Heperu Pty Limited v Belle [2009] NSWCA 252

Reported Decision: 76 NSWLR 230

New South Wales Court of Appeal

CITATION: Heperu Pty Limited v Belle [2009] NSWCA 252

HEARING DATE(S): 9 April 2009

JUDGMENT DATE: 26 August 2009

JUDGMENT OF: Allsop P at 1; Campbell JA at 179; Handley AJA at 180

1. The appellants file and serve within 28 days submissions on relief in the light of the reasons. DECISION: 2. The respondent file and serve within a further 28 days submissions on relief in the light of the reasons. 3. The appellants file and serve submissions in reply within a further 14 days.

CATCHWORDS: BANKING AND FINANCE – bank account authority - authority given to agent to operate account – liability of principal for deposit and withdrawal of fraudulently obtained funds by the agent– scope of authority given to agent to operate account - whether scope of authority included authority to deposit funds misappropriated from third parties – no liability where acts were beyond the scope of the authority given to the agent - BANKING AND FINANCE – bank account authority – liability of principal for withdrawal of funds from account derived from the proceeds of misappropriated cheques – whether withdrawal of funds alone is having use and benefit of the funds – principal did not authorise to use the account to receive or deploy misappropriated funds – no liability of the principal in these circumstances - RESTITUTION – money had and received – receipt and benefit of funds in bank account by owner of the account – liability based on possession and control of funds – requirement that owner of account knew or ought to have known that they had possession of control of the funds – "ought to have known" requires some fault on the part of the recipient – owner of account had no knowledge and ought not to have known in the circumstances - RESTITUTION - money had and received – liability of volunteer recipient of misappropriated funds for the traceable proceeds held at the time of the trial – liability separate from liability in equity as a constructive trustee under Barnes v Addy – recognition at law of an equitable interest in property – personal remedy to value of equitable property interest in property in hands of another - liability for proceeds remaining not for amount received - EQUITY – trusts – constructive trust - liability as constructive trustee under first limb Barnes v Addy - no notice and no knowledge – liability as constructive as trustee under second limb of Barnes v Addy – no notice and no knowledge - TRACING – personal liability for value remaining of misappropriated funds that can be traced into real property – tracing of misappropriated cheques into mortgage repayments made on real property – tracing through mixed fund - REMEDIES – remedies at law and in equity – availability of a personal remedy to value of an interest in property where property in hands of another - GOODS – receiver of goods as finder – traceable proceeds of cheques into real property are not goods – law of receiver of goods as finder not applicable on the facts