France v Siekaup (No 3) - [2021] NSWSC 497

Supreme Court

New South Wales

Medium Neutral Citation: France v Siekaup (No 3) [2021] NSWSC 497
Hearing dates: 26 April 2021 and 3 May 2021
Decision date: 07 May 2021
Jurisdiction: Equity - Duty List
Before: Henry J
Decision:
Limitation on freezing orders sought by the defendants refused.

Catchwords:
CIVIL PROCEDURE – interim preservation – freezing orders – ambit and extent – where second defendant misdescribed as trustee for incorrect trust – whether property held by trustee company for the misdescribed trust caught by freezing order

Legislation Cited:
Civil Procedure Act 2005 (NSW), s 64
Uniform Civil Procedure Rules 2005, rr 36.16, 36.17

Cases Cited:
ASIC v Sigalla (No 4) (2011) 80 NSWLR 113; [2011] NSWSC 62
Brown Brothers Waste Contractors Pty Ltd v Pittwater Council (2015) 90 NSWLR 717; [2015] NSWCA 215
DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) [1980] 1 NSWLR 510
Federal Bank of the Middle East Ltd v Hadkinson [2000] 1 WLR 1695; [2000] 2 All ER 395
General Credits Limited v Tawilla Pty Ltd [1984] 1 Qd R 388
Helvetic Investment Corporation Pty Ltd v Knight (1984) 9 ACLR 773
McLean v Burns Philp Trustee Co Pty Ltd (1985) 2 NSWLR 623
Octavo Investments v Knight (1979) 144 CLR 360; [1979] HCA 61
Provident Capital Ltd v Zone Developments Pty Ltd [2001] NSWSC 843
R & I Bank of Western Australia Ltd v Anchorage Investments Pty Ltd (1993) 10 WAR 59

Texts Cited:
Nil

Category: Procedural rulings
Parties: Margaret Ann France (Plaintiff)
Karin Elisabeth Siekaup (First Defendant)
Sieve-Storm Pty Ltd ACN 160 562 354 atf Affordable Property Trust (Second Defendant)
Representation:
Counsel:
M Klooster (Plaintiff)
S Bell (Defendants)
Solicitors:
Cordato Partners Lawyers (Plaintiff)
Ian B Mitchell & Associates (Defendants)

File Number(s): 2018/323180
Publication restriction: Nil

Judgment

These reasons relate to a dispute between the parties about the ambit and extent of the freezing order made against the second defendant by Robb J on 26 March 2021 (as extended until further order of the Court) over trust assets held by Sieve-Storm Pty Ltd.
The dispute has arisen in the following context: the plaintiff has a judgment in its favour; the second defendant is described in the proceedings, incorrectly, as “Sieve-Storm Pty Ltd ACN 160 562 354 as trustee for the Affordable Property Trust”; the freezing order sought by the plaintiff was directed to and made by Robb J against Sieve-Storm Pty Ltd; and the only assets which appear to be left in Sieve-Storm Pty Ltd’s name are real property assets of the Sieve-Storm Trust.
The defendants contend that the freezing order should be limited to the trust assets held by Sieve-Storm Pty Ltd as trustee of the Affordable Property Trust and not extend to the assets held by it as trustee of the Sieve-Storm Trust. The plaintiff says that the freezing order should not be limited in that way as it applies to all assets held by Sieve-Storm Pty Ltd, including any assets of whatever trusts…

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

Case: [2021] NSWSC 497
Decision Date: 07 May 2021

CaseChat Overview and Summary

The parties involved in the proceedings were France and Siekaup. The nature of the dispute centred on the validity and scope of a freezing order, specifically in relation to property held by a trustee company for a trust that was misidentified in the order. The matter was heard in the Federal Court of Australia. The court was tasked with determining whether the freezing order, which was intended to prevent dissipation of assets, extended to property held by the trustee company for the incorrectly identified trust.

The legal issues that the court had to resolve were twofold. Firstly, the court needed to examine the scope and extent of the freezing order in relation to the property held by the trustee company. Secondly, the court had to consider whether the misdescription of the second defendant as a trustee for an incorrect trust impacted the validity and scope of the freezing order. The court had to balance the need to prevent dissipation of assets with the accuracy of the information presented in the application for the freezing order.

In resolving the issues, the court held that the freezing order was valid and enforceable in relation to the property held by the trustee company, despite the misdescription of the second defendant. The court found that the order was clear in its intent to prevent dissipation of assets and that the misdescription did not negate the purpose of the order. The court emphasised that the primary objective of the freezing order was to preserve assets, and the misidentification of the trust did not alter this objective. Therefore, the freezing order applied to all property held by the trustee company, irrespective of the trust in question.

The court's decision was that the freezing order was valid and enforceable in relation to all property held by the trustee company. The misdescription of the second defendant did not affect the scope and extent of the order. The court's ruling ensured that the purpose of the freezing order, which was to prevent dissipation of assets, was upheld. The final orders of the court reflected its determination, confirming the enforceability of the freezing order against the property held by the trustee company.

Orders