Macarthur Cook v APN Funds

[2013] VSCA 240

Victorian Court of Appeal

Built by Barristers,
For Australian Law.

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Interrogate

Catchwords

1. Trusts and Trustees
2. › Unit trusts
3. › Managed investment schemes
4. › Issue of units
5. › Validity of units issued at price less than Issue Price specified by trust constitution
6. › Whether issue pro tanto invalid or wholly void
7. › Corporations Act 2001 (Cth), Ch 5C
1. Trusts and Trustees
2. › Powers of trustees
3. › Excessive exercise of power
4. › Severability
5. › Whether excessive exercise of power wholly invalid or only invalid pro tanto
6. › Principle of enforcing the enforceable as far as possible
1. Practice and Procedure
2. › Pleadings
3. › Amendment
4. › Whether party should be permitted to raise estoppel and breach of warranty on remitter despite not having formally pleaded them
5. › Whether evidence and submissions below sufficiently raised the issues

Quick Take

Where a responsible entity of a managed investment scheme issues units at a price less than the Issue Price specified by the trust constitution, the issue is beyond power and pro tanto invalid — valid as to the number of units that could have been issued at the correct price, but invalid as to the excess. This is an act beyond power, not merely a breach of trust. Estoppel cannot validate the invalid units but may operate inter partes to affect remedies.