McDonald and others v Horn and others  1 All ER 961.
The fact that pension trust beneficiaries are not volunteers allows them more favourable treatment than other beneficiaries in relation to the matter of costs. In McDonald v Horn it was held that, contrary to the usual rule, pension beneficiaries may obtain a “pre-emptive costs order” where there are serious allegations of impropriety and breach of trust against the employers and trustees. This the beneficiaries would obtain their costs, and any costs which they might be ordered to pay to the defendants out of the fund whether or not their actions ultimately proved successful. The fact that the beneficiaries had given consideration made the action analogous to an action by a minority shareholder on behalf of the company where such an order could be made.
The Court of Appeal had to consider whether members of a pension fund were entitled to seek a pre-emptive costs order indemnifying the members out of the assets of the fund.
The Court of Appeal found at pp 970:
(i) Costs of trustees and other fiduciaries
The second relevant rule of court, which reflects old-established principles applied by the Court of Chancery, is Ord, r 6(2), which is headed
‘Cases where costs do not follow the event‘:
“Where a person is or has been a party to any proceedings in the capacity of trustee, personal representative or mortgage, he shall be entitled to the costs of those proceedings, in so far as they are not recoverable from or paid by any other person, out of the fund held by him in that capacity or out of the mortgaged property, as the case may be, and the Court may order otherwise only on the ground that he has acted unreasonably or, in the case of a trustee or personal representative, has in substance acted for his own benefit rather than for the benefit of the fund”.
Trustees are also able to protect themselves against the possibility that they may be held to have acted unreasonably or in their own interests by applying at an early stage for directions as to whether to bring or defend proceedings. This procedure, sanctioned by the Court of Appeal in Re Beddoe, Downes v Cottam  1 Ch 547 at 557, requires the trustee to make full disclosure of the strengths and weaknesses of his case. Provided that such disclosure has been made, the trustee can have full assurance that he will not personally have to bear his own costs or pay those of anyone else.
(ii) Extension of special principle to beneficiaries
Order 62, r 6(2) does not in itself help the plaintiffs because although the litigation concerns a trust fund, the plaintiffs are not trustees. The Chancery Courts have, however, been willing in certain circumstances to extend to other parties to trust litigation an entitlement to costs in any event by analogy with that accorded trustees. The classic statement of principles upon which the court acts is by Kekewich J, who acknowledged in his time as a master of Chancery procedure, in Re Buckton, Buckton v Buckton  Ch 406 at 413-415…..”
Kekewick J said trust litigation could be divided into three categories. First, proceedings brought be trustees to have guidance of the court as to the construction of the trust instrument or some question arising in the course of administration. In such cases, the cost of all parties are usually treated as necessarily incurred for the benefit of the estate and ordered to be paid out of the fund. Secondly, there are cases in which the application is made by someone other than the trustees, but raises the same kind of point as in the first class and would have justified an application by the trustees. This second class is treated in the same way as the first. Thirdly, there are cases in which a beneficiary is making a hostile claim against the trustees or another beneficiary. This is treated in the same way as ordinary common law litigation and costs usually follow the event.
The Hoffmann J stated at pp 972:
“The plaintiffs however pray in the aid the analogy of Ord 62, r 6(2) by a different route. In Wallersteiner v Moir (No. 2)  1 All ER 849 the Court of Appeal said that a minority shareholder bringing a derivative action on behalf of the company could obtain the authority of the court to sue as if he were a trustee suing on behalf of a fund, with the same entitlement to be indemnified out of the assets against his costs and any costs he may be ordered to pay to the other party. The court said that the minority shareholder could make a Beddoe application in the same way as a trustee and so secure an assurance that he would not be personally liable for any costs. The plaintiffs here say this procedure, imported into company law from trusts, should be re-exported to trust law to cover the position of a beneficiary who is suing on behalf of a fund in which he and many others have interests”.
…….On the other hand, if one looks at the economic relationships involved, there does seem to be a compelling analogy between a minority shareholder’s action for damages on behalf of the company and an action by a members of a pension fund to compel trustees or others to account to the fund. In both cases a person with a limited interest in a fund, whether the company’s assets or pension fund, is alleging injury to the fund as a whole and seeking restitution on behalf of the fund. And what distinguishes the shareholder and pension fund member, on the one hand, from the ordinary trust beneficiary, on the other, is that the former has given consideration for their interests. They are not just recipients of the settlor’s bounty which he, for better or worse, has entrusted to the control of trustees of his choice. The relationship between the parties is a commercial one and the pension fund members are entitled to be satisfied that the fund is being properly administered. Even in a non-contributory scheme the employer’s payments are not bounty. They are part of the consideration for the services of the employee.
Pension funds are such a special from of trust and the analogy between them and companies with shareholders is so much stronger than in the case of ordinary trusts that, in my judgement, it would do no violence to established authority if we were to apply them to the Wallersteiner v Moir (no. 2) procedure.
Section 63.26 of the Supreme Court (Civil Procedure Rules) 2005 (Vic) states:
Unless the Court otherwise orders, a party who sues or is sued as trustee or mortgagee shall be entitled to the costs of the proceeding out of the fund held by the trustee or out of the mortgaged property in so far as the costs are not paid by any other person.
Regulation 42.25 of the Uniform Civil Procedure Rule 2005 (NSW) is similar.