“We can talk about things that can go wrong, but the question is: how do you fix it, or how do we prevent it? One way is education.”

Mark Ellem, head of education for Accurium, said disputes in SMSFs generally arise out of self-interest, and the problem often lies in the fact that members who are also trustees are not meant to have self-interest.

“If myself and Neal were both members of an SMSF, I am not there just to represent Neal. I'm there to look after the fund for the benefit of both of us. If we have a dispute about something, but it suits me to run it a particular way because that affects my account balance to the detriment of Neal’s, that is not a good outcome,” he said.

“It’s easy for two professionals to sit here and say that's how it operates, but in the real world you may have two, three or four trustees or directors coming to you, and yes, they're all on the same point normally, but they're all wearing their self-interest hats.

“When you’re sitting here as a trustee making decisions, you've got to be very careful about focusing on your own self-interest. That's not what you're meant to be doing. You're meant to be acting in the interest of all members.”

Dallas said there are a number of precautions that can be taken when setting up the fund to minimise disputes, including establishing a clear trust deed with robust dispute resolution mechanisms.

“Having a tailored trust deed can help mitigate problems, but if those things are not in the deed we have good old section 52B,” Ellem added.

“[Which means] if it’s not in the deed, it is in the deed and you must follow the regulations.”

Other steps that should be taken to mitigate the chance of disputes are defining member roles in terms of responsibilities and including processes for resolving disagreements.

“Conduct regular reviews with periodic meetings to address issues proactively,” Dallas said.

“[If disputes continue] seek advice by engaging independent advisers for unbiased guidance or consider mediation to resolve conflicts without resorting to litigation.”

Ellem added that advisers may often be more attuned to the possibility of tension between fund members and should try to be proactive in trying to remedy the situation.

“It might be at that point you start saying, ‘Hey guys, is everything all right? Do you realise why you're in this fund and that you have these obligations?’” he said.

“If you're getting a sense that something's going wrong, it might be that you should start to step in, at least to reiterate the fact that there are these obligations that are imposed on people, and if members are not satisfying those obligations, then you're doing themselves a disservice.”