Case in Point | January 2025

The recent case of Brady v NULIS Nominees (No 4) provides an instructive summary of the legal scope and practical implications of several SIS Act covenants, notably the so-called ‘best interests duty’, and the ‘care, skill, and diligence’ duty. The case reiterates that the statutory burden on superannuation trustees to seek out and evaluate information that is relevant to its discretionary decisions is more onerous than at general law and in other forms of trust. It also affirms previous findings that the discharge of the ‘best interests duty’ is prospective rather than retrospective, and is predicated on a reasonable assessment of the circumstances which exist at the time a decision is made. It does not require trustees to achieve a ‘perfect outcome’. The case raises further questions about the nature of a transferring member’s interest in a receiving or merged fund after a Successor Fund Transfer occurs.