ASIC v Wellington Capital Ltd [2013] FCAFC
52
Introduction
For those who work with managed investment schemes
(MIS) or, indeed, trading trusts structured as
unit trusts, the decision of the Full Court of the Federal Court in
ASIC v Wellington Capital Ltd [2013] FCAFC 52 (28 May
2013) is troubling. The Court held that, despite the presence in a
MIS constitution of a universal or plenary powers clause of the
type commonly seen in the Australian market, a responsible entity
did not have power to distribute trust assets in specie to
the unit holders. In overturning an ex tempore decision of
Jagot J at first instance1 the Court took a narrow
interpretation of the terms of the universal powers clause.
However, beyond the interpretation question, the Court appeared to
conflate trustees' powers with the duties incumbent upon them
in exercising their powers. There is also some puzzling analysis,
at first instance and in argument in the appeal, of the
relationship between
