Sapphire (SA) Pty Ltd v Ewens Glen Pty Ltd

Sapphire (SA) Pty Ltd sought orders for the appointment of joint and several receivers and managers of the property of a trust of which Ewens Glen Pty Ltd was trustee. Ewens Glen Pty Ltd was in liquidation, and the liquidators of the company applied for the appointment as receivers and managers of the trust property. The trust was created by the company, which was trustee and sole beneficiary. The appointors and primary beneficiaries of the trust were bankrupts, and the liquidators of those parties had the power to exercise the power of appointment of the trustee. The liquidators also sought a direction under section 479(3) of the Corporations Act 2001 (Cth) that Ewens Glen Pty Ltd remain trustee of the trust while in liquidation. The court considered the nature and purpose of the trust, the rights and obligations of the parties, and the potential consequences of the appointment of receivers and managers. The court held that the liquidators should be appointed receivers and managers of the trust property, but declined to give the direction sought under section 479(3). The court found that the primary purpose of the trust was to provide for the bankrupt appointors and beneficiaries, and that the appointment of receivers and managers was necessary to protect the interests of creditors and beneficiaries. The court also noted that the liquidators had the power to exercise the power of appointment of the trustee, which supported their appointment as receivers and managers. However, the court declined to give the direction under section 479(3), as it considered that the liquidators should be free to exercise their powers as receivers and managers without being bound by the directions of the court. The court gave the liquidators leave to formulate an appropriate direction. The liquidators were ordered to be heard further as to the appropriate orders in light of these reasons.