Yusen Daly Smith International Pty Ltd v Smith [2000] NSWSC 853

Yusen Daly Smith International Pty Ltd v Smith [2000] NSWSC 853

The receiver was validly appointed by Mr Smith on 8 May 1997 because the winding up summons and winding up order constituted an event under clause 18(a) of the mortgage debenture, making the security enforceable under clause 19. Mr Smith could rely on that ground even though he did not rely on it at the time of appointment, and the absence of an established debt due to him at that time did not invalidate the appointment because the appointment protected the security while a serious claim to entitlement was pending.

Jurisdiction
Australia
Judgment Date
30 August 2000
Procedural Posture
Equity Proceedings Concerning Validity of Appointment of Receiver and Secured Entitlements Under a Mortgage Debenture / Final Matters After Two Substantive Judgments
Outcome
Appointment of receiver valid; judgment for the defendant on the plaintiff's claim for a declaration to the contrary; no order as to costs in proceedings 2400/97; Mr Smith to pay the plaintiff's costs of the reserved motion in 1913/95.
Legal Topics
['appointment of Receiver by Creditor' 'mortgage Debenture Enforcement' 'winding Up as Event of Default' 'secured Debts' 'costs of Proceedings']
['corporations' 'equity' 'receivership' 'costs'] ['appointment of Receiver by Creditor' 'mortgage Debenture Enforcement' 'winding Up as Event of Default' 'secured Debts' 'costs of Proceedings']

Case Brief

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Procedural Posture

Equity Proceedings Concerning Validity of Appointment of Receiver and Secured Entitlements Under a Mortgage Debenture / Final Matters After Two Substantive Judgments

Legal Issues

  1. 1 ["Whether Mr Smith's appointment of a receiver on 8 May 1997 was valid where the asserted sum of $27,787.88 was not established as secured under the mortgage debenture." 'Whether a party appointing a receiver may rely on a ground not relied on at the time of appointment to justify the validity of the appointment.' 'Whether a receiver may be appointed on the ground of winding up where no sum is presently established as owing to the appointor.' 'What form of orders should be made concerning the sum of $9,937.50 secured under the mortgage debenture.' 'What costs orders should be made in proceedings 2400/97 and the reserved motion in 1913/95.']

Ratio Decidendi

The receiver was validly appointed by Mr Smith on 8 May 1997 because the winding up summons and winding up order constituted an event under clause 18(a) of the mortgage debenture, making the security enforceable under clause 19. Mr Smith could rely on that ground even though he did not rely on it at the time of appointment, and the absence of an established debt due to him at that time did not invalidate the appointment because the appointment protected the security while a serious claim to entitlement was pending.

Court Disposition

Appointment of receiver valid; judgment for the defendant on the plaintiff's claim for a declaration to the contrary; no order as to costs in proceedings 2400/97; Mr Smith to pay the plaintiff's costs of the reserved motion in 1913/95.

Orders

  • ['The receiver was validly appointed by Mr Smith on 8 May 1997.' "There should be judgment for the defendant on the plaintiff's claim for a declaration to the contrary." 'Mr Smith may have a declaration in his favour on the validity issue if thought necessary.' 'The sum of $9,937.50 is secured under the mortgage...