This is a case note of a family law matter involving a family trusts and property. Kennon v Spry; Spry v Kennon [] HCA 56 (“Spry”) is a particularly noteworthy. The case is Kennon and Spry. In it, the husband sets up a series of trusts for the benefit of the children of the marriage. It was the ability of the Family Court to. The decision of the High Court in Kennon v Spry () CLR ; ALR ; 83 ALJR ;. 40 Fam LR 1; [] FLC ; [] HCA 56 is one of.

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It deprived the husband of any possibility of beneficial interest in the Trust.

The Court could make an order directly applying that property to her benefit. An zpry to those notices was required. Did their Honours agree with the proposition that the right of the wife to be considered as a beneficiary and her right to ensure proper administration of the trust was property for the purposes of section 79? Except in the case of shams, and companies that are mere puppets of a party to the marriage, the Family Court must take the property of a party to the marriage as it finds it.

His Honour had found that the Trust was at all times kennln to the control of the husband. That is a question arguably capable of having factual elements not investigated at trial.

As to the position of the other beneficiaries, it has long been accepted that in some circumstances the Family Court has power to make an order which will indirectly affect the position of a third party. The purpose of s.

So far as these applications rest on a desire to invoke s 79, they are futile in view of the conclusion reached above that the assets of the Trust were not property in which the husband or the wife had interests. This would not be so if there was a discretion to be exercised in relation to these facts, and the primary judge had not had an opportunity of exercising that discretion. It is “property dealt with by The appeals should be dismissed. Further, relevant common law rights and duties which may otherwise subsist must accommodate compliance with orders made in the exercise of federal jurisdiction.


The wife argued that the nature of the orders she sought at trial was clearly brought to the attention of the other parties. The approach which his Honour took, in determining to make the order for the payment of the monies to the wife, was to leave it to the husband to determine how to find the payment of the net amount, although his Honour clearly had in mind that the husband controlled the Trust.

In most cases, trust assets of a purely discretionary trust constitute a mere expectancy, and not a financial resource, given the discretionary nature of such a trust. At that point it could not have been referable to the marriage. As mentioned above His Honour considered she had a right to due consideration as to the application of income and capital and administration that whilst difficult to value is not beyond the realms of possibility.

Ultimately, the High Court held that the trust assets were in fact psry of the marriage, even though the Trust had been amended to the point where Dr Spry and Mrs Spry were no longer beneficiaries, and the Trust had been separated into four separate trusts for the benefit of the Spry children.

That it may result in property becoming vested in him is immaterial; the general nature of the power does not make it property. If she was right to rely on evidence — a proposition contested at least by the trustees — then srpy would have been open to the husband to have called evidence on the point.

Family Law & Family Trusts – Case note for Kennon v Spry; Spry v Kennon [2008] HCA 56

Their interests are vested, but vested only in interest, not possession. The result is that upon the basis explained above the challenged orders made by the Full Court are to be supported as a proper exercise of the powers conferred by the Act.


These are not propositions which the wife did or could contest. The continuing status of a party to the marriage did not affect the exercise of that power. This difficulty cannot be overcome by treating each disposition of property to the trustee of the Trust after the marriage as the creation of a separate trust.

The applications for special leave to crossappeal should be dismissed but with no order as to costs. The proper construction of the section, in order to explain its intended operation, is a matter of general importance. Alternatively the timing of orders may have been a matter left to the parties. Indeed, he never returned to the subject in any significant fashion. Husband established 4 trusts in favour of his 4 children, Elizabeth, Catharine, Caroline and Penelope.

Under the Trust, the wife was the object of a bare fiduciary power of appointment. Kejnon meaning of words in statutes, and the application of general equitable conceptions in relation to those words, must depend on the nature and context of the particular statute. Husband conveyed to the children any shares held by him beneficially. A later cancellation by the vv to the Deed could not alter the effectiveness of the release.

The Trust property represents contributions kennon the parties and is held on terms of a settlement.

Family Law and Family Trusts

In it, the husband sets up a series of trusts for the benefit of the children of the kennno. It is sufficient to refer to the terms of the Elizabeth Spry Trust. The beneficiaries in future would include any person who married those five people, together with the issue of those marriages. This policy, which facilitates a distribution and settlement of property, was not present in the Act or in the English legislation.