The trust deed is the founding document of every family trust. Without it, the trust has no rules. Losing it can be expensive, disruptive, and – in some cases – fatal to the trust itself.
A series of important decisions since 2022 has clarified what trustees must do, what evidence courts will accept, and when a trust will be found to have failed.
The Leading Case: Vanta Pty Ltd v Mantovani [2023] VSCA 53
The Mantovani Family Trust was established in 1976. Following the death of Mrs Mantovani, the trustee (Vanta Pty Ltd) made distributions to only two of the named beneficiaries for approximately ten years. When the remaining beneficiaries demanded trust records, it became clear the original deed – and any copy – had gone missing. Only the trust schedule remained.
At first instance, McMillan J declared the trust had failed for uncertainty, finding the schedule and supporting financial documents fell short of 'clear and convincing proof' of the deed's contents. An automatic resulting trust arose in favour of Mrs Mantovani's estate – meaning decades of trust assets were reclassified as estate assets.
The Court of Appeal overturned this. It held, first, that the secondary evidence – the schedule, ongoing trust operation, documented property transfers and distributions – was sufficient to establish the three certainties (intention, subject matter, objects). Second, and critically, the Court rejected the 'clear and convincing proof' standard as too high, confirming that the ordinary civil standard – balance of probabilities – applies to proving the existence and terms of a lost trust deed.
But Mantovani Is Not a Safety Net
Three subsequent decisions illustrate the limits of Mantovani's reassurance:
Northgate Park v Floyd [2022] VSC 783
Where no document existed at all, the Victorian Supreme Court accepted expert evidence about standard trust drafting practice in 1991 as a basis for establishing the trust's likely terms – particularly where the parties agreed on those terms.
Application of DEK Technologies [2023] NSWSC 544
NSW adopted the Mantovani balance of probabilities standard. An accountant's detailed contemporaneous letter of advice about the trust's establishment was held to be sufficient secondary evidence of the deed's terms.
Application by Gainer Associates [2024] NSWSC 1437
The Werner Thelen Family Trust deed was lost, and both primary beneficiaries had died. The trustee could not identify the wider class of beneficiaries the deed must have specified. The trust failed for uncertainty of objects – and the $2.8 million in trust assets reverted to the estate on resulting trust. Mantovani does not assist where beneficiaries simply cannot be identified.
The Most Dangerous Mistakes
- Continuing to administer the trust as normal – every distribution made without authority from the deed is a potential breach of trust and may need to be repaid.
- Replacing the deed without legal advice – the BAGI case [2023] NSWSC 567 illustrates how a self-prepared 'confirmation deed' may create a new trust, triggering stamp duty and adverse tax consequences.
- Assuming the trust schedule is enough – the schedule does not record trustee powers. Without those, the trustee may be constrained to the most conservative interpretation of what it is permitted to do.
- Failing to search thoroughly – courts expect extensive documented searches before accepting a deed is truly lost.
What To Do If the Deed Is Missing
- Conduct thorough searches immediately – including the establishing solicitor, accountant, ATO, ASIC and all related entity records.
- Preserve all secondary documents – schedule, financial statements, tax returns, minutes, deeds of amendment and any correspondence about the trust.
- Do not make distributions or enter significant transactions until you have legal advice.
- Seek specialist advice promptly – the earlier you act, the more options remain available.
- Consider a court application for judicial advice under section 63 of the Trustee Act 1958 (Vic) – this provides the trustee with protection against liability for acting on the Court's guidance.
- Coordinate legal and tax advice together – the steps taken to address a lost deed can have material and irreversible CGT, income tax and stamp duty consequences if not properly sequenced.
This article is general information only and does not constitute legal advice. Contact Abbots Legal for advice specific to your situation.