Re Benford, A.B. & Ors v. Ex parte Norgard, R.S. & Anor [1987] FCA 557

Re Benford, A.B. & Ors v. Ex parte Norgard, R.S. & Anor [1987] FCA 557

No agreement was made on 7 August 1984 that property in the respondent's unpaid goods would remain in or revert to the respondent. The partnership therefore owned the goods when the respondent took possession on 26 November 1984. Because the partnership was unable to pay its debts as they became due, and the respondent conceded that if the goods belonged to the partnership the taking of possession was outside the ordinary course of business and conferred a benefit denied to other creditors, the taking of possession was a transfer of property giving the respondent a preference, priority or advantage and was void as against the applicant under ss.122 and 231 of the Bankruptcy Act 1966 (Cth).

Jurisdiction
Australia
Judgment Date
21 October 1987
Procedural Posture
Bankruptcy Application / Application for Declaration That a Transfer of Property Was Void as Against the Trustee Under Deeds of Assignment and for Consequential Orders
Outcome
Application allowed; transfer declared void as against the applicant and monetary and costs orders made against the respondent.
Legal Topics
['preference' 'transfer of Property' 'deeds of Assignment' 'retention of Title' 'voidable Transactions']
['bankruptcy' 'insolvency'] ['preference' 'transfer of Property' 'deeds of Assignment' 'retention of Title' 'voidable Transactions']

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Procedural Posture

Bankruptcy Application / Application for Declaration That a Transfer of Property Was Void as Against the Trustee Under Deeds of Assignment and for Consequential Orders

Legal Issues

  1. 1 ["Whether the respondent's taking possession of 230 suits and 144 sports coats on 26 November 1984 was a transfer of property from the debtors to the respondent." 'Whether the property in the goods was vested in the partnership or in the respondent at the relevant date.' 'Whether any agreement was made on 7 August 1984 that property in goods supplied by the respondent would remain in or revert to the respondent until payment.' 'Whether the transfer had the effect of giving the respondent a preference, priority or advantage over other creditors and was void as against the applicant under ss.122 and 231 of the Bankruptcy Act 1966 (Cth).']

Ratio Decidendi

No agreement was made on 7 August 1984 that property in the respondent's unpaid goods would remain in or revert to the respondent. The partnership therefore owned the goods when the respondent took possession on 26 November 1984. Because the partnership was unable to pay its debts as they became due, and the respondent conceded that if the goods belonged to the partnership the taking of possession was outside the ordinary course of business and conferred a benefit denied to other creditors, the taking of possession was a transfer of property giving the respondent a preference, priority or advantage and was void as against the applicant under ss.122 and 231 of the Bankruptcy Act 1966 (Cth).

Court Disposition

Application allowed; transfer declared void as against the applicant and monetary and costs orders made against the respondent.

Orders

  • ['Declares that a transfer of property from the debtors, Ann Barbara Benford, Ronald Benford and James Elliott Small, to the respondent, Berkeley Apparel Pty Ltd, was effected on 26 November 1984 when the respondent took possession from the premises at which the business of Connoisseurs Suit Shop was being carried...