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Hycenko v VHY Enterprises Pty Ltd

Hycenko v VHY Enterprises Pty Ltd

Case [2020] VSC 834 11 December 2020

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IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

PROPERTY LIST

S ECI 2020 01480

NICHOLAS HYCENKO (AS EXECUTOR OF THE ESTATE OF GEORGE HRYCENKO, DECEASED)

Plaintiff

VHY ENTERPRISES PTY LTD (ACN 125 811 654) & ORS

(according to the attached Schedule)

Defendants

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JUDGE:	Derham AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	15 October 2020
DATE OF JUDGMENT:	11 December 2020
CASE MAY BE CITED AS:	Hycenk v VHY Enterprises Pty Ltd & Ors
MEDIUM NEUTRAL CITATION:	[2020] VSC 834

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PROPERTY LAW — Equitable charge — Requirements for a judicial sale pursuant to the Inherent jurisdiction of the Court or s 91 of the Property Law Act 1958 (Vic) — Avco Financial Services Ltd v White, [1977] VR 561; John Sands (Australia) Limited v Joske [2004] VSC 251; King Investment Solutions v Hussain [2005] NSWSC 1076 referred to.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr J O’Donnell	Kennedy Guy
For the First Defendant	Mr O El-Hissi	Noh Legal
For the Second Defendant	No appearance	Wisewould Mahony
For the Third Defendant	No appearance
For the Fourth Defendant	No appearance

HIS HONOUR:

Introduction

This proceeding was commenced by the plaintiff, George Hrycenko (‘George’), by originating motion on the 25 March 2020, seeking a range of declarations regarding two properties in Frankston and Safety Beach, Victoria, owned by the first defendant, VHY Enterprises Pty Ltd (‘VHY’), as well as an order pursuant to s 91 of the Property Law Act 1958 (Vic) (‘the Act’), alternatively pursuant to the Court’s inherent jurisdiction, that these properties be sold.[1]
[1]This proceeding was referred to me by order of Justice Moore on 27 May under r 77.05 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) (‘Rules’).

The plaintiff seeks this relief to satisfy a judgment of $2,646,365.97, together with interest of $441,727.28, (‘Judgment’) given by Lyons J on 31 January 2020 in the proceeding S CI 2017 04965 (‘2017 Proceeding’). Reasons for that order had been delivered on 23 October 2019.[2] This judgment debt is ordered against George’s son Victor Hrycenko (‘Victor’), who is the sole director and shareholder of VHY. The enforcement of the judgment was stayed until 17 February 2020. The judgment has not been paid.
[2]Hrycenko (by his Litigation Guardian Michael Kornitschuk) v Hrycenko [2019] VSC 700.

George died on 6 June 2020. He left a will in which he appointed his other surviving son, Nicholas Hycenko (‘Nicholas’), as executor of his will and trustee of his estate. By order made on 22 June 2020, Nicholas, as executor of the estate of George, was substituted as the plaintiff pursuant to r 9.09(2) of the Supreme Court (General Civil Procedure) Rules 2015 (Vic)(‘Rules’). On 8 September 2020, probate of the will of George was granted to Nicholas.

VHY is the registered proprietor of two properties (‘Properties’), as follows:

(a) the property…

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 Hycenko v VHY Enterprises Pty Ltd

Details

AGLC: Hycenk v VHY Enterprises Pty Ltd [2020] VSC 834
Case: [2020] VSC 834
Decision Date: 11 December 2020

CaseChat Overview and Summary

In the Supreme Court of Victoria, the case of Hycenko v VHY Enterprises Pty Ltd involved a dispute regarding an equitable charge over certain property and the conditions under which a judicial sale could be ordered. The plaintiff sought to enforce an equitable charge against the defendant to recover a debt, with the property in question being a parcel of land. The defendant contested the validity of the charge and the authority under which the sale was sought.

The legal issues before the court included whether the equitable charge was properly constituted and enforceable, and whether the court had the jurisdiction to order a judicial sale under either its inherent jurisdiction or section 91 of the Property Law Act 1958 (Vic). The court needed to determine if the requirements for such a sale were met and if the principles established in previous cases, such as Avco Financial Services Ltd v White and John Sands (Australia) Limited v Joske, applied to the present circumstances.

The court examined the evidence and found that the equitable charge was validly created and enforceable. It considered the authority to order a judicial sale and concluded that the requirements for such a sale were satisfied. The court referenced previous cases to support its decision, ensuring that the principles established in those cases were adhered to. Ultimately, the court determined that it had the jurisdiction to order a judicial sale under the inherent jurisdiction of the court, and granted the plaintiff’s application.

The court ordered that a judicial sale of the property be conducted to satisfy the debt owed by the defendant to the plaintiff. The sale was to be carried out in accordance with the conditions set by the court to ensure fairness and transparency in the process. This decision provided clarity on the enforceability of equitable charges and the procedural requirements for judicial sales in Victoria.

Orders