“We put all our shit in mum’s name…”
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P was the deceased’s spouse, and administrator and sole benef of the decd’s estate: [1]
The Ds were the decd’s parent, D1; sibling, D2; and some related entities: [2]
The decd and D2 - members of a motorcycle club and charged with drug offences years ago - used various entities to engage in business: [4], [5]
In 2002 the decd and D2 transferred substantial assets to D1: [7]
P said the arrangement was that D1 would hold those assets, and the income they generated, on trust in equal shares for the decd and D2. P said this scheme was to protect the assets from confiscation pursuant to the Proceeds of Crime Act: [8], [118] - [132], [248]
D2’s evidence that they had no such concerns was rejected, as was the Ds’ evidence that evidence that D1 had a role in the businesses beyond book-keeping: [117], [138]
The Court formed an unfavourable view of much of the Ds’ evidence, as “unsupported… and inherently unlikely”: [38]
In 2002 steps were taken to put the “asset protection” regime in place including incorporating a corporate trustee of which D1 was director and shareholder; settling a trust with D1, D2 and the decd as beneficiaries; and causing D2’s and the decd’s assets to be transferred without consideration constituting the corpus of that trust: [142] - [152]
The decd had described the arrangements as “we put all our shit in mum’s name”: [151]
After the transfer D2 took some role in various business ventures and property developments for the trust, as did D2 and the decd: [154] - [212]
Contemporaneous notes suggest the decd understood that their entitlement to 50% of the trust assets would pass to P (as their sole beneficiary) on death: [218]
P made various submissions in support of their asset protection or “warehousing” characterisation of the arrangement between the parties. P also said the Ds’ arguments (such as they were) failed to take into account the Proceeds of Crime Act protections that the decd and D2 were pursuing: [260] - [263]
The Ds said P’s characterisation was “Kafkaesque” and the assumptions underlying it unfounded: [269]
The Court accepted P’s characterisation: [271], [287] - [289]
That was because: (i) the Ds’ lack of evidence and explanation about how any debt arose to D1 or the “implausible” suggestion that the parties were unconcerned about the Crime Commission ([272] - [276]), and (ii) the P’s case was supported by contemporaneous evidence: [277] - [286]
The Court found the parties intended to create a trust relationship, including because of language used by the parties to characterise it: [306] - [309]
The relief P sought could be granted against the TCo (i.e. not just D1) on basis that the TCo would not have its discretion fettered but that it would be prevented from exercising power in respect of 50% of its assets: [387]
Costs followed the event: [459]