Australia and New Zealand Banking Group Limited, in the matter of Hawks (bankrupts) v State of Queensland

In the case of Australia and New Zealand Banking Group Limited, in the matter of Hawks (bankrupts) v State of Queensland, the court dealt with an application by ANZ Bank to vest certain real property in Queensland in itself as mortgagee, subject to certain conditions. The property in question was owned by bankrupts, Paul John Hawks and Kayleen Maree Hawks, and had escheated to the Crown of Queensland after the Trustee in Bankruptcy disclaimed any interests in the property. The primary legal issue before the court was whether it was appropriate to make the orders sought by ANZ Bank, given that the mortgagee has no right to enforce its security against the State. The court needed to consider the potential surplus, if any, from the sale of the property and the interests of subsequent interest holders registered on the title.

The court found that, after taking into account enforcement and selling expenses, and subtracting the indebtedness to ANZ, it appeared unlikely that there would be any surplus from the sale of the property. If there was a surplus, the orders would require any such surplus to be paid to subsequent interest holders registered on the title to the property, followed by the Trustee in Bankruptcy. The court was satisfied that it was appropriate to make orders in accordance with the proposed orders set out in the amended application, with one qualification. The applicant sought a declaratory order to the effect that its calculation of the entirety of the debt under the Loan Agreement and related Mortgage be on the basis that there had been no disclaimer of the Property by the Trustee in Bankruptcy. However, the court was not persuaded that it was appropriate to grant such a declaration, though it found that the calculation was soundly based on the evidence before the Court.

The court made several orders in accordance with the application, vesting the estate in fee simple in the property in ANZ Bank subject to certain conditions, including the payment of statutory charges, costs, charges and expenses, discharge of the debt owed to ANZ Bank, and payment of any subsequent mortgages or caveats. The court also ordered that ANZ Bank's costs of and incidental to this proceeding be treated as reasonable enforcement expenses under the Mortgage and payable from the proceeds of sale of the property. The court made no order as to costs.