Voyages Indigenous Tourism Australia Pty Ltd v Tristar Alliance Group Pty Ltd

Voyages Indigenous Tourism Australia Pty Ltd (Voyages) sued Tristar Alliance Group Pty Ltd (Tristar) for misappropriation of funds. Voyages, a company involved in indigenous tourism, contracted Tristar for a loan to fund a project. However, Tristar’s agent, who purported to act on behalf of Tristar, received the funds on behalf of Tristar but dissipated the moneys. Voyages sought to recover the funds, claiming that Tristar was liable for the misappropriation of the loan under a constructive trust or, alternatively, that Tristar’s agent had ostensible authority to receive the funds. The court was required to determine whether Tristar was liable for the misappropriation of the loan funds and whether the agent had ostensible authority to receive the funds on behalf of Tristar.

The court held that the moneys were not held on trust for Voyages and that Tristar was not liable for the misappropriation of the loan funds. The court found that there was no property to support a proprietary remedy because the moneys had been dissipated. However, Voyages could recover the value of the moneys as an equitable compensation as a personal remedy against Tristar. The court held that the agent did not have ostensible authority to receive the funds on behalf of Tristar because the reliance by Voyages on Tristar’s holding out of the agent as a duly authorised agent was unreasonable. The court found that Tristar was not bound by the actions of the agent.

The court ordered that Voyages recover from Tristar the value of the moneys as an equitable compensation as a personal remedy. The court did not order any other relief.