Drinkwater & Ors v Gedrot Holdaway Pty Ltd & Ors [2003] NSWSC 255

Drinkwater & Ors v Gedrot Holdaway Pty Ltd & Ors [2003] NSWSC 255

The Court was not persuaded to vary the Mareva order to permit access to the NPBS account because, although the fifth defendant appeared on the evidence to have been validly appointed trustee of the Unit Trust, there was an arguable case that the liquidator's indemnity should not extend to property held as constructive trustee, the evidence did not identify what costs were attributable to administration of the trusts, and only an unascertained fraction of the NPBS funds was Unit Trust property from which any right of indemnity could arise.

Jurisdiction
Australia
Judgment Date
02 April 2003
Procedural Posture
Application in Winding Up/liquidation Proceedings to Vary a Mareva Order Concerning Trust Property / Hearing of the Fifth Defendant's Notice of Motion; Reasons Published After Dismissal of Paragraph 1
Outcome
Application dismissed
Legal Topics
['winding Up' 'liquidation of Corporate Trustee' 'mareva Order' 'trustee Indemnity' 'trust Assets' 'constructive Trust']
['corporations' 'equity' 'trusts' 'insolvency'] ['winding Up' 'liquidation of Corporate Trustee' 'mareva Order' 'trustee Indemnity' 'trust Assets' 'constructive Trust']

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Procedural Posture

Application in Winding Up/liquidation Proceedings to Vary a Mareva Order Concerning Trust Property / Hearing of the Fifth Defendant's Notice of Motion; Reasons Published After Dismissal of Paragraph 1

Legal Issues

  1. 1 ['Whether the Mareva order should be varied to allow the liquidator of the fifth defendant access to funds held in an NPBS account.' 'Whether a liquidator of a corporate trustee is entitled to recoup costs and expenses from trust assets.' 'Whether the indemnity principle applies where the company holds property as constructive trustee.' 'Whether the fifth defendant was validly appointed trustee of the Unit Trust.' 'Whether the evidence sufficiently identified costs attributable to administration of the trusts rather than general administration.' 'Whether the relevant portion of the NPBS funds constituting Unit Trust property was sufficiently ascertained.']

Ratio Decidendi

The Court was not persuaded to vary the Mareva order to permit access to the NPBS account because, although the fifth defendant appeared on the evidence to have been validly appointed trustee of the Unit Trust, there was an arguable case that the liquidator's indemnity should not extend to property held as constructive trustee, the evidence did not identify what costs were attributable to administration of the trusts, and only an unascertained fraction of the NPBS funds was Unit Trust property from which any right of indemnity could arise.

Court Disposition

Application dismissed

Orders

  • ["Paragraph 1 of the fifth defendant's notice of motion dismissed."]