It’s the classic question that arises time and time again in the law of trusts: can a person assert that he or she did not intend to create a trust, even if he or she has properly manifested an intention to create a trust? Equity lawyers would be familiar with the case of Mr Jolliffe in Commissioner of Stamp Duties (Qld) v Jolliffe (1920) 28 CLR 178; indeed, they may have come across a few Mr Jolliffes in their careers. Mr Jolliffe opened and deposited funds into a savings account in his wife’s name, designating himself as “Trustee” and signing a statutory declaration that he was a depositor as the “bona fide trustee” of his wife. On the face of it, a trust was created in favour of Mr Jolliffe’s wife; but is this what he had intended? The findings of fact were that Mr Jolliffe’s “real” intention was to procure interest that would not be available to him if the funds were placed in his own name, because the Queensland Government Savings Bank Act 1916 (Qld) at the time prohibited a person from having more than one account in the Queensland Savings Bank, except for accounts held in trust for other persons.
A majority of the High Court held that Mr Jolliffe did not intend to create a trust and therefore no trust was imputed against him. In dissent, Isaacs J found that the declaration made by Mr Jolliffe was an unambiguous declaration of trust, which was an “expression of intention that is final and beyond recall” and the result of which could not be affected by Mr Jolliffe’s subsequent assertion of his undisclosed “real” intention.
More than 90 years later, the High Court in Byrnes v Kendle  HCA 26 rejected the majority judgment in Commissioner of Stamp Duties (Qld) v Jolliffe, finding the dissenting judgment of Isaacs J to be preferred in Australia as a statement of trusts law generally. The Court found that where there is a written declaration of trust or written evidence manifesting the intention to create a trust, it is irrelevant whether or not the settler secretly intended to create a trust, and evidence was not admissible to contradict the intention manifested by the declaration or written evidence. The exceptions are where there are the recognised vitiating factors of fraud, undue influence, duress, or the non est factum principle.
In his update of Chapters 1-3 of The Laws of Australia Subtitle 15.13 “Trusts”, Author and Research Consultant Alun A Preece provides an in-depth analysis of the High Court’s decision. Preece argues that “Byrnes v Kendle has very much confined virtually to its own facts the authority of Commissioner of Stamp Duties (Qld) v Jolliffe, which allowed a party … to successfully argue that the trust was a sham”.
It appears that the Court had its sights firmly set on cases where a person asserts his or her “shamming intent” to defeat the effect of a declaration of trust. As French CJ at  stated: “Given its statutory and factual setting, Jolliffe should not be taken as authority for the general proposition that where there has been an explicit written declaration of trust, unaffected by vitiating factors, evidence is admissible to contradict the intention to create a trust manifested by the declaration.”
Preece says that there are too many complexities and nuances in the judgments in Byrnes v Kendle to regard this as a simple case of a previous decision being overruled, but, he argues, it is probably fair to say that as a result of Byrnes v Kendle, Commissioner of Stamp Duties (Qld) v Jolliffe has been confined in its operation and reduced in authority.