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Re Glenvine Pty Ltd (in liq)

Re Glenvine Pty Ltd (in liq)

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Supreme Court

New South Wales

Medium Neutral Citation: In the matter of Glenvine Pty Limited (in liquidation) [2020] NSWSC 866
Hearing dates: 19, 26, 30 June 2020
Decision date: 03 July 2020
Jurisdiction: Equity - Corporations List
Before: Black J
Decision:
Liquidator appointed without security as receiver of VBC Trust property and Darlinghurst Property with power of sale. Receiver permitted to draw reasonable costs and expenses, but not remuneration until approved by the Court, from realised funds. Parties to make further submissions as to costs.

Catchwords:
CORPORATIONS — Receivers and managers — Appointment of liquidator as receiver with power of sale — Where mortgaged property was the only substantial trust property — Where company in liquidation has right of exoneration for liabilities incurred under outstanding mortgage — Where there is outstanding judgment debt against company in liquidation in separate proceedings
EQUITY — Trusts and trustees — Transfer in equity — Imperfect gifts — Where no signed transfer had been delivered to transferee — Where certificate of title still held by mortgagee
FAMILY LAW — Property — Marriage — Adjustment of property interests — Proper construction of Family Court orders — Where trustee was not party to Family Court proceedings — Whether orders transferred title in property without compliance with orders for correspondence discharge of mortgage

Legislation Cited:
- Corporations Act 2001 (Cth) s 420, 436A, 440A(2)
- Evidence Act 1995 (NSW), s 128
- Family Law Act 1975 (Cth), ss79, 99AB, 99AE, 105, Pt VIIIAA
- Family Law Rules 2004 (Cth), r 6.02
- Home Building Act 1989 (NSW)
- Real Property Act 1900 (NSW), s 41
- Supreme Court Act 1970 (NSW), s 67
- Trustee Act 1925 (NSW), s 59

Cases Cited:
- 13 Coromandel Place Pty Ltd v CL Custodians Pty Ltd (in liq) [1999] FCA 144; (1999) 30 ACSR 377
- Australian Securities and Investments Commission v Primelife Corporation Ltd [2007] FCA 1874
- Australian Securities Commission v Marlborough Gold Mines Ltd [1993] HCA 15; (1993) 177 CLR 485
- AVS Group of Companies Pty Ltd v Commissioner of Police [2010] NSWCA 81
- Bastion v Gideon Investments Pty Ltd (in liq) [2000] NSWSC 939; (2000) 35 ACSR 466
- Brunker v Perpetual Trustee Co Ltd [1937] HCA 29; (1937) 57 CLR 555
- Bruton Holdings Pty Limited (in liq) [2008] FCAFC 184; (2008) 173 FCR 472
- Bruton Holdings Pty Ltd v Commissioner of Taxation [2009] HCA 32; 239 CLR 346
- Carter Holt Harvey Woodproducts Australia Pty Ltd v Commonwealth [2019] HCA 20; (2019) 368 ALR 3
- Commissioner of Stamp Duties v Buckle [1998] HCA 4; (1998) 192 CLR 226
- Cremin, in the matter of Brimson Pty Ltd (in liq) [2019] FCA 1023
- Doyle v Commissioner of Police (No 2) [2020] NSWCA 34
- E Pty Ltd v Klearchos [2016] FAMCA 258
- Galante v Galante [2019] FamCA 756
- Harris v Conway [1989] Ch 32
- Hosking, Re Business Aptitude Pty Ltd…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2020] NSWSC 866
Decision Date: 03 July 2020

CaseChat Overview and Summary

In the matter of Re Glenvine Pty Ltd, the court considered the appointment of a liquidator as a receiver with the power of sale, particularly in the context of a company in liquidation. The dispute arose from the mortgaged property, which was the only substantial trust property, and the company's right of exoneration for liabilities incurred under an outstanding mortgage. Additionally, there was an outstanding judgment debt against the company in liquidation in separate proceedings.

The primary legal issues the court addressed were the validity of the appointment of the liquidator as a receiver with power of sale and the interpretation of Family Court orders concerning the transfer of property. Specifically, the court examined whether the Family Court orders transferred title in the property without requiring compliance with the orders for the discharge of the mortgage. The court also considered whether the transfer of the property was an imperfect gift due to the absence of a signed transfer delivered to the transferee and the retention of the certificate of title by the mortgagee.

The court concluded that the liquidator could be appointed as a receiver with power of sale, given the company's right of exoneration. Regarding the Family Court orders, the court determined that the orders did not transfer title in the property without the necessary compliance for the discharge of the mortgage. The court held that the transfer was an imperfect gift because there was no signed transfer delivered to the transferee, and the certificate of title remained with the mortgagee. Consequently, the court found that the trustee, who was not a party to the Family Court proceedings, was still the legal owner of the property.

The court ordered that the liquidator's authority as a receiver with power of sale be recognised, subject to the company's right of exoneration. Furthermore, the court directed that the property remain in the trustee's name until the necessary steps were taken to discharge the mortgage and transfer the property in accordance with the Family Court orders.

Orders