Coshott v Coshott

In the Federal Court of Australia, Coshott v Coshott was a case involving a dispute over the enforcement of a judgment debt through a garnishee order. The primary issue was whether a garnishee order could compel statutory trustees for sale to make a payment from the proceeds of the sale of a property to satisfy a judgment debt. The trustees had already paid the relevant moneys into court. The court had to determine if the trustees' obligation to account to the beneficiary for their interest from the proceeds of the sale of the property constituted a "debt" for garnishment purposes.

The court's reasoning hinged on the interpretation of the phrase "debts that are due or accruing from the garnishee to the judgment debtor at the time of service of the order" as found in section 117 of the Civil Procedure Act 2005 (NSW). The court referred to the case of Coshott v Learoyd, where similar issues were considered. The court found that the obligation of the trustees to account for the net proceeds of sale constituted a debt. This interpretation aligned with the broad definition of "debt" as any sum of money now payable or becoming payable due to a present obligation. The court concluded that where a trustee is under a present obligation to pay money to a beneficiary, the trustee becomes a debtor of the beneficiary in respect of those funds, thus constituting a debt.

The court ordered that specific payments be made to the interlocutory applicants from the moneys paid into court. Additionally, a garnishee order was to be issued to enforce the judgment. Mrs Coshott was directed to pay the costs of the interlocutory applicants, to be determined by a Registrar. The court also set deadlines for the submission of affidavits and submissions regarding the basis and quantum of costs.