Trust Act - Question 1


  • Whether there is any breach of trust on the part of Ewan?
  • Whether the agreement done with Lucy and not informing about the agreement to Shane legal?


  • Trust Act 1973 (Qld)
  • Settled Land Act 1886
  • Themis Holdings Pty Ltd v. Canehire Pty Ltd & Anor [2014] QSC 38
  • Armitage v. Nurse [1998] Ch 241


In the light of the present case and circumstances of the matter, Section 5 of the Act1 tells about the trust which says that the trust do not include any kind of duties which are incidental to be conveyed through the ways of mortgage, yet there is an exception on trust which extends to resulting bare, implied and trusts which are constructive and to the cases in which trustee has a profit of interest in an property of trust, and to the incidental duties to the work place or office of the personal representatives. Section 5 also includes a person which may be included under the term trustee, a trustee can be a corporation, or any corporation in any such property which is subjected in the trust and is vested, or any person who immediately before any such commencement of the Act was trustee of the settlement or in any way a trustee under the Act of 18862 and also who, if Act had not been repealed, would be such a trustee; or any person who is personal representative and if a person is a statutory trustee within the meaning of the Act3. In the present case Shane is the CEO of Smotherbees Pty Ltd. Ewan Smooth is the director of the Smotherbees Pty. Ltd, whereas Lucy is a part time worker at Smotherbees and managing director of Patina Pty Ltd.

On the basis of the decisions and reports made by Shane Ewan should proceed to make and confirm to any offer of the artwork. According to the facts of the current situation and circumstances of the entire matter in January 2018 the company began to face financial problem but were somehow managed by the art lovers who were rich and wealthy. Section 74 provides the powers of the statutory trustee, a person under this section by the orders of the court should exercise the power as a trustee shall have regards to the interest of the parties included and involved in the interest in the property, a person shall be in the place of trustee and in accordance to exercise the power they should have every duty which is liable to the trustee for the benefits of the parties which are interested in the parties and the rights of a person who is a trustee is to be entitled to the indemnities and the prevention of a trustee5.

Therefore, there are some of the duties which are for the trustee to be followed they include: preservation of the duties for property of trust, duty of investing and also to insure the property trust, to act in the good faith, the duty od proving the beneficiaries and loyalty to an industry, duty to manage the information of the accounts and providing information, also a trustee should know about exercising of discretion and at last the duty to act impartial between beneficiaries6. On an occasion Ewan located a valuable and important portrait also submitted a report to Shane, Shane provided direction to Ewan to make an offer and purchase the seen portrait. Instead of listening to Shane Ewan directly approached to Lucy with the same report of an offer. Ewan lied about the report that has been submitted to Shane and Shane rejected such opportunity to Lucy, Lucy therefore, enquires each and every details and verifies the same from her friend who used to work in the Smotherbees as an accountant, and gets to know about the financial conditions of the company.

For next six months Ewan approached Lucy in the same manner and Patina Pty Ltd, agreed to purchase the artwork Ewan will receive on half of the profit. In whole the piece of work was of $85,000 whereas Ewan and Patina made it of $80,000 each on the sale of the artworks. Shane was not informed about the fixed meetings and the project going on in between Ewan and Lucy, Shane therefore sees into the computer of Ewan and figures out the situation of both the other person Ewan and Lucy are in an agreement and such practices. On the confrontation with Lucy, Lucy told Shane she as in an assumption that Shane rejected the artwork and so was told by Ewan in the first purchase.

According to the situation Shane has all the rights as per the Act of 1973 provides breach of trust, from the end of Ewan regarding the fiduciary relationship with Lucy for the artwork, Themis Holdingd Pty Ltd. V. Canehire Pty Ltd & Anor7 the court held that, the act committed by the defendant on the basis of lies and misrepresentation amounts to the breach of contract and trust with the parties included in the particular contract and agreement, therefore on the basis of such breach of contract the agreement made and done shall be fiduciary and also shall mount to the breach of the trust. Further the court also held in the case of Armitage v. Nurse8, the person who is in the contractual framework with other person shall inform the other person about the changes of the liabilities and duties of the contract, and no misrepresentation shall be on the part of the person towards the another person which shall again amount to the breach of trust and misrepresentation of the contract.


As per the facts mentioned above clearly shows and presents that the wrong has been done on the part of Evan towards Shane and therefore on the behalf of the company i.e., Smotherbees Shane has rights to file the suit for the breach of trust and misrepresentation of the facts to the another party which is a part time worker in the company and is managing director of Patina Pty. Ltd.

Trust Act - Question 2


  • Whether the beneficiaries have rights over the trust established?
  • Whether beneficiaries claim for the rights on the trust’s property?


  • Trust Act 1973 (Qld)
  • Calverley v. Green (1985) 155 CLR 242
  • Clegg v. Edmondson (1857) 8 De G M&G 787


In the light of present case and circumstances of the matter Eleanora, Ada and Sharon are sisters who have been entered into a trust by Eleanora, the trust id valid, Ada is the CEO of a company, Sharon is a school teacher. For the trust created there are four beneficiaries Jennifer, Jackson, Rafael and Rebecca and the trust were established in January 2018. In July 2018 the share dividends are paid and with the confirmation from the financial advisor Ada and Sharon divides the share of trust portfolio.

According to the Act9 all the statutory rights and obligations are mentioned in the Act of 197310. The rights and duties of beneficiary are that a beneficiary shall apply to the Court to review the decisions and acts of the trustee even if they have refused to disclose the important documents which are related to the contract. Section 8 of the Act of 197311tells about the rights of beneficiaries which clearly mentions that a person who is a beneficiary in the contract have the right to know about the contract as in the every single detail should be made clear and also should be prevented from misrepresentation of the facts, in the present case Jennifer is a beneficiary of the trust and also comes across the fact that the payment has been made to Jackson and the home is been designed and also seeks for the trust accountants and correspondence that the trustees are holding to the payments made to Jackson, Jackson being another beneficiary has the right to exercise its rights and duties according to the provisions provided under the Act12.

An application can also be made by the beneficiary under the Trust Act of 1973 under section 94 (3), which provides the Court to make the orders in relation to a beneficiary which are entitled and are pursuant to the deed of trust. In the case of Calverley v. Green13 the court held that the beneficiaries have all the rights and duties also have the power to exercise them whenever they feel like. Beneficiaries have the power to know and to get to know about the information which has not been disclosed to anybody, as being part of the trust or any contract beneficiaries can exercise their rights and can even question the parties regarding the same if the agreement is missing with some clauses of points. Further the court also decided in the case of Clegg v. Edmondson14 that it is the duty of the trustees to inform the beneficiaries who are also the part of the agreement about the changes and the information which has been mentioned and in not in the knowledge of anyone, if such information is seen later or is addressed later therefore the trustee shall be liable for explanation and loss (if) caused to the either parties.


From the abovementioned circumstances and situation it has been made clear that the trust was established between the eligible partners and for which there were four trustee which were part of the contract and had all the rights on the property over which the trust has been established, therefore, the rights and duties mentioned under section 8 and 94(3) explains about benefits for beneficiary that can be exercised in any contract which has been established and the beneficiaries are made involved in it. Every beneficiary involved in the contract has rights to exercise and also to know about the contract which have been established and also are made part of the contact or agreement.

Trust Act - Question 3

Holman v. Johnson (1775) ER 1120, 1121, Lord Mansfield stated that no court will lend its aid to a man who founds his cause of action upon an immoral or illegal account.

The statement mentioned and stated by Lord Mansfield says that no court shall help a person who is found guilty on the basis of the immorality and making of an illegal account, therefore shall be punished under the law. It was also said that there is not doubt in the actions that have been tried under the Law of England; the law says that in the variety of the circumstances, also concerning the illegality of the situations and accounts the country such offence or act has been committed shall govern the situation under the provided law. There are many such cases which every state says to determine or is already determined by the laws of the different countries where they have actually taken place. According to the verdict of Faikney v. Renyous and Richardson15 says that to pay moiety of the differences on the rescounter day; therefore, plaintiff is entitles to recover the damages. Furthermore, in the case of Buston v. Clifford16 the plaintiff was held liable to get the compensatory amount and also the benefits of not causing any immorality to any causes of an illegality towards the system. Therefore, the same decision was upheld in the case of Alsibrook v. Hall17. The objection which was raised was that a contract is immoral or illegal when the plaintiff and defendant sounds and reacts all time very sick and in the mouth of each other. It is also mentioned that the objection is not only for the permission of anything also is for the found general principles regarding such activities.

References for Trust Act

A. Cases

Faikney v. Renyous and Richardson, East, 7 Geo. 3, B. R.

Buston v. Clifford 1767

Alsibrook v. Hall 1767

Calverley v. Green (1985) 155 CLR 242

Clegg v. Edmondson (1857) 8 De G M&G 787

Armitage v. Nurse [1998] Ch 241 Themis Holdings Pty Ltd v. Canehire Pty Ltd & Anor [2014] QSC 38

B. Legislation

Trust Act 1973 (Qld)

Settled Land Act 1886

C. Other Sources

Duties of trustee, Slater and Gordon.

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