The Evidence

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For the last 5 years ASIC has repeatedly claimed that there is “No Evidence” to prove Australia’s Worst White-Collar Crime, however it only takes a few documents  and an Act of Parliament to prove the fraud.

Even though it is a criminal offence for a trustee of a Government Regulated Superannuation Fund to wilfully conceal the Deeds from persons who have a “beneficial interest” in the fund, ASIC has refused to take any enforcement action.

The first document is a consolidation Deed of Variation dated 6 May 1958 that was vetted by a Select Committee of the Legislative Counsel of South Australia.

In the diagram below this document is referred to as the “Genuine Deed“.

1958 Consolidation Deed of Variation

The second document is a purported “Deed” dated 26 August 1986 that was executed by the well known white-collar criminal Ken Jarrett. This document did not describe itself as a “Deed of Variation“, however the document recites the Trust Deed made on the 23 December 1913 that established the trust.

In the diagram below this document is referred to as the “Jarrett Deed“.

 

Purported Deed of Variation 26 Aug 86

 

The Act of Parliament is the Elder Smith & Co Limited Provident Funds Act 1963 (SA) which amended the terms of the occupational pension fund established the 23 December 1913 that was once known as The Provident Fund.

 

Proving the Fraud

Why was this Act of Parliament necessary?

Refer to The Laws of Australia {Thompson Reuters) at [15.14.1450] under the section “It is the trustee’s plainest duty to obey the terms of the trust” the following is stated:

“Where the trust instrument confers a power of amendment, the conditions and restrictions imposed on its exercise must themselves be strictly observed.”

The Act of Parliament confirms this principle of trust law. The Power of Amendment provided by the original Trust Deed prohibited the application of the funds of the trust to unauthorised purposes. Therefore the holder of the Power of Amendment, the Board of the sponsoring Employer, could not amend the terms of the trust to allow benefits to be paid to employees of the new company that had acquired the original sponsoring employer.

Therefore an Act of Parliament was required to amend the terms of the trust, that was otherwise prohibited by the Power of Amendment contained in Regulation 50.

Examples of where the Courts have applied this principle of trust law are listed in Appendix A.

Judicial statements of the exercise of powers by trustees are listed in Appendix B.

Trustees are not “free to do anything they like” as falsely represented by  ASIC. Regulation 50

The Power of Amendment imposes a condition that a majority of Directors must execute any Deed that purports to vary the terms of the occupational pension trust established on 23 December 1913. The Power of Amendment is provided to the Directors and not to the legal person – the Company.

The consolidation Deed of Variation dated 6 May 1958 complies with this condition, however the “Jarrett Deed” does not.

The Jarrett Deed is executed ‘on behalf of the Company” under the Common Seal of the company by only one Director, Ken Jarrett, and the Company Secretary.

Jarrett Signature  

It is important to note that for a Deed to be legally valid in South Australia where the party or parties are natural persons, their signatures need to be witnessed by someone who is not a party to the Deed pursuant to Section 41 of the Law of Property Act 1936 (SA).

It is not a requirement under the common law for a Deed to be signed or witnessed, its is sufficient for the Deed to be “Sealed and Delivered“, however the common law requirement has been modified in most jurisdictions by statute.

A similar provision now now operates in the United Kingdom where a Deed executed by a natural person must be witnessed.

The failure to comply with the statutory requirements was the reason why the High Court of England and Wales ruled that 30 purported Deeds of Variation dating from 1990 were void and ineffective in Briggs v Gleeds (Head Office) [2014] EWCH 1178 (Ch).

More information on this case can be found here. .

The Power of Amendment> had been provided to the partners of a partnership, however the purported Deeds of Variation had been executed in a manner of a company executing a Deed and so the purported Deeds of Variation were ruled to be void and ineffective by the Court.

The Jarrett Deed should have been executed by a majority of the Directors of the Company and not “on behalf of the company“.

If the Power of Amendment has been provided to the legal person being the company, then a company can execute a Deed under the Seal of the Company if two Directors sign the Deed or one Director and the Company Secretary signs the Deed.

Furthermore Regulation 50 requires a majority of the Trustees to also execute any Deed of Amendment and the purported corporate Trustee, Elders Superannuation Limited, did not lawfully replace five natural person trustees on 20 December 1982 and is in fact a Trustee de son tort (or a Trustee of its own wrong).

A Trustee de son tort cannot exercise the powers of  a lawfully appointed trustee, including the power to consent to a propose Deed of Variation.

The Jarrett Deed is therefore void and ineffective and the terms of the occupational pension trust established on 23 December 1913 in the State of South Australia have not been amended by this document.

As a bare minimum a valid Deed of Variation in 1986 would require at least nine Directors to have executed any Deed of Variation.

The “Jarrett Deed” is void an ineffective for multiple reasons which are covered in more detail here.

Directors 1986

Loss of Governance

Another key document of evidence is the purported “Resolution” executed by John Dorman Elliott on 20 December 1982. This document was used to unlawfully remove five natural person trustees resident in South Australia from office and replace them with a sole purported corporate Trustee resident in Victoria, in breach of the provisions of the Trustee Act 1936 (SA) and the general law of trusts. More information on this loss of governance can be found here. .
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