Mackay v Jonsson

[2015] FCCA 447

FEDERAL CIRCUIT COURT OF AUSTRALIA

MACKAY & ORS v JONSSON & ANOR [2015] FCCA 447

Catchwords:
BANKRUPTCY – Application for orders for delivery up of items held by Second Respondent claimed as part of the estate of a deceased – declaration sought with respect to property not vesting in the Trustee in Bankruptcy – interim orders sought regarding protection and preservation of valuable items including objects d’art – power of the court to make such orders – appropriateness of such orders.

Legislation:  

Federal Circuit Court of Australia Act 1999 (Cth), s.15(a)
Federal Circuit Court Rules 2001 (Cth), r.1.05(2) & (3)(b)
Federal Court Rules 2011 (Cth), r.14.11
Federal Circuit Court (Bankruptcy) Rules 2006

First Applicant:

Second Applicant

Third Applicant

WENDY ANN MACKAY

DANIEL JOHN ROBINSON

ANNUNAKA PTY LTD ACN 051 633 062

First Respondent:

Second Respondent

ANTHONY JAMES JONSSON AS TRUSTEE IN BANKRUPTCY OF THE ESTATE OF HENRY HARVEY KNEIPP

CAROLYN GATE

File Number: BRG 954 of 2014

Judgment of: Judge Coker

Hearing date: 27 November 2014

Date of Last Submission: 27 November 2014

Delivered at: Townsville

Delivered on: 20 March 2015

REPRESENTATION

Counsel for the 1^st, 2^nd & 3^rd Applicants: Mr P Land

Solicitors for the 1^st, 2^nd & 3^rd Applicants: Lee & Co

Solicitors for the 1^st Respondent: MacDonnells Law

Counsel for the 2^nd Respondent: Mr Hockings

Solicitors for the 2^nd Respondent: Williams Graham & Carman

ORDERS

1. That in relation to orders sought by the First Applicant until further order:

   (a)Pursuant to Federal Court Rule 14.11(1)(a), each item of personal property alleged in paragraph 39 of the Statement of Claim and held by the Second Respondent be picked up from its current location and transported therefrom by Atkins Removals and Storage Pty Ltd to be stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lilydale Road, Rocherlea in the State of Tasmania.

   (b)That the First Applicant pay the costs of picking up, transporting and storage of the items of personal property alleged in paragraph 39 of the Statement of Claim and held by the Second Respondent.

   (c)That the Second Respondent:

   (i)forthwith disclose to Atkins Removals and Storage Pty Ltd the location of the items of personal property alleged in paragraph 39 of the Statement of Claim and held by the Second Respondent; and

   (ii)provide full and free access to that location and to each and every item of personal property referred to in paragraph 39 of the Statement of Claim and held by the Second Respondent to Atkins Removals and Storage Pty Ltd, its officers and employees so as to allow it and/or them to comply with this order.

   (d)That the First Applicant pay the costs of transit insurance of the items of personal property referred to in paragraph 39 of the Statement of Claim and held by the Second Respondent, and the cost of insurance of those items of personal property stored by Atkins Removals and Storage Pty Ltd at is premises at 143-151 Lilydale Road, Rocherlea.

   (e)That Andrew Wright, Auctioneer and Valuer of Tasmania:

   (i)be permitted to inspect each and every item of personal property alleged in paragraph 39 of the Statement of Claim and held by the Second Respondent as each item is being removed from its current location by Atkins Removals and Storage Pty Ltd; and

   (ii)report in writing the results of his inspection to the First Applicant and to the Second Respondent within seven days of the date of the inspection.

   (f)That the Second Respondent:

   (i)forthwith disclose to Andrew Wright the location of the items of personal property referred to in paragraph 39 of the Statement of Claim and held by the Second Respondent so as to allow Andrew Wright to comply with this Order; and

   (ii)provide full and free access to Andrew wright to the location where the items of personal property referred to in paragraph 39 of the Statement of Claim and held by the Second Respondent are stored so as to allow Andrew Wright to comply with this order.

   (g)That the costs incurred by the First Applicant in complying with this Order be costs in the cause.

2. That in relation to orders sought by the First and Second Applicants jointly until further order:

   (a)Pursuant to Federal Court Rule 14.11(1)(a) that each and every item of personal property alleged in paragraph 52 of the Statement of Claim and held by the Second Respondent be picked up from its current location and transported therefrom by Atkins Removals and Storage Pty Ltd to and be stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lilydale road, Rocherlea in the State of Tasmania.

   (b)That the First Applicant and the Second Applicant pay the costs of picking up, transporting and storage of the items of personal property alleged in paragraph 52 of the Statement of Claim and held by the Second Respondent.

   (c)That the Second Respondent:

   (i)forthwith disclose to Atkins Removals and Storage Pty Ltd the location of the items of personal property alleged in paragraph 52 of the Statement of Claim and held by the Second Respondent; and

   (ii)that the Second Respondent provide full and free access to that location and to each and every item of personal property referred to in paragraph 52 of the Statement of Claim and held by the Second Respondent to Atkins Removals and Storage Pty Ltd, its officers and employees so as to allow it and/or them to comply with this order.

   (d)That the First Applicant and the Second Applicant jointly pay the costs of transit insurance of the items of personal property referred to in paragraph 52 of the Statement of Claim and held by the Second Respondent and the cost of insurance of those items of personal property stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lilydale Road, Rocherlea.

   (e)That Andrew Wright, Auctioneer and Valuer of Tasmania:

   (i)be permitted to inspect each and every item of personal property alleged in paragraph 52 of the Statement of Claim and held by the Second Respondent as each item is being removed from its current location by Atkins Removals and Storage Pty Ltd; and

   (ii)report in writing the results of his inspection to the First Applicant and to the Second Applicant jointly and to the Second Respondent within seven days of the date of the inspection.

   (f)That the Second Respondent:

   (i)forthwith disclose to Andrew Wright the location of the items of personal property referred to in paragraph 52 of the Statement of Claim and held by the Second Respondent so as to allow Andrew Wright to comply with this Order; and

   (ii)provide full and free access to Andrew Wright to the location where the items of personal property referred to in paragraph 52 of the Statement of Claim and held by the Second Respondent are stored so as to allow Andrew Wright to comply with this order.

   (g)That the costs incurred by the First Applicant and the Second Applicant jointly in complying with this order be costs in the cause.

3. That in relation to orders sought by the Second Applicant until further order:

   (a)Pursuant to Federal Court Rule 14.11(1)(a) that each and every item of personal property alleged in paragraph 64 of the Statement of Claim and held by the Second Respondent be picked up from its current location and transported therefrom by Atkins Removals and Storage Pty Ltd to and be stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lilydale Road, Rocherlea in the State of Tasmania.

   (b)That the Second Applicant pay the costs of picking up, transporting and storage of the items of personal property alleged in paragraph 64 of the Statement of Claim and held by the Second Respondent until further order.

   (c)That the Second Respondent:-

   (i)forthwith disclose to Atkins Removals and Storage Pty Ltd the location of the items of personal property alleged in paragraph 64 of the Statement of Claim and held by the Second Respondent; and

   (ii)that the Second Respondent provide full and free access to that location and to each and every item of personal property referred to in paragraph 64 of the Statement of Claim and held by the Second Respondent to Atkins Removals and Storage Pty Ltd, its officers and employees so as to allow it and/or them to comply with this order.

   (d)That the Second Applicant pay the costs of transit insurance of the items of personal property referred to in paragraph 64 of the Statement of Claim and held by the Second Respondent and the cost of insurance of those items of personal property stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lilydale Road, Rocherlea.

   (e)That Andrew Wright, Auctioneer and Valuer of Tasmania:

   (i)be permitted to inspect each and every item of personal property alleged in paragraph 64 of the Statement of Claim and held by the Second Respondent as each item is being removed from its current location by Atkins Removals and Storage Pty Ltd; and

   (ii)report in writing the results of his inspection to the Second Applicant and to the Second Respondent within seven days of the date of the inspection.

   (f)That the Second Respondent:

   (i)forthwith disclose to Andrew Wright the location of the items of personal property referred to in paragraph 64 of the Statement of Claim and held by the Second Respondent so as to allow Andrew Wright to comply with this Order; and

   (ii)provide full and free access to Andrew Wright to the location where the items of personal property referred to in paragraph 64 of the Statement of Claim and held by the Second Respondent are stored so as to allow Andrew Wright to comply with this order.

   (g)That the costs incurred by the Second Applicant jointly in complying with this order be costs in the cause.

4. That in relation to orders sought by the Third Applicant until further order:

   (a)Pursuant to Federal Court Rule 14.11(1)(a) that each and every item of personal property alleged in paragraph 78 of the Statement of Claim and held by the Second Respondent be picked up from its current location and transported therefrom by Atkins Removals and Storage Pty Ltd to and be stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lilydale Road, Rocherlea in the State of Tasmania.

   (b)That the Third Applicant pay the costs of picking up, transporting and storage of the items of personal property alleged in paragraph 78 of the Statement of Claim and held by the Second Respondent.

   (c)That the Second Respondent:-

   (i)forthwith disclose to Atkins Removals and Storage Pty Ltd the location of the items of personal property alleged in paragraph 78 of the Statement of Claim and held by the Second Respondent; and

   (ii)that the Second Respondent provide full and free access to that location and to each and every item of personal property referred to in paragraph 78 of the Statement of Claim and held by the Second Respondent to Atkins Removals and Storage Pty Ltd, its officers and employees so as to allow it and/or them to comply with this order.

   (d)That the Third Applicant pay the costs of transit insurance of the items of personal property referred to in paragraph 78 of the Statement of Claim and held by the Second Respondent and the cost of insurance of those items of personal property stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lilydale Road, Rocherlea.

   (e)That Andrew Wright, Auctioneer and Valuer of Tasmania:

   (i)be permitted to inspect each and every item of personal property alleged in paragraph 78 of the Statement of Claim and held by the Second Respondent as each item is being removed from its current location by Atkins Removals and Storage Pty Ltd; and

   (ii)report in writing the results of his inspection to the Third Applicant and to the Second Respondent within seven days of the date of the inspection.

   (f)That the Second Respondent:

   (i)forthwith disclose to Andrew Wright the location of the items of personal property referred to in paragraph 78 of the Statement of Claim and held by the Second Respondent so as to allow Andrew Wright to comply with this Order; and

   (ii)provide full and free access to Andrew Wright to the location where the items of personal property referred to in paragraph 78 of the Statement of Claim and held by the Second Respondent are stored so as to allow Andrew Wright to comply with this order.

   (g)That the costs incurred by the Third Applicant in complying with this order be costs in the cause.

   (h)That the Second Respondent by herself, her servants or agents be restrained from selling, encumbering or otherwise disposing of the Lexus motor vehicle but otherwise be able to continue to use the motor vehicle for her own personal use provided that the Second Respondent continues current registration and comprehensive insurance of the said motor vehicle and provides proof of such registration and comprehensive insurance to the Third Applicant within 7 days of the date of this order.

5. That each party have liberty to apply upon giving 7 days written notice to the other parties.

6. That the argument, if any, regarding discontinuance of the proceedings between the First, Second and Third Applicants and the First Respondent and argument as to costs be listed for no more than 2 hours at 2.15pm on 18 June 2015 in Townsville.

7. That the costs of and incidental to the interim application between the First, Second and Third Applicants and the Second Respondent be reserved.

FEDERAL CIRCUIT COURT OF AUSTRALIA

AT TOWNSVILLE

BRG 954 of 2014

WENDY ANN MACKAY

First Applicant

DANIEL JOHN ROBINSON
Second Applicant

ANNUNAKA PTY LTD ACN 051 633 062
Third Applicant

And

ANTHONY JAMES JONSSON AS TRUSTEE IN BANKRUPTCY OF THE ESTATE OF HENRY HARVEY KNEIPP

First Respondent

CAROLYN GATE
Second Respondent

REASONS FOR JUDGMENT

1. On 31 October 2014, Wendy Ann Mackay, Daniel John Robinson and Annunaka Pty Ltd (ACN 051 633 062), as trustee for the H H Kneipp Family Trust, filed proceedings before this Court seeking orders on both an interim and final basis.

2. The respondents to the application were Anthony James Jonsson, as trustee in bankruptcy of the estate of Henry Harvey Kneipp and Caroline Gate.  The orders that were sought by the first, second and third applicants were comprehensive.  They dealt with declarations sought in relation to the legal and equitable ownership of various items of property which was detailed in a statement of claim filed along with the application.

3. Additionally, orders were sought with respect to a declaration in the negative.  In other words, that none of the items of personal property detailed in the statement of claim were to have been considered as vesting in the first respondent, the trustee in bankruptcy of the estate of the late Henry Harvey Kneipp.  Orders were also sought in relation to the return of items of personal property.  Those orders were sought on the part of the first applicant, as well as in relation to other items of property on behalf of the first and second applicants and then on the part of the second applicant and the third applicant

4. As is perhaps obvious from the complexity of the orders that were sought in relation to the matter, there are hotly disputed issues arising in relation to the assets of the estate of the late Mr Kneipp.  The first applicant is the daughter of the deceased and the second applicant is her partner.  The third applicant, as indicated, is the corporate trustee for the H H Kneipp Family Trust.  The respondents to the proceedings, again, as is perhaps obvious, are the trustees in bankruptcy of the estate of the late Mr Kneipp and the second respondent is his partner, with whom he had resided for a period of years, prior to his death in June of 2014.

5. The interim orders that were sought in relation to the matter were as comprehensive as those sought in relation to final determinations of proceedings between the applicants and the respondents.  In some respects, they were perhaps even more comprehensive, in that they sought orders with regard to what could be termed the preservation and security of items of personal property, the subject matter of the substantive proceedings before the Court.

6. The interim orders sought by the Applicants are broken down to various claims.  The orders sought by the first applicant were in these terms:

   1.An order pursuant to Federal Court Rule 14.11(1)(a) that each and every item of personal property alleged in paragraph 39 of the Statement of Claim picked up from its current location and transported therefrom by Atkins Removals and Storage Pty Ltd to be stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lilydale Road, Rocherlea in the State of Tasmania until further order.

   2.An order that the First Applicant pay the costs of picking up, transporting and storage of the items of personal property alleged in paragraph 39 of the Statement of Claim

   3.An order that the Second Respondent:-

   (a)forthwith disclose to Atkins Removals and Storage Pty Ltd the location of the items of personal property alleged in paragraph 39 of the Statement of Claim; and

   (b)provide full and free access to that location and to each and every item of personal property referred to in paragraph 39 of the Statement of Claim to Atkins Removals and Storage Pty Ltd, its officers and employees so as to allow it and/or them to comply with this order.

   4.An order that the First Applicant pay the costs of transit insurance of the items of personal property referred to in paragraph 39 of the Statement of Claim and the cost of insurance of those items of personal property stored by Atkins Removals and Storage Pty Ltd at is premises at 143-151 Lilydale Road, Rocherlea until further order.

   5.An order that Andrew Wright, Auctioneer and Valuer of Tasmania:-

   (a)be permitted to inspect each and every item of personal property alleged in paragraph 39 of the Statement of Claim as each item is being removed from its current location by Atkins Removals and Storage Pty Ltd; and

   (b)report in writing the results of his inspection to the First Applicant and to the Second Respondent within seven days of the date of the inspection.

   6.An order that the Second Respondent:-

   (a)forthwith disclose to Andrew Wright the location of the items of personal property referred to in paragraph 39 of the Statement of Claim so as to allow Andrew Wright to comply with this Order; and

   (b)provide full and free access to Andrew wright to the location where the items of personal property referred to in paragraph 39 of the Statement of Claim are stored so as to allow Andrew Wright to comply with this order.

   7.That the costs incurred by the First Applicant in complying with this order be costs in the cause.

   8.Liberty to apply by any party on giving each other party seven days notice in writing.

   9.An order that the costs of and incidental to this interim application brought by the First Applicant be reserved.

7. The orders sought by the first and second applicants jointly are in these terms:

   1.An order pursuant to Federal Court Rule 14.11(1)(a) that each and every item of personal property alleged in paragraph 52 of the Statement of Claim be picked up from its current location and transported therefrom by Atkins Removals and Storage Pty Ltd to and be stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lilydale road, Rocherlea in the State of Tasmania until further order.

   2.An order that the First Applicant and the Second Applicant pay the costs of picking up, transporting and storage of the items of personal property alleged in paragraph 52 of the Statement of Claim.

   3.An order that the Second Respondent:-

   (a)forthwith disclose to Atkins Removals and Storage Pty Ltd the location of the items of personal property alleged in paragraph 52 of the Statement of Claim; and

   (b)that the Second Respondent provide full and free access to that location and to each and every item of personal property referred to in paragraph 52 of the Statement of Claim to Atkins Removals and Storage Pty Ltd, its officers and employees so as to allow it and/or them to comply with this order.

   4.An order that the First Applicant and the Second Applicant jointly pay the costs of transit insurance of the items of personal property referred to in paragraph 52 of the Statement of Claim and the cost of insurance of those items of personal property stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lilydale Road, Rocherlea until further order.

   5.An order that Andrew Wright, Auctioneer and Valuer of Tasmania:-

   (a)be permitted to inspect each and every item of personal property alleged in paragraph 52 of the Statement of Claim as each item is being removed from its current location by Atkins Removals and Storage Pty Ltd; and

   (b)report in writing the results of his inspection to the First Applicant and to the Second Applicant jointly and to the Second Respondent within seven days of the date of the inspection.

   6.An order that the Second Respondent:-

   (a)forthwith disclose to Andrew Wright the location of the items of personal property referred to in paragraph 52 of the Statement of Claim so as to allow Andrew Wright to comply with this Order; and

   (b)provide full and free access to Andrew Wright to the location where the items of personal property referred to in paragraph 52 of the Statement of Claim are stored so as to allow Andrew Wright to comply with this order.

   7.That the costs incurred by the First Applicant and the Second Applicant jointly in complying with this order be costs in the cause.

   8.Liberty to apply by any party on giving each other party seven days notice in writing.

   9.An order that the costs of and incidental to this interim application brought by the First Applicant and the Second Applicant jointly be reserved.

1. The orders sought by the second applicant were as follows:

   1.An order pursuant to Federal Court Rule 14.11(1)(a) that each and every item of personal property alleged in paragraph 64 of the Statement of Claim be picked up from its current location and transported therefrom by Atkins Removals and Storage Pty Ltd to and be stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lilydale Road, Rocherlea in the State of Tasmania until further order.

   2.That the Second Applicant pay the costs of picking up, transporting and storage of the items of personal property alleged in paragraph 64 of the Statement of Claim until further order.

   3.An order that the Second Respondent:-

   (a)forthwith disclose to Atkins Removals and Storage Pty Ltd the location of the items of personal property alleged in paragraph 64 of the Statement of Claim; and

   (b)that the Second Respondent provide full and free access to that location and to each and every item of personal property referred to in paragraph 64 of the Statement of Claim to Atkins Removals and Storage Pty Ltd, its officers and employees so as to allow it and/or them to comply with this order.

   4.An order that the Second Applicant pay the costs of transit insurance of the items of personal property referred to in paragraph 64 of the Statement of Claim and the cost of insurance of those items of personal property stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lily dale Road, Rocherlea until further order.

   5.An order that Andrew Wright, Auctioneer and Valuer of Tasmania:-

   (a)be permitted to inspect each and every item of personal property alleged in paragraph 64 of the Statement of Claim as each item is being removed from its current location by Atkins Removals and Storage Pty Ltd; and

   (b)report in writing the results of his inspection to the Second Applicant and to the Second Respondent within seven days of the date of the inspection.

   6.An order that the Second Respondent:-

   (a)forthwith disclose to Andrew Wright the location of the items of personal property referred to in paragraph 64 of the Statement of Claim so as to allow Andrew Wright to comply with this Order; and

   (b)provide full and free access to Andrew Wright to the location where the items of personal property referred to in paragraph 64 of the Statement of Claim are stored so as to allow Andrew Wright to comply with this order.

   7.That the costs incurred by the Second Applicant jointly in complying with this order be costs in the cause.

   8.Liberty to apply by any party on giving each other party seven day’s notice in writing.

   9.An order that the costs of and incidental to this interim application brought by the Second Applicant be reserved.

2. The orders sought by the third applicant are in these terms:

   1.An order pursuant to Federal Court Rule 14.11(1)(a) that each and every item of personal property alleged in paragraph 78 of the Statement of Claim be picked up from its current location and transported therefrom by Atkins Removals and Storage Pty Ltd to and be stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lilydale Road, Rocherlea in the State of Tasmania until further order.

   2.That the Third Applicant pay the costs of picking up, transporting and storage of the items of personal property alleged in paragraph 78 of the Statement of Claim until further order.

   3.An order that the Second Respondent:-

   (a)forthwith disclose to Atkins Removals and Storage Pty Ltd the location of the items of personal property alleged in paragraph 78 of the Statement of Claim; and

   (b)that the Second Respondent provide full and free access to that location and to each and every item of personal property referred to in paragraph 78 of the Statement of Claim to Atkins Removals and Storage Pty Ltd, its officers and employees so as to allow it and/or them to comply with this order.

   4.An order that the Third Applicant pay the costs of transit insurance of the items of personal property referred to in paragraph 78 of the Statement of Claim and the cost of insurance of those items of personal property stored by Atkins Removals and Storage Pty Ltd at its premises at 143-151 Lilydale Road, Rocherlea until further order.

   5.An order that Andrew Wright, Auctioneer and Valuer of Tasmania:-

   (a)be permitted to inspect each and every item of personal property alleged in paragraph 78 of the Statement of Claim as each item is being removed from its current location by Atkins Removals and Storage Pty Ltd; and

   (b)report in writing the results of his inspection to the Third Applicant and to the Second Respondent within seven days of the date of the inspection.

   6.An order that the Second Respondent:-

   (a)forthwith disclose to Andrew Wright the location of the items of personal property referred to in paragraph 78 of the Statement of Claim so as to allow Andrew Wright to comply with this Order; and

   (b)provide full and free access to Andrew Wright to the location where the items of personal property referred to in paragraph 78 of the Statement of Claim are stored so as to allow Andrew Wright to comply with this order.

   7.An order pursuant to Federal Court Rule 14.11(1)(a) that the Lexus Motor Vehicle alleged in paragraph 1(b) of the Statement of Claim be picked up by Atkins Removals and Storage Pty Ltd from the Second respondent’s land at 7 Woolgar Road, Gympie in the State of Queensland and be carried by Atkins removals and storage Pty Ltd to its premises at 143-151 Lilydale Road, Rocherlea in the State of Tasmania and be stored at those premises until further order.

   8.An Order that the Third Applicant pay the costs of picking up, transporting and storage of the Lexus Motor Vehicle until further order.

   9.An order that the Second Respondent provide full and free access to Atkins Removals and Storage Pty Ltd, its officers and employees to permit it and/or them to comply with this interim order.

   10.An order that the Third Applicant pay the costs of transport insurance of the Lexus Motor Vehicle from the Second Respondent’s property in Gympie to Atkins Removals and Storage Pty Ltd’s premises at 143-151 Lilydale Road, Rocherlea, Tasmania.

   11.An order that the Third Applicant pay the costs of insuring the Lexus Motor Vehicle whilst it is in storage at the said premises of Atkins Removals and Storage Pty Ltd.

   12.An order that the costs incurred by the Third Applicant in complying with this order be costs in the cause.

   13.Liberty to apply by any party on giving seven days written notice to the other parties.

   14.An order that the costs of and incidental to this interim application be reserved.

3. No response to the application has been filed by the second respondent, however, affidavit material has been filed by the second respondent and it is clear from that that whilst it is conceded that there is an issue that requires determination in relation to the proceedings, the orders that would be sought by the second respondent are in these terms:

   (a)Upon the Applicants giving the usual undertaking as to damages the Second Respondent until the final determination of these proceedings or further order of the Court:

   (i)by herself, her servants or agents be restrained from selling of otherwise disposing of the items referred to in paragraph 86 of the affidavit if the Second Respondent sworn 21 November 2014 (affidavit of the Second Respondent);

   (ii)store the items identified as numbers 1, 2, 3, 4, 5, 6, 7, 9, 11, 12, 14, 18, 19, 21, 22, 24, 25, 26, 30, 31, 35, 36, 38, 39, 46, 47, 50, 52, 54, 56, 58, 59, 67, 68 and 71 in paragraph 86 of the affidavit of the Second Respondent in the secured storage situated at 3 Chuter Street, Deep Bay, Tasmania;

   (iii)store the items identified as numbers 55, 60, 61 and 62 in paragraph 86 of the affidavit of the Second respondent I the storage situated at 7 Woolgar Road, Southside, Gympie, Queensland;

   (iv)maintain a policy of insurance over the items referred to in subparagraph:

   A. (a)(ii) above for a repayment value of not less than $40,000.00 or such amount as determined by this Honourable Court;

   B. (a)(iii) above for a replacement value of not less than $71,000.00 or such amount as determined by this Honourable Court.

   (v)by herself, her servants or agents be restrained from selling or otherwise disposing of the Lexus motor vehicle although this restraint does not prevent or inhibit the Second Respondent from continuing to use the said motor vehicle for her own personal use.:

   (b)The Second Respondent provide access for Tim Burt, Auctioneer and Agent (or Andrew Wright) to inspect the items referred to in subparagraph (a)(ii) above;

   (c)Tim Burt (or Andrew Wright) report in writing the results of his inspection to the Applicants and to the Second Respondent within 14 days of the inspection;

   (d)The Applicants pay the costs of the inspection and report of Tim Burt (or Andrew Wright); and

   (e)The Applicants disclose to the Second Respondent all documents in their possession from the Public Trustee of Queensland (including a copy of a medical report of Dr Eric Guazzo, neurosurgeon) relevant to the issue of Mary Ann Azzopardi’s terminal brain tumour including the treatment that she received for such condition and her capacity at the time of signing the Deed of Gift; and

   (f)Costs be reserved.

4. A response has not been filed by the first respondent, however, an affidavit has been filed and in fact, the indications given, in relation to that particular aspect of the matter, are that the first respondent does not seek to participate in the proceedings before the Court.

5. There are, however, issues in relation to costs claimed by the applicants against the first respondent and to that end, orders were required to be made with regard to the continuation of the proceedings generally.  On 27 November 2014, therefore, orders were made relating to the first respondent in these terms:

   a)Leave is granted to the legal representative for the first respondent to withdraw from these proceedings.

   b)The issue of discontinuance of the proceedings, as between the first, second and third applicants and the first respondent, and argument as to the issue of costs between the first, second and third applicants and the first respondent be adjourned to a date to be fixed with leave granted for attendance by telephone.

6. Such orders will be required in relation to the matter, it being argued on the part of the applicants that the first respondent was deleterious in responding to the concerns raised by the first applicant and as a result of that, it was necessary for the first applicant to bring proceedings specifically seeking declarations that the disputed property had not vested in the trustee. 

7. The first respondent’s position was to indicate that at the first available opportunity the applicants were informed that the first respondent did not wish to contest ownership of the chattel items, the subject of the proceedings, and that therefore, they would otherwise abide the order of the Court and take a “passive role”, in relation to the proceedings.  The applicant’s position was to say that the trustee had been long involved in the administration of the estate of the deceased and that as a result of that, they should have and could have given notice far earlier, rather than after the institution of the proceedings. 

8. I shall address the issue of the listing of the proceedings, with regard to whether the application should be discontinued and more particularly, whether any order as to costs should be made, at the conclusion of these reasons.

9. The real issue in relation to the interim application therefore, relates to what orders should be made with regard to the preservation and securing of the personal property, the subject matter of the proceedings. It is conceded that there is a genuine dispute and hence a serious question to be tried relating to furniture and other chattel items currently in the possession of the second respondent. It is also clearly acknowledged that the Court has the power, pursuant to rule 14.11 of the Federal Court Rules 2011.

10. The power arises not pursuant to the rules of the Federal Circuit Court of Australia, but rather, pursuant to the Federal Court Rules because whilst the Federal Circuit Court Rules and the Federal Circuit Court (Bankruptcy) Rules do not contain rules, either for the preservation of property or do not contain rules relating to the preservation of property, they adopt where they are silent the Federal Court Rules. Federal Circuit Court Rule 1.05(3)(b) provides for the Federal Court Rules 2011 to apply to the Federal Circuit Court where they are not inconsistent with the Federal Circuit Court (Bankruptcy) Rules 2006. 

11. It is noteworthy that where rule 1.05(3)(b) provides that the Federal Court Rules apply to the Federal Circuit Court as detailed in part 2 of schedule 3, part 2 of schedule 3 does not contain Federal Court Rule 14, the rule of the Federal Court that relates to the preservation of property. It is argued and appears clearly to be accepted that the Federal Circuit Court Rules 2001, rule 1.05(2) does, however, provide that where the rules of the Federal Circuit Court are insufficient, the court may apply the Federal Court Rules and in this instance, rule 14.11(1)(a) allows a party to apply to the court for the detention and/or preservation and/or inspection of property.

12. If that were not sufficient, in any event, section 15(a) of the Federal Circuit Court of Australia Act gives to the Federal Circuit of Australia power to make orders of such kind including interlocutory orders as the Federal Circuit Court of Australia thinks appropriate. The power contained is broadly expressed and it is submitted and I accept would extend to a power to preserve property, the subject matter of a proceeding before the court.

13. Accordingly, pursuant to the Federal Court Rules or pursuant to a wide interpretation of section 15(a) of the Federal Circuit of Australia Act 1999, the court has the power to make a preservation order. It is that form of order which is sought pursuant to the interim orders which are detailed earlier in these reasons. The argument, therefore, comes down to a simple proposition, are the orders sought by the applicants in these proceedings the only proper basis upon which the chattels and other items in dispute can be preserved, pending the final determination.

14. I was addressed at length and in writing by counsel for the applicants in relation to the appropriateness of such orders being made and in particular, the need to consider the items which are, to a significant degree, the subject of the proceedings.  They are, in part, antiques or as described in written submissions, objects d’art.  Additionally, it is submitted that they are fragile or may need regular care, attention and monitoring, including dusting, oiling, winding of clocks and proper storage.

15. The applicants, therefore, seek to rely upon the expert evidence provided in this matter by Linda Heather Atkins and Andrew Michael Wright.  Ms Atkins, in her affidavit filed 31 October 2014, describes herself as the owner and managing director of Atkins Removals and Storage Pty Ltd and notes that the business which is now operated by her as owner and managing director, has been a business, operated until recent times by Ms Atkins and her former husband.  Mr John Atkins died in 2013 and the deponent indicates that she is now solely in charge of the business and because of more than 40 years experience in relation to the operation of a removal and storage business feels “well qualified” to comment on aspects of furniture removal and storage.

16. She details in paragraph 6 of her affidavit what are circumstances that would be in place with regard to the storage of items in dispute, if they were placed with her company.  She says:

    The storage premises of Atkins Removals and Storage Pty Ltd, located at 143-151 Lilydale Road, Rocherlea in the State of Tasmania is comprised of concrete floor, steel walls and steel roof.  These premises are secure.  We have a 3 metre security fence around the whole property with guard dogs full time engaged.  We also have security alarms installed.  The premises are suitable for the storage of antique furniture, clocks and objects d’art such as those set out in the Statement of Claim, a copy of which has been provided to me and which I have read for the purposes of making and swearing this Affidavit. 

17. She goes on to note in paragraph 7 that the company is “capable of and is prepared to comply with those interim orders” sought in the application filed on 31 October 2014.  Ms Atkins’ evidence is not challenged directly in relation to the matter, but it does appear clearly submitted on the part of the second respondent, that alternative arrangements made by her, with regard to the storage of items is secure and appropriate.  I shall come to that particular aspect in the matter a little later in these reasons.

18. However, reliance is also placed by the applicants upon the evidence of Andrew Michael Wright, a certified practicing valuer in Australia and a registered auctioneer in the State of Tasmania.  Mr Wright, after detailing his qualifications and noting that he has valuation and auction experience throughout Australia goes on  to assert as follows:

    I have expertise and experience in the valuing of antique furniture, antique clocks and antique Objet d’Art. 

19. Annexed to his affidavit is a copy of a valuation prepared by him on 19 February 2003.  That valuation relates to many of the items that are the subject of dispute between the applicants and the respondents and places a value on the items of $132,000.  Mr Wright has not had the recent opportunity of inspecting the items and assessing whether they remain in good condition, taking into account their age and, of course, whether they have been properly maintained, but indicates that if the items are in good condition, then their value is approximately $130,000, on today’s market. Mr Wright goes on to note that many of the items would be difficult to replace and that assessments would need to be made with regard to the cost of restoring any items that have been damaged during removal and/or storage. 

20. The evidence of Mr Wright, therefore, is that the items or at least many of them in dispute are items which require specialised care and specialised maintenance, which is not something that is provided, it would seem, by the second respondent. 

21. The second respondent in her affidavit, however, indicates that enquiries have at least initially been made by her in relation to the current market value of various items in her possession and that those items are valued very differently to what was the case some years ago, clearly making reference to the valuation provided by Mr Wright relating to an assessment in 2003.  At paragraph 83 of her affidavit filed on 21 November 2014, the second respondent says:

    All items, with the exception of the paintings, are held in a secure, clean, weatherproof private storage facility at an address nominated on the NRMA insurance policy as 3 Chuter Street, Deep Bay, Tasmania.

22. As best I can assess in relation to the matter, the storage facility referred to is in fact the residence of friends and neighbours of the second respondent and, as indicated by the second respondent, the neighbours monitor the furniture on a daily basis.  With respect, it is unclear at all what monitoring may mean and there is clearly a concern held as to many of the items which are the subject of dispute, particularly with regard to the need to ensure that they are appropriately stored and maintained.  There is no evidence that the persons with whom those items are placed are in any way appropriately maintaining or storing those items. 

1. It is a factor of some significance, particularly as it is submitted on the part of the applicants, that it may be some considerable time before the matter is able to proceed to trial.  As submitted on the part of the applicants, there is a concern that unless adequate and appropriate steps are taken to preserve the property, the chattel items may deteriorate or simply be damaged or destroyed. 

2. A number of considerations are detailed in the written submissions on the part of the applicant.  Those considerations include as follows:

   ·Many of the items of personal property are antiques or objet d’art or are fragile and also need regular care and attention and monitoring, including dusting, oiling and winding up and also need proper storage.

   ·Many of the items of personal property referred to in the valuation are susceptible to damage if not handled professionally.

   ·It is difficult to replace many of the items of personal property mentioned in the valuation.

   ·It is impossible to replace some of the items of personal property.

   ·Many of the items require periodic monitoring so as to preserve them.

3. Those are all factors which weigh in favour of professional preservation and monitoring of the items and it is only the evidence of the applicants which relate to the monitoring of such items.  Insofar as those items are concerned, it appears clear that there is a need to ensure that they are preserved, particularly in light of the fact that certain of those items require specialist maintenance and handling and there is no evidence that such specialised skills are held by the persons in whose possession they currently rest. 

4. In fact it is, with respect, a little troubling that there is no evidence whatsoever from those persons as to their capacity to provide for or to monitor those items.  Simply having good friends or neighbours watch over the items is insufficient when there is evidence of a greater need for care and monitoring.  Similarly, concerns arise with respect to the insuring of the items and no proper or comprehensive evidence is given by the second respondent in that regard.

5. Additionally in dispute is a Lexus motor vehicle which it is suggested on the part of the third applicant, is the property of the third applicant.  The second respondent says in her affidavit filed in relation to these proceedings that the Lexus was given to her by the deceased, Henry Harvey Kneipp.  That is a matter for trial, but in the meantime there needs to be some determination of what arrangements are appropriate, in relation to that motor vehicle. 

6. In that respect, the untested evidence at the present time is that the second respondent forwarded a motor vehicle then in her possession, a Mitsubishi Lancer, to members of the deceased’s family, and that the Lexus motor vehicle was then maintained by the second respondent and the deceased as their “family vehicle” until the death of Mr Kneipp.  It is further submitted that the Lexus is the only means of transport available to the second respondent and the retention by her for her own use can be properly and adequately remedied by damages, if there is any damage caused to the vehicle whilst in the possession of the second respondent. 

7. I am inclined to the view that, subject to appropriate steps being taken with regard to the comprehensive insurance of that vehicle and that comprehensive insurance being maintained by the second respondent, that the retention of the vehicle pending the determination of these proceedings is in order. 

8. Obviously, any determination to be made in relation to matters such as this, do not require a determination of the merits of the claims by either of the parties, but only to act in a manner which will preserve the property, the subject of proceeding, until such time as the case can be heard. 

9. To that end, in my assessment, the appropriate orders to be made will be orders which require the delivery up of at least those items acknowledged to be in the possession of the second respondent, exclusive of the Lexus motor vehicle, for the purposes of storage and preservation but that the Lexus motor vehicle remain in the possession of the second respondent, subject to her insuring that motor vehicle by way of comprehensive insurance, until the determination of the proceedings. 

10. Insofar as the issue of whether the proceedings against the first respondent should be dismissed, discontinued or otherwise dealt with, including with respect to costs, the orders will provide for the further listing.  The orders of the court therefore will be as detailed at the commencement of these reasons. 

I certify that the preceding thirty-nine (39) paragraphs are a true copy of the reasons for judgment of Judge Coker

Associate: 

Date:  20 March 2015