JGM Nominees Pty Ltd v Australvic Pty Ltd (in liq) (No 3)

JGM Nominees Pty Ltd, the appellant, brought an appeal against Australvic Pty Ltd (in liquidation), the respondent, concerning the distribution of funds held in court. The dispute arose from the balance of proceeds from the mortgagee's sale of a property, with the central issue being whether the property was held on trust under a joint venture agreement, and if so, whether the trust was a sham. Additionally, the court had to determine whether the property was subject to any charges, and if so, whether the debts were owing and secured by those charges.

The legal issues the court needed to resolve included the validity of the trust arrangement, the nature of the charges on the property, and the appropriate distribution of the funds. The court also had to consider the liquidator's conduct and the appropriate costs orders under the Supreme Court (General Civil Procedure) Rules 2005, particularly rule 77.06, which governs appeals from decisions of an associate judge.

The court found that the property was indeed held on trust, but that trust was not a sham. It also determined that the property was subject to charges, and that the debts were owing and secured by those charges. The court dismissed the appeal, upholding the decision of the associate judge. However, the court allowed the appeal in relation to the costs orders, ruling that the liquidator should have been ordered to recover costs and expenses from the disputed funds in court rather than being personally liable. The court noted that the liquidator had reasonably conducted the defence of the company and performed a statutory function as an officer of the court.

The final orders of the court were that the appeal was dismissed in relation to the substantive issues, but allowed in relation to the costs orders. The liquidator was to recover costs and expenses from the disputed funds in court.