Groote Eylandt Aboriginal Trust Incorporated (NT 00142C)(First Plaintiff) v Deloitte Touche Tohmatsu (A Firm)(First Defendant)

• Jurisdiction: Northern Territory
• Judge: Hiley J
• Judgment Date: 20 January 2017
• Neutral Citation: [2017] NTSC 04
• Docket Number: FILE NO: 89 of 2014 (21441221)
• Court: Supreme Court
• Date: 20 January 2017

[2017] NTSC 04

SUPREME COURT OF THE NORTHERN TERRITORY

IN THE SUPREME COURT OF THE NORTHERN TERRITORY OF AUSTRALIA AT DARWIN

Judgment of:

Hiley J

FILE NO: 89 of 2014 (21441221)

Between:

Groote Eylandt Aboriginal Trust Incorporated (NT 00142C)

First Plaintiff

The Attorney-General For The Northern Territory

Second Plaintiff

and

Deloitte Touche Tohmatsu (A Firm)

First Defendant

And:

Kpmg (A Firm)

Second Defendant

And:

Minter Ellison Lawyers

Third Defendant

REPRESENTATION:

Counsel:

1 ^st Plaintiff: R Whitington QC B DoyleD McConnel

2 ^nd Plaintiff: G Macdonald

1 ^st Defendant: No appearance

2 ^nd Defendant: No appearance

3 ^rd Defendant: R Derrington QC T Anderson

Commissioners for Special Purposes of Income Tax v Pemsel [1891] AC 531 , Re Scarisbrick Cockshott v Public Trustee [1951] 1 All ER 822 CA, Verge v Somerville [1924] AC 496, applied

Aboriginal Hostels Ltd v Darwin City Council (1985) 33 NTR 1 , Alice Springs Town Council v Mpweteyerre Aboriginal Corporation [1997] NTCA 78, 115 NTR 25, 139 FLR 236

Dareton Local Aboriginal Land Council v Wentworth Council (1995) 89 LGERA 120 , Davies v Perpetual Trustee Co Ltd [1959] AC 439, Dempsey on behalf of the Bularnu, Waluwarra and Wangkayujuru People v State of Queensland (No 2) [2014] FCA 528, Dingle v Turner [1972] AC 601, Electricity Generation Corporation v Woodside Energy Ltd [2014] HCA 7; (2014) 251 CLR 640, Latimer v Commissioner of Inland Revenue [2004] 3 NZLR 157, Plan B Trustees Limited v Parker [2013] WASC 216, Shire of Ashburton v BindiBindi Community Aboriginal Corporation [1999] WASC 108, Shire of Derby-West Kimberley v Yungngora Association Inc [2007] WASCA 233, Thompson v Federal Commissioner of Taxation [1959] HCA 66; (1959) 102 CLR 315, considered

Compton, In re; Powell v Compton [1945] 1 Ch 123 , Oppenheim v Tobacco Securities Trust Co Ltd [1951] AC 297, distinguished

Flynn v Mamarika (1996) 130 FLR 218 , Latimer v Commissioner of Inland Revenue [2002] 3 NZLR 195, followed

Anglican Trusts Corporation of Diocese of Gippsland v Attorney-General for the State of Victoria [2008] VSC 352 , Ashfield Municipal Council v Joyce [1976] 1 NSWLR 455, Attorney-General (NSW) v Cahill [1969] 1 NSWR 85, Attorney-General for New South Wales v Perpetual Trustee Co (Ltd) (1940) 63 CLR 209, Attorney-General v Ross [1986] 1 WLR 252, ASIC v Carey (No 6) [2006] FCA 814; (2006) 153 FCR 509, Australian Executor Trustees Ltd (as trustee for the Martu Banyjima Charitable Trust) v Attorney-General (WA) [2015] WASC 439, ASIC v Carey (No 6) (2006) 153 FCR 509, BSH Holdings Pty Ltd v Commissioner of State Revenue [2000] VSC 302; (2000) 2 VR 454, Byrnes v Kendle [2011] HCA 26; (2011) 243 CLR 253, Cant v Kirby [2011] NSWSC 1193, Commissioner of Taxation of the Commonwealth of Australia v Bargwanna [2012] HCA 11; (2012) 244 CLR 655, FCT v Vegners (1989) 90 ALR 547, Federal Commissioner of Taxation v Vegners (1989) 90 ALR 547, Gibson v South American Stores (Gath & Chaves) Ld [1950] Ch 177, Grain Growers Ltd v Chief Commissioner of State Revenue [2015] NSWSC 925, Inland Revenue Commissioners v Baddeley [1955] AC 572, Inland Revenue Commissioners v City of Glasgow Police and Athletic Association [1953] AC 380, Inland Revenue Commissioners v McMullen [1981] AC 1, In Re Hilditch (1985) 39 SASR 469, In Re Income Tax Acts [No 1] [1930] VLR 211, Re Wilson's Grant; Fidelity Trustee Co Ltd v Johnson [1960] VR 514, Kostka v The Ukrainian Council of NSW Inc [2013] NSWSC 222, McGarvie Smith Institute v Campbelltown Municipal Council (1965) 11 LGRA 321, Mabo v State of Queensland [No 2] [1992] HCA 23; (1992) 175 CLR 1, Members of the Yorta Yorta Aboriginal Community v Victoria [2002] HCA 58; (2002) 214 CLR 422, Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37; (2015) 256 CLR 104, Re Best [1904] 2 Ch 354, Re Clifford [1912] 1 Ch 29, Re Coulthurst [1951] Ch 661, R (Independent Schools Council) v Charity Commission [2012] Ch 214, Re Gillespie [1965] VR 402, Re Mair [1964] VR 529, In Re Patten [1929] 2 Ch 276, Re Evans; Union Trustee Co of Australia Ltd v Attorney-General for Queensland [1957] St R Qd 345, In Re Tree [1945] Ch 325, In Re Wallace v Fatt [1908] VR 636, Royal National Agricultural and Industrial Association v Chester (1974) 3 ALR 486, Said v Barrington [2001] NSWSC 576, Scottish Burial Reform and Cremation Society v Glasgow City Corporation [1968] AC 138, State of Western Australia v Graham on behalf of the Ngadju People [2013] FCAFC 143, Strathalbyn Show Jumping Club Inc v Mayes [2001] SASC 73; (2001) 79 SASR 54, Union Trustee Co of Australia Ltd v Federal Commissioner of Taxation [1962] HCA 52; (1962) 108 CLR 451, Williams' Trustees v Inland Revenue Commissioners [1947] AC 447, Wybenga v Mandandanji Ltd (as trustee for the Mandandanji Charitable Trust) [2014] FCA 861, referred to

Aboriginal Land Rights Act 1983 (NSW)

Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) sch I, s 4(2A)

Charities Act 2013 (Cth), s 9

Income Tax Assessment Act 1997 (Cth)

Statute of Charitable Uses 1601 (43 Eliz 1 c 4)

Native Title Act 1993 (Cth)

INTERPRETATION — trusts — trust deeds — same approach as for construction of contracts — intention as revealed in the words used — resort to extrinsic evidence

TRUSTS — charitable trusts — legal principles — Pemsel categories — trusts for purposes not persons

TRUSTS — charitable trusts — benefit of the public or section of the public — class of potential beneficiaries — tests in Re Compton and Oppenheim — whether potential beneficiaries are defined by reference to a single propositus or several propositii — Aboriginal clans are a section of the public — no difference where non residents are excluded

TRUSTS — charitable trusts — trusts for the relief of poverty — trusts must be solely for the relief of poverty if not for the benefit of the public or a section of the public — Dingle exception

TRUSTS — charitable trusts — public benefit — sport and social facilities — may fall within advancement of education category in some cases — trust must not permit gifts that are not charitable

ABORIGINALS — clans — trusts for the benefit of traditional clans of Aboriginals residing in a particular area — clans are a section of the public for the purposes of charitable trusts — nothing arbitrary or capricious about the membership of Aboriginal clans — appreciably important class of the community

REASONS FOR JUDGMENT

(Delivered 20 January 2017)

Introduction	6
Pleadings and Submissions	6
Question to be answered	7
The 2008 Trust Deed	9
Summary of Main Contentions	17
Factual background	20
The Indigenous Inhabitants of the Islands	20
Recent history	24
Earlier Trust Deeds	26
1989 Trust Deed	28
Flynn v Mamarika	30
1996 Trust Deed	32
1998 Trust Deed	37
2000 Trust Deed	39
2004 Trust Deed	39
2005 Trust Deed	40
Interpretation of Trust Deeds	40
Charitable trusts — relevant law	44
Trusts for the benefit of Aboriginals	47
Clear wording of clause 2	49
Class — the potential objects of benefaction	51
Legal principles	51
‘Beneficiaries’ defined by reference to a propositus	51
Compton	52
Oppenheim	55
The adoption of the Compton-Oppenheim principles in Australia	58
Section 9 of the Charities Act 2013	63
Two exceptions to the above principles	67
Authorities concerning trusts for Indigenous People	68
Aboriginal Hostels Ltd v Darwin City Council	69
Shire of Derby-West Kimberly v Yungngora Association Inc	71
Alice Springs Town Council v Mpweteyerre Aboriginal Corporation	76
Latimer v Commissioner of Inland Revenue	80
Plan B Trustees Limited v Parker	88
Contentions	90
Consideration	95
Descent from ascertainable particular persons	95
Clans and context of the Trust	97
Ambulatory operation of the Trust	99
Effect of excluding non-residents	100
Size of the class	100
Appreciably important class of the community	102
Conclusions	103
Defence paragraph 13(c)	103
Relief from Poverty	105
Charitable purposes	116
Sport and social facilities	118
Charitable purpose market garden	126
Conclusion	128
Conclusion and disposition	128

Introduction

1 On 18 July 2016 I made orders that the following questions be tried as preliminary questions ahead of the trial of the other issues in these proceedings:

• (1) Do the matters alleged in paragraph 13 of the Defence of the Third Defendant to the Amended Statement of Claim filed 2 October 2015 filed on 29 January 2016, or any of them, deny to the Groote Eylandt Aboriginal Trust (as established and continued under the deeds of trust identified in paragraphs 7, 10, 19, 25 and 30–32 of the Amended Statement of Claim) 1 the status of a valid charitable trust at law? For the avoidance of doubt, this question includes whether the matters alleged are established.

• (2) Does the Plaintiff have standing to bring these proceedings against Minter Ellison in the capacity of trustee given that the Plaintiff:

  • (a) has not been found liable for breach of trust; and

  • (b) has not been found responsible for the loss and damage it now claims against Minter Ellison?

2 In its Response to the Plaintiff's Statement of Facts Issues and Contentions, 2 the third defendant withdrew its challenge to the plaintiff's standing. Its defence is to be amended accordingly. As no party is now challenging the plaintiff's standing the second question no longer needs to be answered.

Pleadings and Submissions

3 Pursuant to the orders made on 11 August 2016 the plaintiff, Groote Eylandt Aboriginal Trust Incorporated ( GEAT), filed and served a detailed...