Trading Trusts—Oppression Remedies: Report (html)

Recommendations

1. The Trustee Act 1958 (Vic) should provide for the beneficiaries of trading trusts who are subject to oppressive conduct to be able to apply to the Supreme Court of Victoria for a remedy:

a. in respect of any trading trust other than a managed investment scheme, a regulated or statutory superannuation trust or a charitable trust

b. notwithstanding compliance by the trustee with the trust deed.

2. The Supreme Court of Victoria should be empowered to make any order that it considers appropriate in relation to the trading trust, in terms similar to section 233 of the Corporations Act 2001 (Cth). In particular, the new provisions in the Trustee Act 1958 (Vic) should:

a. include a non-exhaustive list of the types of orders that may be made, including a power for the court to amend the trust deed

b. require the court to have regard to the terms of the trust deed.

3. The following people should be able to apply to the Supreme Court of Victoria for an oppression remedy:

a. a beneficiary of a trading trust (the beneficiary does not have to also be a shareholder in the corporate trustee)

b. a person to whom a beneficial interest in a trading trust has been transmitted by operation of law

c. a person to whom the court grants leave.

4. The amendment to the Trustee Act 1958 (Vic) should expressly state that it does not limit any of the existing powers of the Supreme Court of Victoria.

5. The amendment to the Trustee Act 1958 (Vic) should include a corporation legislation displacement provision.

6. In determining whether to grant an oppression remedy, the Supreme Court of Victoria should be required to consider the interests of third parties including, but not limited to, directors, trustees, shareholders, employees and creditors.