Background
When Kylie Hrysanidis died on 7 November 2021, she left a superannuation death benefit of $348,600 under the Retail Employees Superannuation Trust. The trustee paid the entire amount to her de facto partner, Veljko Radanov, with whom she had lived since October 2019. Her three adult children—Alexandra, Caitlin, and Christopher—disputed the decision through the Australian Financial Complaints Authority (AFCA), arguing the benefit should be shared among them as well.
The deceased’s circumstances were complex: she had suffered a stroke at age 34, was diagnosed with severe cardiomyopathy at age 47, and was not working at the time of death. During her final months, Radanov was supporting her financially while also accumulating rent arrears. The deceased had also expressed a wish to leave assets to her children. Under the superannuation fund rules, the trustee had broad discretion to distribute the death benefit to dependants in such proportions as it determined.
AFCA examined the statutory definition of “dependant” under the Superannuation Industry (Supervision) Act 1993 (Cth) and found that Radanov, all three children, and the deceased’s former spouse were all dependants. After a detailed review, AFCA determined the trustee’s decision was unfair and unreasonable and substituted its own determination.
The Court’s Holding
Justice Goodman upheld AFCA’s decision and dismissed Radanov’s appeal. The Federal Court rejected his three principal arguments: that AFCA’s findings regarding partial financial dependency and limited future financial expectations were legally unreasonable or illogical and unsupported by evidence, and that AFCA had failed to consider the purpose of superannuation death benefits.
The Court found that AFCA’s reasoning was firmly grounded in the evidence. While acknowledging that Radanov and the deceased had genuine financial interdependence—sharing expenses equally, maintaining a joint bank account, and Radanov providing his full pay to her in her final months—AFCA reasonably concluded that Radanov was only partially financially dependent because he had become responsible for rental arrears and the deceased’s future financial support was uncertain due to her poor health. The Court emphasised that dependency involves not just present financial reliance but reasonable expectations of future support, and these expectations must be assessed against the particular circumstances, including the deceased’s precarious health.
The Court also rejected the argument that AFCA improperly distributed the benefit. Under the governing rules and applicable law, AFCA had broad power to vary the trustee’s decision if it found the decision unfair and unreasonable, and AFCA’s substituted decision ordering 25% to each of the four dependants was a lawful exercise of that discretion supported by logical reasoning.
Key Takeaways
- Superannuation death benefit discretion is broad, but trustees must act fairly and reasonably in considering all dependants’ circumstances, not just those with the strongest claim.
- Financial “dependency” extends beyond current financial reliance; trustees must assess reasonable future expectations, which may be limited by factors such as the deceased’s health or short relationship duration.
- AFCA’s de novo review of death benefit decisions is limited to questions of whether the trustee’s decision was fair and reasonable in all circumstances; AFCA cannot create a distribution contrary to the fund rules or applicable law.
- Courts applying the stringent test for legal unreasonableness will uphold AFCA’s reasoning if it is logically grounded in the evidence, even if it represents one of several possible reasonable outcomes.
Why It Matters
This decision provides important guidance for superannuation trustees navigating complex death benefit distributions involving multiple dependants with competing claims. It clarifies that breadth of discretion does not translate to unfettered discretion—trustees must fairly weigh all dependants’ financial needs, actual contributions, and reasonable expectations of future support. The judgment reinforces that courts will not easily second-guess AFCA’s factual assessments or value judgments if they rest on logical foundations, even where evidence could support alternative outcomes.
The decision also highlights the practical implications of dependency beyond formal legal definitions. A de facto relationship of several years with genuine financial sharing does not automatically prioritise one partner over adult children as beneficiaries of superannuation, particularly where the deceased expressed wishes otherwise and health circumstances limit future financial interdependence. For practitioners advising trustees on death benefit claims or representing dependants, the case underscores that AFCA will conduct rigorous, individualised assessments and is willing to redistribute benefits when a trustee has failed to fairly consider all relevant dependants.
✉️ Get tomorrow’s cases before your first coffee
Daily Case Law is our free morning digest — the most substantive new decisions, filtered to your jurisdictions and topics, each linking back here for the full analysis.