Macquarie Leasing Pty Ltd v DEQMO Pty Ltd

The case of Macquarie Leasing Pty Ltd v DEQMO Pty Ltd involved a dispute over competing security interests in certain assets. The first defendant, DEQMO Pty Ltd, had been appointed as a liquidator of the second defendant, 966206 NSW Pty Ltd. Macquarie Leasing Pty Ltd, the plaintiff, sought to enforce a security interest it claimed to hold over the assets of 966206 NSW Pty Ltd, asserting that these assets served as collateral for a debt owed by the second defendant. The dispute was adjudicated by the Federal Court of Australia.

The primary legal issues before the court were whether the first defendant, DEQMO Pty Ltd, possessed the authority to grant a security interest to itself and whether there was a valid security agreement governing the collateral in question. Additionally, the court examined the requirements under section 178 of the Personal Property Securities Act 2009 concerning an amendment demand. The court also considered whether the security interest held by the plaintiff was properly registered and enforceable against the liquidator.

The Federal Court held that the first defendant, as liquidator, did not have the authority to grant a security interest to itself. The court found that the security interest claimed by the plaintiff was not supported by a valid security agreement and was not effectively registered on the Personal Property Securities Register. Consequently, the court ruled that the plaintiff's security interest was not enforceable against the liquidator. The court emphasised that a company cannot validly grant a security interest to itself, and the liquidator's appointment does not confer the authority to grant such interests. The court found no evidence of a security agreement in favour of the first defendant, further invalidating the claim.

In light of these findings, the court dismissed the plaintiff's claims against the first and second defendants. The court ruled that the plaintiff's security interest was not enforceable, and the assets remained free of the plaintiff's claim.