In the matter of O’Keeffe Heneghan Pty Ltd (in liquidation; Aus Life Pty Ltd (in liquidation); Rocky Neill Construction Pty Ltd (in liquidation) trading as KNF Group (a firm) (No 2) [2018] NSWSC 1958

In the matter of O’Keeffe Heneghan Pty Ltd (in liquidation; Aus Life Pty Ltd (in liquidation); Rocky Neill Construction Pty Ltd (in liquidation) trading as KNF Group (a firm) (No 2) [2018] NSWSC 1958

The OzForex Monies are held on trust for the Partnership because the RNC Payments were made in breach of fiduciary duties by the Companies to the Partnership. When effect is given to that trust and the monies are treated as property of the Partnership, the CBA’s security has priority over IFG’s security in respect of the OzForex Monies due to perfection by control of the ADI accounts under the PPSA.

Jurisdiction
Australia
Judgment Date
14 December 2018
Procedural Posture
Equity Proceeding / Separate Application in Interlocutory Proceedings; Judgment on Application for Declaration and Orders
Outcome
Declaration granted that OzForex Monies are held on trust for the Partnership; CBA’s security has priority over IFG’s security; parties to file agreed orders within 7 days.
Legal Topics
['constructive Trust' 'security Interests' 'priority of Securities' 'voidable Transactions' 'breach of Fiduciary Duty']
['equity' 'corporations' 'personal Property'] ['constructive Trust' 'security Interests' 'priority of Securities' 'voidable Transactions' 'breach of Fiduciary Duty']

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Procedural Posture

Equity Proceeding / Separate Application in Interlocutory Proceedings; Judgment on Application for Declaration and Orders

Legal Issues

  1. 1 ['Whether the OzForex Monies are held on trust for the Partnership due to breach of duties by corporate partners' 'Whether constructive trust is an appropriate remedy' 'Whether RNC Payments were voidable under s 37A of the Conveyancing Act 1919 (NSW)' "Whether CBA's security has priority over IFG's security in respect of the OzForex Monies"]

Ratio Decidendi

The OzForex Monies are held on trust for the Partnership because the RNC Payments were made in breach of fiduciary duties by the Companies to the Partnership. When effect is given to that trust and the monies are treated as property of the Partnership, the CBA’s security has priority over IFG’s security in respect of the OzForex Monies due to perfection by control of the ADI accounts under the PPSA.

Court Disposition

Declaration granted that OzForex Monies are held on trust for the Partnership; CBA’s security has priority over IFG’s security; parties to file agreed orders within 7 days.

Orders

  • ['OzForex Monies are held on trust for the Partnership' 'CBA’s security has priority over IFG’s security in respect of OzForex Monies' 'Parties to provide agreed short minutes of order and submissions as to costs']