Makhoul v State of New South Wales

The Federal Court of Australia heard a case involving a dispute over the ownership of a property at 22 Fenwick Street, Yagoona, in the State of New South Wales. The primary issue was whether the applicant, Ms Rosette Makhoul, could be granted an order to vest her half share of the property in her name, subject to certain conditions. The property was originally purchased by Ms Makhoul and her husband, John Makhoul, as joint tenants. However, after Mr Makhoul declared bankruptcy, the trustee in bankruptcy disclaimed his interest in the property under the Bankruptcy Act 1966 (Cth). This resulted in the property being registered in the names of Ms Makhoul and the State of New South Wales as tenants in common. Ms Makhoul sought an order for vesting her half share of the property in her name, subject to the existing mortgage and caveat, so she could sell it.

The court considered whether it was just and equitable to grant Ms Makhoul’s application for vesting, taking into account several factors. These included whether Ms Makhoul had a limited interest in the property and whether she would be burdened by the mortgage over the property if it were vested in her. Additionally, the court considered whether there were any competing interests or claims that might affect the making of the orders. The court noted that neither the Crown nor the mortgagee opposed the making of the orders, and there were no other competing interests. The effect of the orders would allow Ms Makhoul to sell the property, pay off the mortgagee, and recover any surplus after expenses.

The court concluded that the orders sought by Ms Makhoul should be made. It found that she had standing to make the application and that she had made a valid application pursuant to s 133(9) of the Bankruptcy Act 1966 (Cth). The court was satisfied that all formal matters concerning the service of the application had been appropriately addressed. The Crown had submitted an appearance, Mrs Makhoul consented to the orders being made, and Westpac indicated its consent subject to certain conditions that were met by Ms Makhoul. The court then ordered that Ms Makhoul's half share of the property be vested in her name, subject to existing charges, the mortgage to Westpac, and the caveat lodged by Mrs Makhoul.