Ozzy Loans Pty Ltd v Christo [2006] NSWSC 466

Ozzy Loans Pty Ltd v Christo [2006] NSWSC 466

The plaintiff has established a serious question to be tried regarding liability of the second defendant as recipient of trust property misapplied in breach of trust, and there is sufficient evidence to apprehend danger of asset dissipation by the second defendant to justify continuation of Mareva relief, notwithstanding the absence of evidence of knowledge of breach by the second defendant.

Parties
Plaintiff: Ozzy Loans Pty Ltd t/as Express Equity; First Defendant: Joe Christo; Second Defendant: New Face Rendering Pty Limited
Jurisdiction
Australia
Judgment Date
16 May 2006
Procedural Posture
Interlocutory Application / Application for Extension of Mareva Relief
Outcome
Interlocutory Mareva relief granted against both defendants.
Legal Topics
Trusts, Breach of Trust, Recipient Liability, Mareva Injunction
Equity Trusts Breach of Trust Recipient Liability Mareva Injunction

Case Brief

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Parties

Ozzy Loans Pty Ltd t/as Express Equity

Plaintiff

Joe Christo

First Defendant

New Face Rendering Pty Limited

Second Defendant

Procedural Posture

Interlocutory Application / Application for Extension of Mareva Relief

Legal Issues

  1. 1 Whether a recipient of misapplied trust property is liable under the first limb of Barnes v Addy without proof of knowledge of breach of trust
  2. 2 Whether Mareva relief should be extended against a recipient who has paid away the funds

Ratio Decidendi

The plaintiff has established a serious question to be tried regarding liability of the second defendant as recipient of trust property misapplied in breach of trust, and there is sufficient evidence to apprehend danger of asset dissipation by the second defendant to justify continuation of Mareva relief, notwithstanding the absence of evidence of knowledge of breach by the second defendant.

Court Disposition

Interlocutory Mareva relief granted against both defendants.

Orders

  • Relief in appropriate form freezing the second defendant's assets generally until further order.