THC Holding Pty Ltd v CMA Recycling Pty Ltd [2014] NSWSC 1136

THC Holding Pty Ltd v CMA Recycling Pty Ltd [2014] NSWSC 1136

Title in the disputed 1,367 metric tonnes of scrap metal passed to THC once CMA ascertained and set aside the goods (separate and identified pile) by 22 July 2013. When the administrators later sold the goods, they breached s 442C of the Corporations Act, entitling THC to declaratory relief as owner and to damages pursuant to s 1324(10) for the value of the sold goods. CMA held the goods as fiduciary for THC following passing of title, and the administrators' sale amounted to knowing assistance in breach of fiduciary duty.

Parties
Plaintiff: THC Holding Pty Ltd; First Defendant: CMA Recycling Pty Ltd (Administrators Appointed); Third Defendant: Stemcor Australia Pty Ltd; Fourth Defendant: Stemcor Trade Finance Pty Ltd; Fifth Defendant: Philip Patrick Carter; Sixth Defendant: Nicholas John Martin; Seventh Defendant: Marcus William Ayres
Jurisdiction
Australia
Judgment Date
21 August 2014
Procedural Posture
Contract/commercial Dispute—sale of Goods, Administration of Company / Principal Judgment After Hearing and Written Submissions
Outcome
Judgment for the plaintiff; plaintiff declared owner of goods and entitled to damages under s 1324(10) Corporations Act; relief by way of private right for breach of s 442C refused.
Legal Topics
Proper Law of the Contract, Passing of Property in Unascertained Goods, Fiduciary Duties of Bailees, Personal Property Securities, Remedies for Breach of Statutory Duty, Administrators' Powers and Duties in Insolvency
Contract Law Commercial Law Property Law Equity Corporations Law Proper Law of the Contract Passing of Property in Unascertained Goods Fiduciary Duties of Bailees +3 more

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Parties

THC Holding Pty Ltd

Plaintiff

CMA Recycling Pty Ltd (Administrators Appointed)

First Defendant

Stemcor Australia Pty Ltd

Third Defendant

Stemcor Trade Finance Pty Ltd

Fourth Defendant

Philip Patrick Carter

Fifth Defendant

Nicholas John Martin

Sixth Defendant

Marcus William Ayres

Seventh Defendant

Procedural Posture

Contract/commercial Dispute—sale of Goods, Administration of Company / Principal Judgment After Hearing and Written Submissions

Legal Issues

  1. 1 Whether the proper law of the Purchase Agreement is New South Wales or Western Australia
  2. 2 Whether title to property in 1,367 MT of scrap metal passed from CMA to THC
  3. 3 Whether the goods were 'ascertained' for purposes of the relevant Sale of Goods Act

Ratio Decidendi

Title in the disputed 1,367 metric tonnes of scrap metal passed to THC once CMA ascertained and set aside the goods (separate and identified pile) by 22 July 2013. When the administrators later sold the goods, they breached s 442C of the Corporations Act, entitling THC to declaratory relief as owner and to damages pursuant to s 1324(10) for the value of the sold goods. CMA held the goods as fiduciary for THC following passing of title, and the administrators' sale amounted to knowing assistance in breach of fiduciary duty.

Court Disposition

Judgment for the plaintiff; plaintiff declared owner of goods and entitled to damages under s 1324(10) Corporations Act; relief by way of private right for breach of s 442C refused.

Orders

  • Declaration that title in the 1,367 MT passed to THC on 22 July 2013
  • Plaintiff entitled to damages (value $371,824) from administrators for sale in contravention of s 442C