Trading Trusts—Oppression Remedies
Tabled in Parliament Date:
A trading trust is a popular way to structure a business, an alternative to forming a company. Like other trusts, a trading trust has a trustee that holds property on behalf of beneficiaries. The difference is that a trading trust carries on a business. Trading trusts are used by many small family businesses as well as larger enterprises. However, problems can arise if beneficiaries want to leave the trust or change the way the trust is run, but are prevented from doing so. Unlike company shareholders, there’s no clear way to obtain relief from oppressive conduct.
In October 2013, the Commission was asked to review and report on oppression remedies for beneficiaries of trading trusts. In January 2014, after initial research, it produced a consultation paper that outlined the law and the problems with it and asked for submissions.
Seven submissions, three expert consultations and a roundtable discussion fed into the final report delivered on 3 February 2015. In it, the Commission recommended certain changes to the Trustee Act 1958 (Vic) to give beneficiaries in trading trusts new rights and legal recourse for oppressive conduct by trustees.
The report and other documents can be downloaded from the links below.
- Terms of reference received
- Submissions and consultations
- Submissions closed
- Final Report
- Tabled in parliament