Re Gainer - What if the same company is used as trustee for your Trust/SMSF

It can save on fees to only use one company as trustee for multiple trusts such as an SMSF, discretionary trust and bare trust (the latter especially problematic). 

However this issue is becoming more rare with various financial and regualtory parties disapproving of transactions involving this.

The decision of Application by Gainer Associates Pty Ltd [2024] NSWSC 1437 was mainly about a lost trust deed for the Werner Thelen Family Trust (Trust).

The corporate trustee of the purported family Trust (Gainer Associates Pty Ltd – referred to as Gainer) would hold the assets purportedly held for the Trust on resulting trust for the sole beneficiary the late Werner Thelen (Werner), husband of the late Gail Thelen (Gail).

This decision was about a lost trust deed, which is resolved for SMSFs by ordering a lost SMSF deed of variation. 

SMSF deeds can look different but they generally follow a similar structure in relation to their fundamental "three certainties" of objects and subject matter - they hold assets for up to 6 members.

In this case the discretionary trust deed was lost so the resolution was not so simple.

You can't do as much as easily for a lost discretionary trust deed (a deed of confirmation can be ordered but is a more complicated decision when considering whether to apply to the court for confirmation of the trust terms - in this case the parties sought the Court's approval).

But a particular concern from this decision was also regarding the same SMSF trustee company (Gainer Associates Pty Ltd) was also purportedly acting as corporate trustee for the discretionary trust, for which its trust deed was also lost.

When you tick that your company acts as sole purpose corporate trustee for a SMSF to obtain the lowered ASIC annual review fee it cannot act as anything else and not as trustee for a discretionary trust. 

Although there may be some grounds to argue that the one company can legally act in multiple capacities, there are a multitude of other issues that can arise if this issue is not correct from the start, and the issues can compound to the point of not being worth the amounts saved from not incorporating another company.