McElhinney v Ambulance Service of NSW

1. [1]

   HIS HONOUR: His Honour Wright J approved a settlement of these proceedings on 23 October 2020: see McElhinney by her tutor McElhinney v Ambulance Service of NSW [2020] NSWSC 1471. The sum referred to in the consent judgment less authorised deductions was thereafter paid into Court.

2. [2]

   Section 77 of the Civil Procedure Act 2005 is relevantly in these terms:

3. [3]

   The plaintiff, by her tutor, has now applied for an order directing that the money paid into Court for the plaintiff now be paid to Equity Trustees Wealth Services Limited as trustee instead of the NSW Trustee & Guardian. The principal, but not the only, reason for wanting this appointment is the anticipation that the fees of the former will be considerably less than the fees of the latter, thereby assisting in the preservation and maintenance of the fund for longer.

4. [4]

   The application is supported by an affidavit from Craig Raymond Stubbs made on 12 October 2020. Mr Stubbs is a financial adviser employed by AMP Advice, described by him as a specialist advice and investment management firm. Mr Stubbs is not employed by Equity Trustees Wealth Services Limited. Mr Stubbs deposes to the fees that AMP Advice would charge in the event that Equity Trustees Wealth Services Limited were appointed as the plaintiff’s trustee. He does not refer to the fees that Equity Trustees Wealth Services Limited would charge if so appointed. It is not clear to me whether Equity Trustees Wealth Services Limited in fact charges fees in addition to those charged by AMP Advice.

5. [5]

   I have also been provided with an affidavit made on 20 October 2020 by Brielle Straney, the plaintiff’s solicitor. Ms Straney’s affidavit (in almost identical terms to paragraphs 22 and 23 of her 9 October 2020 affidavit) includes the following:

6. [6]

   The plaintiff’s tutor, Corey John McElhinney, made an affidavit on 9 October 2020 in which he said:

7. [7]

   Mr McElhinney’s affidavit does not provide material or supporting documentation that explains his preference. I am aware, however, that Mr McElhinney has had a two hour meeting with Mr Stubbs and Susan Barrett, the Client Relationship Manager at Equity Trustees Wealth Services Limited. Ms Barrett has sworn an affidavit dated 12 October 2020. At the risk of including too much information, the following matters from Ms Barrett’s affidavit should be noted:

8. [8]

   Although not presently relevant, I have also been provided with a consent executed by Equity Trustees Wealth Services Limited to act as manager of the estate of Sophie McElhinney under the order and direction of the NSW Trustee & Guardian pursuant to Chapter 4 of the NSW Trustee and Guardian Act 2009 if so appointed.

9. [9]

   Finally, the application is supported by an affidavit of Ms Straney affirmed on 2 March 2021. That affidavit annexes an email received by her from Angela Ehsani on 2 November 2020. Ms Ehsani is the National Manager – Law Sector for AMP Advice. She has provided a schedule containing a comparison of the fees that would be charged by AMP Advice and those that she anticipates would be charged by the NSW Trustee & Guardian on an invested corpus of $4,750,000 held on trust for the plaintiff.

Disposition

1. [10]

   A comparison between the relative benefits of investment with a public institution and a private corporate trustee is regularly made in proceedings in which the quantum of a plaintiff’s claim for damages is in issue. Competing submissions in such cases are directed to the assessment of the likely or probable longevity of a fund, depending on investment returns and fee structures of the proposed trustees: see, for example, Richards v Gray [2013] NSWCA 402; Hulanicki (bhnf Hulanicki) v Walton [2014] ACTSC 17.

2. [11]

   The power of the Court to appoint a corporate trustee cannot now be doubted. The matter was considered in an analogous setting by Brereton J in Dunning v NSW Trustee & Guardian [2015] NSWSC 2095 as follows:

3. [12]

   In Morris v Zanki bhnf Zanki (1997) 18 WAR 260, a decision of the Full Court of the Western Australian Supreme Court to which Brereton J referred, albeit dealing with a different statutory regime, the issue of the choice between public and private trustees was considered in the context of an appeal where the measure of damages awarded to a plaintiff under a legal disability was in issue. The Court said this at [42] and [43]:

4. [13]

   Ms Ehsani’s schedule indicates that the comparison she has provided may change “depending on the actual investment amount”. This was one issue that concerned Wright J in these proceedings when approving the settlement but declining, clearly for the time being, to deal with the appointment of Equity Trustees Wealth Services Limited. His Honour said this at [22]:

5. [14]

   In the present case, the schedule provided by Ms Ehsani is unfortunately not sufficiently detailed for me to be able to understand or assess where the balance lies. I do not have a clear appreciation of the likely progress of the settled fund over time having regard to the respective fee structures and investment philosophies. I would therefore be assisted by the provision of an updated schedule with calculations made upon the known sum now available for investment. Additionally, although the terms of the trust are undoubtedly contained in a deed in current use, I am presently not aware of the form of any proposed trust deed or the extent to which its terms differ in any significant and relevant way from those administered by the NSW Trustee & Guardian.

6. [15]

   However, I am mindful of the fact that delay in the appointment of a trustee will itself mean that the plaintiff is not earning income and that that circumstance is to be avoided as far as possible. Accordingly, without seeking to abdicate my responsibility to determine the ultimate issue, but bearing in mind the role played by suitably qualified experts in providing opinions to assist the Court to make such decisions, the provision of such an opinion may be of considerable assistance to me in reaching a quick and cheap decision. I do not have in mind anything particularly lengthy or expensive to produce. I anticipate that I would be able confidently to proceed to finalise the matter with the benefit of an actuary or similar expert expressing his or her professional opinion about whether there is good reason in the particular circumstances of this case to prefer Equity Trustees Wealth Services Limited as the trustee of the plaintiff’s damages. I would not anticipate there to be a need to hear from the parties further if the opinion were expressed in unambiguous terms.

7. [16]

   In the anticipation that the proposed course is suitable to the parties, I will reserve further consideration of the application, granting liberty to restore the matter for directions at some convenient time if that becomes necessary. If I am to be provided with an opinion of the type I have mentioned, the plaintiff should also furnish my Associate with a draft minute of the final orders for which she contends.