Silversea Cruises Australia Pty Ltd v Abellanoza

Silversea Cruises Australia Pty Ltd (the appellant) appealed to the Court of Appeal of New South Wales against a decision of the primary judge concerning claims arising from the fraudulent activities of the respondent's wife, who had defrauded her employer of over $3.5 million and deposited these funds into bank accounts held in her name or jointly with the respondent. The appellant sought various orders to assist in recovering the defrauded amount.

The Court of Appeal was required to determine whether the primary judge erred in finding that the respondent did not knowingly deal with monies obtained by dishonest means and was therefore not personally liable to the appellant. Specifically, the court considered whether the primary judge erred in failing to find that the respondent knowingly dealt with monies obtained by dishonest means when he withdrew $20,000 after receiving a summons, and whether the respondent was personally liable to account to the appellant as a constructive trustee.

The Court of Appeal allowed the appeal in part. It reasoned that while the primary judge had correctly dismissed most of the appellant's claims, the respondent's withdrawal of $20,000 after receiving the summons indicated a knowing dealing with monies obtained by dishonest means, rendering him liable for that specific amount. The court applied principles of equity concerning knowing assistance and constructive trusteeship, finding that the respondent's actions in relation to the $20,000 withdrawal met the threshold for personal liability.

Consequently, the Court of Appeal amended the primary judge's orders to include an order that the respondent (referred to as the Second Defendant) is liable to account to the appellant for the sum of $20,000 withdrawn on 26 April 2018, together with specified interest. The parties were also directed to make submissions regarding costs.