Connelly, in the matter of Gregorski Investments Pty Ltd (in liq) v 320 Nominees Pty Ltd as trustee of the Gregorski Property Trust

The liquidators of Gregorski Investments Pty Ltd, Mr Anthony Connelly and Mr William Harris, have applied to the court for orders appointing them receivers over the assets of the Gregorski Property Trust and the Gregorski Investment Trust. The application was brought pursuant to s 600K of, and ss 45-1 and 90-15 of Sch 2 to, the Corporations Act 2001 (Cth) as well as s 57 of the Federal Court of Australia Act 1976 (Cth). The central issue before the court was whether the liquidators should be appointed receivers over the assets of the Property Trust to enforce the former trustee’s right of exoneration and supporting lien. The liquidators argued that the appointment was necessary to ensure the company’s creditors are paid and the trust assets are managed properly. The defendant, 320 Nominees, opposed the appointment on the basis that it would be an unnecessary step and a waste of time and costs.

The court found that the liquidators should be appointed as receivers of the Property Trust assets. The court reasoned that the company has a significant interest in the Property Trust assets, as it incurred substantial debts in its role as trustee. The company's creditors are entitled to be paid, and the current trustee has not discharged this obligation. The court held that there was no valid reason to delay the appointment of the liquidators as receivers, especially given their role in maximising the value of the company’s assets. The conduct of the defendant and its directors further supported the need for the liquidators to take control of the assets to prevent any impropriety. The court granted the orders sought by the liquidators, including declarations regarding the company’s right of exoneration and the liquidators’ entitlement to costs and remuneration.