BANKRUPTCY - payment of moneys by person later becoming bankrupt to third party void as against trustee in bankruptcy - tracing remedies available to trustee in respect of moneys received by third party from person later becoming bankrupt and paid over to other parties to enable them to acquire interests in their own properties - whether tracing remedies are available in respect of moneys paid into a mixed fund
TRUSTS - despite execution of trust deed, no trust ever constituted where evidence shows that person controlling the activities including those taken to establish a trust, that person’s adviser as settlor and the putative trustee had no intention that there was to be a trust for the benefit of others but that the trust fund was to be a repository of moneys to be disbursed by the trustee as and when the controlling person directed
Jacobs, Law of Trust in Australia, 6th ed, at par 214
DAVID LEWIS CLOUT (AS TRUSTEE IN BANKRUPTCY OF THE ESTATE OF GEOFFREYROBERT DEXTER) v ANSCOR PTY LTD,MACKAY & ALLEN PTY LTD, HINATORIE PTY LTD (PROVISIONAL LIQUIDATOR APPOINTED), THE FUND ADMINISTRATORS PTY LTD, REINSAG NOMINEES PTY LTD, SPECTRUM FUND ADMINISTRATION PTY LTD, AUSTRALIAN SECURED MORTGAGES PTY LTD, PROJECT FINANCE (QLD) PTY LTD, ANNE SHIRLEY CORBETT, CROFTBY DOWNS PTY LTD, THORNVILLE PTY LTD IN ITS OWN CAPACITY AND IN ITS CAPACITY AS TRUSTEE OF THE ANSCOR EXECUTIVE INCENTIVE TRUST AND THE THORNVILLE EXECUTIVE INCENTIVE TRUST, ANSCOR INVESTMENTS PTY LTD AND PACIFIC INTERNATIONAL ASSET MANAGEMENT LIMITED
QG 7308 OF 1998
DRUMMOND…
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.
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Details
AGLC
Clout (Trustee) v Anscor Pty Ltd [2003] FCA 326
Case
[2003] FCA 326
Decision Date
CaseChat Overview and Summary
In the Federal Court of Australia, Drummond J delivered a decision in Clout (Trustee) v Anscor Pty Ltd, a case concerning the recovery of property by a trustee in bankruptcy under s 120 of the Bankruptcy Act 1966 (Cth). The applicant, Clout, as the trustee in bankruptcy of Geoffrey Robert Dexter, sought to recover commission moneys paid by Dexter to Anscor Pty Ltd and trace those funds into properties held by various respondents. The court considered whether the commission payments were undervalued transactions void against the trustee, and if tracing remedies were available for the transferred funds. Drummond J held that the commission payments were indeed undervalued transactions and that the trustee could trace the funds into properties held by certain respondents. The court granted various declarations and orders, including voiding certain securities and charging properties to secure payment of the trustee's claims. The decision provides guidance on the application of s 120 of the Bankruptcy Act and the principles of tracing in the context of bankruptcy proceedings.