Stolyar v Scott (Trustee)

Stolyar v Scott (Trustee) concerned a dispute over the ownership of property and funds, with the central issue being whether a resulting trust had been created in the property and funds held by Faina, the widow of Anchel. The case reached the court after a decision by the primary judge, which the appellants challenged, and the trustee in bankruptcy of Anchel brought a cross-appeal. The Federal Court of Australia was tasked with reviewing the primary judge's decision and the subsequent orders made by the court.

The court had to decide whether the primary judge erred in his exercise of discretion in ordering indemnity costs, given the arguments advanced at appeal that were not raised at the first instance. The court also considered whether the primary judge was correct in his analysis of the resulting trust, focusing on the source of the purchase moneys as determinative of whether such a trust arose. Additionally, the court examined whether the presumption of a resulting trust was weak and only arose in the absence of objective evidence regarding the intention of the person providing the funds. The court further assessed whether any resulting trust should have been in favour of entities other than the bankrupt, and whether an oral agreement gave rise to a trust or merely a contractual arrangement. Lastly, the court scrutinised whether the analysis of the availability of the defence of laches should have focussed on the conduct of the bankrupt or the trustee in bankruptcy.

The court found that there was no error in the primary judge's reasoning, and no error which would come close to providing a reason to set aside the primary judge’s exercise of discretion in ordering indemnity costs. The court concluded that the appeal should be dismissed with costs, and the cross-appeal should also be dismissed. However, as the cross-appeal was brought in response to the appeal, the Trustee should bear the costs of the cross-appeal.

The court made the following orders: 1. The appeal and cross-appeal be dismissed. 2. The appellants pay the respondent’s costs of the appeal. 3. The cross-respondents pay the cross-appellant’s costs of the cross-appeal. The entry of these orders is governed by Rule 39.32 of the Federal Court Rules 2011.