Commonwealth Bank v MacDonald

The Commonwealth Bank of Australia sought a variation of a default judgment in the Supreme Court of New South Wales. The judgment was originally entered against a bankrupt individual, who was the registered holder of shares in a unit trust. The bank had obtained a writ for possession of a company title unit, which was subject to a covenant for vacant possession. The dispute centred on whether the right of occupation of the unit was vested in the registered holder of the shares or in the trustee in bankruptcy of the registered holder's estate, as well as whether it was vested in the registered holder over the chargee of the shares.

The central legal issues the court had to address were the interpretation of section 19 of the Supreme Court Act 1970 and Part 42 Rule 4 of the Supreme Court Rules, in the context of section 58 of the Bankruptcy Act 1966. Specifically, the court had to determine whether the right of occupation was held by the registered holder of the shares, the trustee in bankruptcy, or the chargee of the shares. The court also had to consider whether the writ for possession was an appropriate remedy in this context.

The court held that the right of occupation of the company title unit was vested in the registered holder of the shares, rather than in the trustee in bankruptcy or the chargee of the shares. The court found that the writ for possession was not an appropriate remedy in this case, as it did not address the underlying issues of ownership and occupation rights. Instead, the court ordered that the default judgment be varied to reflect the correct ownership of the unit, and that the matter be remitted for further proceedings to determine the appropriate remedy for enforcement of the covenant for vacant possession.

The final orders of the court were to vary the default judgment to reflect the correct ownership of the unit, and to remit the matter for further proceedings to determine the appropriate remedy for enforcement of the covenant for vacant possession. The writ for possession was set aside, and the matter was to be relisted for further directions.