Willmott Forests Ltd (Receivers & Managers appointed) (in liquidation) v Primary Securities Ltd

The case involved Willmott Forests Limited, which had been in liquidation, and Primary Securities Limited, which was the replacement responsible entity of the forestry managed investment scheme. The dispute centred around the nature of the land on which the scheme operated, and whether it constituted property of the scheme. The case was heard by the Federal Court of Australia.

The primary legal issue was determining whether the land on which the forestry managed investment scheme operated was property of the scheme, and thus, subject to the rights and obligations of the replacement responsible entity under the Corporations Act 2001 (Cth). The court needed to establish whether the land was a contribution of money’s worth to the scheme or acquired with the contributions or proceeds of contributions. The court also had to determine the extent of the forestry rights and the entitlement of the replacement responsible entity to those rights.

The court found that the land was not a contribution of money’s worth to the scheme, nor was it acquired with the contributions or proceeds of contributions. Consequently, the land was not held on trust for the scheme, and the former responsible entity’s rights were transferred to the replacement responsible entity. The court held that the replacement responsible entity stood in the shoes of the outgoing responsible entity and now held the rights of the former entity. The court further determined the extent of the forestry rights and confirmed that the replacement responsible entity was entitled to those rights.

The court ruled in favour of Primary Securities Limited, the replacement responsible entity, confirming its entitlement to the forestry rights. The court's decision provided clarity on the nature of the land in forestry managed investment schemes and the rights of replacement responsible entities under the Corporations Act 2001 (Cth).