McManus RE Pty Ltd & Anor v Ward [2009] NSWSC 440

McManus RE Pty Ltd & Anor v Ward [2009] NSWSC 440

The evidence did not show any express or implicit common intention that Mr Ward would hold the holding deposit on trust. The $75,000 was paid into Mr Ward's existing general bank account, not a trust or special purpose account, and the parties agreed only that Mr Ward would repay the money if the transaction did not proceed. Mr Ward's obligation was therefore merely that of a debtor, not a trustee.

Jurisdiction
Australia
Judgment Date
21 May 2009
Procedural Posture
Summons Seeking Declaration of Trust and Repayment of Holding Deposit / Ex Tempore Judgment
Outcome
Declaration refused; defendant not trustee; summons dismissed.
Legal Topics
['intention to Create Trust' 'quistclose Trust' 'resulting Trust' 'holding Deposit' 'sale of Land' 'debtor and Trustee Distinction']
['trusts' 'equity' 'property Law' 'contract Law'] ['intention to Create Trust' 'quistclose Trust' 'resulting Trust' 'holding Deposit' 'sale of Land' 'debtor and Trustee Distinction']

Case Brief

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Procedural Posture

Summons Seeking Declaration of Trust and Repayment of Holding Deposit / Ex Tempore Judgment

Legal Issues

  1. 1 ['Whether the $75,000 holding deposit paid by MRE to Mr Ward pending exchange of contracts was held on trust for the plaintiffs or was merely a debt owed by Mr Ward.' 'Whether a trust should be implied where money was paid to a proposed vendor for a specified purpose and the proposed sale did not proceed.']

Ratio Decidendi

The evidence did not show any express or implicit common intention that Mr Ward would hold the holding deposit on trust. The $75,000 was paid into Mr Ward's existing general bank account, not a trust or special purpose account, and the parties agreed only that Mr Ward would repay the money if the transaction did not proceed. Mr Ward's obligation was therefore merely that of a debtor, not a trustee.

Court Disposition

Declaration refused; defendant not trustee; summons dismissed.

Orders

  • ["The defendant consented to judgment against him in the sum of $75,000 plus interest and to pay the plaintiffs' costs as assessed or agreed." 'The Court declined to make the declaration sought in paragraph 1 of the Summons.']