Court upholds super death benefit ruling

A Federal Court decision has upheld the Australian Financial Complaints Authority’s power to redistribute superannuation death benefits when no binding nomination exists. The ruling allows payments to be split between a surviving partner and children from a previous relationship.

Trustee discretion prevails in death benefit disputes

The case, Radanov v Australian Financial Complaints Authority [2026] FCA 929, involved a $348,600 death benefit from the Retail Employees Superannuation Trust. Kylie Hrysanidis died in November 2021 without a binding nomination, leaving her de facto partner, Veljko Radanov, and three children from an earlier marriage.

The trustee initially awarded the entire benefit to Radanov in October 2022. The children challenged the decision, claiming they were also dependents. After the trustee reaffirmed its position in January 2023, one child escalated the matter to AFCA.

In May 2025, AFCA determined the trustee’s decision was not fair and reasonable. The authority cited the children’s dependent status and Radanov’s limited financial reliance on Hrysanidis. AFCA replaced the trustee’s decision with an equal split—25% to Radanov and 25% to each child.

Justice Scott Goodman rejected Radanov’s appeal. He emphasized that trustees have wide discretion to determine outcomes. The court found no legal error in AFCA’s approach, calling its decision logical rather than a mere disagreement over facts.

Court defers to AFCA’s judgment

Radanov argued AFCA lacked evidence to support partial financial dependency and that his de facto status should have outweighed the children’s claims. The court dismissed both points.

AFCA may weigh testamentary wishes and other considerations.

The ruling confirms that without a binding nomination, trustees and AFCA hold significant flexibility in deciding distributions. Courts will rarely overturn these decisions, meaning disputes over death benefits will likely remain difficult when family situations are complicated.

For those without a binding nomination, the outcome shows how quickly superannuation payouts can become contested. Text messages from Hrysanidis, cited in AFCA’s decision, revealed her intent to build a life with Radanov.

The decision also illustrates the limits of judicial review. Radanov’s appeal failed because AFCA’s reasoning met the required standard of rationality, not because the court disagreed with his legal interpretation. This leaves few options for those who believe a trustee or AFCA has misjudged relationship details or dependency.

Without a binding nomination, the ruling indicates that superannuation funds and AFCA will keep balancing competing claims. Beneficiaries should understand that even simple family situations can lead to lengthy disputes without a legally binding directive.