Evangelista Family Trust, Re [2025] QSC 83

SUPREME COURT OF QUEENSLAND CITATION: Re: In the matter of the Evangelista Family Trust [2025] QSC 83 PARTIES: EVANGELISTA PTY LTD (applicant) FILE NO/S: BS 681 of 2025 DIVISION: Trial Division PROCEEDING: Application ORIGINATING COURT: Supreme Court of Queensland DELIVERED ON: 11 March 2025 (ex tempore) DELIVERED AT: Brisbane HEARING DATE: 11 March 2025 JUDGE: Treston J ORDER: 1. Pursuant to ss 94 and 95 of the Trusts Act 1973 (Qld), the applicant as trustee of the Evangelista Family Trust be empowered and authorised to amend the vesting day of the Trust, as set out in clause 1(d) of the Deed of Settlement dated 8 April 1975, to the date which is 80 years from the settlement date of the Trust Deed, namely 8 April 2055. 2. The applicant’s costs of this application be paid out of the assets of the Trust on the indemnity basis. CATCHWORDS: EQUITY – TRUSTS AND TRUSTEES – DISCRETIONARY TRUSTS – OBJECTS AND DURATION – where the applicant is the trustee of a family-run discretionary trust – where the trust has a vesting date of 8 April 2025 – where the applicant seeks an order amending the vesting date to 8 April 2055 – where all members of the classes of potential beneficiaries consent to amendment except one infant beneficiary – whether amendment to the vesting date is in the interests of the infant beneficiary – whether the vesting date can be changed under s 94 of the Trusts Act 1973 (Qld) – whether changing the vesting date is in the management or administration of the trust – meaning of “expedient” in s 94 of the Trusts Act 1973 (Qld). Trusts Act 1973 (Qld), ss 94, 95 -- 1 of 9 -- 2 Queensland Law Reform Commission, The Law Relating to Trusts, Trustees, Settled Land and Charities, Report No 8 (1971) Ballard v Attorney-General of Victoria [2010] 30 VR 413 Cisera v Cisera Holdings Proprietary Limited (2018) 98 NSWLR 747 Hancock v Rinehart [2015] NSWSC 646 Perpetual Trustees WA Limited v Attorney-General of Western Australia [1992] 8 WAR 441 Re Arthur Brady Family Trust [2015] 2 Qd R 172 Re Dion Investments (2014) 87 NSWLR 753 Riddle v Riddle (1952) 85 CLR 202 COUNSEL: A W Duffy KC and M K Stunden for the applicant SOLICITORS: AVA Solicitors for the applicant [1] This is an application for orders pursuant to ss 94 or 95 of the Trusts Act 1973 (Qld) pertaining to the amendment of a trust deed so as to amend, effectively, the vesting date. By operation of the trust deed, the trust will vest on 8 April 2025. The applicant seeks an authorisation so that the vesting date is changed to 80 years from the date of settlement of the trust deed, namely to 8 April 2055. [2] The applicant, Evangelista Proprietary Limited, is the trustee of the Evangelista Family Trust, which is a family-run discretionary trust established by a deed of settlement dated 8 April 1975. [3] The corpus of the trust is comprised of various commercial properties, which are subject to long-term leases with options. Those properties are situated predominantly in Queensland on the Gold Coast and Sunshine Coast, although historically also in the ACT. The evidence demonstrates that the current income of those properties amounts to something just less than $1 million dollars per year. There is evidence before me that if the trust vests on the date which is looming, being 8 April 2025, that will have the effect of transferring the beneficial ownership of the trust assets such that, either the trust itself, or perhaps the beneficiaries, will become liable for various revenue implications, including transfer duties and capital gains tax, in the order of some $2.5 million. [4] The evidence before me demonstrates that the trust is currently, and always has been, run by members of the Evangelista family. Without any disrespect to them, I will refer to them by their first names. The trust was established by the patriarch of that family, Gino, and his wife, Rosemary, when it was incorporated in the ACT approximately 50 years ago. It is essentially a family business, which has owned and operated service stations and other commercial holdings, such as motels on the Gold Coast, over the years. It now has a number of commercial properties, mostly at Maroochydore on the Sunshine Coast. -- 2 of 9 -- 3 [5] The evidence demonstrates that when the trust was established in 1975, Gino and Rosemary were advised by their accountant at the time to operate their businesses via a trust structure. They followed that advice, and they also followed the advice as to the solicitor that they ought to go for the preparation of the trust deed. The evidence demonstrates that it is likely that the family did not specifically turn their attention to the particular vesting date, which at 50 years, was the April 2025 date to which I have referred. [6] Clause 11 of the trust deed is the clause by which the trustee is given a power in its unfettered discretion to vary the trusts, but that power is subject to the exception, “except to the extent of the vesting date”. [7] Gino is now deceased. Rosemary has provided evidence that neither she nor her husband, turned their minds to the vesting date of the trust, or the specific terms of the deed, in particular, that the deed does not allow for amendments to extend the vesting date. She deposes to the fact that she simply followed the legal advice which she was given, and signed the documents which had been prepared. Her evidence goes further and deposes that, had the issue in relation to the vesting date of 8 April 2025 been brought to her attention at that time, she would have asked for it to have been 80 years, or at least as long as possible. [8] Similar evidence is provided by the trust accountant, Mr Kent, who recommended to Gino and Rosemary the particular solicitor to consult in the ACT. Although Mr Kent did not discuss the terms of the trust deed with that solicitor, he assumed that the deed would be in the standard trust terms. He deposes that he has no knowledge as to why the 50 year vesting date was settled upon, nor why it was included in the deed that the vesting date could not be extended. He deposes to the fact that the date was not chosen on his instructions, and he can only assume that it occurred by default, rather than by design. He also gives evidence that had the vesting date been brought to his attention, he would have provided advice to Gino and Rosemary to make it 80 years, or as long as possible. [9] It is unnecessary for me to make any findings as to why the 50 year date was selected. It does not matter why the timeframe was settled upon. What matters for the purposes of this application is the satisfaction or otherwise of the matters in s 94 of the Trusts Act, to which I will return shortly. [10] But I need to say a few more things just about the terms of the trust. The beneficiaries of the trust are classes of family members, defined by reference to their relationship with the principal, Gino. Those persons are identified in the schedule to the trust as Gino, his widow, children and grandchildren, and any companies in existence, either at the date of the deed, or at any time prior to midnight on the vesting date. Gino was the director and corporate trustee of the family trust until his death on 18 June 2021, when he was aged 82 years. All of the beneficiaries who are affected by the orders sought in this application have been served, and support the making of the orders, save for only one beneficiary, a child currently aged about sixteen and a half years. [11] As a minor, that child, of course, cannot consent to the making of the orders. The child’s mother, however, is a consenting director of the trustee and a joint principal under the trust deed. She expressly supports the orders sought. She also deposes that she believes the continuation of the trust is in her son’s best interests. Although I will -- 3 of 9 -- 4 return briefly to this matter, in my view it is a straightforward case, as is submitted on behalf of the minor child, that the child does not need to be separately represented. [12] In the circumstances of this case, which include that the only beneficiaries are those direct family members related by birth or marriage to the principal Gino, and having regard to the way in which the family business has been conducted over the last 50 years, the interests of the child are broadly reflected by the interests of the other beneficiaries. Currently, the other beneficiaries are, other than the widow Rosemary, Gino and Rosemary’s two children John, and Catherine, and nine grandchildren, as well as a variety of related companies. [13] I have touched briefly on the fact that the extension of the vesting date will avoid the revenue consequences to which I have referred briefly, and I will turn again to that issue a little later. [14] Unsurprisingly, the trustee is concerned by the proximity of the vesting date and the significant tax and stamp duty consequences if the date is not extended. By cl 4 of the deed entitled, “Distribution of capital and income when Trust vests”, the consequences on vesting are set out conventionally, that upon vesting there may be distribution of all income and capital to the beneficiaries then living, and if there is more than one, in proportions which the trustee in its absolute discretion may determine. [15] Under s 94 of the Trusts Act (which I set out below), the court can give the trustees additional powers of management and administration, where the court is of the opinion that the proposed transaction is either expedient in the management or administration of the trust property, or in the best interests of the persons, or the majority of persons beneficially interested under the trust, and further, it is inexpedient or difficult or impractical to effect the transaction without the assistance of the court, or there is an absence of power in the trust instrument. [16] In truth, the authorisation under s 94 does not affect an amendment of the trust instrument, but instead confers the requisite power on the trustee despite the terms of the instrument. [17] I turn now to consider the provisions of s 94 of the Trusts Act, in its own context and in the context of similar provisions which exist in one form or another around the country. Some guidance may be taken from other jurisdictions which have similar but not identical provisions, although it must be said at the outset that the Queensland legislation is generally considered to be broader than the legislation that exists in most other jurisdictions, particularly New South Wales. [18] Speaking of the type of test to be applied in the circumstances of s 94, it can be seen that courts have construed the test in the equivalent sections elsewhere quite liberally. In Riddle v Riddle,1 considering the equivalent New South Wales provision, Williams J defined “expedient” as meaning “advantageous”, “desirable”, or “suitable to the circumstances of the case”,2 while Dixon J described expediency as meaning 1 (1952) 85 CLR 202. 2 Ibid at 222. -- 4 of 9 -- 5 “expediency in the interests of the beneficiaries”.3 His Honour said of the provision at 214: “… is a provision conferring very large and important powers upon the Court which depend upon the Court's opinion of what is expedient, a criterion of the widest and most flexible kind. The power necessarily carries with it responsibilities of equal extent. The responsibilities imposed involve business and financial considerations, but responsibilities of that description have always fallen on courts of administration. I do not think that the powers given by [the provision] were intended to be restricted by any implications.” [19] Similarly, whilst the words “management or administration” have a limiting effect upon the jurisdiction of the court under s 94, it has been held that the words are “of wide import and to pick up everything that a trustee may need to do in practical or legal terms in respect of trust property”.4 [20] I am indebted to counsel for the applicants for the following careful analysis of the authorities in relation to s 94, which I summarise below. [21] The court must be satisfied that it is inexpedient or difficult or impractical to effect the disposition or transaction without the assistance of the court, or that the disposition or transaction could not be effected because there is an absence of power in the instrument. [22] By including the requirement that it must be “inexpedient” or “difficult” or “impracticable” to effect the disposition or transaction without the jurisdiction of the court, the statute makes apparent that the court has jurisdiction where the trustee has no clear power, or where there are difficulties in the exercise of the power by the trustee.5 The circumstances in which a disposition or transaction cannot be effected because there is an absence of power in the trust instrument are wide enough to extend to the situation where the trust instrument does not confer, or prohibits the exercise of such a power. 6 [23] Counsel for the applicants pointed out to me the potential controversy in the present case, being whether the extension of the vesting date of the trust comes within the meaning of the word “transaction” as it appears in s 94 of the Trusts Act. Section 94 provides: 94 Court’s jurisdiction to make other orders (1) Where in the opinion of the court any sale, lease, mortgage, surrender, release or other disposition, or any purchase, investment, acquisition, retention, expenditure or other transaction is expedient in the management or administration of any property vested in a 3 Ibid at 214. 4 Ballard v Attorney-General of Victoria [2010] 30 VR 413 at 419 citing Royal Melbourne Hospital (2007) 18 VR 469 at 500, [149]. 5 Queensland Law Reform Commission, The Law Relating to Trusts, Trustees, Settled Land and Charities, Report No 8 (1971) 65. 6 Perpetual Trustees WA Limited v Attorney-General of Western Australia [1992] 8 WAR 441; See also Stein v Sybmore Holdings Pty Ltd [2006] NSWSC 1004 at [63]–[64] (Campbell J) and Barry v Borlas Ltd [2012] NSWSC 831 at [19] (White J). -- 5 of 9 -- 6 trustee, or would be in the best interests of the persons, or the majority of the persons, beneficially interested under the trust, but it is inexpedient or difficult or impracticable to effect the disposition or transaction without the assistance of the court, or it or they can not be effected by reason of the absence of any power for that purpose vested in the trustee by the trust instrument (if any) or by law, the court may by order confer upon the trustee, either generally or in any particular instance, the necessary power for the purpose, on such terms, and subject to such provisions and conditions (if any) as the court may think fit, and may direct in what manner any money authorised to be expended, and the costs of any transaction, are to be paid or borne, and as to the incidence thereof between capital and income. (2) The court may from time to time rescind or vary any order made under this section, or may make any new or further order; but such a rescission or variation of any order shall not affect any act or thing done in reliance on the order before the person doing the act or thing became aware of the application to the court to rescind or vary the order. (3) An application to the court under this section may be made by the trustees, or by any of them, or by any person beneficially interested under the trust. [24] In relation to that controversy, however, the question was directly considered by Justice Philip McMurdo, as his Honour then was, in the case of Re Arthur Brady Family Trust. 7 There, trustees of two discretionary trusts brought similar applications under s 94 of the Trusts Act for orders that the trustees be empowered and duly authorised to amend vesting dates, extending them to a date which was 80 years from the settlement date of the trust deed. The trustees were given a power to amend the trust deed, however there were some exceptions to the exercise of that power, including, the express exclusion of a power to amend the trust deed by altering the description of the vesting date. [25] I particularly take note of the following from Arthur Brady’s case: “The term ‘transaction’ is obviously a wide one. Although it usually refers to a dealing between at least two parties, it is not so limited in every case. The amendment of the trust deed to change the vesting date could be fairly characterised as a transaction, in my view, which is fortified by the numerous cases, such as Stein, in which it has found favour...”8 (footnotes omitted) [26] I would add to his Honour’s consideration of s 94, that the word “transaction” as it appears in the section is preceded by a wide range of other words, including “any sale, lease, mortgage, surrender, release or other disposition, or any purchase, investment, acquisition, retention, expenditure or other transaction”. The word 7 [2015] 2 Qd R 172. 8 Ibid at [41]. -- 6 of 9 -- 7 therefore takes its meaning from the language around it, which is intended, in my view, to encapsulate the broadest possible dealings with the trusts and the trust assets, which must, include vesting. [27] Further, the words “management and administration”, while they have the effect of limiting the scope of the court’s statutory jurisdiction to the managerial supervision and control of the trust property, the words are not synonymous with each other. [28] In Ballard v Attorney-General of Victoria, Kyrou J, when considering the equivalent Victorian provisions, said: “[31] None the less, the words ‘management or administration’ are ‘of wide import and pick up everything that a trustee may need to do in practical or legal terms in respect of trust property’. Although their meanings may largely overlap, the disjunctive use of the words indicates that they are not necessarily synonymous and that an unduly narrow interpretation should be avoided. This court has held that ‘management’ refers to ‘the management of trust property in the commercial or practical sense’, whereas ‘administration’ encompasses ‘all of the legal powers and duties which might be possessed by a trustee in respect of trust property’.” (footnotes omitted) [29] Arthur Brady’s case has not been expressly disapproved, and remains good law in Queensland. I was, however, cautiously directed to those decisions to the contrary elsewhere, and although I refer to them briefly, I propose to follow the approach of Justice McMurdo’s in Arthur Brady’s case. [30] First, I was referred to the decision of Re Dion Investments,9 where the Court of Appeal in New South Wales undertook a review of cases and concluded that the post- 1997 decisions which proceeded on the basis that variation of the trust terms is of itself a transaction within the contemplation of s 81(1) of the New South Wales equivalent of s 94 of the Trusts Act, rest on an unsound foundation. The court is not empowered to amend a trust instrument or the terms of the trust, but rather, mainly, grant specific powers in relation to the management and administration of trust property. [31] However, Justice Barrett in that case noted that a wider criterion existed in Queensland which was based on the best interests of the beneficiaries, and that criterion did not form a part of the New South Wales legislation. Respectfully, that is likely correct, but it is also a matter that was considered by Justice McMurdo in Arthur Brady’s case, where his Honour observed that in respect of the Queensland provision, it was wider than the English provision, and by extension, the New South Wales provision.10 [32] I was also referred to a decision of Justice Brereton in the New South Wales Supreme Court in Hancock v Rinehart,11 where it appears Justice McMurdo’s decision in 9 (2014) 87 NSWLR 753. 10 Ibid at [92]. 11 [2015] NSWSC 646. -- 7 of 9 -- 8 Arthur Brady’s case was not drawn to the court’s attention. I was further directed to a decision of Cisera v Cisera Holdings Proprietary Limited,12 and again, it is sufficient to note that although the Court of Appeal there did not follow the same line of authorities followed by Justice McMurdo, the Court of Appeal did note the greater width of the comparative legislation in other states, which I take to include Queensland. I therefore propose to follow the approach, as I say, of Justice McMurdo’s, although I am grateful for the alternative views expressed elsewhere having been brought to my attention. [33] There are two other matters to which I ought to avert. The first is the proposition as to whether the provision can be utilised for the stated purpose, in this case, that is the minimisation of possible revenue consequences. Justice McMurdo considered precisely that issue in Arthur Brady’s case, where his Honour referred to a provision to minimise the taxation liability of or in relation to a trust property, and considered whether this provision can be used to minimise a taxation liability of or in relation to a trust property. His Honour considered that it was a well-established proposition that the provision could be so used, and I refer to the authorities to which his Honour averted at [44]: “This provision can be used to minimise the taxation liability of or in relation to trust property: Re A.S. Sykes (deceased); Re Trusts of Kean Memorial Trust Fund; Stein; and Heydon and Leeming, Jacobs’ Law of Trusts in Australia.” (footnotes omitted) [34] Respectfully, I agree with his Honour’s assessment. There is no difficulty that the authorisation which the court might give under s 94, may have the potential effect, not of avoiding revenue consequences, but merely in the proper management and administration of the trust deferring that potential revenue consequence to a later date. I therefore propose to follow the same course that his Honour did in the authorities he referred to on that issue. [35] Finally, that leaves the question of whether there ought to be a particular contradictor, and this is raised primarily in the context that one of the beneficiaries who cannot consent, is the minor to whom I have already referred. The solicitors for the applicant took the cautious approach of contacting the Public Trustee to provide it with information and ask whether it wished to be heard in the interests of the minor. The response of the Public Trustee is before me in evidence. It was quite properly satisfied that it had no such role in the circumstances here. [36] In any event, I am satisfied that the interests of a minor beneficiary can be properly protected by this court in its parens patriae jurisdiction. In doing so, I take into account that, as will be seen shortly, I consider it is in any event in the interests of the minor beneficiary for the trust to continue, so that the authorisation is granted for the extension of the vesting date. In all the circumstances, I am therefore satisfied that there is a discretion to make the order which is sought in this case. [37] The particular factors which are relevant to the exercise of the discretion include these: firstly, this is a family business which has been operating for approximately 50 years. Its purpose is the generation of income for family members. The evidence 12 (2018) 98 NSWLR 747. -- 8 of 9 -- 9 demonstrates that some members of the family have only ever earned an income from this source, and others of them have had no source of employment other than involvement in the trust business. The ongoing operation of the trust is therefore one which is exquisitely a matter of family business. [38] Second, I take into account the very substantial impact of the capital gains tax and other revenue implications were the trust to vest now. Deferring the vesting date does not ultimately deprive proper authorities of revenue, it merely defers it to another date, subject to the laws that exist at the time. [39] Third, there is almost unanimous approval of the members of classes of potential beneficiaries to the course of action which the trustee proposes. I say almost unanimous, of course, because of the infant to whom I have already referred who is incapable of providing effective approval. [40] Nevertheless, the balance of the beneficiaries have all indicated their approval, and in that regard I also take into account the third consideration, being that under s 94(1) of the Trusts Act, the use of the words “in the best interests of the persons or the majority of the persons beneficially interested in the trust”. It is not therefore necessary for there to be unanimity, even though that is a factor which persuaded Justice McMurdo in Arthur Brady’s case. [41] Here, there is, in any event, overwhelming consensus, and the court is persuaded that it is in the best interests of the infant beneficiary, his interests being effectively identical with the other beneficiaries, that all parties are best served by the extension of the vesting date. [42] Fourth, although of significantly lesser weight to me, is to take into account that a vesting date of 80 years, at least in Queensland, is the ordinary vesting date, and there is nothing unusual therefore, about the time period which the court is being asked to authorise. [43] Fifth, I take into account – again of even lesser weight – but worth noting, that proposed amendments to the Property Law Act 1974 (Qld), which will take effect later this year, will in fact extend the perpetuity date from the existing 80 years to 125 years. That is a relevant consideration only to the extent that it provides the court with some comfort that there is nothing unusual about a perpetuity date of 80 years as is sought here. [44] In the circumstances, for all of those reasons, I am persuaded to make the order in accordance with the draft which has been handed up to me. -- 9 of 9 --