From hallandwilcox.com.au: The High Court of Australia ruled by a 4:3 majority that a new trustee does not owe a fiduciary duty to a former trustee regarding the former trustee’s right to indemnification from trust assets.

This decision clarifies that a former trustee can seek court orders for the sale of trust assets to satisfy its right of indemnity and does not create fiduciary duties simply due to the new trustee holding property subject to these rights.

Insolvency practitioners are advised to pursue receiver appointments and interlocutory injunctions to protect the rights of former trustees entitled to indemnification from trust assets.