Candelori v Umberto - [2006] NSWSC 777

CITATION: Candelori v Umberto [2006] NSWSC 777

HEARING DATE(S): 27 July 2006

JUDGMENT DATE :
4 August 2006

JURISDICTION: Equity

JUDGMENT OF: Austin J

DECISION: Order 6a reinstated

CATCHWORDS: PRACTICE AND PROCEDURE - procedural fairness - court makes orders for appointment of receiver which give the receiver access to trust assets for payment of remuneration and expenses - order varied shortly afterwards to exclude access to trust property - receiver not notified of application to vary

LEGISLATION CITED: Uniform Civil Procedure Rules 2005, r 36.15, 36.16

CASES CITED: BP Australia Ltd v Brown (2003) 58 NSWLR 322
Cameron v Cole (1944) 68 CLR 571
Dahozo Pty Ltd v Oz-US Film Productions Pty Ltd (1997) 24 ACSR 739
Logwon v Warringah Shire Council (1994) 33 NSWLR 13

PARTIES: Peter Burton as Receiver & Manager of D2 (A)
Annunciata Candelori (P1/R)
Mauro Candelori (P2/R)
Umberto Pty Ltd (D1/R)
Candelori Pty Ltd (D2/R)
Rossano Candelori (D3/R)
Sergio Laureti (D4)
LCI Partners Pty Ltd (D5)
Gina Candelori (D6/R)

FILE NUMBER(S): SC 2457/04

COUNSEL: D D Feller SC with J Horowitz (Ps/Rs)
R K Eassie (Receiver & Manager of D2/A)
S Gooden, Solicitor (D6/R)
T Ledlin, Solicitor (D1/D3/Rs)

SOLICITORS: Swaab Attorneys (Ps/Rs)
NOT Lawyers (A)
Ledlin Partners (D1/D3/Rs)
G J Gooden (D6/R)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

AUSTIN J

FRIDAY 4 AUGUST 2006

2457/04 ANNUNCIATA CANDELORI & ANOR V UMBERTO PTY LTD & 5 ORS

HIS HONOUR:

Background and applications

1 Mrs Candelori (the first plaintiff) is the mother of Mauro (the second plaintiff) and Rossano Candelori (the third defendant). I shall refer to the brothers and Rossano's wife Gina (the sixth defendant) by their first names, for convenience. The plaintiffs say that in 1997 Mrs Candelori and her husband, now deceased, owned a property in Hassall St Wetherill Park ("the Hassall Street Property"). In 1997 they entered into negotiations to purchase a property in The Horsley Drive, Smithfield ("the Horsley Drive Property"). The plaintiffs allege that Mr and Mrs Candelori, senior, retained the services of Sergio Laureti (the fourth defendant) through his company LCI Partners Pty Ltd (the fifth defendant) as their accountant and adviser, on the recommendation of Rossano and Gina. They say Mr and Mrs Candelori were persuaded by Mr Laureti and Rossano and Gina to establish a family trust and to transfer the Hassall Street Property and the Horsley Drive Property (in course of acquisition) to the trust. The trustee was Candelori Pty Ltd (the second defendant, "Candelori") although there is now a disputed claim that the trustee has become a company called Umberto Pty Ltd (the first defendant). There are disputed questions about who is and should be the directors and beneficial owners of the shares in Candelori.

2 The plaintiffs allege that in 1999 Candelori began trading on its own account as Candelori's Italian Restaurant in premises within the Horsley Drive Property. Mrs Candelori, the brothers and Gina worked in the restaurant together, but there were disputes between the brothers about the restaurant's takings…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Candelori v Umberto

Details

AGLC: Candelori v Umberto [2006] NSWSC 777
Case: [2006] NSWSC 777
Decision Date: 4 August 2006

CaseChat Overview and Summary

The case of Candelori v Umberto was heard in the Supreme Court of Victoria, involving a dispute between the plaintiff, Candelori, and the defendant, Umberto. The primary issue was whether the court's failure to notify the receiver of an application to vary the orders, which excluded the receiver's access to trust property, rendered the orders unfair and in breach of procedural fairness principles. The court was tasked with determining the validity of the orders and the impact of the receiver's lack of notification on the proceedings.

The legal issues before the court involved the principles of procedural fairness and the appropriate steps required to ensure a receiver is notified of significant changes to court orders affecting their access to trust assets. The court needed to assess whether the lack of notification to the receiver constituted a breach of natural justice and whether the orders could still be considered valid under the circumstances.

The court found that the orders initially appointing the receiver did indeed give the receiver access to trust assets for the purpose of payment of remuneration and expenses. However, the subsequent orders, which excluded access to the trust property, were made without notifying the receiver of the application. The court held that this failure to notify the receiver of the application to vary the orders constituted a breach of procedural fairness. The court concluded that the orders were invalid due to the failure to adhere to the principles of natural justice, and the receiver's lack of opportunity to be heard on the application rendered the orders unfair. The court varied the orders to exclude the receiver's access to the trust property, thereby upholding the principles of procedural fairness.

Orders