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Supreme Court of Vanuatu |
IN THE SUPREME COURT OF
THE REPUBLIC OF VANUATU
(CIVIL JURISDICTION)
CIVIL CASE NO. 175 OF 1997 and
COMPANY CASE No. 22 of 1997(Consolidated)
IN THE MATTER OF: THE SABRA TRUST
BETWEEN:
GEORGE ATKINSON
Plaintiff
AND:
GEOFFREY ROBERT GEE
First Defendant
AND:
JAMES NOALL
Second Defendant
Coram: Mr Justice Oliver A. Saksak
Clerk: Mrs Anna Kasten
Counsels: Mr Hodgekiss and Mr Ozols for the Plaintiff
Mr J. Malcolm for the First Defendant
Mr Waterstreet and Mr Blake for the Second Defendant
Dates of Hearing: 28th – 31st August and 1st September, 2000
RESERVED JUDGMENT
The case has quite a long history and it is not necessary for me to go back on it. It suffices to say that the only issues before this Court to consider and determine in the light of the evidence before it are matters contained in the Plaintiff’s originating summons filed on 10th December 1997 pursuant to Order 58 of the High Court (Civil Procedure) Rules 1964. The Plaintiff seeks the following declarations:-
(a) That pursuant to the term of the Sabra Trust and in accordance with the actions taken by the Defendant the Plaintiff acquired the Sabra Trust in 1994 and that he became the “Protector” of the trust.
(b) That the term “Protector” as used by the trustee is synonymous with the term “Nominator” used in the Deed of Trust and that the Plaintiff has the power, inter alia, to nominate or remove beneficiaries pursuant to the terms of the Deed of Trust.
(c) That by written direction dated 17th September 1997 the Plaintiff has validly appointed Mr Gordon Atkinson as sole beneficiary of the Sabra Trust.
(d) That the First Defendant as Trustee of the Sabra Trust is bound by law to put into effect such charge of beneficiary.
(e) That the First Defendant as Trustee is bound to comply with the limitations found in clauses 2 and 3 and elsewhere in the Deed of Trust to comply with the directions of the Plaintiff as Nominator and/or seek his written consent as the case may be.
By Order of this Court dated 27th May, 1997 Second Defendant has been held to be the beneficial owner of all issued shares in Atlas Investments since 15th June, 1995. That is still the position of the Court. The Plaintiff has not at any time sought to have those Orders set aside or appealed against. Therefore in my view the issue of beneficial ownership is a dead issue.
During the trial of this matter the Second Defendant was not available due to illness. A medical report dated 23rd August 2000 confirms that fact. It is in evidence as Exhibit D2. In any event, he was no longer required to give evidence as he had given his evidence adequately on 15th March, 1999 in the trial as to the authenticity of a signature purported to be his. The Plaintiff was not available at that time. Mr Atkinson, the Plaintiff has plainly acknowledged and admitted that James Noall the Second Defendant is the beneficial owner of the Sabra Trust. I set out below in full Exhibit P25 which says it all –
“Mr J.W. Sackville,
11th Floor,
63 Exhibition Street Tele: 03.96546488.
Melbourne. Vic. 3000
Dear Mr Sackville,
James Noall has requested I pass on to you details of certain circumstances that have occurred concerning the writer over the past two years.
1. In or around May 1994 I spoke to JN regarding monies lost to bookmakers Lindsay Gallagher (Brisbane) Collin Tidy (Sydney) Michael Webster (Adelaide) Alan Tripp (Vanuatu).
2. In or around June 1994 my ex-wife started an action for property settlement.
3. In or around June 1994 I was locked into a property deal, the property was situated in the Hunter Valley at Muswellbrook in the State of New South Wales.
4. The property was purchased through Atlas Investments Limited, an Offshore Company, registered in Vanuatu.
5. Business associates who agreed to participate in the property deal now found they were unable to complete.
6. I was locked into the deal, I had agreed a purchase figure of $880,000 and had paid a deposit of $88,000., stamp duty and legals came to further $40,000. A total of $128,000.
7. I settled with the on-shore bookmakers , but was unable to settle with Tripp and complete the property deal.
8. Following further discussions with Tripp and JN I used monies available to me to settle the property deal.
9. JN arranged the settlement with Tripp.
10. For this consideration I transferred the shares of Atlas Investments Limited to a Trust, the Trust is known as the Sabra Trust, the Trustee is Geoffrey Gee, and attorney resident in Vanuatu.
11. James Noall is the beneficiary of the trust.
12. On February 12th 1996, Justice Purdy of the Family Court of Australia decided in his judgment the subject property bought by Atlas Investments Limited was my ‘alter ego’ and ceded the property to the ex-wife.
13. The property settlement is subject to an appeal set down for hearing on the 4th July, 1996.
14. Geoffrey Gee, the Trustee of the Sabra Trust believes JN and I should have had an exchange of letters around the time when the shares were transferred. See my letter to JN dated 25/05/94.
15. I requested JN to re-type, sign and return the draft letter dated 6/6/94. JN asked me to forward a copy of the draft letter for your opinion, JN will telephone you in due course.
16. There are three other enclosures.
Signed: G. Atkinson
12/04/96”
In paragraph 14 Mr Atkinson is referring to his letter dated 25/5/94. In fact it appears that he got the date wrong. The correct date is 23rd May 1994. It is written on his letterhead. I set it out in full below-
“23rd May 1994
Tel: 61.2.3623376
James Noall
C/- The Swiss Hotel,
Istanbul
TURKEY.
Dear Jim,
Further to our recent telephone conversations.
I appreciate your offer to help me through my present problems, the situation is as I explained, I do not believe any documents are required providing we have an exchange of letters, it is a Bearer Share deal, and as such is exempt from transfer fees or stamp duties.
For the record, we have agreed a figure of AUD$800,000.
Regards
Signed: G. Atkinson.
Ps. Sorry to be so formal, but I feel I should put my signature to this letter.”
In paragraph 15 Mr Atkinson refers to a letter dated 6/6/94. No doubt he prepared it for Mr Noall to retype and sign. There is no signed copy of the letter on record . I set it out in full below –
“C/- The Swiss Hotel,
Istanbul
TURKEY.
Dear George
Alright Smedley, I owe you a favour, I’ll get you off the hook.
I will take over the Muswellbrook property, and arrange to clear your debt.
Agreed value of the property Aust.$800.000.00.
As I informed you I still have the Trust I set up in Vila some years back, the Trust is in the care of Geoffrey Gee & Partners Attorneys, PO Box 479, Port Vila, Vanuatu. Tel. 22067 Fax. 23710
Geoffrey Gee is the Trustee.
The Trust is known as the ‘Sabra Trust’ the Trust will require all the shares in Atlas Investments Limited, you will have to instruct the Nominee Company to transfer the Shares to the Trust.
I need to receive documentation in due course that all the income from Muswellbrook will be for the benefit of the Trust.
I have spoken to Stig in Port Vila, you have his number if you require his services.
Until I am in a position to return to Australia, I leave it to you George to administer on my behalf.
Take care Smedley,
JAMES NOALL
6/6/94”
It appears that Mr Noall was not communicating with Mr Atkinson so that on 28th January 1997 Mr Atkinson wrote again on his letterhead from PO Box 451 Double Bay 2028, Australia. I set out below the full text of the letter –
“Tuesday 28th January, 1997 Tel: 61.2.93623448
Dear Jim
I shall telephone you in a few days time.
I won my appeal in the matter of Atkinson/Atkinson as did the Company Atlas Investments, the matter has now been sent back to Parramatta for a new hearing.
On the 12/04/96 following your request I wrote to Mr Sackville, your family Solicitors, I followed up with a phone call to Mr Sackville.
Mr Sackville said he would advise you to follow the advice of Geoffrey Gee, your attorney in Port Vila.
Geoffrey Gee, the Trustee of the Sabra Trust said we should have exchanged letters regarding the transfer of shares from me to the trust.
I enclose:-
1. My letter to Mr Sackville dated the 12/04/96
2. My letter to you dated 23/05/94
3. Draft of a letter dated the 6/06/94 from you to I, this letter should be retyped in a similar vein and returned to me at the above box number.
Regards,
Signed (G.A).”
The signature on this letter is very much different from the signature of Mr Atkinson on his letter of 23rd May, 1994 to Mr Noall.
Then on 16th February 1997 Mr Noall sent a hand-written facsimile which is in evidence as Exhibit P24. Page 1 of the fax is set out below –
“For Your Eyes Only 6 Pages INC This Page.
From Jim
800’000
To NUMBER ONE BETTING SHOP
Stamp Duty & Legals 497’000
To GA 40,000
Original Deposit to GA 88,000
Balance of Moneys to GA 175,000 ____________
800,000 800,000
TRANSACTION CARRIED OUT BY ‘STIG’ &
ACCOUNTANT IN PORT VILA, VANUATU
_______________________________________
IMPORTANT YOU NOTIFY GEOFF GEE RENT
REQUIRE HAS DUE ON PROPERTY JAN.97”
_______________________________________
Bank records for the 1995 were subpoenaed but they were not helpful. The relevant records would have been for the year 1996 – 97 in the light of the above facsimile. But there were not produced nor were they called for.
But a very revealing document in evidence is Exhibit P6. It is an undated note of acknowledgment from the Number One Betting Shop in Port Vila. It is on Official letterhead providing full details of postal addresses both in Vanuatu and in Australia. It contains also telephone and facsimile numbers in Vanuatu and in Australia. It reads as follows:-
“TO WHOM IT MAY CONCERN”
It may be stated categorically, all monies due to this agency by (Mr) George Atkinson have been paid in full .
We are aware funds were made available to (Mr) Atkinson from the transfer of shares of the Company, Atlas Investments Limited .
Signed: Donald Harry
(Licensee Nambawan Betting Shop)”
Mr Alan Tripp, second witness for the Plaintiff gave evidence both by affidavit and orally . He denied that the Plaintiff owed US$ 350,000 to his Betting Shop . He denied that his business ever received this sum from Mr Noall or from any of his business associates . He confirmed that Donald Harry was a licensee with him in 1995, that Donald Harry is Ni-Vanuatu and that he had not discussed the matter with him . He denied ever seeing the above document in 1995 or at any time . It was a fax dated 11th May 1995. It was produced at the Plaintiff’s request but it was not disclosed by him or Mr Tripp.
I find it hard to believe that Mr Tripp being the operator who had the day to day carriage of the business had never seen the letter signed by Donald Harry . It did not matter therefore that Donald Harry was not called to confirm the document . Being on the letterhead of the business it was an official acknowledgement from the Number One Betting Shop and not from Donald Harry personally. On that basis it is an admissible evidence from the business whose operator is the deponent of the evidence. The rest of Mr Tripp’s evidence lacks credibility.
From the documents set out earlier there be can be no doubt in my mind that Mr James Noall is the sole beneficial owner of the Sabra Trust.
But Mr Atkinson now asserts that this is not so. He is now claiming that under the Deed of Trust there was a discretionary trust held for the benefit of Mr Atkinson. So I will examine some relevant documents. Firstly the Minutes of Trustee Meeting of Sabra Trust held at its registered office, Port Vila on 24th October, 1994. Present was Mr Geoffrey Robert Gee, the Trustee. Two resolutions were made as follows:-
“1. THAT George Atkinson c/- KPMG Peat Marwick become Protector of the Trust and that the Trustee at all times act on his instructions including nomination of new Trustee if declined and/or status of beneficiaries.
2. THAT Sabra Trust become beneficial owner of the shares in Atlas Investments Limited, P O Box 212, Port Vila and Share Transfer be executed in favour of the nominee of Geoffrey Gee & Patners for the Sabra Trust.”
Then on 15th June, 1995 it was resolved as follows:-
“THAT as instructed by George Atkinson Mr James Noall of Istanbul to be nominated as beneficiary of the Trust but that all instructions to the Trustee in relation thereto be approved by G. Atkinson.”
Subsequently the Trustee executed a Declaration of Trust dated 15th June, 1995 that reads in part as follows:-
“BY THIS DEED SATELLITE HOLDING LIMITED, PO Box 782, Port Vila (the “Trustee”) declares that although it is the apparent beneficiary under a certain Trust called the SABRA TRUST settled on October 12, 1990 (the “Trust”) as set out in the First Schedule hereto it holds as trustee and not the beneficiary thereof or the beneficiary entitled to any right, title or interest thereunder but only on behalf of and as trustee for the person or company named in the Second Schedule hereto (“the Beneficiary”)….
SECOND SCHEDULE
James Noall of Swiss Hotel, Istanbul, Turkey.”
Then there is the Deed of Trust (the Deed) itself which is difficult to understand. In Clause 1 (I) “the trustee” means the original trustee who is named as Geoffrey Robert Gee, the First Defendant herein.
Clause 3 defines “the beneficiaries” to mean –
“(a) SATELLITE HOLDING LIMITED
(b) such charitable institutions or purposes as the trustees shall see fit and as are deemed charitable in accordance with English law as applicable in Vanuatu.
(c) any person (as defined in the schedule to the Interpretation Act 1981) as the nominator or (if the nominator be an individual) after his death his legal personal representative or representatives shall from time to time by notice in writing to the trustee during the specified period appoint to e beneficiaries for the purpose of this Deed (not being:-
(i) the nominator;
(ii) the nominator’s legal personal representative or representatives whether in their capacity as such legal personal representative or in their personal capacity;
(iii) the settlor; or
(iv) any person or company who or which is or has been a trustee of the trust fund).“
The nominator is specifically named in Clause 4 of the Deed as WATERFORD LIMITED. The settler is Regent Limited.
Clause 2 of the Deed specifies both the duties and the power of the trustee. Clause 2(4) gives the trustee power to “create protective or discretionary trusts or powers operative or exercisable at the discretion of any persons or person corporations or corporation;“
Clause 2 (6) of the Deed gives the trustee power to –
“generally make or confer in favour or for the benefit or all or any of the objects of this power of appointment all such dispositions charges or powers of or in relation to the trust fund and the income thereof or any part or parts thereof respectively as an absolute owner could lawfully make or confer of or in relation to any property belonging to him beneficially (regard being had nevertheless to the law relating to remoteness) PROVIDED always that no exercise of the power or powers conferred by this clause shall invalidate any prior payments or application of the trust fund or income thereof or any part or parts thereof respectively made under any power conferred by this Deed or by law AND PROVIDED also that the trustee may at any time or times by deed extinguish (or restrict the future exercise of) the power or powers conferred by this clause AND PROVIDED further that no exercise of the power or powers conferred by this clause 2 shall be effective without the consent in writing obtained in advance by the Nominator.”
Then on 1st December, 1999 Waterford Ltd, the Nominator issued a letter to Geoffrey Gee & Partners authorizing them to remain and to continue to act on their behalf in the following terms –
“Dear Sirs,
WATERFORD LIMITED – TRUST DEEDS.
I write to confirm that from inception of your request in 1987 to Mr Tony Richie, then director of Price Waterhouse, Port Vila Office, that the utilisation of Waterford listed as a Nominator in your Trust Deeds was and continues to be on the basis that such use was in a nominee capacity only and that at all times Geoffrey Gee was and remains fully authorised to act on behalf of Waterford Limited and without recourse to us specifically in relation to its position as nominator in all Trust Deeds engrossed and settled by that firm were Waterford Limited is listed as nominator provided Geoffrey Gee remained both Trustee under the Trust and Proprietor of his law firm .
Yours Faithfully,
Waterford Limited
Signed: Mark Conway
Director.”
In my view that letter amounts to a consent under clause 2(6).
On 24th September 1997 Mr Atkinson wrote the following letter on letterhead from 40 Northland Road, Bellevue Hill, Australia 2028 –
“24th September, 1997 Tel : 93623448
Mr Mark Johnson,
GPO Box 119,
SYDNEY NSW 2001
I am in receipt of your letter dated the 23rd September inst; which was delivered by courier, and received by the writer at approximately 5.45 pm on that day .
I have noted the contents, and in reply I must state:-
1. I have no control over the company known as ‘Atlas Investments Limited.’
2. I have no control over the affairs of a trust known as ‘Sabra Trust.’
3. I signed ‘Consent Orders’ in the family Court of Australia at Parramatta on 19th June, 1997 . I now realise it was wrong in law for me to sign Orders that concerned entities over which I have no control .
4. Had I been represented by a qualified lawyer the Orders would never have been signed.
5. On the 23rd September 1997, I filed at the Family Law Court, Sydney Registry the following documents, Application – Affidavit – Financial Statement – Final Orders, these documents were served on the interested parties. In my Application I requested on behalf of myself and Barkus Pearson, Solicitors for Mrs Atkinson, that all the Consent Orders be vacated or set aside pending a further determination of the Court.
6. I have forwarded your letters of the 17th and 25th September last to Geoffrey Gee and Partners, Port Vila, Vanuatu, your instructing Solicitors, who no doubt will advise you in due course.
Yours faithfully,
Signed: George Atkinson
By facsimile, original by mail.
Copies to:-
Barkus Pearson
Geoffrey Gee.”
I have examined the oral evidence of the Plaintiff together with his affidavit evidence and the many other documents tendered by him into evidence. I have found numerous inconsistencies, so much so that I must conclude that Mr Atkinson cannot be a truthful witness. His whole evidence lacks credibility. I must however accept that what he said in his letter to Mr Mark Johnson in his letter of 24th September 1997 at paragraphs 1 and 2 is the truth. I must also accept that Mr Atkinson’s letter of 12th April, 1996 to Mr Sackville reflects the true position as between himself and Mr Noall. Further, I must accept that his letter of 23rd May 1994 to Mr Noall reflects the true position of the matter as between himself and Mr Noall. This includes the purported reply by Mr Noall to Mr Atkinson of 6th June, 1994.
There is nothing in those correspondences to suggest or indicate that the arrangement was that James Noall would hold in trust for Mr Atkinson as the ultimate beneficiary. Mr Atkinson specifically admitted in paragraph 11 of his letter to Mr Sackville that Mr Noall is the beneficiary of the trust. That admission is consistent with his instructions to the trustee to transfer AU$92,000 to Mr Noall’s account in Switzerland on 23rd March, 1997. What Mr Atkinson was doing in effect was simply administering the funds from the Muswellbrook property on behalf of Mr Noall, the beneficiary. By doing so Mr Atkinson was complying with the instruction of Mr Noall to him in his letter of 6th June, 1994 (see last sentence).
It is in the light of that last sentence that the Deed of Trust must be construed. For ease of reference I quote the sentence again as follows:-
“Until I am in a position to return to Australia, I leave it to you George to administer on my behalf.” (underlining, mine)
Much of what was said and done is privy only to Mr Atkinson and Mr Noall. I have heard both Mr Atkinson and Mr Noall give oral evidence. Due to the many inconsistencies in Mr Atkinson’s evidence I do not regard him as a truthful witness. I accept Mr Noall’s evidence in the light of the acknowledgements and admissions made by Mr Atkinson in the various correspondences set out herein to be the truth.
Mr Atkinson cannot now ask the Court to interpret the Deed of Trust and the Resolutions of the two meetings of 24th October, 1994 and of 15th June, 1995 in any other way. The Court must construe the wording of the Deed and these Resolutions according to the true intent of the persons involved. And the true intent from the correspondences herein set out is that Mr Noall was to be the beneficiary and Mr Atkinson was to ‘administer’ on his behalf. That is consistent with clause 1 (3) (c) (i) of the Deed which specifically provides that the beneficiary cannot be the nominator. If Mr Atkinson claims to be the nominator then under this provision he cannot be the beneficiary as well. But Clause 1 (4) specifically provides that the nominator here is Waterford Limited, not Mr Atkinson. The beneficiary is James Noall nominated as such under a Declaration of Trust, Schedule Two dated 15th June, 1995. He is the only named beneficiary. And he is neither the ‘ protector’ nor the ‘nominator’. Different persons or entities do that for him. Mr Gee and/or his nominees and Mr Atkinson are examples of such persons and entities.
Mr Gee explained what the position of Mr Atkinson was and is at paragraph 15 of his affidavit dated 19th may, 2000. It reads as follows:-
“That at the same time and as discussed with the Plaintiff to provide the Plaintiff with ongoing authority to deal with the Assets of the Trust. I nominated him as the overseer of the Trust Assets and the general status of the Trust but again made it quite clear that ultimately this was always subject to the wishes of the beneficiary and provided there was no such instruction then his position as overseer of the Trust Assets and dealings with them would continue.”
The term ‘overseer’ is defined in the New Collins Dictionary as “boss”. Reading Resolution 1 of the Minutes of Trustee Meeting of 24th October, 1994 it appears to me that being in the position of ‘protector’ of the trust then, Mr Atkinson was the boss. In other words at the time, he was the beneficial owner of the Trust. However all that changed when on 15th June, 1995 Mr Noall was declared to be the sole beneficial owner. Mr Atkinson knew the circumstances that warranted that change. He conceded in his letter to Mr Sackville dated 24th September, 1997 that he had no control over both Atlas Investments Limited and the Sabra Trust (paragraphs 1 and 2). In my considered opinion Resolution 1 of 24th October 1994 is no longer operative. It was rendered in-operative by the change of beneficial ownership in 1995 and remains as such to this day, and I so rule.
That being so, when Mr Atkinson nominated his brother Gordon Atkinson on 17th September, 1997 as sole beneficiary of the Sabra Trust, firstly he did it contrary to what he advised Mr Sackville seven (7) days later on 24th September, 1997. Secondly, that nomination was purportedly done pursuant to his authority in Resolution 1 of 24th June, 1994. However as I have earlier ruled, on 15th June 1995 that authority had ceased. Therefore it follows that on 17th September, 1997 Mr Atkinson was no longer the protector of the trust and it follows further that he had no authority to make the nomination that he did, and I so rule.
The First Defendant therefore was and is not bound by law to put into effect Mr Atkinson’s nomination of 17th September, 1997. The First Defendant is now only bound to take and comply with the instructions from or by Mr James Noall, the Second Defendant as the beneficiary of the Sabra Trust and/or the nominator, Waterford Limited.
For those reasons I must also conclude that the First Defendant was not negligent and there was no breach of a retainer on his part.
The Plaintiff’s Originating Summons is dismissed in its entirety. The Plaintiff will pay the First Defendant’s costs of and incidental to these proceedings. The Second Defendant’s costs are to be paid out of the funds of the Trust.
Dated at Luganville this 31st day of July, 2001
BY THE COURT
OLIVER A. SAKSAK
Judge
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