Date: March 30, 2026 (Monday)
Time: 1pm – 2pm
Venue: Rm 723, 7/F Cheng Yu Tung Tower, The University of Hong Kong
In Naaman v Jaken Properties Australia Pty Ltd [2025] HCA 1 the High Court of Australia found that the equitable proprietary interest of a trustee was not in the nature of a beneficiary’s interest held on trust, but rather, has the character of an equitable lien. There was widespread concern following this decision that absent being owed fiduciary obligations, the trustee’s interest is limited to taking prophylactic steps to protect its interest and that a former trustee is powerless to seek recourse against a successor trustee who dissipates trust assets.
In this paper it is argued that a removed trustee’s equitable lien is not such a weak form of protection. Whilst it is difficult to find an overarching rationale that explains the basis for equity’s recognition of the various forms of equitable lien, they nonetheless share a ‘bundle of rights.’ These include rights to seek the assistance of the court upon threat of dissipation of the assets, or orders for sale, or appointment of a receiver. Furthermore, at least in the context of a solicitor’s equitable lien for payment, courts of equity have also ordered equitable compensation against a defendant who, with knowledge or notice of the interest, dissipates assets over which a lien exists and is liable for ‘his own wrong’: Welsh v Hole (1779) 1 Doug KB 238 (Lord Mansfield). This paper argues that the normative justifications for such personal liability are not unique to the solicitor’s lien and apply equally to a removed trustee in enforcing its lien. This is consistent with observations by Brereton J in Lemery Holdings Pty Ltd v Reliance Financial Services Pty Ltd (2008) 74 NSWLR 550 that ‘the former trustee can ensure the new trustee does not take steps which will destroy, diminish or jeopardise the old trustee’s right of security…’
Dr Allison Silink is an Associate Professor in the Faculty of Law at the University of Technology Sydney, and a barrister in New South Wales. She was called to the bar in 1997 prior to which she was the associate to Justice Sheppard in the Federal Court of Australia. Her teaching, research and practice are in private and commercial law with a focus on equity and trusts, tort law, insolvency and banking and financial services, and she is widely published in these areas in Australia and internationally.
Moderator: Kelvin Low, Professor, The University of Hong Kong Faculty of Law
To register, please visit https://hkuems1.hku.hk/hkuems/ec_regform.aspx?guest=Y&UEID=105608.