Thursday, May 26, 2016
"An interesting decision regarding the arbitrability of internal trust disputes (ie, those involving the trustee and beneficiaries rather than the trust and a third party entity) has just been handed down from the Federal Court of Australia. In Rinehart v. Rinehart (No. 3)  FCA 539 (26 May 2016) (the saga has been going on for some time), the court considered a number of key issues.
The instant dispute involves an order sought by Mrs Rinehart " pursuant to s 8(1) of the Commercial Arbitration Act 2010 (NSW) (“NSW Act”) that the parties to this proceeding be referred to arbitration in respect of the matters the subject of the proceeding." Ultimately, the court decided there should "be a trial of the question whether any of the following agreements is null and void, inoperative or incapable of being performed within the meaning of s 8(1) of the Commercial Arbitration Act 2010 (NSW) or the Commercial Arbitration Act 2012 (WA)."
The opinion considers sixteen agreed questions and is both very long (669 paragraphs) and very comparative, taking into account case and statutory law from a number of common law jurisdictions as well as international law (i.e., construction of the New York Convention). One of the key issues focused on whether the trust could be considered commercial and thus within the scope of the commercial arbitration statute."
Summary written by Stacie Strong, Manley O. Hudson Professor of Law, University of Missouri.
For the full decision—Rinehart v. Rinehart.