AustraliaMy super fund was mismanaged and lost significant value. What duties did the trustee breach?
Trustees of Australian superannuation funds owe strict legal duties under the Superannuation Industry (Supervision) Act 1993 (Cth), including to act honestly, with care and diligence, in members’ best interests, and solely for core super purposes.
What the Law Says
The legal duties of superannuation fund trustees in Australia are set out primarily in the Superannuation Industry (Supervision) Act 1993 (Cth) (SIS Act). These duties are mandatory, enforceable, and apply to all trustees — whether corporate or individual — of regulated super funds.
Under section 52 of the SIS Act, trustees must exercise their powers and discharge their duties with the degree of care, skill and diligence that a prudent person would exercise in managing the affairs of another person. This is a high objective standard — not based on the trustee’s personal experience or knowledge.
Trustees must also act honestly and solely in the interests of members and beneficiaries — not for commercial gain, employer benefit, or third-party advantage. They must ensure the fund is maintained solely for core superannuation purposes, such as providing retirement benefits, death benefits, or disability benefits.
Section 52(2)(b) explicitly requires trustees to 'act in the best interests of the members' — a duty that cannot be contracted out of or diluted by trust deed terms. Breach of these duties may result in civil penalties, disqualification, or compensation orders.
Statutory TextThe trustee must… exercise the same degree of care, skill and diligence as a prudent person would exercise in managing the affairs of another person.
— Superannuation Industry (Supervision) Act 1993 (Cth), s. 52(2)(a) — Duties of trustees
Statutory TextThe trustee must… act in the best interests of the members.
— Superannuation Industry (Supervision) Act 1993 (Cth), s. 52(2)(b) — Duties of trustees
Statutory TextThe trustee must… ensure that the fund is maintained solely for one or more core purposes.
— Superannuation Industry (Supervision) Act 1993 (Cth), s. 52(2)(c) — Duties of trustees
What to Do
Contact your fund’s trustee in writing to request details of the investment decision(s) and risk management processes involved.
Lodge a formal complaint with the Australian Financial Complaints Authority (AFCA) — free and binding up to $1 million.
If AFCA cannot resolve it, consider seeking legal advice about potential claims for breach of statutory duty under the SIS Act.
Note: You generally have 6 years from the date of loss (or when you reasonably discovered it) to commence court proceedings — though some claims may be subject to a 7-year long-stop limitation period under the Limitation Act 1969 (NSW) or equivalent state laws.
Sources
Not legal advice. This article is general information based on publicly available sources, written for educational purposes. Laws change and individual situations vary. Consult a licensed attorney in your jurisdiction before acting on anything you read here. Last reviewed: 2026-06-08.