BrodiePty Ltd is the trustee of the Brodie family trust. The trustee operates aliquor retail store at a building owned by Brodie Pty Ltd as trustee for thefamily trust. Recently, the sole director...

Issue:
The issue is from whom, if anyone, can Winits Pty Ltd recover $15,000?
Law:
The applicable law is contained in Section 197, combined with Sec 283AC of the
Corporations Act 2001.
As per Section 283AC of the Corporations Act 2001 relating to who can be a trustee; besides
others, the trustee must be a body corporate, approved by ASIC.
As per Section 197 of the Corporations Act 2001, a director is liable to discharge all debts
and other obligations which are incurred by the corporation as a trustee. Further, he or she is
liable both individually, as well as jointly with the corporation. As per Section 197 (1), the
director will not be so liable merely because of insufficiency of trust assets.
As per the definition of trust, a trust is an obligation which is imposed on a person or an
entity to hold some property for the benefit of the beneficiaries of that. A trust is not a legal
entity, but is rather a relationship. In rather simpler terms, the owner of property which may
be real estate, shares, money, or a business, creates a trust over such property.
The relevant case law is Kerry...