GOODWIN v DUGGAN SUPREME COURT OF NEW SOUTH WALES — COURT OF APPEAL PRIESTLEY JA 18 March 1996 [1996] NSWCA 221 Priestley JA. Application is made for orders made by Simos J on 15 December last to be stayed pending determination of an appeal from those orders. The situation which brings about the application is a difficult one. The applicant for the stay was one of two trustees of the will of her deceased sister. The other trustee was a brother of the applicant for the stay and of the deceased. The deceased had left a will, of which probate was duly granted, in which she bequeathed her estate equally to her two daughters, both then minors, one of whom was the plaintiff before Simos J and is the first opponent in the application today. Stated very generally, the claim before Simos J was that the two trustees of the deceased sister's will were in breach of their trust. The plaintiff's claim succeeded, and she obtained orders and declarations from Simos J that the trustees were in breach of trust and must repay to her amounts that should have been paid pursuant to their duties as trustees. The claimant/appellant was a passive trustee to a large extent. The active trustee was the brother, Mr Brett Yuile. The judges findings were, in effect, that he had wasted the estate of his niece, the plaintiff. The claimant/appellant made a case before Simos J which, in the end, came down to an application to be excused under section 85 of the Trustee Act from the consequences of her breaches of trust on the basis that she acted fairly and honestly and ought reasonably be excused. The judge found against her on that. This has led to the practical situation where the judge's orders require payment to the plaintiff/first opponent of an amount somewhat in excess of $70,000. Mr Brett Yuile, it would seem, will not be able to meet any part of his obligation. The only source of money to satisfy the judge's orders will be the claimant, Deborah Goodwin. She has put on an affidavit in support of this application showing total assets of $356,000 and total liabilities of $170,000. This indicates on the face of things an ability to meet the judgment for the sums that she will be required to pay pursuant to Simos J's orders if she fails in her appeal. Of the various grounds in her appeal it has been said to me that the section 85 aspect is the principal one. Although her assets position looks healthy, in a net sense, on the face of things, nevertheless her principal asset is a villa unit at Avoca Beach which is subject to three mortgages. That casts some doubt on her ability to provide satisfactory security if I were to require security as a condition of the stay. It has been suggested on her behalf an undertaking to the Court would be sufficient to ensure that her asset position was maintained pending the hearing of the appeal so if she were to lose there would be no problem in then satisfying Simos J's orders. 2 UNREPORTED JUDGMENTS I have some doubts about that in view of the difficulties in framing such an undertaking, and the three mortgages I have mentioned already. Her affidavit does not disclose her income position. There is some indication in the reasons for judgment of Simos J that the beneficiary presently entitled to the benefit of Simos J's orders may be inimmediate need of funds. There is no evidence before me indicating with any clarity what her position is. It seems to me that in order to arrive at the best decision in these proceedings I should have, or at least give the parties the opportunity to put before me, evidence from the beneficiary of her present position and need for funds and further evidence from the claimant of her overall financial position, and in particular her income situation. Also, I would like to see the form of undertaking proposed should I be disposed to grant a stay upon an appropriate undertaking being given by the claimant. In addition the case seems to be one where an application should be made by the claimant for expedition of the hearing of the appeal. Rather than make a decision today with presently available information, I suggested to the parties that I would be inclined to stand the matter over to enable them to put before me such further material as they choose to do in the light of the observations I have made. As I understood the parties responses to that, although they did not actively ask me to take that course, nevertheless they did not raise any matters of substantial opposition to its being followed. I therefore stand the matter over until 9.30 am on Thursday 4 April next. Any documents proposed to be relied on at that further hearing should be filed no later than 4 pm on Friday 29 March. It may be that on 4 April I will have to be sitting in the Court of Appeal at 10.15. I would be proposing to decide this matter on any further material and, after hearing such argument as the parties may wish to put, by 10.15 am on that day. It has been indicated to me today that the first opponent wishes to address the Court on the prospects that the claimant/appellant's proceeds of appeal are weak and that that matter should be taken into account in whatever decision I come to on an application for a stay. In order that the matter can be disposed of expeditiously on Thursday 4 April I direct, in addition to filing all the material which I have already mentioned by 4 pm on 29 March, written submissions should be filed no later than 4 pm on Tuesday 2 April with the object that the time needed for oral address on the Thursday can be kept to a reasonable minimum. I reserve the costs of today. I have mentioned already that without in any way pre-judging the result of the application I thought the matter should be held in statu quo until Thursday 4 April and I grant a stay of execution of the orders made by Simos J until 10.15 am on Thursday 4 April next. I give leave to amend the notice of motion to apply also for expedition of the hearing of the appeal. Orders accordingly.