Limitations of Actions

Many legal actions are statutorily debarred after the elapse of a certain period of time.

However in both South Australia and Victoria there is no Limitations of Actions period for a fraudulent Breach of Trust.

This is important since the initiation of the fraudulent Breach of Trust can be traced back to the 1980s. However there has been on going criminal conduct since then, including the criminal concealment of the original Trust Deed from the cestuis que trust (ie members and beneficiaries of the fund) so as to deny them knowledge of a cause of action.

The definition of a fraudulent Breach of Trust can be found here.

No limitation period applies to an action in respect of any fraud or fraudulent breach of trust to which the trustee was a party or privy. “Fraud” in this context means equitable fraud, rather than its narrower common law meaning. A trustee is guilty of fraud if he or she knowingly commits an act amounting to a breach of trust from the nature of which the trustee must have taken to have known that the act was contrary to law1.

The requirement that the trustee must be party or privy to the fraud or fraudulent breach of trust means that there must be some moral complicity on the Trustee’s part2.An innocent trustee is not liable for the fraud of a co-trustee 3, however if a trustee becomes aware that another trustee has been guilty of fraud or a fraudulent breach of trust and conceals it, he or she would become party or privy to the fraud.

As far as trusts are concerned, each State has provisions which approximate to the provisions of Section 8 of the Imperial Trustee Act 1888.

The provisions The Limitations of Actions Act 1936 (SA) related to trusts {Section 31 and 31} have been base on Imperial enactments – Section 31 on the provisions of the Imperial Real Property Limitations Acts of 1833 and 1874 and Section 32 on the provisions of Section 8 the Imperial Trustee Act 1888

The following is stated at [3412] in Equity: Doctrines and Remedies:

Two points of some interest ought to be noted about the provisions of the various statutes of limitions……The second is that they are directed, in the main, to barring proprietary remedies; they would therefore, not seem to bar a beneficiary’s action in personam against either a trustee or another beneficiary.

The following table summarises that limitations periods for a fraudulent breach of trust by State.

Limitation of Actions

For South Australian legislation refer to the Limitations of Action 1936 (SA) here.

For Victorian legislation refer to the Limitations of Action 1958 (Vic) here.

Notes:

(1) Re Sale Hotel & Botantical Gardens Co Ltd (Hesketh’s Case) (1897) 77 LT 681 (CHD); Hicks v Trustees, Executors & Agency Co Ltd (1901) 27 VLR 389 (FC); Honey v McLennan (1997) 18 WAR 384.

(2) Thorne V Heard [1984] 1 Ch 599 (CA), Kay LJ at 608.

(3) Buckland v Ibbotson (1902) 28 VLR 688.


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This tab updated on 19 March 2015