Case: Secretary, Department of Family and Community Services v Geeves [2004] FCAFC 166 ; (2004) 136 FCR 134 
Outcome: discussed
Counsel for the Secretary submitted that "a beneficial interest" would exist for the purposes of par 1207V(2)(d) where there was "the entitlement ... to enforce the due administration of the trust, and ... the capacity to receive property or interest". On this submission, the position at general law was very largely immaterial. Relying on Secretary, Department of Family and Community Services v Geeves [2004] FCAFC 166 ; (2004) 136 FCR 134 (" Geeves ") and Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 29 ; (1998) 194 CLR 355 at 368 and 381, the Secretary argued that a broad construction of par 1207V(2)(d) was consistent with the purpose of Pt 3.18, which was to capture the kind of arrangements made by the testamentary trust in question here. The Secretary maintained that par 1207V(2)(d) was specifically intended to capture discretionary trust entitlements; and that, if I were to accept the Elliotts' submissions, then par 1207V(2)(d) would not operate to capture discretionary trust beneficiaries as intended. The Secretary emphasised the Elliotts' practical capacity to have access to the income and assets of the trust created under clause 5(b) of the will and that they benefited from regular payments out of trust funds. The Secretary noted that all possible discretionary beneficiaries were necessarily "associates" and argued that their interests could be aggregated, with the result that the Elliotts should be considered to pass the control test via par 1207V(2)(d). 40 The authorities provide little direct assistance on the principal question in the case. The Secretary referred to Geeves , which gave rise to the question whether a court-ordered trust fund was to be taken into account in valuing the "assets" held by the sole beneficiary for the purpose of the assets test in s 198(1B) of the Social Security Act . Geeves is, plainly enough, a different case from the present. It did not concern a discretionary trust where the entitlement of a beneficiary is unascertained. Geeves related to a private trust with an ascertained beneficiary, who therefore held a proprietary interest in the property subject to the trust. The Full Court upheld the primary judge's decision that the trust was an "excluded trust" and therefore its assets could not be attributed for the purposes of the assets test. This finding provides no guidance here. Keifel J, with whom Weinberg J agreed, also held that the beneficiary's interest in the trust assets was not to be regarded as 'property' or 'assets' within the meaning of s 11 of the Social Security Act , because the trust assets could not be utilised by the beneficiary: see Geeves at 141. Keifel J's comments in this regard have some bearing on the present case. Her Honour said (at 141-2): The evident focus of the Act, in my view, is upon assets which are available for a person's use. It does not seem to be consistent with the purpose of the Act to require that assets which are not able to be utilised by a person are to be taken into account in assessing whether they qualify for the benefit in question. ... Even on a wider view of property a discretionary trust would not qualify. It could in no sense be said to be the property of a person who is not yet identified as a beneficiary of it. For the purposes of the Act, however, some beneficiaries of discretionary trusts in reality, if not in law, have access to the trust assets because they are in a position to control the trust. The amendments of 2000 recognise and deal with such a situation. They and the Explanatory Memorandum tend to confirm, in my view, that it is assets which are in truth available to a person which are relevant for the purposes of the Act. ... I would therefore conclude that [the beneficiary's] interest in the trust assets would not be regarded as property or assets within the meaning of s 11 of the Act. The amendments of 2000 have the effect however that they would nevertheless be attributed to him. Whilst not in control in the same sense as persons who control discretionary trusts, he would pass the control test set up by s 1207V(2) because his beneficial interest in the trust fund would be 50% or more. The presumption here is that he does have a measure of control because of the extent of his interests. The Secretary's declaration exempts a court-ordered trust, such as that in question here, from the attribution rules. It puts beyond doubt that they are not to be included in the value of the care receiver's assets. It seems to me that, to the extent that this passage elucidates the present question, it tends against the Secretary's argument. First, it emphasises that the purpose of subs 1207V(2) is to make assets that are in reality available to a person relevant for the purposes of determining pension entitlements and, secondly, it underscores the fact that regard must be had to the question of control, having regard to the particular trust in question. This indicates that it is incorrect to view every discretionary trust in the same light; instead, attention must be paid to the particular terms of each trust, whether fixed or discretionary, and to the criteria to which subs 1207V(2) direct attention. 46 Furthermore, Gartside , Anchorage , Carey and Livingston (see Weinberg J's discussion in Geeves at 143) make it plain that, although the object of a discretionary trust holds a bundle of rights, these rights do not necessarily amount to what can be termed an "interest" or "beneficial interest", when considered from the perspective of a particular statute: compare M Stone and V Lesnie, "Some Thoughts on Beneficial Interests and Beneficial Ownership in Revenue Law" (1996) 19(1) UNSW Law Journal 181 at 183 and David Hayton, Paul Matthews &amp; Charles Mitchell, Underhill and Hayton Law Relating to Trusts and Trustees (LexisNexis Butterworths, 17 th ed, 2006) at [1.1]. Of course, this is not to say that, in a particular statute, such rights might not be so regarded and described. The question, then, is whether or not the rights of the discretionary beneficiaries in this case amount to "beneficial interests in the corpus or income" such that they might be "aggregated" within the meaning of par 1207V(2)(d).