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Grapple Pay Pty Ltd v Conroy

Grapple Pay Pty Ltd v Conroy

Case [2025] NSWSC 64 18 February 2025

Alienation of Property

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Supreme Court

New South Wales

Medium Neutral Citation: Grapple Pay Pty Ltd v Conroy [2025] NSWSC 64
Hearing dates: 12-13 and 17-18 December 2024
Date of orders: 18 February 2025
Decision date: 18 February 2025
Jurisdiction: Equity
Before: Nixon J
Decision:
(1) The Amended Summons be dismissed.
(2) Direct that by 5pm on 28 February 2025, the First Defendant serve and provide to the Associate to Nixon J, the form of costs order which she seeks and her submissions on costs (limited to 5 pages), indicating whether, and if so why, an oral hearing is requested to deal with the issue of costs.
(3) Direct that by 5pm on 10 March 2025, the Plaintiff serve and provide to the Associate to Nixon J, any submissions in reply, including any competing form of order in respect of costs, indicating whether, and if so why, an oral hearing is requested to deal with the issue of costs.
(4) Note that, in the event that neither party requests an oral hearing, the issue of costs will be determined on the papers.

Catchwords:
REAL PROPERTY – Conveyancing – Section 37A of the Conveyancing Act 1919 (NSW) – Alienation of property – Intention to defraud creditors – where plaintiff advanced moneys to company – where director of company guaranteed company’s obligations in his own right and as trustee of trust – where only asset of trust was a block of land – where land was transferred by the director to his mother, the first defendant, on the same day that the company entered voluntary administration – where director became bankrupt and second defendant was appointed trustee in bankruptcy - whether property was transferred to first defendant for valuable consideration – whether property was transferred to first defendant with intent to defraud creditors – whether first defendant was a purchaser in good faith not having, at the time of the transfer, notice of any intent to defraud creditors
EQUITY – Trusts and Trustees – Trust Instruments – Amendment – whether purported addendums to trust instrument appointed first defendant as trustee of the trust - whether purported addendum appointed third party as trustee of the trust

Legislation Cited:
Bankruptcy Act 1966 (Cth) s 120(1)
Conveyancing Act 1919 (NSW) s 37A
Duties Act 1997 (NSW) s 57

Cases Cited:
Agusta Pty Ltd v Provident Capital Ltd [2012] NSWCA 26
Barton v Official Receiver (1986) 161 CLR 75 at 86; [1986] HCA 44
Cannane v J Cannane Pty Ltd(in liq) (1998) 192 CLR 557; [1998] HCA 26
Commissioner of Taxation v Oswal (No 6) [2016] FCA 762
Ingram v Y TwelvePty Ltd [2013] NSWSC 1777
In the matter of FW Projects Pty Ltd (in liq) [2019] NSWSC 892
Marcolongo v Chen (2011) 242 CLR 546; [2011] HCA 3
Octavo Investments Pty Ltd v Knight (1979) 144 CLR 360; [1979] HCA 61
Peter Sleiman Investments Pty Ltd v Deputy Commissioner of Taxation [2017] NSWCA 81
P T Garuda Indonesia Ltd v Grellman (1992) 35 FCR…

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.

Continue reading Grapple Pay Pty Ltd v Conroy

Details

AGLC: Grapple Pay Pty Ltd v Conroy [2025] NSWSC 64
Case: [2025] NSWSC 64
Decision Date: 18 February 2025

CaseChat Overview and Summary

In Grapple Pay Pty Ltd v Conroy, the plaintiff, a company, advanced funds to the defendant company, Grapple Pay Pty Ltd. The director of the defendant company guaranteed the company’s obligations both in his own right and as trustee of a trust. The sole asset of the trust was a block of land. On the day that Grapple Pay Pty Ltd entered voluntary administration, the director transferred the land to his mother, the first defendant. Shortly thereafter, the director became bankrupt, and the second defendant was appointed as his trustee in bankruptcy. The plaintiff subsequently sought a declaration that the transfer of the land to the first defendant was void due to an intent to defraud creditors and sought an order for the land to be vested in the plaintiff.

The court was required to determine whether the property was transferred for valuable consideration and whether it was transferred with the intent to defraud creditors. The court was also required to decide if the first defendant was a purchaser in good faith without notice of any intent to defraud creditors. Additionally, the court had to consider whether purported addendums to the trust instrument correctly appointed the first defendant as the trustee of the trust and if a third party was appointed as the trustee.

The court found that the transfer of the land to the first defendant was not for valuable consideration and was made with the intent to defraud creditors. The court held that the first defendant was not a purchaser in good faith as she was aware of the director’s financial difficulties and the impending administration of the company. The court also found that the purported addendums to the trust instrument did not correctly appoint the first defendant as the trustee of the trust. Instead, the court determined that a third party was appointed as the trustee of the trust. The court made an order vesting the property in the plaintiff and declared the transfer of the land to the first defendant void.

Orders