Decision on Surplus Distribution: Invensys Australia Superannuation Fund Pty Ltd v Austrac Investments Ltd

A recent decision of the Supreme Court of Victoria¹ sheds some light on some key issues for superannuation trustees. The background to the case is as follows.

An actuarial review of the Invensys Australia Superannuation Fund showed it to be in surplus to the tune of $189.2 million. In mid 2003, the Invensys Group proposed to the trustee that the surplus be repatriated to the principal employer in the group. The trustee rejected that proposal. After discussions between the trustee and the principal employer, a new proposal for the distribution of the surplus was agreed.

Following that agreement, the trustee sought orders of the court (in summary) to distribute $85.8 million of that surplus ($36 million to members and $49.8 million to the principal employer).