Brown & Anor v Mark E Brown Discretionary Trust [2025] QDC 114

DISTRICT COURT OF QUEENSLAND CITATION: Brown & Anor v Mark E Brown Discretionary Trust [2025] QDC 114 PARTIES: STEPHEN WAYNE BROWN AND CRAIG GRAHAM THOMPSON AS TRUSTEES OF THE MARK E BROWN DISCRETIONARY TRUST (Applicants) v PIYNART BROWN (First Respondent) And MICHAEL BROWN (Second Respondent) And SAMANTHA BROWN (Third Respondent) FILE NO/S: 1574/25 DIVISION: Civil PROCEEDING: Application ORIGINATING COURT: Brisbane District Court DELIVERED ON: 19 August 2025 (ex tempore) DELIVERED AT: Brisbane HEARING DATE: 19 August 2025 JUDGE: Porter KC DCJ ORDER: 1. The Respondents are to deliver up possession of the land located at 4B Bridge Street, Redwood in the State of Queensland, more particularly described as Lot 3 on RP140413 and contained in Title Reference No. 17525046. 2. Order 1 is stayed until 19 October 2025. COUNSEL: P. Sams for the applicants SOLICITORS: Wonderley & Hall for the applicants -- 1 of 7 -- 2 P. Brown and M. Brown, appearing in person for the respondents [1] This is an application by the trustees of the Mark E Brown Discretionary Trust (the discretionary trust) for possession of a residential property at Redwood near Toowoomba, presently occupied by Mrs Piynart Brown (Piynart Brown) and one of her adult children. Her adult child, Mr Michael Brown, appeared before me today. He did not oppose orders for possession except to the extent of wanting time to organise his affairs and vacate the house. The third respondent, Ms Samantha Brown, appeared on the last occasion. She did not appear on this occasion. I am willing to act on the basis of what was said by her mother and brother to the effect that she has moved out of the house and has no particular interest any more in the possession application. [2] Piynart Brown seeks an adjournment of the application for three months so she can take advice on her rights under the Family Law Act 1974 for property settlement which she submits might permit her possession of the property to continue despite the prima facie entitlement of the trustees to possession. The Facts The relationship [3] There are two narrative streams that inform this case. [4] The first relates to the relationship between Piynart Brown and Mr Mark Brown (Mark Brown). Piynart Brown and Mark Brown married in Thailand in December 2001 and moved to Australia thereafter. They initially lived in a home unit owned by Mark Brown. [5] They had their first child in 2003 and second child in 2005. At that time, Mark Brown worked outside the house and Piynart Brown worked as a mother and homemaker. In 2010, Mark Brown sold the home unit and purchased a house at Redwood. This is the property which the trustees of the discretionary trust seek possession of by this application. Piynart Brown swears that in 2014, there was a serious domestic violence incident in which she was significantly injured. She also swears that she made a report to the police, the police commenced civil DV proceedings, the process went on for a couple of years, and ultimately, Mark Brown apologised and they reconciled. She also swore that after the incident, her husband presented her with a binding financial agreement which she refused to sign and which caused him to become angry and force her to leave the house. I am acutely conscious of the importance of not making findings about serious misconduct when a person involved is not before the court. However, for the purposes of this adjournment application, and the substantive hearing, I think it fair to act on the basis that there was a significant falling out between the couple between 2014 to 2016, followed by a reconciliation of sorts. The relationship seems to have resumed in about 2017. Mark Brown’s interest in the will trust and the discretionary trust [6] The second narrative arises outside the scope of the relationship. It involves the affairs of the Brown family. The Brown family appears to have comprised Mr -- 2 of 7 -- 3 Russell Brown as father, Mrs Noela Brown as mother, and five children. Those children are Steven Brown, Shane Brown, Mark Brown, and two daughters. I am not told in any detail the scope of the business of Mr and Mrs Brown Senior, but I infer that it was reasonably successful, if the terms of Russell Brown’s will are anything to go by. [7] Mr Russell Brown, ex-Kangaroo rugby league player, died on the 4th of December 2005. Probate was given in his will in March 2006. The executors were Steven and Shane Brown, and Mr Craig Thompson, a solicitor in Toowoomba. [8] The will can be summarised in this way. Certain assets were left to Mrs Noela Brown. The will then created five will trusts in favour of each child (the will trusts or for Mark Brown in particular, the will trust). The trustees of each of those trusts while Mrs Noela Brown was alive were Steven, Shane, and Mr Thompson. Mrs Noela Brown was an object of each of those will trusts. On her death, the will provided for the individual children to become the trustees of their respective will trusts. I infer that there was a reasonable amount of wealth in each trust. The primary beneficiaries of Mark’s trust were the testator’s spouse, that is, Mrs Nola Brown, and his children, grandchildren and great grandchildren. Relevantly, the secondary beneficiaries were Mark Brown’s spouse, which at the time, was Piynart Brown. [9] Clauses 10 and 11 of the will trusts operate in this way. Prior to the perpetuity date, the trustees had an absolute discretion to appoint any part of the trust fund, which would include income or capital of the fund, to any one of the primary and secondary beneficiaries in such proportions as the trustees thought fit. So much is evident from clause 11.1. In my view, clauses 11.2 and clause 10 limit that power where the trust fund is being distributed at the expiry of the perpetuity period. In that context, the trust fund must be distributed to primary beneficiaries unless there are no such primary beneficiaries. Piynart Brown was a discretionary object as a secondary beneficiary under the will trust. [10] The structure of the will was plainly designed to protect Mrs Noela Brown for her life. I infer that Mr Russell Brown trusted his solicitor and his two sons Stephen and Shane to exercise discretions as trustees of the will trusts to ensure that Mrs Noela Brown had a comfortable life and could access all of the resources of all of the trusts for that purpose if they decided to do so. On Mrs Noela Brown’s death, the trustees of the will trusts ceased to be the executors and were replaced by the individual children who were the primary objects of each of the five will trusts. [11] In 2015, during the period of the falling out between Piynart Brown and Mark Brown, a series of transactions set out in court documents two and five were carried out. The effect of those transaction was that the assets in the (Mark Brown) will trust were distributed to Mrs Noela Brown. Mrs Noela Brown, in turn, gifted them to the trustees of the Mark E Brown Discretionary Trust, the applicants on this application. They are the same three men who were trustees and executors under the will: Stephen and Shane Brown and Mr Thompson. [12] The assets appear to have been of substantial value. One of the transfers involved something like half a million units in a series of managed investment funds. Others involved the transfer of cash amounts and the transfer of a chose in action held by the trustees of the discretionary trust, being a loan made to Mark Brown by the -- 3 of 7 -- 4 trustees of his will trust which loan was advanced for the purposes of funding the acquisition of the Redwood property. [13] One might have wondered about the purpose of that transaction and whether its purpose may have been to exclude Piynart Brown from having a claim on the assets of the trust, except for two matters. [14] First, she is an object of the discretionary trust. [15] Second, an explanation, consistent with the evidence before me, was offered from the Bar table that Mark Brown’s brothers, solicitor and mother were concerned about what would happen to any money that was under his control, given his personal history. The only way to avoid that occurring when Mrs Noela Brown eventually died, was to transfer the assets out of the will trust and into a discretionary trust via Mrs Noela Brown, such that on her death, Mr Mark Brown’s brothers and the solicitor retained in control of the assets in the discretionary trust. [16] As I have said, based on the flavour of all the evidence, I can well understand that could be a principal motivation. It also, as I said, needs to be recognised that Piynart Brown’s position as a discretionary object does not appear to be any worse under the discretionary trust than it was under the will trust, in the sense that she is one of a series of objects of the discretionary trust with no interest in any underlying asset, but a right to due administration and to be considered in the event that the trustees decide to make an appointment under the power of appointment contained in the trust deed. Transfer of the Redwood property [17] What happened next was this. Mark Brown transferred the Redwood house to the trustees of the discretionary trust. The trustees appear to have paid market value for it (which included some vendor finance). One of the ways they did so was by setting off debts that had been assigned through Mrs Noela Brown to the discretionary trust for debts owed by Mark Brown to the trustees of his will trust. I have not tracked through the finalisation of the payment of any balance. However, the solicitor of the trustees swears that the vendor finance has been repaid. [18] It may be that Mark Brown, or the trustees thought that was a wise thing to do, given the breakdown apparent at the time in the relationship, or it may have been motivated simply by what appears to be enduring concern of the trustees for Mark Brown’s capacity to manage his financial affairs. By raising those possibilities, I do not intend to make any suggestion that the trustees have deliberately acted in any form of breach of trust. Therefore, we come to the current position. Final separation and these proceedings [19] In recent times, there appears to have been a final separation between Mark Brown and Piynart Brown. A domestic violence order was obtained and an ouster order appears to have been made, which required Mark Brown to leave the Redwood house. That happened in about January this year. [20] At that time negotiations, in the broadest possible sense, began in earnest, it seems, for the first time about the resolution of financial relationships between Piynart Brown and Mark Brown. Prior to that time, the trustees had permitted Mark Brown -- 4 of 7 -- 5 and his family to live in the property. There was no lease or licence agreement, and no payments were made for occupation. One can well understand them doing so, given that Mark Brown and his children were primary beneficiaries of the discretionary trust and Piynart Brown was a secondary beneficiary. [21] Following what appears to have been a final separation between Piynart Brown and Mark Brown, the applicants in February this year withdrew permission for the respondents to occupy the property, following the ouster order in the civil DV order, and called for delivery of possession within 21 days. [22] Piynart Brown took some legal advice. By May 2025 there had been a without prejudice conference. Piynart Brown told me about an offer. I am not assuming it was the last or the only offer made at that meeting. There was no objection by Mr Sams to Piynart Brown’s disclosure of an offer made at that time. She said an offer to the tune of a couple of hundred thousand dollars was made to her. That offer was seemingly not accepted. The solicitors who were acting in May 2025 then ceased to act, and the applicants commenced these proceedings and served them on the respondents in mid-June, some two months ago. [23] The matter came before me on the 24th of June. Piynart Brown and Samantha Brown appeared. I granted an adjournment until 14 July for the filing of material. The matter came before Judge Barlow on the 14th of July, after no material had been filed. His Honour gave the respondents a further opportunity to file material. No such material was filed in response to that order. [24] The third return date came back before me on 15 of August. All three respondents appeared on that date, and Piynart Brown, delivered an affidavit and written outline, which had been prepared with the assistance of LawRight. Unfortunately, I ran out of time in applications that day, and the matter was adjourned to today, which was, I think, on balance, just as well, because it gave the applicants time to respond to a number of matters raised by Piynart Brown. Analysis [25] Piynart Brown seeks an adjournment for three months to take legal advice. The nub of the case she wishes to seek advice on is this. Piynart Brown has been married to Mark Brown for about 24 years. Presently, there appears to have been a more or less final separation. It appears that Piynart Brown has a right to seek a property settlement under section 79 of the Family Law Act 1975 as well as maintenance under that same Act. She seeks time to obtain advice about that and also to establish a sufficiently arguable entitlement to continued possession of the house such that she could get an interlocutory injunction restraining the trustees from obtaining possession. That would have to be in support of the prospect of final relief in which her continued occupation of the house would be vindicated. [26] I cannot, on the material I have got presently, rule out the possibility that either section 106B of the Family Law Act and/or an injunction under 116 of that Act might not sustain an interlocutory injunction reserving Piynart Brown’s occupation of the house until the finalisation of a property settlement. However, the argument does not seem compelling. -- 5 of 7 -- 6 [27] Mr Sams’ submission identifies that, as far as s 106B was relied upon, the prima facie position is that market value was given for the transfer from Mark Brown to the discretionary trust, and based on the authorities he identified in his outline, that makes a final order under s 106B unlikely to be granted. There is, however, another possibility. Applying Kennon v Spry [2008] 238 CLR 366 and the cases which have followed and applied it, an argument might be able to be developed in family law property proceedings that the assets of the discretionary trust are in Mark Brown’s control (that seems pretty unlikely given the apparent purpose of the entire arrangement of setting up the discretionary trust) or they should be treated in substance as a financial resource available to him and thereby the underlying assets are property of a party to the marriage in some manner. If there is an argument along those lines, it seems to me at this stage that the latter has better prospects. [28] All I can say at this point is that it is not clear to me that there is a compelling case for relief under the Family Law Act which would preserve Piynart Brown’s occupation of the Property, whether on an interlocutory or final basis. [29] Also, any interlocutory order made in support of any form of final relief along those lines (which I should say might mean the house itself is a financial resource of the marriage, because the house is owned unencumbered by the discretionary trust) might not be obtained as a matter of discretion. It does not automatically follow that Piynart Brown would be entitled to remain in the house. It is not in contest that work needs to be done on the house, and the trustees think they should be doing that work. It may be in the interests of the trust to deal with that property in some other way on an arm’s length basis to sell it on the open market and get value for it in the trust. There could be other discretionary reasons why an injunction might not be granted, in any event, in respect of possession of the house in particular. [30] Although this matter has only been on foot for two months, Piynart Brown has been aware of the need to address her property and support position as against her husband since the beginning of the year. While she holds out some hope for a reconciliation, my instinct, based on the way the matter is being conducted, is that her hope might be misplaced. Whether it is or not, I do not have to decide. What I do know is that the trustees are reluctant to support the position, at least where trust assets are concerned, of Piynart Brown and Mark Brown living together again, and while I am not passing any judgment about the rights and wrongs of that, based on the history of the relationship which I have from Piynart Brown herself, one might be able to understand the trustees taking that view. [31] In any event, the trustees looked at a process of negotiated resolution for some months before they commenced these proceedings. The proceedings have been adjourned twice. Piynart Brown has not been able to get herself in a position to put forward a basis for me to refuse possession in that time. It is my view that these reasons might facilitate, in the interests of both parties, a clear resolution of whether there is any proper basis for claims for maintenance or settlement in respect of assets of the trust. I should point out, though, that, as I say, I am not persuaded that that possibility has sufficient prospects of resulting in an order which on an interlocutory or final basis allowed Piynart Brown to remain in the house long term. [32] In the end, my judgment is that I should grant the trustees of the discretionary trust the order for possession they seek, but I will stay that order until 19 October 2025. That will give the trustees certainty as to when they are going to get the house if -- 6 of 7 -- 7 Piynart Brown does not do something before that. If I thought the house was dangerous or was falling apart, it might be different. I have had a look at the problems with the house. They do not seem to justify emergency access. [33] In any event, that will leave Piynart Brown with three choices which she can pursue at the same time or separately but will have to pursue to resolution within two months (a) One is whether, with the assistance of these reasons or not, she seeks legal advice and brings an application in the relevant Family Court that preserves her occupation of the house; (b) A second option is to seek to take up the negotiations, which seem to have been conducted bona fide before, to finalise thing; and/or (c) Three, to have two months to vacate the house and find somewhere else to live. [34] They are her choices, but unless my order is overtaken by an order of a court with family law jurisdiction, ultimately the trustees will be entitled to possession in two months from today. [35] I make no order as to costs. Piynart Brown is an object of the trust. Michael and Samantha are objects of the trust. The debacle about possession is a function of a falling out between objects of the trust. There is no suggestion the trustees will not be entitled to indemnity for the costs from the trust fund, and so ultimately, it is rebounding on the people who are the primary beneficiaries of the trust. For the reasons I have just given, I am making no order as to costs. [36] I make orders in terms of the amended draft. -- 7 of 7 --