One of the “irreducible core obligations” of a Trustee is to act honestly and in good faith, since a Trustee is the quintessential “fiduciary“.
The occupational pension scheme was established by a “Trust Deed” made on the 23 December 1913 in the State of South Australia. The Trust Deed provided a pension benefit for a male staff member who had completed at least 15 years of service and did not voluntarily leave until the age of 60.
The original pension benefit was improved in the consolidation Deed of Variation dated 6 May 1958 where the pension for male officers is provided by Regulation 29
A “automatic” survivorship pension was added and improved in a Deed of Variation dated 20 November 1974 in Regulation 30A. Neither of these Regulations has been repealed.
However in this case, “Responsible Persons” of a purported corporate Trustee resident in Victoria criminally concealed the original Trust Deed, made on the 23 December 1913 in the State of South Australia, and genuine Deeds of Variation from the cestuis que trust (ie the members and beneficiaries), including those containing Regulation 29 and Regulation 30A.
Instead a fraudulent document executed on 26 August 1986 by a well known white-collar criminal who has served a term of imprisonment for dishonest conduct, was misrepresent as the legitimate “Trust Deed“. The purported Trustee just refused to execute the trust provisions in Regulations 29 and 30A which had not been repealed./p>
By concealing the genuine Deeds and failing to advise the members, their wives and widows of their lawful entitlements, the victims were unaware that they had been defraued by a dishonest “de facto trustee” that had not been lawfully appointed to the office of trustee. A “de facto trustee” is also referred to as a “trustee de son tort”
More information on a “de facto trustee” or a “trustee de son tort” is provided here.
A document described on its face as a “Deed” may appear to be a legitimate legal document which could even fool a suburban lawyer, however a member or beneficiary of a superannuation trust has to obtain copies of the original Trust Deed that established the superannuation trust as well as copies of every instrument that purports to vary the terms of the original Trust Deed.
A purported amending instrument whether described as a “Deed” or not may be void and ineffective for a number of reasons that all need to be checked:
- failure to comply with statutory provisions in relation to he execution of the amending instrument
- failure to comply with conditions and restrictions imposed by the Power of Amendment
- A “Fraud on a Power” in the exercise of the Power of Amendment
The fraud is proven by reference to only a few Deeds and a few Acts of Parliament including the Elder Smith & Co Limited Provident Funds Act 1963 (SA) which amended the Regulations of the occupational pension scheme, the Trustee Act 1936 (SA) and the Stamp Duties Act 1923 (SA).
The impact on benefits is shown in the following diagrams. The “de facto trustee” refused to execute the trust provisions of Regulation 29 and Regulation 30A and instead only executed a purported provision contained in a fraudulent document signed by a well known white-collar criminal.
To add insult to injury the member’s contribution rate was increased 300% from 5% of salary to around 15% of salary for most members, while the value of their retirement and retrenchment benefit typically fell by around 80%.
This tab updated on 19 March 2015