Konica Minolta v L.S. Vongkeneta
[2013] NSWSC 1029
•30 July 2013
Supreme Court
New South Wales
Medium Neutral Citation: Konica Minolta v L.S. Vongkeneta [2013] NSWSC 1029 Hearing dates: 30 July 2013 Decision date: 30 July 2013 Jurisdiction: Equity Division Before: Kunc J Decision: Vesting order made
Catchwords: TRUSTS AND TRUSTEES - Implied trusts - Property acquired with stolen funds declared to be held on trust for plaintiff by defendants - Defendants absconded - Vesting order made to perfect plaintiff's title to property Legislation Cited: Trustee Act 1925 (NSW) Category: Principal judgment Parties: Konica Minolta Business Solutions Australia Pty Ltd ABN 50001065096- Plaintiff
Linda Sisavath Vongkeneta - DefendantRepresentation: Counsel: Mr. P. Newton and Ms. J. Gatland (Plaintiff)
No appearance for Defendant
File Number(s): 2012/234933 Publication restriction: No
EX TEMPORE Judgment
HIS HONOUR: By a motion filed on 3 Jul 2013 the plaintiff ("Konica") moves for a vesting order under s 71 of the Trustee Act1925 (NSW) (the "Act") against the first and second defendants in respect of certain land at Edensor Park (the "Property"). Konica is entitled to that relief.
On 24 April 2013 these proceedings were heard by Hallen J. The relevant facts may be briefly stated as found by his Honour.
The first defendant was in the employ of Konica as a payroll/office administrator. Over the course of a number of years she defrauded Konica of a sum totalling $3,628,565.48. The fraud was conducted with the knowing assistance of the second defendant, her husband.
As part of the final relief which Hallen J granted on 24 April 2013 his Honour made the following declaration:
A declaration that the first and second defendants hold their interest in the property at Edensor Park in the State of New South Wales ... on trust for the plaintiff, subject to the mortgages to Australia and New Zealand Banking Group Ltd (ANZ) being mortgage number ... and mortgage number ...
For the purposes of understanding the course of proceedings today it is important to note that the hearing before Hallen J was conducted in the absence of the first and second defendants. His Honour's judgment (Konica Minolta Business Solutions Australia Pth Ltd v Vongkeneta [2013] NSWSC 486 at [21] to [26]) makes reference to compliance with orders for substituted service that had been made in relation to the service of the first and second defendants. There was also evidence before his Honour that the first and second defendants, together with two of their children, had left Australia for Thailand and had not returned.
His Honour was satisfied that it was appropriate for the hearing to proceed in the absence of the first and second defendants.
Since his Honour's decision, the mortgages to the ANZ have been paid out. In those circumstances, there is no doubt that, pursuant to the declaration made by Hallen J, the first and second defendants hold their interest in the Property on trust for the benefit of Konica.
For the purposes of today's hearing further enquiries have been made as to the whereabouts of the first and second defendants. Unsurprisingly, those enquiries have been unsuccessful. It is clear that, in the circumstances, a further order for substituted service could not sensibly be made. I am satisfied it is appropriate to proceed today in the absence of the first and second defendants.
Mr Newton of Counsel, who appears with Ms Gatland for Konica (and to whom the Court is indebted for their careful preparation of this application, no doubt with the assistance of those who instruct them) submitted that this was the type of application that could be made ex parte and that there was, in fact, no need for service upon or further notice to the first and second defendants.
While that is probably the case, for more abundant caution, I am satisfied on the basis of the evidence of what occurred before Hallen J and the further enquiries that have since been made in relation to the first and second defendants' whereabouts, that it is proper in granting Konica the relief it seeks that I should also make an order dispensing with service of today's motion.
Section 71(1) of the Act provides that:
The Court may make an order in this Act called a vesting order, which shall have effect as provided in section 78.
Section 71(2) of the Act sets out the cases in which a vesting order may be made.
Of those relied upon in Konica's submissions, the most obviously satisfied in the present case are s 71(2)(g) (where a trustee cannot be found) and s 71(2)(o) (where it appears to the Court to be expedient).
I am satisfied that the evidence in this case meets both of those cases, in particular that it is expedient for a vesting order to be made.
The Court has determined that Konica is the victim of the first and second defendants' fraud and that at least part of the proceeds of that fraud were disposed of in such a way as to give Konica the beneficial interest in the Property. Konica is now entitled, with the discharge of the mortgages to ANZ, to have its rights in the Property perfected by the making of a vesting order.
Finally, Mr Newton submits, correctly, that it is unnecessary for Land and Property Information (LPI) to be joined as a party to these proceedings. That is because the course which must be adopted by LPI on the making of the vesting order is specified in s 78(3) of the Act.
The ultimate registration of Konica as the registered proprietor of the Property should, therefore, not require any further intervention by the Court.
However, again for more abundant caution, I will make an order giving Konica liberty to restore the proceedings on three days' notice should some further assistance be required from the Court to give effect to the orders which I now make.
Accordingly, the orders that I make are: I make orders and directions in accordance with the document entitled "Short Minutes of Order" which I initial and date today and place with the papers.
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Decision last updated: 06 August 2013
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