Dopking, in the matter of CHM Trading Pty Ltd [2024] FCA 1173

Dopking, in the matter of CHM Trading Pty Ltd [2024] FCA 1173

Where a company operates solely as trustee of a trust and all company assets and liabilities are referable to the trust, it is appropriate, when the company is in liquidation, to authorise the liquidator to treat assets as trust assets, appoint the liquidator as receiver and manager over those assets, confer standard receivership powers to sell assets and pay creditors, and order remuneration and expenses (including for the application) be payable out of trust assets in priority, in order to protect and preserve those assets for the benefit of trust creditors.

Parties
First Plaintiff: Stefan Dopking in his capacity as liquidator of CHM Trading Pty Ltd (In Liquidation) ACN 628 555 813; Second Plaintiff: CHM Trading Pty Ltd (In Liquidation) ACN 628 555 813; Interested Person: Michelle Bowker
Jurisdiction
Australia
Judgment Date
08 October 2024
Procedural Posture
Corporations – Insolvency Application / Application for Orders Concerning Realisation of Trust Assets (ex Parte, Final Orders)
Outcome
Orders made as sought by the liquidator; declaration granted; receiver and manager appointed; receiver's powers conferred; requirement for security dispensed with; costs and remuneration to be paid in priority from trust assets; liberty to apply granted.
Legal Topics
Liquidator's Powers, Trust Assets in Insolvency, Receivership, Indemnity for Liquidators, Payment of Creditors From Trust Property
Corporations Law Insolvency Liquidator's Powers Trust Assets in Insolvency Receivership Indemnity for Liquidators Payment of Creditors From Trust Property

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Parties

Stefan Dopking in his capacity as liquidator of CHM Trading Pty Ltd (In Liquidation) ACN 628 555 813

First Plaintiff

CHM Trading Pty Ltd (In Liquidation) ACN 628 555 813

Second Plaintiff

Michelle Bowker

Interested Person

Procedural Posture

Corporations – Insolvency Application / Application for Orders Concerning Realisation of Trust Assets (ex Parte, Final Orders)

Legal Issues

  1. 1 Whether liquidator is justified in treating company assets as trust assets
  2. 2 Whether liquidator should be appointed as receiver over trust assets
  3. 3 What powers are appropriate for the receiver/liquidator in managing and realising trust property

Ratio Decidendi

Where a company operates solely as trustee of a trust and all company assets and liabilities are referable to the trust, it is appropriate, when the company is in liquidation, to authorise the liquidator to treat assets as trust assets, appoint the liquidator as receiver and manager over those assets, confer standard receivership powers to sell assets and pay creditors, and order remuneration and expenses (including for the application) be payable out of trust assets in priority, in order to protect and preserve those assets for the benefit of trust creditors.

Court Disposition

Orders made as sought by the liquidator; declaration granted; receiver and manager appointed; receiver's powers conferred; requirement for security dispensed with; costs and remuneration to be paid in priority from trust assets; liberty to apply granted.

Orders

  • Declaration that liquidator is justified and acting reasonably in treating company assets as trust assets and creditors as trust creditors.
  • First plaintiff appointed nunc pro tunc without security as receiver and manager of the business and assets of the Trust.