A responsible entity's right to indemnity from scheme property for litigation costs under s 601GA(2)(b) of the Corporations Act is limited to costs properly incurred, and costs incurred by administrators acting in their own commercial interests to retain control of a fund rather than in the interests of members are not properly incurred. A constitutional indemnity clause that purports to allow indemnity in circumstances short of negligence, fraud or breach of trust where the responsible entity has acted improperly or not for the purpose of the trust does not operate by reason of s 601GA(2)(b). In assessing the propriety of a trustee's conduct for indemnity purposes, the nature of the trust and the trustee's position are relevant, including whether the trustee is well-remunerated and whether the fund is financially stricken.
The full text is available to signed-in members, including the 6 later cases that cite this judgment.
2 of the 6 citing cases carry a classified treatment. How each court treated it is available to signed-in members.