Krejci, in the matter of Union Standard International Group Pty Limited (in liq) [2021] FCA 1483

Federal Court of Australia

Krejci, in the matter of Union Standard International Group Pty Limited (in liq) [2021] FCA 1483 File number(s): NSD 754 of 2020

Judgment of: JAGOT J

Date of judgment: 26 November 2021

Catchwords: CORPORATIONS — financial services and markets — corporation holding financial services licence insolvent — priority in distribution of proceeds of liquidation as between trading clients and investing clients — whether investing clients provided with financial products or financial services — whether statutory trust over moneys paid by both trading clients and investing clients to the insolvent licensee exists — statutory trust over moneys paid to licensee by trading clients and investing clients held for benefit of both classes of clients — application by liquidators for directions relating to exercise of liquidators powers

Legislation: Corporations Act 2001 (Cth) ss 660K, 761A, 761D, 763A(1), 763B, 763C, 763E, 764A, 766A(1)(b), 766A(1)(c), 766C, 766D, 767A(2)(a), 981A(1), 981B, 981D, 981F(a), 981H, Sch 2 – Insolvency Practice Schedule (Corporations) s 90-15(1) Corporations Regulations 2001 (Cth) regs 7.8.01(5), 7.8.02A, 7.8.03(4), 7.8.03(6)(a),7.8.03(6)(c), 7.8.03(6)(d)

Cases cited: ABN AMRO Bank NV v Bathurst Regional Council [2014] FCAFC 65; (2014) 224 FCR 1 Australian Securities and Investments Commission v Secure Investments Pty Ltd (No 2) [2020] FCA 1463; (2020) 148 ACSR 154 Barclays Bank Ltd v Quistclose Investments Ltd [1970] AC 567 Black v S Freedman & Co [1910] HCA 58; (1910) 12 CLR 105 Brady v Stapleton [1952] HCA 62; (1952) 88 CLR 322 Caron and Seidlitz v Jahani and McInerney in their capacity as liquidators of Courtenay House Pty Ltd (in liq) and Courtenay House Capital Trading Group Pty Ltd (in liq) (No 2) [2020] NSWCA 117; (2020) 102 NSWLR 537 Frith v Cartland (1865) 2 H & M 417; 71 ER 525 Georges v Seaborn International (Trustee), in the matter of Sonray Capital Markets Pty Ltd (in liq) [2012] FCA 75; (2012) 288 ALR 240 Hospital Products Ltd v United States Surgical Corporation [1985] HCA 64; (1985) 156 CLR 41 In the matter of BBY Limited (Receivers and Managers appointed) (in liquidation) (No 2) [2018] NSWSC 346; (2018) 363 ALR 492 In the matter of MF Global Australia Ltd (in liq) [2012] NSWSC 994; (2012) 267 FLR 27 Kelly (Liquidator), in the matter of Halifax Investment Services Pty Ltd (in liquidation) v Loo [2021] FCA 531 Nadilo v Souris [2019] NSWSC 108 Nikitins v EncoreFX (Australia) Pty Ltd (in Liq), in the matter of EncoreFX (Australia) Pty Ltd (in liq) (No 2) [2021] FCA 27; (2021) 149 ACSR 533 Re BBY Ltd (recs and mgrs apptd) (in liq) (No 3) [2018] NSWSC 1718 Re Global Finance Group Pty Ltd (in liq) [2002] WASC 63; (2002) 26 WAR 385 Re Hallett's Estate (1880) 13 Ch D 696 Re Oatway [1903] 2 Ch 356 Sze Tu v Lowe [2014] NSWCA 462; (2014) 89 NSWLR 317