YUDGMENT No.l SO SB. CATCHWORDS BANKRUPTCY - trust formed in anticipation of bankruptcy - held a sham - held bankrupt beneficial owner of moneys in trust. Bankruptcy Act 1966, ss.116, 120, 121 Re: Joy Naomi Jacka Ex Parte: The Official Trustee in Bankruptcy Qld E781 of 1985 PINCUS J. BRISBANE 10 MARCH 1988 IN THE FEDERAL COURT OF AUSTRALIA GENERAL DIVISION ~~ QLD E781 of 1985 BANKRUPTCY DISTRICT OF THE SOUTHERN DISTRICT OF THE STATE OF QUEENSLAND —~ RE: JOY NAOMI JACKA Bankrupt EX PARTE: THE OFFICIAL TRUSTEE IN BANKRUPTCY (as trustee of the estate of JOY NAOMI JACKA, a Bankrupt) Applicant KAREN BEVERLEY McMILLAN First Respondent TANGERINE PTY LIMITED Second Respondent SHELLEY LU JACKA Third Respondent PINCUS J. 10 MARCH 1988 REASONS FOR JUDGMENT The Official Trustee in Bankruptcy applies for declarations and orders which may be generally described as being attempts to recover property alleged to have been disposed of by the bankrupt in anticipation of her bankruptcy. The bankrupt attained that status by presenting her own petition on 24 October 1985. The respondents to the trustee's application, apart from the bankrupt herself, are two daughters, Karen Beverley McMillan IN THE FEDERAL COURT OF AUSTRALIA ) GENERAL DIVISION ~ QLD E781 of 1985 BANKRUPTCY DISTRICT OF THE SOUTHERN DISTRICT OF THE STATE OF QUEENSLAND ~ ~~ RE: JOY NAOMI JACKA Bankrupt EX PARTE: THE OFFICIAL TRUSTER IN BANKRUPTCY (as trustee of the estate of JOY NAOMI JACKA, a Bankrupt) Applicant KAREN BEVERLEY McMILLAN First Respondent TANGERINE PTY LIMITED Second Respondent SHELLEY LU_JACKA Third Respondent MINUTES OF ORDER . JUDGE MAKING ORDER: PINCUS J. DATE OF REASONS: 10 MARCH 1988 DATE OF ORDER: 8 APRIL 1988 WHERE MADE: BRISBANE THE COURT: 1. DECLARES that the land described as Lot 411 on Registered Plan No. 151590, County of Ward, Parish of Gilston, containing 840 sqm and being land contained in Certificate of Title Volume 5595 Folio 247 is beneficially owned by the Applicant Trustee subject to registered Bill of Mortgage No. H528536; AND ORDERS that the said property vest in the Applicant Trustee forthwith subject to the said mortgage; AND FURTHER that the mortgagee, the National Australia Bank Limited, forthwith in conjunction with the Applicant Trustee lodge the said Certificate of Title with the Registrar of Titles to enable the Applicant Trustee to be registered as Registered Proprietor; DECLARES that the land described as Lot 441 on Registered Plan No. 181204 County of Ward, Parish of Gilston, containing 924 sqm and being land contained in Certificate of Title Volume 6271 Folio 68 is beneficially owned by the Applicant Trustee subject to the Registered Bill of Mortgage No. H499036 and subject to a charge in favour of Shelley Lu Jacka in the sum of four thousand seven hundred and eighty dollars ($4,780.00); AND ORDERS that the said property vest in the applicant Trustee forthwith subject to the said mortgage and the said charge; AND FURTHER that the mortgagee, The Associates Pty. Ltd., forthwith in conjunction with the Applicant Trustee, lodge the said Certificate of Title with the Registrar of Titles to enable the Applicant Trustee to be registered as Registered Proprietor; DECLARES that the moneys standing to the credit of account No.: 007-820-8768 in the name of "Lena Brown" with the Metropolitan Permanent Building Society, constitute property divisible amongst the creditors of the Bankrupt pursuant to s.116 of the Bankruptcy Act 1966; AND ORDERS that all such moneys be paid forthwith to the Applicant Trustee. DECLARES that the Sigma motor vehicle registration JNIJ-79 was the property of the Bankrupt at the date of Bankruptcy and that the applicant is entitled to same as Trustee. Settlement and entry of orders is dealt with in Rule 124 of the Bankruptcy Rules. and Shelley Lu Jacka and a trustee company, Tangerine Pty Limited. A number of items of property must be dealt with in these reasons and the evidence relating to each separately analysed. However, some part of the history of the matter is relevant to all the transactions to be discussed. Considered (as I regard them) as a group, those transactions began in October 1982, some three years before the bankruptcy. The avoiding provisions relied on by the applicant trustee are ss.120 and 121 of the Bankruptcy Act 1966. The former has two time limits: that in subs.(1) is two years, and the latter, that in subs.(2), is five years. Each of these provisions - subs.(1) and subs.(2) - deals with settlements of property before bankruptcy. So far as relevant to this case, the 1mportant differences between the two provisions are that proof of "good faith and ... valuable consideration" defeats an application under subs.(1) but not necessarily one under subs.(2). The trustee succeeds under subs.{(2) unless it is shown against him (to put it simply) that the settlor was solvent at the time of the settlement and that his or her interest passed straight away. In default of proof of an act of bankruptcy earlier than the date of presentation of the petition (24 October 1985), that date is the date of the commencement of the bankruptcy for the purposes of these provisions. Section 121(1) has no time limit and allows attack on dispositions with intent to defraud creditors. The essential cause of the bankrupt's financial problems was that during the last Gold Coast real estate boom she contracted to buy high rise units off the plans, apparently hoping to sell them for a profit before settlement. The market fell; there was no "on sale" of two of the units and asa result the bankrupt did not settle. Legal proceedings were brought against her by two of the vendors, one of whom obtained judgment for damages in the Supreme Court on 9 February 1984. It is important to note, however, that long before that judgment was obtained, the bankrupt had become apprehensive about the effect these transactions in units were likely to have upon her financial position. On 27 September 1982, she wrote a letter to a Mr. Towers, who was involved in one of the purchases, saying: "However IF WE CAN GET OUT OF THE CONTRACT then that is the way to go, as we cannot settle." The letter went on: "I will be eagerly awaiting news from Peter Frost, as 'right from the horses Esicl] mouth' the big boys are keeping the deposit and suing. Sorry the news is not better, but I dont [Esic] see how it CAN be .. its OUT as fast as possible before Rbgistration Csicl etc. and get any property out of your name ASAP into a Deed of Trust or Coy. name ..." A month later, the bankrupt's solicitor, Mr. Wilson, wrote her a letter acknowledging instructions to constitute a trust and referring to the problem of future bankruptcy. Then on 25 November 1982, the bankrupt typed a letter to her solicitor saying: "I would like Palm Beach & Wyuna tucked away safely as possible from being touched by Developers." The bankrupt claimed she did not recall typing the letter, but it was found in a bundle of documents taken from the bankrupt's premises in 1986. The documents to which I have just referred suggest that, long before the judgment of February 1984, the bankrupt had it in mind to salt her property away. Far from dispelling the impression created by those documents, evidence of later events reinforced it; I refer to the use of false names and the like in the carrying out of the transactions discussed below. The case made by the trustee was that the series of transactions I have mentioned was entered into in anticipation of bankruptcy and to defeat the creditors 1n bankruptcy. The origin of the law presently embodied in s.121(1) 1s the statute 13 Eliz.c.5. In Barton v. The Deputy Commissioner of Taxation of the Commonwealth of Australia (1974) 131 C.L.R. 370 at p.374, Stephen J., 1n a judgment with which the other members of the High Court agreed, said: "... it is well established that conveyances may fall within that Statute, although there existed no creditors at the date of conveyance, so long as the intent to defeat future creditors be made out ..." As I understand the operation of s.121, it is not enough for the trustee to show merely that a disposition of property has been made with the idea, wholly or in part, of taking property out of the reach of future creditors; there must be intent to defraud. In the ensuing passages, there is discussion of the dealings referred to in evidence under a number of headings; it is not possible neatly to categorize them, as they interconnect at various points. 1. Palm Beach The description of the property in question is lot 1 on registered building units plan no. 4304. According toa letter written by Mr Wilson to the Commissioner of Stamp Duties, the bankrupt made a gift of the unit to her daughter, Mrs McMillan, who in turn sold the unit to Tangerine Pty Limited for the sum of $20. Tangerine Pty Limited, mentioned above as the second respondent, was made the trustee of the Jacka trust on 28 October 1982. The bankrupt and Mrs McMillan were the directors, but the latter lived in Victoria and the bankrupt in practice managed the company. She claimed the trust was formed in order to provide for her children in the event of her death. I find that not to be so. It was simply a part of the mechanism designed to keep her property out of the reach of creditors; cf. Cranstoun v. Federal Commissioner of Taxation £1984] 2 A.T.C. 4,876 at 4,882. The Palm Beach property is the same as is mentioned in the bankrupt's letter to Mr Wilson, partly quoted above. The trustee's case was that the transactions with it were designed to see it "tucked away safely as possible", as set out in that letter. According to the form VGl, the "notification of change of ownership" required to be given to the Valuer-General, possession of the property was given to Mrs McMillan as purchaser on 12 November 1982. That appears to be unlikely. The date of taking possession under the further transaction from Mrs McMillan to Tangerine Pty Limited was, according to the VG1, 15 November 1982. The transfers lodged in the Real Property Office have corresponding dates. It is clear that these documents were predated. Mr Wilson said, in effect, that he "would presume" from the notes on his file that his instructions were obtained on 22 November 1982 and, as I have pointed out, the letter which mentioned tucking Palm Beach away, found among the bankrupt's possessions, was dated 25 November. The backdating, in my opinion, helps the applicant trustee. If Mrs Jacka were, at the time, concerned about future bankruptcy, the backdating would have some point to it. If, as is her version of events, the trust had nothing to do with bankruptcy, the backdating 1s incomprehensible. The bankrupt said in her evidence, speaking of the property in question: "I gifted it to Karen, and later on she put it into the trust ..." I do not believe that. The transfer to Karen (McMillan) and then to the trust were two aspects of one transaction, and in a practical sense, were two phases of the tucking away spoken of in the letter of 25 November. The bankrupt, when asked if she knew why Mrs McMillan put the property into the trust, said: "She put it in because she was going back home, and she had aman friend down there, and he had a business, and she thought that maybe she could come up. She was having problems with him at that time. She thought she could come up, and then she realised it was terribly hot. It was Christmas time, and she said, 'I really don't think I. could train horses up here.'" The difficulty of accepting this 1s obvious. Even the (predated) transfers have only three days between them. In my opinion, the double transaction - the transfer to Mrs McMillan and then onto the trust - was an attempt to complicate the trail which would have to be followed in the event of bankruptcy. The Palm Beach property was sold by Tangerine Pty Limited, under a contract which was settled on 8 January 1985, for $55,000 and a sum of $652,541.13, part of the proceeds, was paid into the company's bank account. I find that the disposition of the property 1n question to the trustee company, Tangerine Pty Limited, was such a transaction as described in s.121(1) of the Act. The finding involves treating the interposition of Mrs McMillan as a mere device and I so treat it; there was no independent decision by Mrs McMillan to transfer the property to Tangerine Pty Limited. The inference I draw is that both steps were taken at the direction of the bankrupt. Further, I am of the view that there is no question of application of s.121(2), preserving the interest of a "person who has, in good faith and for valuable consideration" acquired a property. Whether these findings should be expressed as declarations is another question, discussed below. From the bank account just mentioned, money went out towards the purchase in 1985 of one of the other properties the subject of this application, namely that situated at Burleigh Waters, discussed in part 6 of these reasons. 2. Main Beach About the same time as the Palm Beach property was disposed of to Tangerine Pty Limited, the bankrupt sold a dwelling house she owned at Main Beach. The contract was dated 28 November 1982. This property 1s one of those mentioned in the letter of 25 November quoted above; it 1s located at Wyuna Street. There is no suggestion made by the applicant that the purchaser took other than in good faith. What the applicant wishes to do, however, is to follow the proceeds. They were originally banked to an account the bankrupt had with Westpac at Broadbeach - on 21 December 1982. On the following day, $60,000 was taken from that account anda week later $38,000 was withdrawn. The bankrupt then opened two accounts in the name of "Robson". One was with the National Australia Bank, Broadbeach and the other with the Commercial Banking Company Limited at Mermaid Beach. She paid a total of $39,000 into the former anda total of $26,000 into the latter. Those moneys were all paid in between 23 December 1982 (the first payment, of $10,000, to the Broadbeach account) and 6 January 1983 (the last payment, of $8,000, to the same account). This was part of the flurry of activity on her part generated by the downturn in the Gold Coast unit market. During the course of investigations of these matters, the bankrupt claimed that, unknown to her, a Mrs Curran had lent money to her husband and herself during the 1970's and that the payments to "Robson" were to Mrs Curran. Documents were produced in support of that story, but 1t was then abandoned. On 22 May 1986, in her public examination, the bankrupt gave evidence agreeing that the documents she had produced were "entirely false". It appears that they were fabricated as part of the bankrupt's plans to get money away from creditors. In fact, although the bankrupt, in evidence before me, seemed unwilling to accept that she had admitted fabrication of these documents, it is clear that she did admit that and equally clear that they were fabricated. I find that the name "Robson" was used to lessen the risk that the money would be found. There was no such person 10. known to the bankrupt, and her story about Mrs Curran was invented. About the same time, the sum of §58,615 was deposited with Trustees Executors and Agency Co. in the bankrupt's maiden name, Joyce Dalton. The version given in relation to that was that the bankrupt did not want one of her daughters to know of the account. I cannot accept that. In my opinion, the purpose of use of the maiden name was the same as that of use of the name "Robson". Further discussion of the moneys just dealt with - in the National Australia Bank, Broadbeach, in the Commercial Banking Company Limited, Mermaid Beach, and on deposit with the Trustees Executors and Agency Co. - appears in part 4. 3. Sunbird Court Mr Wilson acted ina purported purchase by "Sherry Le Robson" of a unit at Sunbird Court in Burleigh Waters. The property was, when sold, described as lot 3 on registered building units plan 5233. The contract was dated 17 December 1982 and the transaction was settled on 7 January 1983. A "special condition" typed on the back page of the contract made it "Subject to and conditional upon the purchaser obtaining final settlement on the sale of her dwelling house at 5 Wyuna Street, Coral Gables on or before 21st December, 1982". The presence of this condition supports the inference that the price of the property ($60,000) was to come wholly or in 11. part from the proceeds of sale of the property at Wyuna Street, Main Beach. Of the $60,000, a total of $57,500 can be traced out of the accounts resulting from the Main Beach sale. On 6 January 1983, $35,000 was drawn from the National Australia Bank Account and on 4 January 1983 $22,500 came from the Commercial Banking Company account. Those sums were paid into Mr Wilson's trust account for the purchase of the Sunbird Court property. After that purchase, the bankrupt resided at Sunbird Court for a while. She was ostensibly paying rent to one Robson who, of course, did not exist. It was said by the bankrupt that her daughter was at the mercy of certain criminal elements who wanted to get hold of her assets, but there is in my opinion no truth in the suggestion that her dealings were caused by that circumstance. The unit at Sunbird Court was sold in November 1984 and the proceeds went to Tangerine Pty Limited, the trustee referred to above. It is to be noted that the authority to place the money in the account of Tangerine Pty Limited purported to be signed by one Robson. 4. The Trustees Executors and Agency Co. Moneys and other Accounts I have mentioned in part 2 that a sum totalling $58,615 was deposited with Trustees Executors and Agency Co. The deposits 12. were made between 27 October 1982 and 12 April 1983 and the bankrupt's maiden name "Joyce Dalton" was used. The bankrupt lodged a proof of debt with the liquidator of Trustees Executors and Agency Co. and received from the liquidators the sum of $42,875.94. That amount was banked to an account with a building society in the name "Freeman". Various stories were told about the use of these false names and during her public examination the bankrupt claimed she used the name "Freeman" "to keep things from my daughter and the men behind her, her associates". I do not believe that and am of the opinion that the false names were used to make it difficult for creditors or their representatives to chase assets. Later (in December 1985) three accounts with the same society (Metropolitan Permanent Building Society) were opened in the name of "Peta Kelly". The next false name used was "Lena Brown" and a further account was opened in that name in March 1986. It 1s not possible, as it seems to me, accurately to ascertain the source of all payments into and fate of all payments out of these accounts. The balance in the "Lena Brown" account 1s currently $14,258.31. The bankrupt appears to maintain that moneys received from the estate of her aunt, Mrs Curran, were intended to be held in trust. It appears that a cheque for $16,469.31 came from the Victorian Public Trustee in December 1985 on account of that estate, and that these moneys then flowed into the "Lena Brown" account. 13. The bankrupt claims that the estate moneys were intended to be held by her in trust for her daughters. In support of that, a statutory declaration by one Colin Henry Fellow-Smith has been produced. Mr Fellow-Smith says in the declaration that he was the manager of a hospital, of which I gather Mrs Curran was an inmate. He says that Mrs Curran told him "Joy would be all right and that her monies would go to nieces and newphews Csic] and that Joy would take charge of the money to be shared between Karen and SHELLEY AS THEY NEEDED IT". Mr Fellow-Smith says, "She was writing a letter of intention in this regard, but apparently it became misplaced on her death at the hospital". A similar version of these events is given by Mrs Jacka. She says that her aunt "never left a will but she had a letter of intention and it has never been able to be found at the hospital". One circumstance which would tend to make one doubt that story was that Mrs Jacka admitted that the two daughters had never been told that they had any interest in the money. Claims that money left by a will or under an intestacy 1s subject to a secret trust arise, ordinarily, in suits against the alleged trustee. Here, that person herself claims a trust existed. I accept that, even where there is no will, an undertaking by a next of kin to apply property for a particular purpose may be enforced: Jacobs' Law of Trusts in Australia, 5th ed., para.719. Clear proof of the trust or undertaking is 14, necessary. Having studied the evidence relating to this point, I do not feel satisfied of the truth of the bankrupt's case about it. In my opinion, the money which came from the Public Trustee represented an interest in an estate held at the date of bankruptcy. 5. Robina On 23 November 1983, a block of land at Robina was bought for $47, 800. A Mrs Pridham has given evidence that the bankrupt bought the land without telling Shelley Jacka, who is supposed to have been a co-purchaser. The bankrupt denies Mrs Pridham's version of these events. The land was bought in the names of Shelley Lu Jacka and Tangerine Pty Limited as tenants in common in equal shares. As to the mode of payment for the land, a number of versions exists. Shelley Jacka said that she got $50,000 from having gone on a two-week holiday on the Sunshine Coast and that the money was used to buy the Robina land. The bankrupt, in her public examination, agreed with that story. Subsequently, the bankrupt said only $40,000 {or thereabouts) of the price came from Shelley Jacka and the rest from Tangerine Pty Limited. 15. Then, at a later stage, the bankrupt talked about $22,000 of the money having come by way of loan from people called Armstrong. She said the repayments of the loan were made by Shelley Jacka and that $40,000 was later paid by Shelley Jacka to reimburse the bankrupt. At the risk of being excessively repetitive, I would remark one could not place much reliance upon the bankrupt's version of these events. There is a ledger card which shows that the bankrupt paid two sums of $11,000 and $10,000 from the "Freeman" account to Mr Wilson's trust account on 21 December 1983 and 22 December 1983 respectively. The dates correspond with the dates of cash withdrawals from the "Freeman" account, which were made in the same amounts on the same dates. It seems clear that $22,000 came by way of loan from the Armstrongs. Repayments under the mortgage have been attended to by the bankrupt; there 1s a large degree of correspondence between deposits to that account and withdrawals from the "Freeman" account. Further, there is a document exhibited to an affidavit of Mr. Hosking (which document the bankrupt admits to having written) in which she said, in effect, that she bought the Robina land by putting in $25,000 and borrowing $22,000. The document went on to say that its author (the bankrupt) paid the interest at $283 per month. Despite the variance between the accounts given about the matter, there is no reason to doubt that, apart from the deposit, the money necessary to purchase the land supplied by the 16. bankrupt, partly by means of the moneys extracted from the "Preeman account" and partly by borrowings. As to the deposit of $4,780, the matter is not quite so clear. The bankrupt said at one stage that the sum was paid by Tangerine Pty Limited and that her daughter Shelley reimbursed the amount later. Other documents support the notion that Shelley Jacka contributed to the purchase. One could not be certain what the truth is, but on the whole I think I. should find that the deposit came from Shelley Jacka. There 15 a mortgage onthe Robina land, apparently supporting a loan to Mrs McMillan. The mortgagee is not a party to these proceedings and it would plainly be improper to make any order against it. It therefore becomes unnecessary to consider the question - left rather obscure by the papers before me - whether, and to what extent, the security 1s good against the trustee. It appears to me then that the Robina land belongs to the trustee, subject to a charge ina sum of $4,780 in favour of Shelley Jacka and to such rights as the registered mortgagee has. 6. Burleigh Waters The money from the sale of the Sunbird Court property was used to buy a dwelling house at Burleigh Waters from a vendor called Lenjo Pty Ltd, the contract having been made on 22 November 1984; the property was bought in the name Tangerine Pty Limited. 17. Other moneys came from the Trustees Executors and Agency Co. account and the proceeds of sale of the Palm Beach property. There was also an advance arranged by way of commercial bill by the National Australia Bank through Mr S. Ravenscroft, who dealt with the bankrupt concerning the loan. It appears that the land is subject to registered mortgage number H528536 in favour of the National Australia Bank. The trustee did not assert that any order should be made affecting the rights of the mortgagee, nor would it be possible to make such an order without notice to it. Apart from that it seems to me that no other person than the bankrupt has any proprietary right of a beneficial kind in respect of the Burleigh Waters property. To put that more precisely, I find that although the property was registered in the name Tangerine Pty Limited, the cestui que trust was the bankrupt. 7. Motor Vehicle There is a dispute concerning a Sigma motor vehicle, reg. no. JNJ-79 which appears to have been assigned to Mrs McMillan for a nominal sum in 1983. The documents suggest that the transfer was intended to be only temporary and the bankrupt kept the vehicle in her possession. It seems clear enough, in the circumstances, that the trustee is entitled to disregard the transfer to Mrs McMillan. 18. ORDERS SOUGHT The trustee claimed orders in 18 paragraphs which it is umnecessary to set out in full; the orders sought fall into groups. Orders 1 - 3: These relate to the 1982 dealings with the Palm Beach property referred to in part 1 above. The trustee seeks declarations that the successive transfer are void against him under ss.120 and 121. I am satisfied that the transfers were made with intent to defraud creditors and that they were not dispositions for valuable consideration in favour of persons who acted in good faith. It follows that the applicant 1s entitled to treat them as void. However, it is inappropriate to make declarations accordingly, because the Palm Beach property was last sold under a contract settled in January 1985, and that transaction is not attacked; it was a sale to an outsider. Treating the two earlier transfers as void would, therefore, avail the applicant not at all. However, the proceeds of the sale of that property, as I have mentioned, went to the account of Tangerine Pty Limited and were applied to the purchase of the Burleigh Waters property. I find that those proceeds were beneficially owned by the bankrupt at all material times. That is, I have decided that Tangerine Pty Limited was merely a facade; the true intention was 19. that moneys in that name would be beneficially owned by the bankrupt. Orders 4 - 6: These orders relate to the purchase of the unit at Sunbird Court, in which moneys derived from the sale of the Main Beach property were used, as explained in part 3 above. What the trustee seeks is a declaration that the transfer of the proceeds of sale to Tangerine Pty Limited is void against him. I find that that transfer was such a disposition as is mentioned in s.121(1) of the Act. However, the moneys in question have gone; they were used to buy the Burleigh Waters property discussed in part 6 above. It therefore seems inappropriate to make a declaration which would be of historical significance only. I find that the money from the proceeds of sale of the Sunbird Court unit were beneficially owned by the bankrupt; the supposed trust was a sham. I do not propose to make any of the orders sought in para.4, 5 and 6 of the application. Orders 7 & 8: The applicant seeks a declaration to the effect that the proceeds of sale of the Palm Beach property, and of the Sunbird Court property, were used by Tangerine Pty Limited to buy the Burleigh Waters property, and that Tangerine Pty Limited holds that property in trust for the applicant. I have already found that the cestui que trust under the Tangerine Pty Limited trust was the bankrupt, when the property was registered in the name Tangerine Pty Limited. It follows that that 20. beneficial interest vested on 24 October 1985, if not earlier, in the applicant. It appears to me that the proper course is to make a declaration that the land described as lot 411 on registered plan number 151590 county of Ward, parish of Gilston, certificate of title volume 5595 folio 247 is beneficially owned by the applicant trustee, the land being subject to a registered mortgage number H528536. There will also be an order vesting the said property in the applicant trustee subject to the said mortgage. Orders 9, 10, 11 & 12: These relate to the Robina property. The trustee seeks a declaration that the application of moneys towards the purchase of the property constituted such a disposition as is mentioned in s.120 or s.121, and a declaration that the land 1s held in trust for the applicant. IT have found that the deposit of $4,780 came from Shelley Lu Jacka; the rest of the money which went towards the purchase was beneficially owned by the bankrupt. It 1s not immediately obvious what would be the result of declaring the application of the moneys towards the purchase to be void against the applicant. Presumably, the purpose of doing so would be to enable the trustee to disregard Shelley Lu Jacka's being registered as one of the property's legal owners, but it does not appear to me that the declarations sought would achieve that result. There is a more fundamental objection: the application of moneys sought to be treated as void was effected by 21. paying the moneys to the vendor. There is no question of recovery of those moneys; they have been, and will remain, paid. I therefore decline to make the declarations sought with respect to the application of the moneys. I am satisfied, as TI have mentioned, that at the date of the bankruptcy the beneficial owner of the land was the bankrupt. Subject to a charge for the sum of $4,780 in favour of Shelley Lu Jacka and the rights of the mortgagee, by virtue of the bankruptcy, that beneficial interest vested in the applicant and there will be a declaration that the land 1s the property of the applicant subject to the interests I have mentioned - the charge and the mortgage - and an order vesting it in the applicant. Order 13: Next, the applicant seeks a declaration that the moneys in the "Lena Brown" account with the Metropolitan Permanent Building Society constitute moneys divisible among the creditors pursuant to s.116. The substantial dispute about the "Lena Brown" moneys has been dealt with above; it related to the sums which came from the Curran estate. I propose to make a declaration that the moneys standing to the credit of an account in the name of "Lena Brown" with the Metropolitan Permanent Building Society constitute property divisible among the creditors of the bankrupt pursuant to s.116 of the Bankruptcy Act 1966, and to order that all such moneys be paid to the applicant. 22. Orders 14. - 16: These relate to the Sigma motor vehicle, registration JNJ-79, registered in the name of the first respondent. In accordance with the reasons, there will he a declaration that the said vehicle was the property of the bankrupt at the date of the bankruptcy and that the applicant is entitled to the same as trustee. To enable the party to make submissions as to the form of the proposed declarations and orders, and on the question whether any other declarations and orders should flow from the findings I have made, the matter will be listed for further mention. It does not seem to me appropriate to make any order for costs other than one against the bankrupt herself, but I shall, if desired, hear the parties on that question also. { certify that this andthe Q/ preceding peges are a true copy cf the reasons for judgment herein of His Honcur Mr, Justice Pincus Argel: Factew Y Associate Dated /O Marc 1989