Gatsios Holdings v Kritharas Holdings (in Liquidation) [2002] NSWCA 29 (14 March 2002)

Last Updated: 15 March 2002

NEW SOUTH WALES COURT OF APPEAL

CITATION: Gatsios Holdings v Kritharas Holdings (in Liquidation) [2002] NSWCA 29

FILE NUMBER(S):

40355 of 2001

HEARING DATE(S): 12/02/02

JUDGMENT DATE: 14/03/2002

PARTIES:

Gatsios Holdings Pty Ltd (ACN 076 177 869)

v

Nick Kritharas Holdings Pty Ltd (In Liquidation) (ACN 054 663 464)

JUDGMENT OF: Spigelman CJ Mason P Meagher JA

LOWER COURT JURISDICTION: Supreme Court

LOWER COURT FILE NUMBER(S): 3132 of 2000

LOWER COURT JUDICIAL OFFICER: Hamilton J

COUNSEL:

A: Mr Ash

R: Mr Evans

SOLICITORS:

A: Conway Leather Shaw

R: Australian Government Solicitor

CATCHWORDS:

Declaration Sought - breach of section 52 of the Trade Practices Act 1974 - whether trustee entitled to be indemnified from trust assets - section 59(4) of Trustee Act 1925 - whether activitiy in respect of which indemnity is claimed must be "reasonable" and/or "proper" - appeal dismissed with costs.

LEGISLATION CITED:

Trade Practices Act 1974

Trustee Act 1925

DECISION:

Appeal dismissed with costs.

JUDGMENT:

IN THE SUPREME COURT

OF NEW SOUTH WALES

COURT OF APPEAL

CA 40355 of 2001

SC 3132 of 2000

SPIGELMAN CJ

MASON P

MEAGHER JA

Thursday, 14 March 2002

GATSIOS HOLDINGS PTY LTD v NICK KRITHARAS HOLDINGS PTY LTD (IN LIQUIDATION)

Facts

In the conduct of the business of a trading trust, the respondent trustee, NKH, made certain representations regarding the timing involved in packaging snack foods and their profitability, which were found by the Federal Court of Australia, to be in breach of section 52 of the Trade Practices Act 1974. NKH, was thereby ordered to pay damages in the sum of $400 000. The respondent instituted proceedings against the appellant, the new trustee, seeking a declaration that it was entitled to be indemnified from trust assets for the liability to pay $400 000. This formed the basis of the appeal.

Held: Per Meagher JA (Spigelman CJ and Mason P agreeing)

(i) A right to indemnification extends to reimbursement of the trustee for damages awarded against him for torts committed by him in the course of carrying on the trust business: Benett v Wyndham (1862) 4 DF&J 259; re Raybould [1900] 1 Ch 199. It follows that damages under the Trade Practices legislation, for this purpose, are equated with damages for common law torts.

(ii) If the activity, which generated the liability in question, involved a breach of trust, or was criminal or fraudulent in nature, then the law would withhold the right to indemnification.

Per Spigelman CJ (Mason P agreeing)

(iii) The reference to a "proper agent" in Benett v Wyndham [1862] EngR 900; (1862) 4 DF & J 259, 45 ER 1183 is simply a reference to one of a number of facts that made it appropriate that the trustee be reimbursed.

Per Meagher JA

(iv) The United States authorities which might be read as establishing either that the activity in respect of which indemnity is claimed, must be "reasonable" and or "proper", are limitations which do not exist in Australian law.

Per Spigelman CJ

The use of such terminology as conduct being "proper" or "reasonable" cannot be regarded as a test of when a trustee is entitled to receive indemnity for outgoings incurred in the course of execution of the trust. The general approach set out in both Cotterell v Stratton (1872) 8 Ch 295 at 302 and Corrigan v Farelly (1897) QLJ 105 at 111-112 are more helpful than the use of conclusory terminology of whether or not conduct was "proper" or "reasonable" as if it were a test.

Per Mason P

The terminology "reasonable" and/or "proper" conduct are terms which are notoriously open-ended and embody judgments to be made in context.

Per Meagher JA (Mason P agreeing)

(v) Occasional breaches of the Trade Practices legislation are incidental aspects of ordinary commercial life. Broadly, the trustee's behaviour would therefore be covered by the last sentence of Cl 15 of the trust deed.

Per Spigelman CJ

Section 52 of the Trade Practices Act is a vague and indeterminate statutory standard of a character that covers conduct of such a wide range of moral obloquy that the mere fact of contravention cannot of itself be determinative of whether there has been a breach of a trustee's duty to exercise reasonable care in the management of the trust. A breach of a duty to a third party to exercise reasonable care cannot be determinative of whether there has been a breach of a trustee's duty to exercise reasonable care in the management of the trust.

Orders

Appeal dismissed with costs.

IN THE SUPREME COURT

OF NEW SOUTH WALES

COURT OF APPEAL

CA 40355 of 2001

SC 3132 of 2000

SPIGELMAN CJ

MASON P

MEAGHER JA

Thursday, 14 March 2002

GATSIOS HOLDINGS PTY LTD v NICK KRITHARAS HOLDINGS PTY LTD (IN LIQUIDATION)

Judgment

1 SPIGELMAN CJ: I have had the benefit of reading the judgment of Meagher JA in draft. Subject to some additional observations, I agree with his Honour's reasons.

2 In the conduct of the business of a trading trust, the trustee made certain representations which were found by the Federal Court of Australia to have been in breach of, relevantly, s52 of the Trade Practices Act 1974 (Cth). The, now former, trustee, sought indemnity for the damages it was ordered to pay by the order of the Federal Court, pursuant to its right of indemnity. It instituted proceedings against the new trustee, which is the correct party. (See Belar Pty Ltd (in liq.) v Mahaffey [1999] QCA 2; [2000] 1 Qd R 477 at [19]- [21].)

3 Hamilton J found in favour of the former trustee on the basis of the express provisions of the trust instrument. In this Court, although no formal notice of contention was filed, the submissions proceeded on the basis that the issue of whether or not the claim for indemnity could be made good at general law, as recognised by statute in s59(4) of the Trustee Act 1925, was properly before the Court.

4 The case law is replete with references to the fact that the right of indemnity attaches to all liabilities "incurred in the proper performance of duties or exercise of powers". (See e.g. Vacuum Oil Co. Pty Ltd v Wiltshire [1945] HCA 37; (1945) 72 CLR 319 at 335; Stott v Milne (1884) 25 Ch 710 at 715; In Re Beddoe [1893] 1 Ch 547 at 558; In re Grimthorpe (Deceased) [1958] 1 Ch 615 at 623; R.W.G. Management Ltd v Commissioner for Corporate Affairs [1985] VR 385 at 396; Ron Kingham Real Estate Pty Ltd v Edgar [1999] 2 Qd R 439 at 442. See generally Hay "Trading trusts and creditors' rights" (1993) 67 LIJ 510.)

5 In the present proceedings the submissions proceeded on the basis that the most useful analogy for purposes of determining whether the right of indemnity extends to damages awarded under the Trade Practices Act is to be found in the authorities which permit such a claim in the case of damages awarded in tort. Benett v Wyndham [1862] EngR 900; (1862) 4 De G F & J 259; 45 ER 1183 and In re Raybould [1900] 1 Ch 199 were the cases referred to in submissions.

6 I agree with Mason P that the reference to "a proper agent" in Benett v Wyndham is simply a reference to one of a number of facts that made it appropriate that the trustee be reimbursed.

7 The Appellant relied on the observations in Raybould at 201:

"... the trustee, if he has acted with due diligence and reasonably, is entitled to be indemnified out of his testator's estate."

and at 202:

"... I am not prepared to say that the injury done to the applicants' land was occasioned by reckless or improper working, or otherwise than by the ordinary and reasonable management of the colliery ..."

8 The use of such terminology as conduct being "proper" or "reasonable", cannot be regarded as a test of when a trustee is entitled to receive indemnity for outgoings incurred the course of execution of the trust. Such terminology generally records a conclusion which has been reached on other grounds. Rather than constituting a statement of the relevant test it is "the end of the inquiry and not the beginning". (To employ the formulation of Hope JA with respect to the determination of whether a statutory requirement is "mandatory" or "directory" in McRae v Coulton (1986) 7 NSWLR 644 at 661, being terminology expressly adopted in the joint judgment of four judges of the High Court in Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 at [93].)

9 Section 59(4) of the Trustee Act 1925 provides:

"A trustee may reimburse himself or herself, or pay or discharge out of the trust property all expenses incurred in or about execution of the trustee's trusts or powers."

The relevant inquiry pursuant to this statutory provision is whether or not expenses incurred do in fact answer the description of having been so incurred "in or about execution of the trustee's trusts or powers". References to "proper" or "reasonable" expenses must now be understood in this statutory context. The statutory provision itself must be understood in the light of the pre-existing law, which it did not purport to change.

10 As Sir George Jessel MR said in In Re Chennell (1878) 8 Ch 492 at 502 (quoted in this context in Jacobs' Law of Trusts in Australia, 6th ed. (1997) par [2104]):

"It is ... a violent exercise of the Court's discretion to deprive a trustee of his charges and expenses."

11 In this appeal, as before Hamilton J, the Appellant relied on the summary of American law in Scott on Trusts vol. 3A, 4th ed. (1988) where in pars [244] and [245] the learned authors state the relevant propositions in terms that a trustee may recover expenses "properly incurred" but may not recover expenses "not properly incurred". (A couplet probably derived from In Re Beddoe at 558.)

12 With respect to the issue of liability in tort, which as I have said is the analogy that was used in the submissions in the present case, Scott on Trusts refers to Benett v Wyndham and Raybould as authority for the proposition stated in par [247] as follows:

"A trustee who has incurred a liability in tort to a third person is entitled to indemnity out of the trust estate if the liability was incurred in the proper administration of the trust and the trustee was not personally at fault in incurring it."

A number of American authorities are referred to.

13 The reference in this passage to the "proper administration of the trust" begs the relevant question. The issue is what is "proper". The proposition that the trustee was not "personally at fault" is stated too widely.

14 It is clear that the right of indemnity cannot be availed of if expense was incurred by conduct outside the scope of the trust or in excess of the powers conferred by the trust. The same result should ensue when a trustee incurs expenses as a result of conduct in breach of a duty which the trustee owed to the trust, including the duty to execute the trust with reasonable diligence and care. (See e.g. Ecclesiastical Commissioners v Pinney [1900] 2 Ch 736 at 742-743.) It was in this way that Brooking J explained the passages in Benett v Wyndham and Re Raybould on which the Appellant relies. (See R.W.G. Management Limited at 396.)

15 To similar effect is the observation of Lord Selborne LC with respect to the contractual rights of indemnity of a mortgagee or trustee:

"These rights, resting substantially upon contract, can only be lost or curtailed by such inequitable conduct on the part of the mortgagee or trustee as may amount to a violation or culpable neglect of his duty under the contract." (Cotterell v Stratton (1872) 8 Ch 295 at 302.)

16 This passage was quoted with approval by Griffiths CJ, then Chief Justice of Queensland, in Corrigan v Farrelly (1897) QLJ 105 at 111-112, in a context where a challenge was made to the right of an executor to recover costs and expenses arising from his failure to prove a will in solemn form. His Honour applied the test in the following terms at 112:

"The only question, therefore, is whether the executors' conduct in this case has been such as to amount to a violation or culpable neglect of their duty."

17 I find this general approach more helpful than the use of conclusory terminology of whether or not conduct was "proper" or "reasonable" as if it were a test.

18 On the above analysis, it is necessary to set out and consider the actual conduct of the trustee that led the trustee to incur the relevant expenses.

19 I do not agree with Meagher JA when his Honour describes a breach of the Trade Practices Act as an "incidental aspect of ordinary commercial life". However, s52 of the Trade Practices Act is a vague and indeterminate statutory standard of a character that covers conduct of such a wide range of moral obloquy that the mere fact of contravention cannot of itself be determinative of the right to seek indemnity on the part of a trustee. For much the same reasons, a breach of a duty to a third party to exercise reasonable care cannot be determinative of whether there has been a breach of a trustee's duty to exercise reasonable care in the management of the trust. (See Jacobs' Law of Trusts in Australia at [1718].)

20 For the purpose of the statutory proscription by s52 of the Trade Practices Act of "conduct that is misleading or deceptive or is likely to mislead or deceive", s51A makes specific provision that:

"... where a corporation makes a representation with respect to any future matter (including the doing of, or the refusing to do, any act) and the corporation does not have reasonable grounds for making the representation, the representation shall be taken to be misleading."

21 Nothing in the case law under the consumer protection provisions of the Trade Practices Act suggests that the approach to what are, or are not, "reasonable grounds" for the making of a representation as to future matters, represents a standard of reasonableness of the same quality as that which the authorities suggest is appropriate when dealing with the prospect of depriving a trustee of his or her right of indemnity. The word "reasonable" is not able to be applied as if it constituted a fixed set of rules or a fixed standard of permissible behaviour, equally applicable in all contexts: relevantly a statutory context of consumer protection and the quite different context under consideration in the present proceedings.

22 The evidence before this Court was given in an unusual form. The relevant evidence consisted of the reasons for judgment of Tamberlin J in the proceedings which led to the award of damages against the trustee company. (Australian Competition and Consumer Commission v Top Snack Foods Pty Limited [1999] FCA 752; 21 ATPR 41-708.) Neither the transcript nor the evidence before Tamberlin J was tendered in the present case. Nor were any of the relevant witnesses called.

23 There are considerable difficulties in appreciating the quality of the conduct, said to be disentitling, on the basis of evidence of this character. In particular, the findings by Tamberlin J to the effect that certain representations had been made without the person having "reasonable grounds for making the representation" must be understood in the specific statutory context with which his Honour was dealing i.e. s51A quoted above.

24 The representations made by the former trustee were made for the purpose of inducing persons to become franchisees of a business of distribution of boxes containing snack foods to various premises within a franchise area. The ability of franchisees to successfully turn their investment and effort into account was dependent on a number of different parameters, including the number of sites that a franchisee or his, her or its employees could visit on a particular day, the time it took to pack the boxes of snack foods, the stability of the relevant client list, etc. Tamberlin J found that misrepresentations had been made with respect to the number of sites capable of being serviced per day, the packing time of the boxes, the loss of clients and, also, with respect to the overall profitability of the business conducted under the franchise.

25 With respect to the representations as to loss of clients, this appeared to be based on concessions made in the course of proceedings. Nothing in the judgment establishes the basis on which the representations were made. Certain concessions were made, in the course of his cross-examination, by one witness called on behalf of the former trustee, upon the basis of which his Honour concluded that the representations were not "reasonably based". It is simply not possible to judge the quality of the trustee's conduct in that regard for present purposes, on the basis of Tamberlin J's findings.

26 With respect to packing time, his Honour did not accept the case of the Respondent in the proceedings before him that the representation was limited to what the Respondent could achieve in terms of number of boxes packed per hour. Furthermore, his Honour was not satisfied that there had been "any adequate trial" of what could be achieved in this respect. His Honour found that there was "no documented evidence" as to what rates of packing the representatives of the trustees had been able to achieve, and, accordingly, he was not satisfied that there were reasonable grounds to make the representation. Again, it is impossible on the basis of these findings to assess the conduct of the trustee on the different basis appropriate to the present proceedings.

27 With respect to the representations as to the number of sites capable of being serviced per day, his Honour accepted the evidence of the applicants in the case before him as to what they had been capable of achieving. He did not accept the evidence on behalf of the Respondents, that it was possible for an experienced agent to service 50 or more sites in a day and that the two individuals called for the Respondent had in fact done so. His Honour again referred to the absence of any documentation establishing that this had in fact occurred. He found that accordingly there were no reasonable grounds for the representation. Again, the quality of the conduct cannot be relevantly assessed.

28 Each of the above matters was of significance also for the general representation upon which the applicant succeeded before Tamberlin J, that it was false and misleading to represent that gross profit could be $300 per day per franchise area. This representation was made in a document that set out various component parts of the calculation of gross profit. The document also contained the following disclaimer:

"You should undertake your own careful assessment of the offer to purchase a TSF Distribution Agreement."

29 Although this disclaimer does not avail a respondent in proceedings under the Trade Practices Act, the traditional common law approach of caveat emptor may well prove more pertinent when such matters must be assessed in a different context.

30 It appears that the representation as to both the end result, and a number of the component parts of the computation, was based on certain trials that had been conducted by the Respondent in June and July of 1994. It appears that the figures in the document were based only on the results of July. Nothing appears in his Honour's findings which could establish the degree of moral culpability that arose from failing to refer to the results for June. The case for the Respondents before Tamberlin J was that the June figures were not included because they were a settling down period. His Honour's finding that the Respondent did not have reasonable grounds for making the assertions as to profitability was based to a substantial degree on the failure to furnish prospective franchisees with the whole of the data from the trial.

31 It is of significance to note Tamberlin J's conclusion that;

"Although I have formed the view that many assertions were made by the respondents without reasonable grounds, it does not follow that there was deliberate fraud or that there was any intent to exploit franchisees by a systematic course of conduct of resale of the franchises. The individual respondents were not thorough or painstaking in their preliminary (trials). They failed by silence to disclose the true position and indeed expressly misrepresented the profitability of the franchise. This does not amount to fraud."

32 Nothing in his Honour's findings of fact, which are the sole evidentiary basis for the present proceedings, suggests that the conduct of the trustee was of the requisite character to disentitle the trustee to its right of indemnity on the basis of the principles I have discussed above.

33 The conclusion I have come to means that I do not have to address the advantages which the beneficiaries of the trust received from the conduct which the new trustee seeks to impugn. The beneficiaries do not propose to disgorge any such advantage. Specifically, the trust received capital monies from the franchisees that were awarded as one component of the damages which the former trustee was required to pay to the Australian Competition and Consumer Commission, taking proceedings on behalf of the former franchisees. At the very least, such damages and related expenses would be recoverable. (See e.g. Vyse v Foster (1872) 8 LR Ch App 309).

34 On the alternative basis for dismissing the appeal, I agree with Meagher JA's conclusion that the matter is covered by the last sentence of Cl 15 of the trust deed. The damages awarded by the Federal Court, together with other related outgoings, are "loss or damage occasioned by the exercise" of the power to conduct the business, in the course of which the false and misleading representations were made.

35 I agree that the appeal should be dismissed with costs.

36 MASON P: I agree with the reasons of Meagher JA and with the orders he proposes.

37 I do not understand the following remarks to qualify my concurrence, save in the final paragraph of my reasons.

38 Benett v Wyndham [1862] EngR 900; (1862) 4 DF & J 259, 45 ER 1183 held that trustees were entitled to indemnity out of the trust estate. By their managing trustee they had directed the bailiff of an estate to have certain trees felled. The trustees had incurred liability in damages to an unfortunate passer-by who was himself felled by a falling branch. The bailiff had ordered the woodcutters usually employed by the estate to cut the trees.

39 The appellant submitted that Benett turns upon the fact that the trustees used what Knight Bruce LJ termed "a proper agent" to cut the trees. I would reject this submission. The reference to the agent was no more than a recital of one of a group of facts that rendered it appropriate that the trustees should be entitled to indemnity in the particular case.

40 A right of indemnity is not lost merely because the loss to the estate is caused by the trustee's personal default. Byrne J recognised this expressly in Re Raybould [1900] 1 Ch 199 at 201 ("either by himself or his agent") and this is entirely consistent with the general principle embodied in the maxim qui facit per alium facit per se.

41 The corporate trustee had power to carry on a business (Deed of Discretionary Trust, cl 7(i)). It obviously had to use agents. The conduct that attracted the award of damages in the Federal Court was hardly commendable, but unremarkable in its heinousness. The individual agents were acting in the course of their employment in the trust enterprise. In these circumstances, it is not unjust for the trust assets to take the burden of the consequences of the respondent's conduct, just as it would have taken its benefit (cf generally Balkin v Peck (1998) 43 NSWLR 706 at 712).

42 I prefer to express no view on the broader issue whether a trustee's conduct must be "reasonable" and/or "proper" before the right of indemnity will be upheld (cf IIIA Scott on Trusts (4th ed 1988) at §§244-247). The terms are notoriously open-ended, but I would need to be persuaded that they are meaningless in the present situation. Like all such terms, they embody judgments to be made in context. Some outer limit needs to be drawn in order to recognise that certain types of grossly improper frolics by trustees will put them outside the presently uncertain boundary of the right now in question.

43 MEAGHER JA: At all material times the respondent ("NKH") was the trustee of a trust created on 30 April 1993. The trust property was certain issued units. NKH owned one half of them, the other half being held by a company called Adway Holdings Pty Ltd. The business carried on by NKH as trustee was supervising the supply of snack foods to the employees of certain companies. It was removed as trustee on 20 November 1996, and replaced by the appellant. It has now gone into liquidation.

44 By an order of the Federal Court of Australia (Tamberlin J) on 2 August 1999, NKH was, with others, ordered to pay damages for breaches of the consumer protection provisions of the Trade Practices Act 1974, such damages being in the sum of $400,000. His Honour found that NKH, and various of its officers, had, in the course of conducting their business, made false and misleading statements to their agents about the times involved in packaging the snack foods and the profitability of selling them. His Honour also negatived fraud. His Honour's judgment was received into evidence by Hamilton J, presumably as evidence of all the facts referred to in it.

45 NKH commenced these proceedings seeking a declaration that it was entitled to be indemnified from trust assets for the liability to pay $400,000 (together with interest and costs). Such a right is recognized by the Trustee Act 1925, which in s59(4) provides as follows:

"(4) A trustee may reimburse himself or herself, or pay or discharge out of the trust property all expenses incurred in or about execution of the trustee's trusts or powers."

As Hamilton J remarked, that section does no more than repeat the general law which antedated it. Lord Eldon LC's statement on the matter is probably the best known:

"It is in the nature of the office of a trustee, whether expressed in the instrument, or not, that the trust property shall reimburse him all the charges and expenses incurred in the execution of the trust."

(Worrall v Harford [1802] EngR 342; (1802) 8 Ves Jun 4, 32 ER 250)

46 It is well settled that this right to indemnification extends to reimbursement of the trustee for damages awarded against him for torts committed by him in the course of carrying on the trust business. The cases most usually cited for this proposition are Benett v Wyndham [1862] EngR 900; (1862) 4 DF&J 259; 45 ER 1183 and in re Raybould [1900] 1 Ch 199. In the present case the trustee argued successfully that damages under the consumer protection provisions of the Trade Practices Act should, for this purpose, be equated with damages for common law torts. I quite agree with this submission.

47 What are the limits to be placed on this right to indemnification? This is a matter which has rarely engaged the attention of either the Australian or the English Courts. Presumably if the activity which generated the liability in question were a breach of trust, the right to an indemnity under the general law would no longer exist; similarly if it were criminal in nature, but no criminal offences were charged against NKH, its associates or officers. Again, one must in principle incline to the view that if the activity in question had been fraudulent the law would withhold the right to indemnification; but in the present case Tamberlin J expressly negatived fraud. I find it difficult to formulate any other limitations. United States authorities, to which Hamilton J refers, might be read as establishing either or both these propositions: (a) that the activity in respect of which indemnity is claimed must be "reasonable", and (b) that the activity must be "proper". In my view, neither such limitation exists in Australian law. As to the former, it is in the circumstances, meaningless; no conduct has to be castigated as "unreasonable" unless one has a clear criterion of what constitutes reasonableness, and here there is none. As to the latter, it is almost as meaningless to endeavour to apply some hypothetical standard of propriety in ordinary commercial life, absent fraud and crime. I find it difficult to view occasional breaches of Trade Practices legislation as anything other than incidental aspects of ordinary commercial life.

48 For these reasons, I should have thought NKH was entitled under the general law to the declaration which it sought. However, Hamilton J took the (perhaps, curious) course of failing to decide this question, and embarked on the further question of whether, supposing there were no right of indemnity under the general law, one was supplied by the specific provisions of the trust deed of 30 April 1993. Two provisions of that document are of relevance. They are both drafted with maximum clumsiness, and are in the following form:

"13. THE Trustee shall not be personally liable for the consequences of any error or forgetfulness whether of law or of fact on the part of any of the Trustee or its legal or other advisor [sic] or generally for any breach of duty or trust whatsoever unless it shall be proved to have been committed made or omitted in personal conscious fraudulent bad faith by the Trustee charged to be so liable and accordingly all persons claiming any beneficial interest in over or upon the property subject to this Settlement shall be deemed to take with notice of and subject to the protection hereby conferred on the Trustees.

15. SUBJECT always to any express provision to the contrary herein contained every discretion vested in the Trustee shall be absolute and uncontrolled and every power vested in it shall be exercisable at its absolute and uncontrolled discretion and the Trustee shall have the like discretion in deciding whether or not to exercise any such power. No Trustee shall be responsible for any loss or damage occasioned by the exercise of any discretion or power hereby or by law conferred on the Trustee or by failure to exercise any such discretion or power or for any loss or damage accruing as a result of concurring or refusing or failing to concur in any exercise of any power or discretion."

49 In broad terms I agree with his Honour. In my view, the Trustees' behaviour would be covered by the last sentence of paragraph 15, if it were necessary to rely on it.

50 Accordingly I would dismiss the appeal with costs.

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LAST UPDATED: 14/03/2002