Metropolitan Petar v Mitreski [2012] NSWSC 16

Supreme Court New South Wales

Medium Neutral Citation: Metropolitan Petar v Mitreski [2012] NSWSC 16 Hearing dates: 2 - 30 August 2010 Decision date: 03 February 2012 Jurisdiction: Equity Division Before: Brereton J Decision: (1)The plaintiffs are entitled to a declaration to the effect that all the property of the Association other than the litigation funds are held as trustee on the trust declared by Hamilton J. If the defendants desire to contend that any litigation funds remain, they may have an account of the litigation funds at their own risk as to costs. (2)The plaintiffs are entitled to declarations to the effect that the Association has, in breach of trust: (a) excluded the diocesan Bishop, (b) excluded the parish priest appointed by the Bishop, (c) prevented a priest licensed by the Bishop to conduct services in the church from doing so, (d) employed priests not appointed by the Bishop, and (e) failed to accept applications for membership from believers in the doctrines of the Macedonian Orthodox Church who have satisfied the criteria for membership specified in the 1994 Church constitution, the diocesan statute and the by-laws. (3)The plaintiffs are entitled to injunctive relief that has the effect of compelling the Association to comply with the rules of Macedonian Orthodox Church as they apply to parishes of the Macedonian Orthodox Church in respect of not excluding or impeding the Bishop, not excluding or impeding Fr Mitrev, and admitting into membership those who meet the requirements of church law for membership of a parish assembly. (4)The plaintiffs are entitled to an order that the Association account to the trust for the moneys paid to Fr Dzeparovski and Fr Despotoski, save those paid prior to November 1997 in respect of which the claim is statute barred. (5)The plaintiffs are entitled to an order that each of the Committee Members accounts to the trust for the moneys paid to Fr Dzeparovski and Fr Despotoski while that Committee Member remained in office, save those paid prior to November 1997 in respect of which the claim is statute barred . Direct that the parties bring in Short Minutes to give effect to these this judgment. Catchwords: TRUSTS AND TRUSTEES - Charitable trusts - church trust - trust property - where certain property held by trustees to permit its use by unincorporated association as a church of the Macedonian Orthodox Religion - whether income generated by church and parish activities is trust income - whether other property acquired with trust income is held upon same trusts. ASSOCIATIONS AND CLUBS - Incorporated associations - where property held by trustees to permit its use by a predecessor unincorporated association as a church of the Macedonian Orthodox Religion - where constitution of successor incorporated association provides that funds of association shall be applied to carry out the objects of the association - whether legislation and constitution impedes acquisition by incorporated association of further property on same trust. TRUSTS AND TRUSTEES - Charitable trusts - church trust - whether certain provisions of church law were sufficiently fundamental to be terms of trust. TRUSTS AND TRUSTEES - Breach of trust - defence of proceedings brought against trustee - whether resort to trust assets to fund defence is breach of trust. LIMITATIONS - Breach of trust - charitable trusts - whether claim by plaintiffs suing not for the benefit of the public at large but by virtue of special interest in enforcing the trust is "an action on a cause of action in respect of a breach of trust" accruing to a plaintiff within Limitation Act, s 48(a). TRUSTS AND TRUSTEES - Rights of trustees - Judicial advice - where advice obtained irrelevant to breaches established. TRUSTS AND TRUSTEES - Excusable breaches - whether trustee ought fairly to be excused for omitting to obtain the direction of the Court in the matter in which the trustee committed the breach - where trustee did not believe that it was a trustee - whether trustee ought fairly to be excused for the breach of trust - relevant considerations - whether trustee has acted honestly and reasonably - where breaches involved repudiation of sworn promise to adhere to church law and to knowledge of trustee could achieve no religious purpose. TRUSTS AND TRUSTEES - Charitable trusts - accessorial liability - whether mere engagement in conduct causative of breach attracts accessorial liability - necessity for consciousness of those elements of the transaction which make participation transgress ordinary standards of honest behaviour - where breaches involved repudiation of sworn promise to adhere to church law and to knowledge of trustee could achieve no religious purpose. Legislation Cited: (CTH) Corporations Act 2001, s 1318 (CTH) Trade Practices Act 1974, s 52 (NSW) Associations Incorporation Act 1984, s 6 (NSW) Associations Incorporation Act 2009 s 95 (NSW) Limitation Act 1969 s48(a) (NSW) Trustee Act 1925, s 59(4), s 63, s 85, s 93(3), UCPR 42.25 UCPR 42.7 Cases Cited: Application of Macedonian Orthodox Community Church St Petka Inc (No 3) [2006] NSWSC 1247 Application of Macedonian Orthodox Community Church St Petka Inc (No 4) [2007] NSWSC 254 Armitage v Nurse [1998] Ch 241 Attorney-General (ex rel Elisha) v Holy Apostolic and Catholic Church of the East (1989) 98 ALR 327 Attorney-General (Queensland); Ex rel Nye v Cathedral Church of Brisbane [1977] 136 CLR 353 Attorney-General v Cocke [1988] Ch 414 Attorney-General v Gould (1860) 28 Beav 485 Attorney-General v Wylde (1948) 48 SR(NSW) 366 Banque Commerciale SA v Akhil Holdings Limited [1990] 169 CLR 279 Barnes v Addy (1874) LR 9 Ch App 244 Chief Commissioner of Stamp Duties (NSW) v Buckle (1998) 192 CLR 226 Corrigan v Farrelly (1897) QLJ 105 Craigdallie v Aikman (1820) 2 Bligh 529 Edwards v Attorney-General (2004) 60 NSWLR 667 Farah Constructions v Say-Dee (2007) 230 CLR 89 Fay v Moramba Services Pty Ltd [2010] NSWSC 725 Gatsios Holdings Pty Ltd v Nick Kritharas Holdings Pty Ltd (in liq) [2002] NSWCA 29 General Assembly of Free Church of Scotland v Lord Overtoun [1904] AC 515 His Grace Metropolitan Petar v Aco Kostovski; Alexander v Branov (unreported, VSC, 27 October 1997) In re Beddoe; Downes v Cottam [1893] 1 Ch 547 In re Grimthorpe [1985] Ch 615 Lemery Holdings Pty Ltd v Reliance Financial Services Pty Ltd (2008) 74 NSWLR 550 Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar (2008) 237 CLR 66 Mead v Watson (2005) 23 ACLC 718 Metropolitan Petar v Mitreski [2003] NSWSC 262 Metropolitan Petar v Mitreski [2009] NSWSC 106 Miller v Cameron (1936) 54 CLR 572 Mitreski v Metropolitan Petar [2009] NSWSC 319 National Trustee Co of Australasia Ltd v General Finance Co of Australasia Pty Ltd [1905] AC 373 National Trustees Executors and Agency Co of Australasia v Barnes (1941) 64 CLR 268 Nolan v Collie [2004] HCATrans 22 Paul A Davies (Australia) Pty Limited v Davies [1983] 1 NSWLR 440 President and Scholars of St Mary Magdalen, Oxford v Attorney-General (1857) 6 HLC 189 Radmanovich v Nedeljkovic (2001) 52 NSWLR 641 Re Buckton [1907] 2 Ch 406 Re Llewellin; Llewellin v Williams (1887) 37 Ch D 317 Re Tollemache [1903] 1 Ch 457 Re Turner [1897] 1 Ch 536 Re Application of Macedonian Orthodox Community Church St Petka Inc [2004] NSWSC 388 Re Application of Macedonian Orthodox Community Church St Petka Inc (No 2) (2005) 63 NSWLR 441; [2005] NSWSC 558 Scandrett v Dowling (1992) 27 NSWLR 483 Solicitor-General v Wylde (1945) 46 SR(NSW) 83 Wylde v Attorney-General (NSW) ex rel Ashelford (1948) 78 CLR 224 Texts Cited: Jacobs on Trusts, 7th edition, 2006 Lewin on Trusts, 18th edition, 2008 Category: Principal judgment Parties: His Eminence Petar the Diocesan Bishop of the Macedonian Orthodox Diocese of Australia & New Zealand (first plaintiff) The Very Reverend Father Mitko Mitrev (second plaintiff) Lambe Mitreski (first defendant) Peco Damcevski (second defendant) Boris Minovski (third defendant) Eftim Eftimov (fourth defendant) Mile Marcevski (fifth defendant) Macedonian Orthodox Community Church St Petka Incorporated (sixth defendant) Naum Despotoski (eighth defendant) Attorney-General for the State of NSW (ninth defendant) Representation: Counsel: Mr TGR Parker SC w Mr RE Steele (Ps) Mr M Leeming SC w Ms L Goodchild (D1-6, 8) Mr M Izzo (D9) Solicitors: Sachs Gerace Lawyers (Ps) McConnell Jaffray Lawyers (D1-6, 8) Crown Solicitor (D9) File Number(s): 1997/25609