living on the Vesting Day, for such person or persons living who would be entitled, in accordance with the applicable law governing the distribution of the estates of intestates, to the estate of the Principal Family Member if the Principal Family Member were to die intestate on the Vesting Day and, if there is more than one such person, as tenants in common in such shares as they would have been so entitled.

11. TRUSTEES DISCRETION UNFETTERED

11.1 For the avoidance of doubt and notwithstanding anything in this deed or any rule of law which imposes upon the Trustees the duty to act impartially towards Beneficiaries, the Trustees shall have unfettered discretion as to the exercise of the powers and discretions conferred upon them by this deed even though:

(a) the interests of all Beneficiaries are not considered by the Trustees;

(b) the exercise would or might be contrary to the interests of any present or future Beneficiary;

(c) the exercise results, at any time whether before or on the Vesting Day, in the whole or in any part of the capital or income of the Trust being distributed to any one Beneficiary or to any two or more Beneficiaries in equal or unequal proportions, in either case to the exclusion of the other Beneficiaries.

17. APPOINTMENT AND REMOVAL OF TRUSTEES

17.1 Principal Family Members power of appointment and removal: The Principal Family Member shall have the powers, exercisable, from time to time, to appoint and remove Trustees.

17.2 Transfer of powers of appointment and removal: The Principal Family Member may transfer the powers of appointment and removal of Trustees to such person or persons as the Principal Family Member may nominate by deed or will. ...

17.5 Power of appointment unrestricted: The holder of any power of appointment of Trustees may, subject to any contrary intention expressed in the deed (if any) transferring the power to that person, exercise that power in favour of himself or herself.