Where a trustee has operated an unregistered managed investment scheme in contravention of Part 5C of the Corporations Act, the clear accounts rule is engaged to reduce the trustee's right of indemnity from the trust fund, and the court may direct the scheme administrator to apply trust property first to the administrator's remuneration, then to unitholders, before satisfying scheme claims by analogy with the statutory priority regime. AI-generated submissions containing hallucinated case references may support an order for indemnity costs.
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