Garcia v Masters

Case [2005] NSWSC 480


CITATION:

Paul Joseph Garcia v Raymond Henry Masters & Ors [2005] NSWSC 480

HEARING DATE(S): 19/5/05
 
JUDGMENT DATE : 


23 May 2005

JURISDICTION:

Equity Division

JUDGMENT OF:

Einstein J

DECISION:

Declarations and Orders made-see post paragraph 106

CATCHWORDS:

Property Law - Equity - Licensing - Liquor Administration Board- Rights to Poker machine entitlements regulated by Gaming Machines Act 2001 - Equitable/beneficial interests in poker machine entitlements - Whether outgoing lessee/licensee can bind incoming lessee/licensee in relation to poker machine entitlements - Former lessee, business operator and holder of hotelier's licence surrenders lease and contracts to sell hotel business to new lessee/transferee of hotelier's licence - Complex of contractual provisions between former lessee and new lessee whereunder former lessee seeks to preserve alleged title to property rights in respect of poker machine entitlements - Lessors protect themselves with complex of contractual provisions between themselves and new lessee - Former lessee seeks relief against lessors and against new lessee who still holds hotelier's licence - Former lessee claims that new lessee is constructive trustee of poker machine entitlements for benefit of former lessee - Former lessee also claims relief in contract - Former lessee seeks to sell poker machine entitlements to outside third-party holder of hotelier's licences - Claim to orders that new lessee obliged to deal with poker machine entitlements to direction of former lessee by making application to Liquor Administration Board for transfer of entitlements to purchaser of entitlements from former lessee - Claims of former lessee upheld in very urgent circumstances

LEGISLATION CITED:

Gaming Machines Act 2001 (NSW)
Liquor Act, 1982 (NSW)
Liquor and Registered Clubs Legislation (Further Amendment) Act 1996

CASES CITED:

888 Casino and Tavern Pty Limited v Hurlfobe Pty Limited (1997) 8 BPR 15,505
Antaios Compania Naviera SA v Salen Rederierna AB [1985] AC 191
Australian Broadcasting Commission v Australasian Performing Right Association Ltd (1973) 129 CLR 99
Australian Elizabethan Theatre Trust, Re; (1991) 102 ALR 681
Barclays Bank Ltd v Quistclose Investments Ltd [1968] 3 All ER 651
Baumgartner v Baumgartner (1987) 164 CLR 137
Burns Philp Trustee Co Ltd v Ironside Investments Pty Ltd [1984] 2 Qd R 16
Calverley v Green (1984) 155 CLR 242
Carl Zeiss Stiftung v Herbert Smith & Co (No 2) [1969] 2 Ch to 276
Codelfa Constructions Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337
Gosper v Sawyer (1985) 58 ALR 13
Hide and Skin Trading v Oceanic Meat Traders Ltd (1990) 20 NSWLR 310
International Fina Services AG v Katrina Shipping Ltd ("The Fina Samco") [1995] 2 Lloyd's Rep 344
Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896
Jabetin Pty Ltd v Liquor Administration Board [2005] NSWCA 92
Jack v Smail (1905) 2 CLR 684
Jones v Dunkel (1959) 101 CLR 298
L Schuler AG v Wickman Machine Tool Sales Ltd [1974] AC 235
Maggbury Pty Ltd v Hafele Australia Pty Ltd (2001) 210 CLR 181
Mellor v Liquor Administration Board [2003] NSWSC 38
Muschinski v Dodds (1985)…

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Details
AGLC
Garcia v Masters [2005] NSWSC 480
Case
[2005] NSWSC 480
Decision Date

CaseChat Overview and Summary

In the case of Garcia v Masters, the matter before the court involved disputes concerning the equitable interests in poker machine entitlements regulated under the Gaming Machines Act 2001. The dispute arose between the former lessee, business operator, and holder of a hotelier's licence, who had surrendered their lease and contracted to sell the hotel business to a new lessee who had also obtained the hotelier's licence. The former lessee sought to preserve their alleged title to property rights in respect of poker machine entitlements, while the lessors sought to protect their interests through various contractual provisions with the new lessee. The former lessee further sought relief against both the lessors and the new lessee, claiming that the new lessee was a constructive trustee of the poker machine entitlements for their benefit and sought relief in contract. Additionally, the former lessee attempted to sell the poker machine entitlements to an outside third-party holder of hotelier's licences.

The legal issues before the court included determining whether the outgoing lessee/licensee could bind the incoming lessee/licensee in relation to poker machine entitlements and whether the new lessee was a constructive trustee of the poker machine entitlements for the benefit of the former lessee. The court also needed to consider whether the former lessee's claims in contract and equity were valid and if the new lessee was obliged to deal with the poker machine entitlements under the direction of the former lessee.

The court found in favour of the former lessee, holding that the new lessee was a constructive trustee of the poker machine entitlements for the benefit of the former lessee. The court determined that the former lessee's claims in contract and equity were valid and that the new lessee was obliged to deal with the poker machine entitlements under the direction of the former lessee by making an application to the Liquor Administration Board for the transfer of entitlements to the purchaser of the entitlements from the former lessee. The court's decision was made in very urgent circumstances, and the former lessee was granted the relief they sought.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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