Tuftevski v Total Risks Management Pty Ltd  NSWSC 315
Execution of Trust
176 The plaintiff submitted that the court should execute the Trust after hearing all the evidence.
177 In Baker v Local Government Superannuation Scheme Pty Ltd  NSWSC 1173 at  McDougall J said:
“The general rule is that when a trustee’s decision is fundamentally flawed, it is in law no decision at all. In normal circumstances, the court will not itself exercise the discretion but will remit the matter to the trustee to be considered on a proper basis … “
“I accept that, in the case of at least some kinds of discretionary trust powers, the Court may in a proper case execute the trust by substituting its own discretion for that of trustees (see McPhail v Doulton [supra] at 451 and cases there cited, and also at 457). … In my opinion it can only be right to take such a course where at the very least it is established that the existing trustees are unlikely to fulfil the relevant duty in a proper manner.”
178 The plaintiff relied on the behaviour of the Trustee. He referred to the Trustee holding back materials from the plaintiff so that he did not know what was being said against him. There is the related fact that he was given no opportunity to respond to what was being put against him.
179 The plaintiff did not complain about the trustee undertaking video surveillance but he complained about not being told about material allegedly adverse to him and not being given an opportunity to meet it. Senior Counsel for the plaintiff submitted that it was what the Trustee did after receiving the surveillance material which was where it erred.
180 Senior Counsel for the plaintiff pointed out that no one from the defendant ever interviewed the plaintiff and that it did not ask him for his response to the material against him, that the trustee only heard from one person employed by BHP and that person had little to do with the plaintiff. The Trustee received a communication from 19 fellow workers and also one from Mr Wilkinson, a Supervisor of the plaintiff, all of whom supported what the plaintiff alleges. The Trustee rejected what they said despite the fact that they had an extended opportunity to observe and assess the plaintiff.
181 Senior Counsel accepted that the Trustee had a duty to investigate claims and to reject claims which were unjustified. The Trustee has the dual functions of considering and investigating applications on the one hand and, on the other, determining whether they should be accepted. In Tonkin & Ors v Western Mining Corporation Ltd & Anor  WASCA 101 Franklyn J pointed out that a Trustee is not an adversary either for or against an applicant for the benefit. Senior Counsel submitted that in the present case the behaviour of the Trustee was such that it was effectively acting as an adversary against the applicant. In this Court the Trustee conducted a vigorous and determined case against the applicant. The operative filming the plaintiff, particularly on 23 May 2000, adopted, by his comments, the approach of a vigorous adversary.
182 Having regard to the behaviour of the Trustee in the circumstances of the present case, I am of the opinion that the matter should not be remitted to the Trustee but that the Court should execute the Trust.
Eric Noel Tonkin & Ors v Western Mining Corporation Ltd & Anor  WASCA 101.