Trust disputes

A trust dispute can be complex and difficult to navigate. As trusts are used frequently for a variety of purposes in Australia, trust disputes can be very common.

Trust disputes can arise for a number of reasons, and when they do, it is important to seek legal advice.

Whether you’re a trustee, trustor, or beneficiary of a trust, our trust dispute lawyers at Gibbs Wright Litigation Lawyers can help you.

Google review profiles
Google rating social proof
Home » Services » Trust disputes
Gibbs Wright are registered members of Law Council of Australia
Ones To Watch - Firm Logo
Gibbs Wright are registered members of Queensland Law Society
exclusively litigation scales of law icon

Trust Litigation

What is a trust?

A trust is a way to control the distribution of property and assets, including money. A trust can ensure that assets are distributed under specific circumstances to specific beneficiaries.

Due to the tax and inheritance benefits associated with trust structures, they are frequently used in Australia.

Fundamentally, a trust is a fiduciary relationship between three separate parties:

what is a trust?

The trustor

The trustor is the person who creates the trust and puts their property into it. The trustor allows the trustee to hold a legal or equitable interest in property, not for the benefit of the trustee but the beneficiary.

The trustee

The trustee of a trust is the person who holds and controls the property inside the trust for the beneficiary. The trustee’s duty is to maintain the trust and they have onerous duties to abide by the rules and terms of the trust deed.

A trust deed instructs how the trust assets can be used, and the trustee is legally bound to carry out those instructions. The assets may only be used according to these instructions and for the nominated beneficiaries.

If a trustee is found to be misusing assets they may be removed and subjected to legal action.

The decision to act as a trustee should not be taken lightly.

The beneficiary

A beneficiary of a trust is a person or entity for whose benefit the property is held. The beneficiary can receive the property in many ways. For example, they can receive the property outright, as a percentage incrementally over time, or as payment for expenses over the beneficiary’s lifetime.

How the trust assets are disbursed depends on the reason(s) for the trust.

what our customers say


What our clients say

…turned our crazy situation into positive new beginnings… We would highly recommend their services to anyone who is in need of professional property lawyers who have your best interests at heart. Thank you Mitchell and Melany!

5 star rating

Rachel Olorenshaw

During the first phone call with Spencer I knew immediately that I was in competent hands. Spencer and his troops moved into position akin to military action… I would strongly recommend contacting Gibbs Wright Litigation Lawyers…

5 star rating

John Christian


Trust structures

Types of trusts

Fixed trusts

A fixed trust is one of the most well-known types of trust. In a fixed trust, each beneficiary is entitled to a fixed proportion of the capital and income of the trust each year.

The trustee is bound to distribute the assets to the beneficiaries according to these fixed amounts and they are not required to exercise discretion since each beneficiary is automatically entitled to their fixed share.

Why do people use fixed trusts?

As the share entitlement of this type of trust is predetermined and fixed, it often means that there is less conflict amongst the beneficiaries of the trust.

Unit trusts

A unit trust is a trust that is divided into units for the beneficiaries. Each beneficiary of the trust holds a certain number of “units” and they are entitled to the income and capital of the fund proportional to the number of units they hold.

The beneficiaries in a unit trust are often referred to as unit-holders and they are able to sell their units in the trust to interested buyers.

Why do people use unit trusts?

Unit trusts are often used by unrelated parties to co-own assets. Beneficiaries each have a fixed interest in the trust’s property. There are also tax and asset protection advantages for unit trusts.

Charitable trusts

A charitable trust is a trust registered for a charitable purpose, such as advancing health, education, culture or human rights. There are no nominated beneficiaries and the trust must fund the charitable purpose stated. The trust must be not-for-profit, have a charitable purpose that is for the public benefit, and must not be a person, political party or government entity.

Why do people use charitable trusts?

Charitable trusts are often used for tax concessions. Registered trusts can for example, apply for income tax and GST exemptions, as well as deductible gift recipient status, and can receive Commonwealth grants. Charitable trust status also helps garner public confidence and donations.

Discretionary family trusts

In discretionary trusts, the trustee has greater control over the way the assets and income of the trust are distributed to the beneficiaries. Unlike fixed trusts, the beneficiaries do not have any fixed interests or entitlements to the property or income of the trust; rather, their entitlement is at the discretion of the trustee. Trustees are also not required to be transparent about the reasons for the allocation of trust assets.

Why do people use discretionary family trusts?

Discretionary trusts are usually used for their business advantages. For example, a person can hold their assets without being the legal owner of the property. As such, in instances where a beneficiary may be pursued by a creditor, becomes bankrupt, or is sued personally, the assets in the trust are protected because they are the property of the trustee not the beneficiary.

Special disability trusts

Special disability trusts are often set up by family members of a person affected by a disability. The aim is to provide a way for that person to be looked after if the family members die.

Assets are left in a trust to fund the person’s ongoing medical, care and accommodation expenses. The trust should not affect the person’s entitlement to a disability support pension.

Testamentary trusts

A testamentary trust is created by a will. The aim is to provide a greater level of control over how assets are distributed to beneficiaries. The trust can provide an entire estate, a specific asset or a specific portion of an estate to a beneficiary.

This type of trust does not come into effect until after the trustor’s death and is commonly used in estate planning. Multiple testamentary trusts can be created by one will.

Child maintenance

A child maintenance trust is usually created due to a family breakdown. However, it can also be used if the parents of a child are not living together, and a financial maintenance order is in place.

Why do people use child maintenance trusts?

A child maintenance trust allows property required for the ongoing support of children to be kept in a trust separate from both parents. Such a trust protects property from creditors seeking a parent’s assets and can reduce income tax payable by parents.

Bare trusts

A bare trust is the simplest form of a trust. The trustee holds the property of the trustor for the beneficiary. The trustee has no duties to perform other than to transfer the property of the trust to the beneficiary when they are instructed.

Why do people use bare trusts?

Bare trusts are used to hold real estate when the property owner prefers not to disclose the ownership.

Hybrid trusts

A hybrid trust combines structures of different trusts. Most commonly, a hybrid trust is a cross between a unit trust and a discretionary trust.

The trustee of a hybrid trust has the discretion to distribute income from the trust to the discretionary beneficiaries. The unit-holders have the right to receive income and capital in proportion to the units they hold.

Why do people use hybrid trusts?

The flexibility of a hybrid trust makes it particularly suitable for situations where two or more unrelated people co-own an investment or business.

Superannuation trusts

A superannuation trust provides retirement or death benefits to its members, the beneficiaries. All superannuation funds in Australia operate as trusts.

Why do people use superannuation trusts?

Superannuation trusts offer tax concessions, flexibility for beneficiaries to make investment decisions to maximise their returns, and a process to accumulate assets which can be used to pay a pension at retirement. However, they require the beneficiaries to pay attention to the performance of their investments, as well as to the economy and changes in legislation.

Types of Estate and Wills Disputes We Can Help With

exclusively litigation scales of law icon


How we can help

Trust disputes are a complicated area of law. Our trust dispute lawyers assist clients with all types of disputes, from minor disagreements that can be resolved through mediation to complex litigation matters involving extensive court proceedings. If you’re an unfairly treated beneficiary of a trust or a trustee accused of breaching your responsibilities, contact Gibbs Wright about your trust dispute today. We offer a free, confidential, no-obligation consultation.




Letter of Demand

court or tribunal

Court Proceedings

what our customers say


Frequently asked questions

Who can be a trustee?

To be eligible as a trustee, a person must be aged at least 18 years, not have a legal disability and be able to own property. The trustee can be an individual or a company.

Due to the complicated nature of trusts and the duties of a trustee, the person taking on the role must be aware of their responsibilities.

Who can be a beneficiary?

The beneficiary of a trust can be an individual or a company. There are really no limits on who can be a beneficiary. Minors, people who are affected by disabilities and even unborn children can be beneficiaries.

Can a trust be disputed?

In most instances yes, a trust can be disputed. When a trust is disputed it means that the validity or authority of the trust is being challenged.

Common reasons for trust disputes involve management of the trust, trustee actions, and division of trust property. Disputes may be brought by beneficiaries or other trustees.

What happens when a trust is disputed?

The way in which a trust dispute is managed depends on the type of trust and the reason for the dispute. It is important to seek legal advice early, to help minimise the harm and damage that can be caused. Call Gibbs Wright Litigation Lawyers for a free, confidential, no-obligation discussion about your options to manage your trust dispute.

When should a trust be created?

There are many types of trusts, so the reason(s) for creating a trust may vary.

Essentially a trust is a form of property ownership which allows others to benefit from the distribution of income gained by the property.

Benefits of trusts include:

  • Providing for family members

A trust can allow a person to share their property with their chosen beneficiaries, for example, their children and grandchildren. A trust can allow the property owner to determine how the property is to be held and distributed. A trust is particularly useful if the beneficiaries are too young, or are unable to manage their own finances.

  • Protecting assets

Another reason trusts are often created is to separate a person’s assets from their estate. When assets are in a trust, they are in the name of a trustee. This helps in situations such as when a business fails, because creditors will be unable to pursue any assets that are in the trust.

Asset protection and trusts are complex, so it’s best to seek legal advice to receive the most up-to-date information.

  • Tax advantages

There are tax advantages to holding assets in a trust. One main advantage is that the income generated by those assets is taxed at the rate that applies to the beneficiary. This rate is often lower than the rate that applies to the original owner.

Because there are many different trust types, it’s important to discuss your options with a taxation lawyer.

Can a trustee also be a beneficiary of a trust?

Yes, a trustee can also be the beneficiary of a trust, but not the sole beneficiary unless there is more than one trustee.

Where a trustee is also a beneficiary of a trust, it is recommended that more than one trustee is appointed to avoid complications regarding the improper exercise of power.

When might I need a trust litigation lawyer?

A trust litigation lawyer can help deal with trusts of any type and in a variety of ways. Most commonly, a trust lawyer is needed if:

  • The validity of a trust is questioned;
  • The distribution of the trust assets is disputed; or
  • The actions of a trustee are believed to be improper.

A trust lawyer can help all key players involved in a trust. They can determine whether concerns are valid and the steps that should be taken to resolve a dispute.

What can be in a trust?

Common assets in a trust, called trust property, include cash, securities, business interests, real estate and life insurance policies.

Are there any time limits on trust disputes?

Under the Limitations of Actions Act 1974 (Qld), there is a six-year time limit for a beneficiary to take action against a trustee, unless the action is related to fraud, or to the recovery of trust property or proceeds of trust property.

What are the grounds for removing a trustee?

In most instances, for a trustee to be removed from a trust, it needs to be proven that removal is needed:

  • Because the trustee has not fulfilled their duties;
  • To protect the trust assets and the beneficiaries; or
  • Because the trustee is exercising their powers in a prejudicial way.

Trustee behaviour that can lead to removal includes when a trustee is:

  • Confused about, or misunderstands, their duties;
  • Unable to be contacted; or
  • Acting in a way that harms the trust.

Why and when are trusts dissolved?

Most trusts will have a date by when they must be formally dissolved. This process is known as vesting. The vesting date is usually included in the terms of the trust deed. In many trusts the vesting date is 80 years from when the trust was created.

When a vesting date is reached, the trust must be dissolved. However, the trust may be dissolved prior to the vesting date, when:

  • It is revoked. A trust may contain a provision that allows the trustee or trustor to revoke the deed.
  • The beneficiaries have consented. All beneficiaries must be aged at least 18, and collectively decide to dissolve the trust, and the trustee must formally declare and record the trust as terminated.
  • A court orders that the trust be dissolved.

When a trust is dissolved, all property held in the trust is distributed according to the trust deed.

brisbane litigation lawyer yusuf
why choose gibbs wright

Why us

Why choose Gibbs Wright Litigation Lawyers

At Gibbs Wright, our trust lawyers have extensive experience in handling all types of trust dispute matters, including caveats, estate and breach of responsibilities. Whether you are a trustee, trustor or beneficiary, we have the skills and experience necessary to help you achieve the best possible outcome.

  • Commercially viable outcomes
  • Dedicated litigation firm
  • Outstanding client satisfaction
  • High success rate
  • Direct contact with your lawyer
  • Brisbane-based litigation team
Team of three litigation lawyers walking to court


Get a callback​

Fill out the form. Provide as much detail as possible. Get a callback within 2 business hours!

If your dispute is urgent please call​ (07) 3088 6364 go