Late in 2017, the HESTA Trustee brought proceedings in the Supreme Court of South Australia in relation to the HESTA Trust Deed. HESTA members were represented in the proceedings by a representative member, appointed by the Court. The Australian Prudential Regulation Authority also participated in the proceedings. The Court has recently made orders in the proceedings.
What were the proceedings about?
The Trustee brought the proceedings because it believed that the terms of the Trustee’s amending power in the Trust Deed were unclear and needed to be amended. It also wanted the other terms of the existing Trust Deed to be confirmed by the Court, in view of the fact that there were doubts about whether some previous amendments had been made in accordance with the terms of the Trustee’s amending power.
It is important for the Trustee and members that the Trustee is able to vary the Trust Deed from time to time to address the changing needs of members and changes to the law. It is important for the amendment power to be clear. The Trustee can only exercise its power of amendment if it considers that an amendment to the Trust Deed is in the best interests of members.
The representative member was independently represented before the Court and substantially agreed with the orders sought by the Trustee. The representative member reviewed all documentation presented to the Court and drew to the Court’s attention a number of issues to be considered by the Court prior to making the orders sought.
The Trust Deed has also been amended to include additional provisions requiring the Trustee to notify members of significant changes affecting their superannuation accounts. These include amendments to the Trust Deed or a decision to close an investment option or to transfer a member's superannuation account to another Division or fund (although the Trustee is in any case normally required to notify members of these changes).
The Trustee did not ask the Court to determine whether previous amendments to the Trust Deed were validly made but sought orders confirming the terms of the existing Deed going forward, on the basis that it was desirable to ensure certainty about those terms.
The Court’s orders do not have retrospective effect and do not affect the rights of members prior to the date of the orders.
The terms of the Trust Deed as ordered by the Court are contained in a copy of the Trust Deed available at hesta.com.au/disclosure.