Perpetuities Act 1984

This Act may be cited as the Perpetuities Act 1984.

Sections 1 and 2 shall commence on the date of assent to this Act.

Except as provided by subsection (1), this Act shall commence on such day as may be appointed by the Governor in respect thereof and as may be notified by proclamation published in the Gazette.

In this Act, except in so far as the context or subject-matter otherwise indicates or requires:

appointed day means the day appointed and notified under section 2 (2).

disposition includes:

the conferring or exercising of a power of appointment and any other power or authority to dispose of property, and

any alienation of property.

interest includes any estate and any right.

power of appointment includes any discretionary power to make a disposition.

property includes any interest in real or personal property and any thing in action.

settlement includes:

a will,

an instrument, testamentary or otherwise, exercising a power of appointment, whether general or special, and

any other instrument, transaction or dealing whereby a person makes a disposition,

but does not include an Act of Parliament.

the rule against perpetual trusts means the common law rule that invalidates a trust (not otherwise invalid) for a purpose which is not charitable where the duration of the trust will or may exceed the perpetuity period.

trust and trustee have the meanings respectively ascribed thereto in the Trustee Act 1925.

will includes a codicil.

For the purposes of this Act, a will shall, in relation to a disposition contained in it, be deemed to take effect on the death of the testator.

For the purposes of this Act:

a person shall be treated as a member of a class if in that person’s case each and every condition identifying a member of the class is satisfied, and

a person shall be treated as a potential member of a class if in that person’s case only one or some of the conditions identifying a member of the class is or are satisfied but there is a possibility that the remainder of those conditions will in time be satisfied.

Except as provided by sections 11, 12 and 13, this Act does not apply in relation to a settlement taking effect before the appointed day.

This Act applies in relation to a settlement exercising a power of appointment, whether general or special, and taking effect on or after the appointed day, whether or not it applies in relation to the settlement creating the power of appointment.

This Act does not apply to render invalid, at the outset or at some future time, an interest created by a provision of a will executed before the appointed day, but taking effect on or after the appointed day, if the provision would not have infringed the rule against perpetuities had this Act not been enacted and had the will taken effect when it was executed.

Except as provided by subsection (2) or by any other Act, the rule against perpetuities, the rule against perpetual trusts and this Act bind the Crown not only in right of New South Wales but also, so far as the legislative power of Parliament permits, the Crown in all its other capacities.

Nothing in the rule against perpetuities, in the rule against perpetual trusts or in this Act affects any settlement made by the Crown.

For the purposes of the rule against perpetuities, a power of appointment shall at any particular time be treated as a special power unless, at that time, the appointor has, by the settlement creating the power, unconditional authority at his or her own discretion to exercise the power by appointing the interest the subject of the power to himself or herself.

Notwithstanding subsection (1), an appointment of an interest made by will under a power of appointment that would, but for the fact that it was made exercisable only by will, have been a general power shall be treated as a general power for the purposes of determining whether the appointment of the interest infringes the rule against perpetuities.

For the purposes of this section, an authority is unconditional notwithstanding any formal condition relating to the mode of exercise of the power.

For the purposes of the rule against perpetuities, the perpetuity period applicable to an interest created by a settlement shall be 80 years from the date on which the settlement takes effect.

Where an appointment of an interest is made under a special power of appointment, the perpetuity period shall be reckoned from the date on which the settlement creating the power takes effect.

Where a provision of a settlement which creates an interest would, but for this section and section 9, infringe the rule against perpetuities, the interest shall be treated, until such time (if any) as it becomes certain that it must vest, if at all, after the end of the perpetuity period, as if the provision did not infringe that rule, and its becoming so certain does not affect the validity of any thing previously done in relation to the interest.

Where a provision of a settlement which creates an interest consisting of the conferring of a general power of appointment would, but for this section and section 9, infringe the rule against perpetuities, the interest shall be treated, until such time (if any) as it becomes certain that the power will not be exercisable within the perpetuity period, as if the provision did not infringe that rule.

Where a provision of a settlement which creates an interest consisting of the conferring of any power or right (except a general power of appointment) would, but for this section and section 9, infringe the rule against perpetuities, the interest shall be treated as regards any exercise of the power or right within the perpetuity period as if the provision did not infringe that rule, and the provisions shall be treated as infringing that rule only if and so far as the power or right is not fully exercised within the perpetuity period.

This section does not affect the operation of section 15.

Where:

a provision of a settlement creates an interest and the vesting of the interest depends on the attainment by any person of a specified age, and

it becomes apparent that the provision would, but for this subsection, infringe the rule against perpetuities but that it would not infringe that rule if the specified age had been a lesser age,

the interest shall, for all purposes, be treated as if, instead of its vesting depending on the attainment by the person of the specified age, its vesting depended on the attainment by the person of the greatest age which, if put in place of the specified age, would save the provision from infringing that rule.

Where an interest to which subsection (1) applies is ulterior to any other interest created by the settlement, that other interest shall not be defeated or otherwise adversely affected by the operation of subsection (1).

Where, in relation to an interest created by a provision of a settlement, different ages are specified in relation to different persons:

the reference in subsection (1) to the specified age shall be construed as a reference to all the specified ages, and

subsection (1) shall operate to reduce each such age so far as is necessary to save the provision from infringing the rule against perpetuities.

Where a provision of a settlement creates an interest which is to be taken by a class of persons and it becomes apparent that the inclusion of a person, being a member of the class or an unborn person who at birth would become a member or potential member of the class, would, but for this subsection:

cause the provision to infringe the rule against perpetuities, or

prevent subsection (1) from operating to save the provision from infringing that rule,

then, upon its so becoming apparent, the person shall, unless the exclusion of the person would exhaust the class, be treated in relation to the interest as if the person were not a member of the class, and, where subsection (1) applies that subsection shall thereupon have effect accordingly.

Where this section has effect in relation to a provision to which section 8 applies, the operation of this section does not affect the validity of any thing previously done in relation to the interest created by the provision.

The following provisions shall, for the purposes of the rule against perpetuities, be applied in the following order:

section 8,

section 9 (1),

section 9 (4).

In this section, administrative power means a power of a trustee to sell, lease or exchange trust property and any other power of a trustee, but does not include a power to appoint, pay, transfer, advance, apply, distribute or otherwise deal with trust property in or towards satisfaction of the interest of a beneficiary under the trust or in or towards satisfaction of a purpose of the trust.

The rule against perpetuities does not invalidate an administrative power in relation to trust property during the subsistence of a beneficial interest in the trust property.

This section applies to an administrative power taking effect, and to any exercise of an administrative power, before, on or after the appointed day.

The rule against perpetuities does not invalidate a power or other provision for remunerating a trustee for the trustee’s services.

This section applies to a power or other provision for remunerating a trustee taking effect before, on or after the appointed day.