By Stuart Eustice, Partner and Rory MacDonald, Associate 

A recent Supreme Court of Victoria decision sheds light on a long‑running family dispute within the Kurtz family, who built a substantial property portfolio over many decades. After the passing of parents Sam and Renia Kurtz in 2022, their three daughters—Helen, Susan and Sandra—found themselves in disagreement about how their parents’ estate and related trusts should be managed.

At the centre of the dispute is a “Letter of Wishes” that Sam and Renia signed in 2021.  This letter, while not legally binding, expressed their desire for some trust assets to be distributed unevenly between the daughters, favouring Susan and Sandra. Helen argues that this letter was created in questionable circumstances, kept secret from her until after her parents’ deaths, and contradicted the equal division intended by the parents’ wills. She also suggests her parents may not have had full capacity when the letter was prepared.

This decision focused not on the substance of the estate, but on the lawyers acting in the case.  Helen applied to have the law firm acting for Susan and Sandra to be removed.  Her concern was that one of the law firm’s senior partners had advised Sam and Renia for years and was deeply involved in drafting the Letter of Wishes. Helen argued that the senior partner is likely to be a key witness at trial, and that the law firm’s involvement raises the risk of a conflict of interest or the appearance that the lawyers are defending their own conduct.

While the Court accepted that the senior partner is likely to give evidence at trial, he emphasised that this alone is not enough to force a law firm to step aside.  Courts will only intervene in exceptional situations—such as where a lawyer has a personal stake in the outcome, or where their evidence is likely to directly contradict their client’s case. On the evidence available, the court found no basis to conclude that such a conflict existed.

Helen had pointed to invoices, file notes and emails to suggest that Susan or Sandra may have influenced the drafting of the Letter of Wishes, contrary to their sworn evidence.  The court accepted that these issues may be explored at trial, but said that the documents did not currently establish any meaningful contradiction between the lawyer’s likely evidence and the position of Susan or Sandra. Much of Helen’s argument relied on speculation about who was behind emails or why particular steps were taken, rather than clear evidence of conflicting instructions.

Another argument raised by Helen was that because the law firm acting for Susan and Sandra had been paid more than $1.6 million in legal fees out of a trust fund connected to the estate, and of which Helen, Susan and Sandra are beneficiaries, the firm itself might be exposed to claims of improperly receiving trust property. The court rejected this, noting that Susan and Sandra—if required—would be able to reimburse the trust themselves.  In other words, there was no real risk that the law firm faced financial exposure that would compromise its independence.

The court also took into account several practical factors. The law firm has acted for the family for years and is deeply familiar with the group’s complex web of trusts, companies and history. Replacing them would cause major disruption, delay the proceedings and lead to significant additional legal costs.

The court found that the high threshold for removing a party’s chosen lawyers had not been met, concluded that a fair minded, reasonably informed member of the public would not believe that the proper administration of justice required restraining the law firm from acting.

The Takeaway point

This ruling does not resolve the underlying family dispute, but it does clarify that challenges to a law firm’s role must rely on more than suspicion or the mere possibility of a lawyer becoming a witness.  Without concrete evidence of a conflict affecting the fairness of the trial, courts are cautious about interfering with a party’s choice of legal representation.