In the matter of Reserve Hotels Pty Limited

Reserve Hotels Pty Limited was involved in a legal dispute that was heard by the Supreme Court of New South Wales. The primary issue was whether the deed of assignment that transferred ownership of certain hotel properties to the defendant was valid and binding. The defendant sought to set aside the deed of assignment, arguing that it was obtained through undue influence and unconscionable conduct. The plaintiff argued that the deed of assignment was valid and enforceable.

The court had to determine whether the defendant was subject to actual undue influence and whether the influence amounted to undue influence in the relevant sense. The court also had to decide whether the defendant was at a special disadvantage and whether the embarrassment amounted to a special disadvantage. Additionally, the court had to determine whether the exercise of powers of appointment and removal of trustee was improper, whether it was expedient to appoint a new trustee in the circumstances, and whether unpaid beneficiary entitlements amounted to an interest in the trust property. Finally, the court had to consider whether the company director's unauthorised transactions supported an equitable claim for restitution and whether amounts paid to solicitors were recoverable.

The court found that the defendant was subject to actual undue influence, and that the influence amounted to undue influence in the relevant sense. The court also found that the defendant was at a special disadvantage and that the embarrassment amounted to a special disadvantage. The court held that the exercise of powers of appointment and removal of trustee was improper and that it was expedient to appoint a new trustee in the circumstances. The court further found that unpaid beneficiary entitlements did not amount to an interest in the trust property. Finally, the court held that the company director's unauthorised transactions did not support an equitable claim for restitution and that amounts paid to solicitors were not recoverable.

The court set aside the deed of assignment and ordered that a new trustee be appointed. The court also ordered that the defendant be compensated for unpaid entitlements and that the plaintiff pay the costs of the proceedings.