Salvo v New Tel Ltd

The case of *Salvo v New Tel Ltd* concerned a dispute over funds allegedly held on trust. The appellant, Salvo, claimed that money lent to New Tel Ltd for the purpose of purchasing a company, and subsequently paid as a deposit, was held on trust for him. This deposit was later returned to New Tel Ltd. A related issue involved a subscription agreement where Salvo alleged that subscription monies, paid partly in cash and partly through set-off, were also held on trust.

The primary legal issues before the Court of Appeal of New South Wales were whether the returned deposit constituted property held on trust for Salvo, and whether the amounts set-off under the subscription agreement were part of the subscription price and thus subject to an express trust. The court was required to consider the principles governing *Quistclose* trusts and express trusts, particularly in relation to the identification of trust property and the nature of the consideration for the subscription agreement.

The court discussed the principles of *Quistclose* trusts, noting that such trusts arise when money is paid for a specific purpose and the payer retains an equitable interest in the funds. However, the court found that the evidence did not establish that the returned deposit was held on trust for Salvo. Regarding the subscription agreement, the court considered whether the set-off amounts could be considered part of the subscription price and therefore subject to an express trust. The court ultimately determined that there was no identifiable property capable of being the subject-matter of a trust in relation to the set-off amounts.

The appeal and cross-appeal were dismissed, and no order was made as to costs.