Aurora Australasia Pty Ltd v Hunt Prosperity Pty Ltd

The appeal before the Court of Appeal of New South Wales concerned a dispute between Aurora Australasia Pty Ltd (appellants) and Hunt Prosperity Pty Ltd (first respondent), along with other respondents. The central issue revolved around whether the appellants had been conferred an equitable charge over units in a trust as security for loans, and whether a trustee was obliged to process a redemption request for a specific amount.

The court was required to determine two primary legal issues. Firstly, whether the debtor had conferred an equitable charge over units in a trust by email offering a pledge of those units as security for loan repayment, and if so, whether this claim failed due to the requirements for signed writing under section 23C(1)(c) of the Conveyancing Act 1919 (NSW). Secondly, the court had to consider whether the trustee was obliged to process a redemption request in the amount claimed by the appellants.

The Court of Appeal allowed the appeal, setting aside the declarations and orders made by the primary judge. The court reasoned that an equitable charge had indeed been conferred, and that the requirements of section 23C(1)(c) of the Conveyancing Act 1919 (NSW) were satisfied. The court found that the trustee was obliged to redeem the units in certificate 3 and pay the specified sum. Consequently, the court ordered the trustee to redeem the units and pay the sum of $1,696,472.17, with directions to be provided by its director. The costs orders were also varied, with the second and third respondents ordered to pay the appellants' and first respondent's costs at first instance, save for specific claims, and to pay the appellants' costs of the appeal.