Lost trust deeds and the presumption of regularity: A (Boogie) Wonderland**

Recent posts have considered various issues in relation to lost trust deeds.

The decision in Chase v Chase [2020] NSWSC 1689 provides another useful summary of the key issues in this area.

In a situation where there was only secondary evidence about the possible existence of a trust, the court reiterated anyone wanting to have the court confirm the existence of a trust relationship is required to establish:

1. Clear and convincing proof of the existence and contents of the missing trust deed (as confirmed in the decision of Maks v Maks (1986) 6 NSWLR 34, as set out in an earlier post).
2. The '3 certainties of a trust', that is:
1. The identity of the beneficiaries.
2. The property the subject of the trust.
3. The nature of the trust (i.e. whether fixed or discretionary).

The court found the above tests had not been satisfied.

In particular, there was an absence of a declaration of trust, an absence of any document establishing the terms of the trust and a lack of coherent evidence of what the contents of any such documents were. Thus there was uncertainty as to the identity of the beneficiaries, the property the subject of the trust and whether or not the trust was fixed or discretionary.

The court also made comments about the potential application of the 'presumption of regularity', another concept featured in previous View posts.

This presumption states that where 'an act is done which can only be legally done after the performance of some prior act, the proof of the latter carries with it a presumption of due performance of the prior act'.

The court confirmed:

1. There are 4 key conditions that must be satisfied, before the resumption of regularity will be applied.
2. First, the matter must be more or less in the past and incapable of easily procured evidence.
3. Second, it must involve a mere formality or detail of required procedure in the routine of a litigation or of a public officer’s action.
4. Third, it must involve, to some extent, the security of apparently vested rights so that the presumption will serve to prevent an unwholesome uncertainty.
5. Fourth, the circumstances of the particular case add some element of probability.

Cross referencing the case of Burnside v Mulgrew; Re the Estate of Doris Grabrovaz [2007] NSWSC 550, it was confirmed that when considering the presumption of regularity, courts will draw a distinction between cases where “what is in question is compliance with formal requirements” as opposed to those involving a “substantive issue”, with the presumption potentially applying in cases of the former but not the later.

Thus here, unlike the cases mentioned in last week's post, where there was very little to support the existence of the trust, the presumption of regularity offered no assistance.

As usual, please contact me if you would like access to any of the content mentioned in this post.

** For the trainspotters, the title of today's post is riffed from the Earth, Wind and Fire song 'Boogie Wonderland’.

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