HARCO NOMINEES PTY LTD ACN 007 577 755 [2026] SASC 20

Applicant: HARCO NOMINEES PTY LTD ACN 007 577 755 Counsel: DR V GILLILAND - Solicitor: PAUL D BEAR LEGAL SERVICES PTY LTD Hearing Date/s: 17/02/2026 File No/s: CIV-25-008773 B SUPREME COURT OF SOUTH AUSTRALIA (Civil: Application) DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment. The onus remains on any person using material in the judgment to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court in which it was generated. IN THE MATTER OF HARCO NOMINEES PTY LTD ACN 007 577 755 [2026] SASC 20 Judgment of the Honourable Justice B Doyle (ex tempore) 17 February 2026 EQUITY - TRUSTS AND TRUSTEES - APPLICATIONS TO COURT FOR ADVICE AND AUTHORITY EQUITY - TRUSTS AND TRUSTEES - POWERS, DUTIES, RIGHTS AND LIABILITIES OF TRUSTEES - LIABILITY FOR BREACH OF TRUST - RELIEF FROM LIABILITY - EXCUSE OF ACTING ON LEGAL OR JUDICIAL ADVICE Harco Nominees Pty Ltd (‘the applicant’) seeks judicial advice pursuant to s 91 of the Trustee Act 1936 (SA). The applicant was incorporated in 1958 by partners of a stockbroking firm to provide a vehicle through which citizens of the United States of America (‘US investors’) could purchase shares in Santos Ltd (‘Santos’). The director of the applicant who was most familiar with its activities is deceased. The applicant currently holds approximately 275,000 shares in Santos and approximately $2.1m received by way of dividends or payments derived from shareholdings in Santos. Despite the making of specific inquiries and the placing of publications in newspapers in the United States of America, the applicant has been unable to identify the US investors for whom it acquired the Santos shares. Held, giving advice and directions pursuant to s 91 of the Trustee Act: 1. the applicant holds its property on trust and the Court accordingly has jurisdiction to give advice and directions; 2. in the absence of any further material developments the applicant would be justified in refraining from pursuing any action against its former directors, and would be justified in selling the remaining Santos shares and dealing with the proceeds and the funds held by the applicant pursuant to the Unclaimed Money Act 2021 (SA). Companies Act 1962 (SA); Trustee Act 1936 (SA) s 91; Unclaimed Money Act 2021 (SA) ss 3, 4, 5, 7(1), 7(2)(b)(i), referred to. Burke v Public Trustee for the State of South Australia [2022] SASCA 64, discussed. -- 1 of 11 -- -- 2 of 11 -- IN THE MATTER OF HARCO NOMINEES PTY LTD ACN 007 577 755 [2026] SASC 20 Civil 1 B DOYLE J (ex tempore): The applicant seeks judicial advice pursuant to s 91 of the Trustee Act 1936 (SA). 2 The provision of advice to trustees serves both to protect a trustee who acts upon the advice provided, and to protect the interests of the trust, by providing a summary style procedure to assist and guide a trustee without conclusively determining the substantive issues in relation to which the advice is sought. Reflecting these unusual features of the advice jurisdiction, the advice or direction is typically given in terms of what the trustee would be justified in doing.1 3 Protection is afforded to the trustee so long as the essential factual basis upon which the advice has been sought is accurate. It is appropriate therefore to summarise the facts as set out in the affidavit evidence relied upon by the applicant, and upon which I have proceeded.2 Background facts 4 Santos Ltd (‘Santos’) was first listed on the Australian Stock Exchange on 1 October 1954. The original underwriters of the share issue were Cutten & Harvey. 5 The applicant was incorporated on 25 February 1958 pursuant to the Companies Act 1962 (SA) by the partners of Cutten & Harvey. Its directors have, since incorporation, always been partners or former partners of that firm. The applicant’s Memorandum of Association includes the objective of acting as a trustee. 6 The applicant was established for the specific purpose of holding shares on behalf of citizens of the United States of America who wished to invest in Santos (‘US investors’). 7 Partners of Cutten & Harvey travelled to the United States and held meetings with stockbrokers known to them, to garner interest in their clients investing in Santos. Under the laws or regulations of that nation there was, for a time, a preclusion upon direct ownership. 8 Stockbroking firms later advised Cutten & Harvey of the total number of shares required and the parcels in which they should be acquired. Cutten & Harvey purchased shares in those parcels and received share certificates issued in the 1 Burke v Public Trustee for the State of South Australia [2022] SASCA 64 at [362]-[364] (Doyle JA). 2 Affidavit of Paul Bear filed 23 July 2025 (FDN 2), affidavit of Ian Jenkinson filed on 23 July 2025 (FDN 3). -- 3 of 11 -- [2026] SASC 20 B Doyle J 2 applicant’s name but which were treated as being held on particular clients’ accounts. 9 The share certificates were then sent to stockbrokers who either retained them on behalf of their clients or distributed them to their clients. Unfortunately, it seems the applicant did not receive and at all events did not systematically maintain the details of the individual clients of the stockbroking firms. 10 Following a regulatory change in the 1970s, some US investors commenced to hold the shares directly themselves and, upon request, the applicant facilitated transfers of the parcels of shares to them. Where a request was made for the value of the shares to be paid over, the applicant would arrange for an on market sale and would remit the proceeds after brokerage and any costs to the investor in question. 11 For many years, Santos did not issue a dividend. Things became more complicated when that changed. The applicant banked dividends in its bank accounts. As well, Santos issued bonus shares and issued renounceable and non- renounceable rights to its shareholders from time to time. 12 As at the date of the application to this Court, the applicant held 274,129 shares in Santos with an approximate total value of around $1.8 million. It maintains bank accounts totalling nearly $2.1 million, made up of dividends and the proceeds of sale of rights issues together with interest, less certain costs. 13 Over the years, a substantial number of transactions have been carried out by the applicant on behalf of the beneficial owners of the shares. The details were recorded on ledger cards. However, the correspondence and dealings were carried out by Mr Danny Watson, who died in 2018. He kept the relevant records at his home. 14 Mr Ian Hugh Jenkinson was a director of the applicant from 1987 until 2024. He is not aware of any other repository of records apart from those maintained by Mr Watson. Having reviewed the records and correspondence he has affirmed that the identity of the beneficial owners of any remaining Santos shares held by the applicant cannot be determined from them. 15 Mr Paul Bear is an experienced practitioner who was first instructed to assist in relation to this matter in 2019. After a thorough and careful review, he has come to the conclusion that the remaining records provide names only of persons to whom shares have been transferred, or whose shares have been sold and the proceeds remitted to them. The review has not assisted in identifying the identity or whereabouts of the investors for whom the applicant continues to hold Santos shares or proceeds or funds derived from them (the ‘missing beneficiaries’). Efforts to locate missing beneficiaries 16 From the materials that the applicant and its advisors have maintained, the names of a number of stockbroking firms and, in some cases, their successors, have -- 4 of 11 -- [2026] SASC 20 B Doyle J 3 been compiled. Mr Bear has written to the successor firm of Carl Marks & Co, which appears to have been responsible for representing a number of the investors, but he received no response. 17 Mr Bear has also written to investors with whom contact was able to be established. One such response was instructive. The individual found a share certificate belonging to his father in a filing cabinet after his father’s death. When he showed them to two different US brokerage firms he was told they were worthless. It was only his persistence that eventually resulted in him contacting the applicant and being properly paid for the value of the shareholding. This individual was not aware of any other investors. 18 Another investor who was located had previously worked for Delhi International (‘Delhi’). He had left his share certificate in a bank lock box for a long time before finding it and arranging for the shares to be sold in 2016, with Mr Watson’s assistance. Whilst he suggested that other former Delhi employees might have been investors he commented that he was one of the youngest buyers. It seems likely other buyers would now be deceased, or would well and truly be retired (and thus not in regular contact with Delhi). 19 In 2021, Mr Bear sought out the assistance of a firm called Alliance Advisors, situated in New York, who are proficient at finalising odd lots of shares and searching for lost share certificates and shareholdings. That firm was not able to advance matters but suggested that, if an advertisement were to be placed in a newspaper, USA Today would be an appropriate publication. 20 In April 2025, Mr Bear caused advertisements to be placed in USA Today (on two occasions) and in the Wall Street Journal. The advertisements were simply and effectively drafted. They failed to yield any inquiries. Past payments to directors 21 Mr Bear’s analysis of the material discloses that over a period of approximately 20 years between 1989 and 2018, three former directors of the applicant were paid fees and, in some cases, reimbursed for apparent expenditure. Over that period, Mr Watson appears to have received approximately $800,000. The two other directors received lesser, but still substantial, amounts. 22 Mr Bear’s investigations have not revealed any express basis upon which the directors charged a fee. Mr Jenkinson was not able to shed any light on the original agreement (if any); any such arrangement pre-dated his involvement. However, as Mr Bear deposes, it would be surprising if the US investors expected that the shares would be held and transacted, and dividends accounted for, without any charge. 23 Given the absence of evidence one way or the other about what was disclosed concerning fees, the applicant’s current directors have not considered it -- 5 of 11 -- [2026] SASC 20 B Doyle J 4 appropriate to make claim against the three former directors, two of whom are now deceased. The application 24 By an originating application filed on 23 July 2025, the applicant sought the following relief: 1. A declaration that the shares currently held by the Applicant in Santos Limited and referred to in IHJ-16 and PDB-8 are held by the Applicant on trust for various US Shareholders (the Beneficiaries) who are unable to be identified (Share Trust). 2. A declaration that the dividends paid by Santos from time to time and currently held by the Applicant are held on trust for the Beneficiaries (Dividend Trust). 3. That this Honourable Court to provide advice and directions to the Applicant as to the further inquiries to be undertaken in attempting to ascertain the identity and whereabouts of the remaining Beneficiaries of the Share Trust, in particular that it is appropriate for the Applicant to: (a) advertise in such newspapers and/or other media as it may be advised for US Shareholders to come forward and be identified and, if necessary, to deal with their shares in such manner as they think fit; (b) continue to liaise as far as possible with the US Stockbrokers named in PDB- 13 and PDB-14 to attempt to identify any possible US Shareholders still holding shares in Santos; (c) pay to the recently appointed Directors, Stefan Jury and Daniel Pallaras, each being practitioners of this Honourable Court, a fee based on the Higher Court Rate for their time and trouble and assistance in this matter; and (d) pay the expenses for the above actions, including the associated legal fees and disbursements, from the Dividend Trust. 4. Advice and directions that it is reasonable in all of the circumstances that the Applicant does not pursue any further action against the former Directors of Harco Nominees Pty Ltd or their respective Estates, in relation to potential past breaches of trust with respect to the Share Trust and/or the Dividend Trust. 4. Advice and directions that it is reasonable in all of the circumstances that the Applicant does not pursue any further action against the former Directors of Harco Nominees Pty Ltd or their respective Estates, in relation to potential breaches of trust with respect to the Share Trust and/or the Dividend Trust. 5. Advice and directions that, in the event that the further inquiries made in relation to the existence and whereabouts of the remaining Beneficiaries does not provide any results, the remaining Shares be sold and, after all costs and expenses are paid (including the costs of this application for advice and any outstanding taxation liabilities), the residual funds be paid pursuant to the regime in the Unclaimed Moneys Act. 6. That the costs of all of the searches and inquiries in relation to the search for US Investors and of and incidental to the application be costs payable by the Applicant from the moneys held by it on behalf of the Dividend Trust. -- 6 of 11 -- [2026] SASC 20 B Doyle J 5 7. The Applicant’s costs of this application be paid from the Dividend Trust on the footing of an indemnity. 8. Any other order, declaratory or otherwise, or direction that the Court sees fit as to the administration of the estate, or the construction of the will, deed or document which is the subject of the application. 25 At a hearing on 22 August 2025, the Chief Justice gave relief substantially in the terms of paragraph 3(c). I received written submissions in respect of the balance of the application and have heard further oral submissions this morning. 26 The applicant recognises that liquidating the Santos shares and paying the proceeds (after any taxes and expenses) pursuant to the Unclaimed Money Act 2021 (SA) (‘the Act’) would, prima facie, amount to a breach of trust. It submits, however, that in circumstances where the beneficiaries cannot be located and where the funds would be dissipated by making further inquiries, there comes a point where the applicant should be wound up and the funds dealt with under the Act. The applicant is a trustee 27 A finding that the applicant holds the Santos shares and the funds in its bank accounts on trust is foundational to the exercise of jurisdiction. In my view, the material before me plainly demonstrates that the applicant has held its property from incorporation as a trustee. The precise terms of the trust may be debated. It is not known what if anything was conveyed to the beneficiaries as to how dividends (which may have seemed a speculative proposition at the time the Santos shares were acquired) would be accounted for. 28 For the purposes of establishing this Court’s jurisdiction, it is not necessary to settle on a precise characterisation of the trust, nor an articulation of its express, implied or imposed terms. It is sufficient that I find, as I do, that the applicant held the Santos shares on trust and that the further property that has been acquired from or as a consequence of those holdings is also impressed with a trust. I do not consider declaratory relief to that effect is necessary or appropriate. Advice and direction 29 There are two related issues requiring consideration. The first is whether the Court should give advice that the applicant would be justified in either immediately or imminently terminating further inquiries to locate potential beneficiaries and engaging in a winding up, with the surplus proceeds to be dealt with under the Act. The second is whether the applicant is justified in refraining from investigating any claim that may be available against former directors in respect of payments made to them. 30 Before addressing the appropriateness of what is proposed, I should briefly consider whether the regime under the Act is available. Sections 4 and 5 provide as follows: -- 7 of 11 -- [2026] SASC 20 B Doyle J 6 4—Register of unclaimed money (1) A corporation to which this section applies must— (a) maintain a register of unclaimed money in a form determined by the Treasurer; and (b) make the register available, free of charge— (i) on the corporation's website; or (ii) on a website approved by the Treasurer for the purposes of this subsection; and (c) by 31 January each year, enter into the register the particulars determined by the Treasurer relating to unclaimed money exceeding the prescribed amount held by the corporation as at 1 January in that year. Maximum penalty: $5 000. (2) This section applies to a corporation that carries on business in this State other than— (a) a corporation established on a non-profit basis; or (b) an ADI; or (c) a superannuation provider within the meaning of the Superannuation (Unclaimed Money and Lost Members) Act 1999 of the Commonwealth; or (d) a corporation of a prescribed kind. 5—Unclaimed money to be paid to Treasurer (1) Unclaimed money that has not been paid by a corporation to the owner of the money before the second anniversary of the day on which notice of the unclaimed money first appeared on a register of unclaimed money maintained by the corporation (whether under this Act or the repealed Act) must be paid by the corporation to the Treasurer within 4 months after that anniversary. Maximum penalty: $5 000. (2) Money paid to the Treasurer under subsection (1) must be credited to the Consolidated Account. 31 I am satisfied that the moneys presently held by the applicant, and the proceeds that it will hold if it sells the remaining Santos shares, amount to ‘unclaimed money’ within the meaning of s 3 of the Act.3 32 The moneys are derived from money received by the applicant when the relevant US investors subscribed through the applicant for shares in Santos many years ago. Where money comprises the traceable substitute for money received more than five years earlier by a corporation, I would treat that money as ‘unclaimed money’ in light of the words in parentheses in its definition (that is 3 ‘Unclaimed money’ means ‘any sum of money (including, but not limited to, principal, interest, dividends, bonuses and profits) that — (a) has come into the possession of a corporation by virtue of a transaction with the owner of the money occurring in this State; and (b) has been held by the corporation for at least 5 years; and (c) in respect of which there has been no claim by the owner against the corporation’. -- 8 of 11 -- [2026] SASC 20 B Doyle J 7 ‘including, but not limited to, principal, interest, dividends, bonuses and profits’) and the evident purposes of the legislation.4 33 Section 7(1) of the Act provides that if the Treasurer is satisfied, on application made in a manner and form approved by the Treasurer, that the applicant is the owner of money that has been paid to the Treasurer under the Act, the Treasurer may pay the money to the applicant.5 34 Whilst selling the Santos shares and dealing with the funds under the Act would appear to be contrary to the interests of the missing beneficiaries, it does not seem reasonable to expect the applicant to engage in ongoing management and investment of the property, or to continue to make inquiries with a view to identifying and then accounting for beneficial owners, on a gratuitous basis. The value of the property may be gradually dissipated by those means, and, unless it is reasonably likely that beneficial owners will be identified, to little end. 35 Having regard to the share splits that have occurred, it seems likely that the unidentified beneficiaries would have originally acquired fewer than 30,000 Santos shares. The available records suggest that the vast majority of missing beneficiaries purchased parcels of 100 shares. That suggests there are fewer than 300 missing beneficiaries. An ‘average’ beneficiary may have a claim equating in value to approximately $13,000. 36 On the assumption that most or all investors took up their investments through the applicant at or shortly after its incorporation, and whilst they were above the age of majority, any surviving individuals are likely to be at an age which exceeds average life expectancy. Any investor who was aged 40 years or older is very likely now to be deceased. Being realistic, most of the missing beneficiaries are likely deceased and their estates are likely to have been administered. If a relevant part of their estate passed to a spouse, the spouse is also likely to be deceased. 37 On the assumption that any residue was divided between a number of persons, any heir or successor is likely to have an interest in the fund which, if established, would be of a correspondingly lesser monetary value. The task of determining who amongst their heirs or successors may now be entitled to claim through the deceased investor’s estate could involve complex law, potentially involving laws of different jurisdictions within the United States of America. 38 The applicant has engaged in both specific inquiries and what might be described as ‘broad spectrum’ publicity in an attempt to locate missing beneficiaries. These have proved unsuccessful. Whilst further more specific 4 The statute must contemplate that a corporation may have received a sum of money more than five years ago but will be continually accruing interest. It cannot be that each cent of interest must itself have been held for at least five years before it becomes ‘unclaimed money’. 5 Section 7(2)(b)(i) requires that such application be made no more than 25 years after the money first appeared on a register under the Act. -- 9 of 11 -- [2026] SASC 20 B Doyle J 8 inquiries could be made through other successor firms of the original stockbroking firms, the practical reality is that this would involve a reasonably significant administrative burden for which those firms would be expected to charge a fee. 39 To my mind, the applicant would be acting reasonably in selling the remaining Santos shares on the open market and treating the moneys as governed by the Act. This will require the creation of a website, or a publication relating to the applicant’s Santos shares on a website managed by the Treasurer, for a period of around two years. Persons who locate Santos shares in the name of the applicant during that period will at least have some prospect, through internet searches, of becoming aware of the status of the moneys. The material before the Court satisfies me that pursuing further investigations is only likely to result in the incurring of cost and expense. 40 As I raised with the applicant during submissions, I consider that steps should be taken to investigate the maintaining of a simple web page containing information about how the funds have been dealt with for a period of some years after the moneys are then transferred to the Treasurer. That way, information concerning the applicant and its Santos shares will be able to be found on the internet for a reasonable period of time after the applicant is wound up and de- registered. 41 Turning to the question of a claim against directors, I consider that, by virtue of the following considerations in combination, the applicant is justified in refraining from pursuing such claims: • first, the merits of the claim are speculative. There may well have been an arrangement or understanding that authorised fees to be charged. If there was not, the directors (or their estates) might nevertheless seek the Court’s approval for retrospective remuneration; • secondly, and relatedly, pursuing the claims may involve incurring considerable expense and may expose the applicant to an adverse costs order if the action is not successful; • thirdly, and arguably, subject to the time period in respect of which fees are disgorged, any successful recovery would be held subject to beneficial interests on the part of investors who had otherwise quit their interests in the applicant, thus casting an even more complex administrative burden on the applicant; and • fourthly, unless and until any missing beneficiaries are located, the pursuit of any claim against the former directors would serve little practical purpose. 42 In the absence of a beneficiary being located and expressing a desire to consider indemnifying other beneficiaries against any adverse costs exposure for -- 10 of 11 -- [2026] SASC 20 B Doyle J 9 doing so, I consider the applicant will be justified in refraining from pursuing any claims. Relief 43 For the foregoing reasons, I will make an order in the following terms, with the terms ‘Harco Trust’ and ‘Beneficiaries’ to be appropriately defined. On the basis of the evidence contained in the Affidavit of Paul David Bear dated 23 July 2025 (FDN 2) and the Affidavit of Ian Hugh Jenkinson dated 10 December 2024 (FDN 3), the Court advises and directs pursuant to s 91 of the Trustee Act 1936 (SA) that, in the absence of any further material developments regarding the identity of the Beneficiaries, the Applicant would be justified in: 1. refraining from pursuing any action against its former directors or their respective estates, in relation to the potential breaches of trust raised in paragraphs 39-43 of FDN 2; 2. save for any steps taken pursuant to paragraph 4 below, undertaking no further inquiries to ascertain the identity and whereabouts of the remaining Beneficiaries; 3. selling the remaining shares and, after all costs and expenses are paid (including the costs of this application for advice and any outstanding taxation liabilities), subject to no claim or notification being received within the required notice period, dealing with the residual funds pursuant to the regime in sections 4 and 5 of the Unclaimed Money Act 2021 (SA); 4. taking such reasonable and practicable steps as may be available to establish a website (or other similar media) advertising the existence of the Harco Trust, the fact that the funds have been or will be paid pursuant to the Unclaimed Money Act 2021, and directing any beneficiaries, or potential beneficiaries, towards the register maintained by the Treasurer of South Australia from time to time; and 5. if all Trust funds have been dispensed consistent with the above advice, winding up and de-registering. It is ordered that: 6. the costs of and incidental to the Applicant’s attempts to identify the Beneficiaries, and of this application, be paid from the Harco Trust by the Applicant on the footing of an indemnity; 7. the applicant has liberty to apply. -- 11 of 11 --