In the matter of Blujack Pty Limited (in liquidation) [2016] NSWSC 685

In the matter of Blujack Pty Limited (in liquidation) [2016] NSWSC 685

The evidence supported that the Company held the Inverell property as trustee for the Invprime Trust and the Muswellbrook property as trustee for the Calgaroo Investment Trust, and no evidence established an effective removal or replacement of the Company as trustee. In any event, a trustee or former trustee retains a right of indemnity and equitable lien over trust assets for liabilities properly incurred as trustee. Because the liquidator's statutory power of sale did not extend to trust property, it was just and convenient to appoint him receiver of the trust assets so that the Company's indemnity could be enforced and any surplus from mortgagee sales dealt with appropriately.

Jurisdiction
Australia
Judgment Date
18 April 2016
Procedural Posture
Corporations Winding Up Application for Directions Under S 479(3) of the Corporations Act 2001 (cth) and Appointment of a Receiver Under S 67 of the Supreme Court Act 1970 (nsw) / Interlocutory Application Determined Ex Tempore
Outcome
Directions made and receiver appointed.
Legal Topics
["liquidator's Directions" 'corporate Trustee in Liquidation' "trustee's Right of Indemnity" 'equitable Lien Over Trust Assets' 'appointment of Receiver of Trust Assets']
['corporations' 'insolvency' 'trusts' 'equity' 'receivership'] ["liquidator's Directions" 'corporate Trustee in Liquidation' "trustee's Right of Indemnity" 'equitable Lien Over Trust Assets' 'appointment of Receiver of Trust Assets']

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Procedural Posture

Corporations Winding Up Application for Directions Under S 479(3) of the Corporations Act 2001 (cth) and Appointment of a Receiver Under S 67 of the Supreme Court Act 1970 (nsw) / Interlocutory Application Determined Ex Tempore

Legal Issues

  1. 1 ['Whether the liquidator should be directed that the Company holds the Inverell property as trustee for the Invprime Trust and the Muswellbrook property as trustee for the Calgaroo Investment Trust.' 'Whether the Company is entitled to be indemnified from assets of the relevant trusts for liabilities properly incurred as trustee.' "Whether the trust assets may be realised to satisfy the Company's indemnities." "Whether the liquidator should be appointed as receiver of the trust properties and other trust assets to enforce the Company's right of indemnity."]

Ratio Decidendi

The evidence supported that the Company held the Inverell property as trustee for the Invprime Trust and the Muswellbrook property as trustee for the Calgaroo Investment Trust, and no evidence established an effective removal or replacement of the Company as trustee. In any event, a trustee or former trustee retains a right of indemnity and equitable lien over trust assets for liabilities properly incurred as trustee. Because the liquidator's statutory power of sale did not extend to trust property, it was just and convenient to appoint him receiver of the trust assets so that the Company's indemnity could be enforced and any surplus from mortgagee sales dealt with appropriately.

Court Disposition

Directions made and receiver appointed.

Orders

  • ['The liquidator is entitled to proceed on the basis that the Company holds the Inverell property as trustee for the Invprime Trust and the Muswellbrook property as trustee for the Calgaroo Investment Trust.' 'The liquidator is entitled to proceed on the basis that the Company is entitled to indemnity from the...