Supreme Court New South Wales Medium Neutral Citation: In the matter of International Art Holdings Pty Ltd (admin apptd); International Art Holdings Pty Ltd (admin apptd) & ors v Adams & ors [2011] NSWSC 164 Hearing dates: 24 February 2011 Decision date: 07 March 2011 Before: Ward J Decision: Judicial advice given as to manner in which different categories of artworks may be dealt with by administrator and declaration as to statutory or equitable lien over artworks for administrator's remuneration costs and expenses. Catchwords: JUDICIAL ADVICE - application by administrator of company for judicial advice and directions under ss 447D and 447A of the Corporations Act 2001 (Cth) - in the alternative, application for directions under ss 63 and 81 of the Trustee Act 1925 (NSW) to the extent that administrator is a bare trustee - HELD - it was appropriate for judicial advice to be given under s 447D as to the manner in which the assets of the company should be dealt with by the administrator and the administrator's claim for remuneration - it was inappropriate for orders to be made which would determine competing parties' claim to the artworks in question - EQUITY - whether statutory lien or equitable lien to be imposed over artworks that are property of investors, not company - whether imposition of equitable lien over assets of a regulated self-managed superannuation fund will result in those assets losing their 'complying fund status' under reg 13.14 of the Superannuation Industry (Supervision) Regulations 1994 (Cth) - whether amount of work undertaken by the administrator in the administration of the company was excessive or unnecessary - HELD - statutory lien over artworks the subject of lease to the company - equitable lien imposed to secure reimbursement of administrator's reasonable costs and expenses - reg 13.14 not applicable to an equitable lien imposed by the court - work undertaken by administrator was reasonable in the circumstances Legislation Cited: Corporations Act 2001 (Cth) Factors (Mercantile Agents) Act 1923 (NSW) Sale of Goods Act 1923 (NSW) Superannuation Industry (Supervision) Regulations 1994 (Cth) Superannuation Industry (Supervision) Act 1993 (Cth) Trustee Act 1925 (NSW) Cases Cited: Application of Crouch [2005] NSWSC 1122 ASIC v Carey (No 6) (2006) 58 ACSR 141 Bertrand v Davies (1862) 54 ER 1204 Clark Equipment Credit of Australia Ltd v Como Factors Pty Ltd (1988) 14 NSWLR 552 Coad v Wellness Pursuit Pty Ltd (in liq) 71 ACSR 250 Commonwealth v ABC2 Group Pty Ltd [2008] NSWSC 1383; (2008) 69 ACSR 229 Commonwealth Bank v Butterell (1994) 35 NSWLR 64 Crawford v Oswald Park Pty Ltd [2006] NSWSC 987 Crouch Re: Heritage Fine Wines [2007] NSWSC 1055; (2007) 214 FLR 244 Crouch v Lynne Adams [2006] NSWSC 1029 Davies v Littlejohn (1923) 34 CLR 174 Dean-Willcocks v Soluble Solution Hydroponics (1997) 42 NSWLR 209 Editions Tom Thomspon v Pilley (1997) 77 FCR 141 Flack v Chairman, National Crime Authority (1997) 80 FCR 137 Gatward v Alley (1940) 40 SR (NSW) 174 Grossman v E Katz Manufacturing Jewellers (2004) 213 ALR 373 Hamilton v Donovan Oates Hannaford Mortgage Corporation Ltd [2007] NSWSC 10; (2007) 61 ACSR 82 Handberg (in his capacity as liquidator of S&D International) (in liq) v MIG Property Services Pty Ltd [2010] VSC 336 Hewett v Court (1983) 46 ALR 87 Hoath v Connect Internet Services [2006] NSWSC 158 Lemery Holdings v Reliance Financial Services Pty Ltd (2008) 74 NSWLR 550 Lockwood v White (2005) 11 VR 402 Macedonian Orthodox Community Church v His Eminence Petar the Diocesan Bishop of the Macedonian Orthodox Diocese of Australia and New Zealand (2008) 237 CLR 66 Matter of Tharp (1852) 65 ER 533 Moodemere Pty Ltd (in liq) v Waters [1988] VR 215 Onefone Australia Pty Ltd v One Tel Ltd [2010] NSWSC 1120 Perpetual Trustees & National Executors of Tasmania Ltd v Perkins (1989) Aust Torts Reports 80-295 Re Ansett Australia (2001) 39 ACSR 355 Re Application of Sutherland [2004] NSWSC 798 Re Berkeley Applegate (Investment Consultants) Ltd (in liq); Harris v Conway [1988] 3 All ER 71 Re Central Commodities Services Pty Ltd [1984] 1 NSWLR 25 Re G B Nathan & Co Pty Ltd (in liq) (1991) 24 NSWLR 674 Re Kirkegaard [1950] St R Qd 144 Re Petersen [1920] St R Qd 42 Re Universal Distributing Co Ltd (in liq) (1933) 48 CLR 171 Shiraz Nominees (in liq) v Collinson (1985) 10 ACLR 7 Shirlaw v Taylor (1991) 31 FCR 222 Specialised Transport v Domimak (1989) 16 NSWLR 657 Standard Electronic Apparatus Laboratories Ply Ltd v Stenner [1960] NSWR 447; (1960) 77 WN (NSW) 833 Stephenson Nominees Pty Ltd v Official Receiver (1987) 16 FCR 536 Weston v Carling Constructions Pty Ltd (2000) 35 ACSR 100 Texts Cited: Austin & Black's Annotations to the Corporations Act Jacobs' Law of Trusts in Australia (7th edn) McClintock, Handbook of the Principles of Equity (2nd edn) Palmer, Bailment (2nd edn) Stuart Jones' Australian Superannuation Handbook, 2010-11 The Law of Superannuation in Australia Category: Principal judgment Parties: International Art Holdings Pty Ltd (admin apptd) (First Plaintiff) GD Rentals Pty Ltd (admin apptd) (Second Plaintiff) Hunter Capital Pty Ltd (admin apptd) (Third Plaintiff) Hunter Holdings (Australia) Pty Ltd (admin apptd) (Fourth Plaintiff) Sule Arnautovic in his capacity as administrator of the First to Fourth Plaintiffs (Fifth Plaintiff) Lynne & Mark Adams and the other persons described in Schedule 1 to the Plaintiffs' Further Amended Originating Process (Defendants) Representation: DR Stack (Plaintiffs) G O'Mahoney (Miss D Williams) ERA Legal (Plaintiffs) LE Drolz (as trustee of the Drolz Superannuation Fund)(30th Defendant) (self represented) E Uri (116th Defendant) (self represented) File Number(s): 10/417616 Publication restriction: No Judgment 1Before me for hearing on 24 February 2011 was an application by Mr Sule Arnautovic, in his capacity as the administrator of the first to fourth plaintiffs (collectively, the corporate plaintiffs), for judicial advice and directions under section 447D (together with section 447A) of the Corporations Act 2001 (Cth) or, to the extent that Mr Arnautovic is a bare trustee, under sections 63 and 81 of the Trustee Act 1925 (NSW) . Consequential orders are also sought. 2The particular issue in respect of which the advice is sought relates to the manner in which the administrator should deal with several artworks which are currently in the possession of the first plaintiff (International Art Holdings) and to resolve the administrator's claim for remuneration and expenses incurred in dealing with the said artworks. 3In summary, International Art Holdings carried on business principally as an art dealer and investment company. Together with GD Rentals, it operated a business whereby artwork was purchased and sold to clients (described as 'investors') and assistance was then provided to enable those investors to enter into rental arrangements whereby the artwork was leased to third parties. (The third and fourth plaintiffs, Hunter Capital and Hunter Holdings, are companies related to or associated with the principal of the first and second plaintiffs - the former, in the business of the provision of consultancy services; the latter, being the ultimate parent company of International Art Holdings and GD Rentals.) 4Mr Cameron Hall is the sole director of the corporate plaintiffs. On 7 October 2010 he resolved in that capacity to appoint Mr Arnautovic as the administrator of those (and other related) companies pursuant to Part 5.3A of the Corporations Act . 5In the course of his administration of International Art Holdings, Mr Arnautovic has investigated the ownership of the artwork in its possession and has classified that artwork within three categories: (a)artworks in respect of which there is more than one person or entity claiming ownership or a proprietary interest (and which Mr Arnautovic does not believe belong to International Art Holdings), such artworks being identified in Schedule A to the Further Amended Originating Process filed in court on 24 February 2011 and since then updated in an Amended Schedule A; (I refer to these artworks collectively as the "disputed artworks".) (b)artworks in respect of which Mr Arnautovic has identified the owner (and there is no competing claim to ownership) but where the owner has refused to pay a levy sought to be imposed by Mr Arnautovic to cover a portion of the fees and expenses of dealing generally with the artworks, such artworks being identified in Schedule B to the Further Amended Originating Process and also since then updated in an Amended Schedule B; (I refer to these artworks collectively as the "levy artworks".) (c)artworks in respect of which Mr Arnautovic has been unable to identify any third party as the owner (and as to which he is uncertain whether the artworks are the property of International Art Holdings, though they are in its possession), such artworks being identified in Schedule C to the Further Amended Originating Process. (I refer to these artworks collectively as the "unclaimed artworks".) 6In Mr Arnautovic's most recent affidavit of 23 February 2011, which was filed in court at the commencement of the hearing of this application, Mr Arnautovic explained that there had been changes in the Schedules from those attached to the original process to reflect the fact that in the course of his ongoing investigations there has been some change in the classification of the artworks. (For example, if a competing claim had been resolved after the preparation of the initial Schedules, the Schedules would be amended so that the artwork in question was removed from Schedule A and, presumably only where the identified owner had refused to pay the levy, added to Schedule B. Consequential changes were made to the schedule of defendants). As I understand it, the persons or entities listed in the schedule of defendants are those with a competing claim to a disputed artwork and those who have refused to pay the levy in respect of a levy artwork. 7In respect of artwork currently rented out to a third party by GD Rentals or International Art Holdings for an investor, Mr Arnautovic deposes that he does not believe the company has any interest in the artwork and he has notified investors of the whereabouts of the artwork and left it to them to make arrangements for the ongoing rental or return of that artwork. Similarly, where artwork was in the process of being framed or repaired at the time of Mr Arnautovic's appointment (and the framers have claimed a lien or other security interest in the artwork as a consequence of moneys claimed to be owing to them), Mr Arnautovic has again notified the particular investors of the whereabouts of the artwork and left it to them to resolve the claims of the framers. Artworks referred to in this paragraph do not form any part of the present application. 8For completeness, I note that the first meeting of creditors of the corporate plaintiffs was held in accordance with the requirements of s 436E of the Corporations Act on 19 October 2010 and the second meeting was held in accordance with the requirements of s 439A of the Corporations Act on 11 November 2010. The creditors of each of the companies on each occasion resolved that the meetings be held concurrently. The second meeting of creditors has been adjourned. On 16 December 2010, Barrett J ordered that the period of adjournment allowed under s 439B(2) be extended to 14 March 2011. 9In relation to the three categories of artwork, Mr Arnautovic has proposed that they be dealt with as follows: Schedule A - disputed artworks that Mr Arnautovic be appointed as the receiver of each of the disputed artworks with powers of the kind set out in s 420(2)(a),(b),(c),(e) and (g) of the Corporations Act ; that Mr Arnautovic's remuneration as receiver of the disputed artworks be calculated in accordance with the Scale of Rates of Jirsch Sutherland (the accounting firm of which he is a partner) and apportioned amongst each of the disputed artworks as a percentage sum in accordance with a proposed formula; that there be a declaration that Mr Arnautovic have a lien over the artworks for the percentage sum so calculated; and that after the sale of the disputed artworks and payment of the percentage sum, the monies remaining be paid in equal shares to each of the defendants who have demonstrated to Mr Arnautovic's reasonable satisfaction that they have a legitimate claim to ownership of that specific artwork. Schedule B - levy artworks that there be a declaration that International Art Holdings, GD Rentals and Mr Arnautovic have an equitable lien over the respective levy artworks in a specified amount (varying by reference to the specified value of the particular artworks in the administrator's current catalogue); that Mr Arnautovic be appointed as the receiver of each of the levy artworks with powers of the kind set out in s 420(2)(a) and (e) of the Corporations Act ; that Mr Arnautovic notify each of the persons recorded in Schedule B as the owner of the respective works of his intention to sell the artwork and pay the levy from the proceeds of sale (and then to pay the surplus sale proceeds to that person) unless payment of the levy is received within a specified time; that on payment, within a specified time, of the levy from a person recorded in Schedule B as the owner of an artwork Mr Arnautovic release that art work to that person; that in relation to artwork not so released, Mr Arnautovic, as receiver of the remaining artworks identified in Schedule B, have powers of the kind set out in s 420(2)(b), (c) and (g) of the Corporations Act ; that on and from 21 days after the making of such orders, Mr Arnautovic 's remuneration as receiver of the remaining levy artworks be calculated in accordance with the Scale of Rates of Jirsch Sutherland (the accounting firm of which he is a partner) and apportioned amongst each of the remaining levy artworks as a percentage sum in accordance with the proposed formula; that Mr Arnautovic have a lien over the remaining levy artworks for the said percentage sum. Schedule C - unclaimed artworks that there be a declaration that the unclaimed artworks are the property of International Art Holdings and may be dealt with in the ordinary course of the administration of that company. 10Orders were made by Barrett J last year in relation to the mode of service of the Originating Process in this matter. On the hearing before me only three persons claiming an interest in any of the artworks attended or were represented for the purpose of making submissions: (i) Ms Louise Drolz, who has filed an appearance on behalf of the superannuation fund "Drolz Superannuation Fund" of which she is a trustee and who has affirmed an affidavit on 7 February 2011 in relation to the matter (there being 6 levy artworks of which Ms Drolz as trustee of the said fund is acknowledged to be the owner); (ii) a Miss Donna Williams (or an entity associated with her) was represented by Mr O'Mahoney of Counsel, who ultimately made no submission as to the advice and orders sought by Mr Arnautovic (his client having received an undertaking that the levy artwork of which Miss Williams or an entity controlled by her is acknowledged to be the owner would not be sold without notice to her); and (iii) Mr Erik Uri, who was self-represented and who claims an entitlement to one of the disputed artworks. He attended with documentation to support his claim. 11No notices of appearance for Miss Williams or Mr Uri appear to have been filed but no issue was taken as to this. Background Facts 12As noted earlier, International Art Holdings carried on business as an art dealer, offering artworks for sale and then assisting (either itself or with GD Rentals) with the placement of those artworks for rent by third parties. An example of the rental arrangements can be found in Exhibit B (from p 166 of which is a copy of a rental agreement entered into with GD Rentals by an investor who was not represented on this application) and Exhibit 1 (which includes a copy of a rental agreement signed by Ms Drolz and her co-trustee of the Drolz Superannuation Fund, but not by any other party, in which International Art Holdings, defined as "Smith & Hall", is named as a party). Although no counterpart agreement signed by International Art Holdings was in evidence, in her affidavit affirmed 7 February 2011 Ms Drolz deposed to the circumstances in which, as trustee of the fund, she purchased on behalf of the fund an "art portfolio" through International Art Holdings and signed a rental agreement in relation to that portfolio. 13Under the terms of the rental agreements which were in evidence, the relevant investor agreed to lease specified artworks to GD Rentals or International Art Holdings, as the case may be, and that entity in turn agreed to take the specified artworks on lease for the lease period and to pay the rent stipulated in the agreement (clause 2). Clause 2 further provided that the company was entitled to lease those artworks to its customers. Pausing there, it can be seen that clause 2 of the respective rental agreements in its terms confers a leasehold (and thus proprietary) interest in the artworks on the relevant entity (GD Rentals or International Art Holdings) - a matter relevant when considering whether the artworks in question constitute part of the property of either of those companies. Somewhat confusingly, however, the agreement goes on to refer to the company as a bailee. 14It seems that the rental agreements used by the first and second plaintiffs were in standard terms (and that seemed also to be the thrust of Ms Drolz' submission). 15Under the Rental Agreement signed by Ms Drolz (and there is a corresponding provision in the GD Rentals agreement tendered by Mr Arnautovic), International Art Holdings warranted, among other things, under clause 6, that: (c) it will not use the Artworks for any illegal purpose; or do anything to the Artworks as to cause or result in a breach of the Superannuation Industry (Supervision) Act 1993 ('SIS Act') or the Superannuation Industry (Supervision) Regulation 1994 or that would result in the Owner losing its complying status nor shall Smith & Hall lease the Artworks to a 'related party' as that term is defined in the SIS Act; ... (e) subject to the Owner's indemnity as to Smith & Hall's costs Smith & Hall will act as the Owner's attorney in all matters reasonably required for the protection of the Owner's rights necessitated by the fact that the Owner is not a party to any lease agreement between Smith & Hall and its customers; ... (g) that it will not in any way encumber the Artworks including sell, exchange, pledge, mortgage, charge, grant a lien over any of the Artworks without the prior written consent of the Owner. 16Ms Drolz places considerable emphasis on those warranties. In her affidavit she deposes to conversations in which she says stressed the need for the inclusion of a clause to the effect of that in 6(g). The relevance of this is in the context of Ms Drolz' submission that an equitable lien should not be imposed over the levy artworks of which she is acknowledged to be the owner. Ms Drolz believes this will result in the assets losing their 'protected' status under the superannuation legislation. I consider this submission in due course. 17Under the terms of the Rental Agreement put in evidence by Ms Drolz (and the corresponding GD Rentals agreement tendered by the administrator), International Art Holdings further acknowledged that it was a "lessee" of the artworks from the owner, that the owner retained title thereto "and that Smith & Hall has rights to possess the Artworks as a mere bailee only subject only to Smith & Hall's right to lease the Artworks to its customers" (clause 7). (The apparent contradiction between International Art Holdings being acknowledged to be a lessee and at the same time being said to have a right to possess those works as a "mere bailee" for the purpose of what would seem to be an on-lease or sub-lease to its clients is not explained.) 18As noted earlier, the corporate plaintiffs were all placed into administration on 7 October 2010, following a resolution of the sole director, Mr Hall. (I note that it would seem the business model followed by Mr Hall had some flaws in that he had also been a director of Heritage Fine Wines Pty Limited, the liquidation of which seems to have given rise to not dissimilar problems as those besetting this administration. I was referred in that regard to the ex tempore judgment of Campbell J, as his Honour then was, in Application of Crouch [2005] NSWSC 1122 at [1], in which his Honour noted the appointment (of the liquidator of that company) as the receiver and manager of the assets there in question, namely wine in the possession of the company. His Honour there commented that the appointment of the liquidator as receiver of the wine was in the context that there was a realistic prospect that some or perhaps all of the wine in question in the possession of the company might not be the property of the company but might be held by it as bailee for individual investors.) 19Mr Arnautovic has deposed to the steps that were taken in the course of his administration in relation to the artworks. In particular, he disclosed that the books and records for International Art Holdings and GD Rentals had recorded that those companies were in possession of 1141 works of art but that only 980 of those had been located (and that those artworks had been located at a number of different places) (paragraphs 33-34 of Mr Arnautovic's affidavit sworn 16 December 2010). Mr Arnautovic caused all of the artworks to be stored at one location, a storage facility at Mascot, in part due to the requirement of his insurers that the artwork be stored in a specialised storage facility (paragraph 35 of Mr Arnautovic's 16 December affidavit). 20According to Mr Arnautovic, at the time of the administration the books and records of the corporate plaintiffs were incomplete and this made it difficult to identify the artworks and to determine which works were owned by which investors (paragraph 37 of Mr Arnautovic's 16 December 2010 affidavit). He deposed to the process in which he had engaged of identification of the artworks and to the steps taken in an endeavour to determine ownership of the artworks, which he said had been a time consuming process involving the retention of Grays Auctioneers to catalogue the artworks; the review of the books and records of the company; notification by way of circular of persons that it was thought might have an interest in the artwork; the placement of advertisements in the Australian newspaper on 9 October 2010 and 4 November 2010 and an article in the Australian Financial Review on 12 October 2010; the creation of various schedules and update of the artworks catalogue; and the issuing of a general press release. He estimated that not less than 431 hours (or 60% of the total time working on the administration) of his staff's time had been spent in identifying and cataloguing the artwork. 21Mr Arnautovic expressed his concern (not shared by Ms Drolz based on her own enquiries) that in some instances the same artwork appeared to have been sold to more than one investor (Ms Drolz was dismissive of this and referred to her review of information contained on a CRM spreadsheet provided to her by a creditor). Nevertheless, I was taken by Counsel for the plaintiffs (Mr Stack) to material, by way of example, which indicated that artwork of the same title and by the same artist ('Resolve and General VIII' by Jasper Knight) might well have been the subject of two separate transactions involving two investors (and I was informed by him that even as late as the morning of the application before me the administrator had become aware of a third party claiming an interest in a particular work in respect of which the administrator had previously known of only two claimants). 22Ms Drolz, both in her affidavit and in oral submissions during the hearing, was critical of the work carried out by or on behalf of the administrator (which she illustrated by reference to instances in which her own investigations into the whereabouts of certain artwork or as to the rightful owner of artwork had, she considered, been conducted more efficiently than the administrator's investigations). Among other things, Ms Drolz criticised the inventory prepared by Grays as "sloppy, hastily prepared and ... of a poor standard" (something for which I note that the administrator cannot have been directly responsible as he had engaged a firm of auctioneers to prepare the inventory). She also criticised various matters in relation to the preparation of the administrator's Schedules and as to his manner of communication with investors as to the levy (said to have caused creditor confusion and hostility). Mr Arnautovic has responded to various of the criticisms in his later affidavit of 23 February 2011. (I consider Ms Drolz' criticisms in relation to the work carried out by the administrator and his staff in due course when considering the issue of the equitable lien in relation to the levy artworks.) 23Mr Stack, quite fairly, indicated that although objection could be made, based on relevance, to much of the material in Ms Drolz' affidavit, the administrator would not object to the material being put before the court for such relevance as it might be perceived to have. I have read carefully Ms Drolz' affidavit (in which she comments on the efficacy of the steps taken by the administrator and his staff and relays complaints conveyed to her from others) and those matters which represent her conclusions as to matters outside her direct knowledge or her opinions, I have read as being in the nature of submissions. 24Mr Arnautovic has explained in both his affidavits the basis on which he formed the view that it was appropriate to charge a levy in relation to the levy artworks (those being the artworks in which no more than one investor had claimed an interest in the artwork and where Mr Arnautovic had formed the view that the investor was entitled to ownership of the artwork). He expressed the concern that, 'as the artwork was not the property' of any of the corporate plaintiffs, the creditors of those plaintiffs should not have to pay the costs of dealing with those artworks in circumstances where they could have no interest in the recovery of the artwork. 25Mr Arnautovic assessed the costs and estimated the expenses of completing what he termed the "Non-Creditor Work", ie of dealing with the issues relating to the levy artwork, initially at $290,000 and subsequently at a lesser amount of about $200,000. He explained the basis on which he had considered it impractical (if not indeed impossible) to work out the actual cost referable to each item of artwork. Mr Arnautovic also explained why he did not consider it fair to charge a flat levy to all owners (since in some cases the levy would be more than the particular artwork was worth). Mr Arnautovic has therefore proposed a sliding scale, based on the value of the artwork, for the setting of the levy. Mr Arnautovic says that the calculation of the levy has the effect that a relatively small amount of time is attributed as having been referable to each piece of artwork (although recognising that the time involved in determining issues in relation to some pieces would well exceed the time involved in dealing with others). He also explained the basis on which he had later revised the levy for artworks of lesser value (and had refunded the difference to those who had already paid a higher amount than the now revised levy). As at December last year, some 159 people had paid the levy. Those that have refused to do so (including Ms Drolz) are listed in Schedule B. 26As noted earlier, Ms Drolz appeared before me on the application and has affirmed an affidavit in support of her position. Ms Drolz, whose profession is that of financial adviser, says that she acquired, as co-trustee of her superannuation fund, eight artworks with the intention of leasing them out to earn an income from the fund. Two artworks have not been able to be located (and Ms Drolz says that they may never have been consigned by the company in the first place). It is not clear whether Ms Drolz has asserted any claim against the company in that regard but it does indicate that, in taking account the creditors of the respective companies, the administrator may need also to take into account the contingency of such claims. 27In essence, Ms Drolz has two complaints in relation to the proposed imposition of an equable lien (having indicated that her issue is not with the amount of the levy itself, which she described as 'relatively trivial' in the case of her artworks). First, in circumstances where the levy artworks in her name are assets held by her as co-trustee of a superannuation fund, Ms Drolz maintains that she cannot allow a lien of any kind to be asserted over the assets. Secondly, insofar as the rationale for the imposition of such a lien (or a discretionary factor to take into account in deciding whether such a lien should be imposed) is the benefit gained by the work carried out by the administrator, Ms Drolz takes issue with the proposition that there has been any incontrovertible benefit gained by her from the administrator's efforts (and Ms Drolz suggests that she could have carried out the necessary work at her own expense more efficiently and more cheaply). 28Mr Uri's position is different from that of Ms Drolz in that he falls into the category of those having a claim in respect of disputed artworks and I consider his particular position in that context later in these reasons. Legal principles 29Section 447D (1) of the Corporations Act , relevantly, provides: The administrator of a company under administration, or of a deed of company arrangement, may apply to the Court for directions about a matter arising in connection with the performance or exercise of any of the administrator's functions and powers. 30This is similar in essence to the provisions contained in ss 479(3) and 511 of the Corporations Act and, as Mr Stack points out, applications under s 447D are in general determined in much the same way as applications under those other provisions (reference being made to Editions Tom Thomspon v Pilley (1997) 77 FCR 141 at 149 ; Re Ansett Australia (2001) 39 ACSR 355 at [58] to [59] ; Dean- Willcocks v Soluble Solution Hydroponics (1997) 42 NSWLR 209 at 212 ; Crawford v Oswald Park [2006] NSWSC 987 at [10] ; and S&D International v MIG Property Services [2010] VSC 336 at [7]) . 31Mr Stack notes that in Ansett at [59], Goldberg J cited, with approval, the observations of McLelland J (as his Honour then was) in Re G B Nathan & Co (1991) 24 NSWLR 674 in relation to the genesis and legislative history of s 479(3) of the Corporations Law . In Re G B Nathan , McLelland J said, at 679 to 680: Modern Australian authority confirms the view that s 479(3) 'does not enable the court to make binding orders in the nature of judgments' and that the function of a liquidator's application for directions 'is to give him advice as to his proper course of action in the liquidation; it is not to determine the rights and liabilities arising from the company's transactions before the liquidation. ... It should be observed that there are instances where a court has, in proceedings commenced as a liquidator's application for directions, gone on to make orders declaratory of substantive rights, clearly intended to be of binding effect on the parties to the proceedings .... The procedures of the court are sufficiently flexible to enable proceedings commenced as an application for directions to be changed into proceedings for the determination of substantive rights, and this is sometimes a convenient course in order to avoid the need to commence further proceedings involving additional cost and delay .... However it is important that the distinction between the two kinds of proceedings be not lost sight of or blurred, and such a fundamental change should not be permitted unless the court is satisfied that those affected either consent to that course ..., or will not suffer injustice in consequence of the alteration to the status of the proceedings. Goldberg J noted that the position stated in the first paragraph extracted above had been adopted in a number of subsequent cases and expressed in the context of s 477D of the Corporations Law in Editions Tom Thompson . 32In Ansett , Goldberg J also considered the interaction between ss 447A and 477D, noting that the power conferred upon the court by s 447A (to make such order as the court thinks appropriate about how Part 5.3A is to operate in relation to a particular company) empowered the court to make an order that the directions which the court may give to an administrator pursuant to s 477D of the Act include a direction approving an agreement entered into by the administrators (that agreement being the subject matter of an application for directions), his Honour observing that in so doing what the court was doing was making it clear that it was appropriate for the administrators enter into the agreement in the specific terms in which it was executed and that they thereby have the protection of the court in having done so. 33In Crawford v Oswald Park [2006] NSWSC 987 at [12], Austin J applied the reasoning in Re G B Nathan & Co in the context of a determination as to whether the company should proceed with a distribution of the net balance of the company's surplus funds in accordance with the liquidator's draft plan of distribution, although this involved a determination as to whether certain amounts were owing to the company (and thus went beyond the giving of directions and amounted to a determination of substantive rights) in circumstances where not to do so would, his Honour said, "be sending them [the parties] away without the 'just and beneficial' exercise of the power that s 511(2) contemplates. 34The alternative basis on which the present application is brought arises if it were to be found that the administrator is a bare trustee of some or all of the artworks. In that case the application is made under section 63 of the Trustee Act or otherwise under the inherent or implied jurisdiction of the Court. 35It is by no means apparent that Mr Arnautovic, as administrator of the corporate plaintiffs, does hold any of the artworks as a trustee (bare or otherwise) of those artworks. The rental agreements in evidence suggest that unless the artwork in question remained the property of International Art Holdings (say, because it had not been sold to an investor by the time the company went into administration) it is likely that one or other of the first and second plaintiffs entered into an agreement with an investor under which they were the lessee (or at least the bailee) of those artworks the subject of such agreements. There seems no basis for the imposition of a trust where the relationship is governed by a contract that itself makes provision for the basis on which the goods are held by those companies. 36Assuming for the moment that Mr Arnautovic were to be a bare trustee of at least some of the artworks, s 63(1) would permit him as trustee to apply to the Court for an opinion, advice or direction on any question respecting the management or administration of the trust property, or respecting the interpretation of the trust instrument. Here it is said that the questions arise in the management or administration of the trust property. 37Mr Stack referred to the statement of general principles relevant to applications of under s 63 to be found in Macedonian Orthodox Community Church v His Eminence Petar the Diocesan Bishop of the Macedonian Orthodox Diocese of Australia and New Zealand (2008) 237 CLR 66 at [54] to [75] and, in particular, to the recognition by the High Court (at [70] to [71]), that the proper purpose for seeking judicial advice includes relief aimed at resolving legitimate doubts held by the trustee as to the proper course of action and protecting the trust and those entitled to it. 38As a general rule, however, (see Jacobs' Law of Trusts in Australia (7 th edn) [at 2134]), where the question concerns the respective rights of beneficiaries or their identity, it is not considered appropriate to give a trustee opinion or advice under s 63; rather the proper procedure is by way of originating summons where all parties are served and have the opportunity to be heard (the authors there referring to Re Kirkegaard [1950] St R Qd 144; Re Petersen [1920] St R Qd 42). 39In the Macedonian Church case, in the Court of Appeal [2006] NSWCA 277, Beazley and Giles JJA said that: ... An application for judicial advice is an inappropriate process to resolve disputes between trustees or to settle disputes between parties to a trust. If the Court is of the view that determining an application would determine a dispute it may refuse the application outright. ( Harrison v Mills [1976] 1 NSWLR 42, [44 - 45]; Hartigan Nominees Pty Ltd v Rydge (1992) 29 NSWLR 405 ) 40This seems to me to pose a difficulty on the present application since what is sought would in effect permit the administrator to make a determination as to rights or entitlements of competing claimants in respect of the disputed artworks in circumstances where those claimants had not had an opportunity to have their claim heard in the appropriate forum. That makes the exercise of power under s 63 (or for that matter s 479(3) of the Corporations Act ) inappropriate in my view at least for the making of orders as sought in relation to the disputed artworks, although it does not mean that no directions can usefully be made in order to facilitate the resolution of disputes as to their ownership in the most expeditious and least costly way, in the interests of the overall administration of the corporate plaintiffs. 41With the above principles in mind, I turn then to the particular classes of artwork in respect of which the administrator seeks advice. Schedule A - Disputed artworks 42When the matter was before me for hearing there were 100 artworks in respect of which Mr Arnautovic had identified that two or more persons had claimed or might be in a position to claim ownership of the artwork. (One of those persons is Mr Uri.) Mr Arnautovic deposed to a concern that if he were to return the artwork to the wrong person, he might incur a liability. (Since the hearing, competing claims in relation to some 19 of those 100 artworks have, as I understand it, been resolved and my associate was informed that those artworks had been removed from Schedule A and now appear in a further updated Schedule B. That does not affect the nature of the issues raised on the present application but an application for leave to file amended schedules when this judgment is handed down has been foreshadowed.) 43Mr Stack notes that it may well be that the application of section 28 of the Sale of Goods Act 1923 (NSW) and section 5 of the Factors (Mercantile Agents) Act 1923 (NSW) would determine the question of title to the disputed artworks (such that the subsequent purchaser for value, in good faith and without notice, would have the better title to the relevant artwork), but concedes that this determination requires a consideration of both fact and law. 44The "just, quick and cheap resolution" to this issue is said to be to appoint the administrator as receiver of the artworks with a view to selling the artworks and distributing the net proceeds amongst the claimants in equal shares (where the administrator is satisfied that each of the claimants has an interest in the artworks in question). However, to the extent that the proposal contemplates, in effect, conferring power on Mr Arnautovic to determine whether a claimant has established an interest in the property. I am not satisfied it is appropriate to do. It cannot be, for example, that successive investors are in a position to establish equal title to the artworks - the interest of one must as a matter of law prevail over the other (unless they purchased in a joint capacity and thus had an interest as joint owners). While I accept that there is much to be said for a practical solution that enables an expeditious and cheap resolution of competing claims, it must also be one that produces a just result. 45I do not consider it appropriate to exercise power under the relevant sections of the Corporations Act and Trustee Act in order to determine ownership disputes as between competing claimants where those claimants have not had (or may not have appreciated that they had) an opportunity to be heard on the question. 46Mr Uri, for example, attended the Court in person with paperwork in order to demonstrate his title to the artwork in question. He tendered (Exhibit 2) a copy of the claim he had made to an artwork identified as "Flinders Ghost edition 20/45" (but said to have been wrongly listed on the initial catalogue of the artwork simply as "Ghost"). Mr Uri produced an artwork sales report (showing that there were 3 editions of the said "Flinders Ghost" artwork - one, edition 20/45 listed as having been sold to him, one "tbc/45" listed as having been sold for the same price to a "veronica" - her surname having been redacted on the copy in evidence and one being "available"); an order form in relation to that purchase dated 6 January 2011; and a tax invoice dated 9 October 2009 but making reference to the order number in the 2011 tax invoice referring to Flinders Ghost. He also produced a redacted copy of an order form of the same date to 'veronica' in which, among the listed items, is the same description of the Flinders Ghost artwork but with the reference (tbc/45) and a tax invoice again redacted to 'veronica and dated 15 October 2009. 47Mr Uri attached copies of photos described as having been taken during the viewing at the gallery of the artwork (though there identifying it as edition 20/65) and an inventory in which the artwork 20/45 was listed. 48On the face of the documentation produced, Mr Uri clearly has a reasonable basis to claim an interest in the artwork. There is nothing to suggest that he did not, as the company's records appear to state, acquire the artwork for the amount stated in the tax invoice. However, there is uncertainty as to the status of any claim by 'veronica' to that same artwork. (It may be that the reference 'tbc', which I assume to mean 'to be confirmed' indicates that there was another edition number - and hence a different piece of artwork was assigned to her; alternatively, it may be that the same actual piece of artwork was assigned to her - giving rise to potential claims as to whose claim should prevail). It is said by Mr Uri that 'Veronica' would have an incentive wrongly to assert a claim to ownership of this piece of artwork if, by so doing, she can share equally in the proceeds of sale of the artwork and recover more than she would otherwise be able to do. (Of course, there may be an incentive to make such a claim whether or not the administrator's proposed method of distribution between competing claimants were to be adopted.) 49Relevantly, also, Mr Uri (not unreasonably) says that he does not want the artwork to which he says he can prove title to be sold (which is what the administrator's proposal contemplates in the absence of an agreement being reached between the competing claimants). 50I do not consider it appropriate to determine (in the absence of a contested hearing) the entitlements as between Mr Uri and 'Veronica' (or as between any other of the disputants) to the disputed artworks. I appreciate that this gives rise to the prospect of what may be numerous relatively small claims (with the consequential cost and delay in finalising the administration of the corporate plaintiffs that this would involve). However, that does not seem to me to overcome the problem that the making of orders of the kind sought would deprive persons who may have a valid claim to the property (that being property in which the company does not assert any ownership interest) without a fair hearing. 51I am, however, also conscious that it cannot be in the interests of creditors for the administration to be prolonged pending a succession of what may well be relatively small cases (in which the administrator's only interest would be the recovery of the costs of storage and the like), in order to determine the true owner of the disputed artworks. 52It seems to me that the practical solution is put in place a regime to ensure that competing claimants who wish to assert rights to any of the disputed artwork (and who do not wish that artwork to be sold before their claims are determined) be required to provide security for the costs of storage and insurance of the artwork pending the determination of the dispute. In effect, if the administrator then would be no more than a bare custodian of the artwork pending determination of the dispute, then the position of creditors and contributories of the company should not be prejudiced by the delay in the determination of the administration. (If agreement were able to be reached between competing claimants as to a regime for storage of the disputed artwork that permitted the administrator to release it to some other stakeholder, that would also seem to me to be a reasonable way in which equitably to balance all of the interests at stake.) Further, if it transpired later that a person had pursued a baseless claim to an interest in the disputed artwork (which seems to be what is feared by Mr Uri) that could potentially be dealt with by reference to costs orders at the end of the day. 53That said, it seems to me that if none of the competing claimants to a disputed artwork is prepared, pending determination of the dispute between themselves, to provide security for the storage/insurance costs of the specific artwork over which they have competing claims, then the administrator should be appointed as receiver to sell the artwork and the proceeds (after deduction of the administrator's costs of dealing with it) should be paid to a stakeholder or the court pending determination of the question as to who (as between the competing claimants) as a matter of law had the better title to the artwork. 54The first step in this exercise should be to ensure sufficient notification to the competing claimants of the process that is to be adopted in relation to the artwork in order to afford them an opportunity to preserve the painting (rather than to have it sold and then to have a dispute as to who was entitled to the proceeds). 55In Mr Uri's case, as I endeavoured to make clear during the hearing last week, I do not consider that it is appropriate for me to determine his claim to ownership of the Flinders Ghost 20/45 edition in the absence of the identified competing claimant ('veronica') having an opportunity to put forward such case as she may have in relation to this particular artwork. 56Finally, I note that Ms Drolz proffered the suggestion that if the administrator were to be the person looking at the legitimacy of competing claims (and, as noted above, I do not think that it is his function to make any binding determination as to those matters) then this should be done before any sale of the artwork (as I understand it, on the basis of her view that this would perhaps "avoid a sale at fire sale rates"). (It is not apparent to me that a sale of disputed artwork would be at 'fire sale' rates but, in any event, in balancing the interests of all the parties the question as to who should bear the ongoing storage and insurance costs pending determination of the disputed ownership issues would inevitably arise and it is that concern that leads me to conclude that the administrator should be appointed as receiver to the assets for their sale if those costs are not met by the competing claimants.) Schedule B - Levy artworks 57There were, as at the hearing, 121 artworks where the owner of the artworks has been identified but the artworks have not yet been returned to the owner (these being listed in schedule B to the Further Amended Originating Process). (That number has increased as the number of artworks listed as disputed artworks has decreased.) Mr Arnautovic does not assert any claim to these items but does assert an entitlement to a lien (either equitable or statutory) over those artworks for the costs and expenses associated in collecting and protecting those artworks and in attempting to identify the owner of those artworks. 58The striking of a levy was the means by which the administrator sought to recover those costs and expenses in what he (not unreasonably) considered to be an equitable way as between the various owners. As indicated earlier, the amount of the levy was struck on a sliding scale in accordance with the value of the relevant artworks and it is, in that sense, relatively arbitrary. in the case of the artworks with a specified value of $5,000 or more, a levy of $500 was notified; for artworks with a specified value of between $1,500 and $4,999.99, a levy of $300 was struck; and for artworks with a specified value of less than $1,500, a levy of $100 was charged. It was described, at least in some communications (as highlighted in Ms Drolz' affidavit) as a voluntary levy, although Mr Arnautovic has not been prepared to release artworks to acknowledged owners until the levy is paid (and hence there is an element at least of some practical compulsion on those who seek recovery of the levy artwork). 59In the absence of agreement being reached with all of the owners of artworks in this category, Mr Arnautovic seeks a declaration that he has either an equitable or a statutory lien over these artworks (for his costs and expenses of dealing with the artworks); and orders for his appointment as receiver of the levy artworks and entitling him to sell those artworks) where the levy is not paid within 21 days of the making of such orders (and to deduct the amount referable to his remuneration before remitting the surplus funds to the owners). 60Such a regime, in a practical sense, would compel an owner of levy artwork to pay the levy or else accept the balance of the proceeds of sale on what might be seen to be a forced sale by the administrator (in his then capacity of receiver of the goods). 61When an administrator is appointed, he or she can usually look to the assets of the company in administration in order to meet his or her proper remuneration and liabilities properly incurred. Section 443D of the Corporations Act gives an administrator an entitlement to be indemnified out of the 'company's property' for his work and this indemnity is secured (pursuant to s 443F) by way of a 'statutory lien' over the 'company's property'. Thus the administrator has a statutory indemnity over the assets of the company and as such is entitled to a lien. The lien covers not only remuneration, but also the administrator's costs and expenses properly incurred ( Re Application of Central Commodities Services Pty Ltd [1984] 1 NSWLR 25 at [27] per Needham J). This principle may also apply to a privately appointed receiver (Austin & Black's Annotations to the Corporations Act at [5.425]). 62Whether Mr Arnautovic can rely upon a statutory lien over the levy artwork for the costs and expenses of dealing with that artwork turns on whether the artworks in his possession are the "property" of the company for the purposes of the statutory provision. 63While Mr Arnautovic has not asserted any property in the sense of a right to ownership of the levy artworks, it seems to me that, at least in relation to artworks governed by a leasing arrangement of the kind Ms Drolz relies on in relation to her superannuation fund, the company does have a proprietary right insofar as it is described as a lessee of the artworks. 64Section 9 of the Corporations Act defines "property" to mean: Any legal or equitable estate or interest (whether present or future and whether vested or contingent) in real or personal property of any description and includes a thing in action. 65Mr Stack notes that in ASIC v Carey (No 6) (2006) 58 ACSR 141, French J (as his Honour then was) said, at [29], that this "definition and its various elements should not ... be narrowly construed". 66If International Art Holdings is in fact the lessee of any of the artworks in question, then it has property in the sense of a leasehold interest in them and this is property over which the administrator's statutory lien could then attach. The position is less clear where it is a mere bailee. 67It is submitted by Mr Stack that the interest which a bailee ordinarily has in a chattel is an interest which satisfies the wide definition of "property" in the Corporations Act , noting that at common law, the bailee, as the possessor of a chattel, has a better title as against the rest of the world save the true owner. (So, for example, a bailee's possession entitles the bailee to exercise any and all remedies of a true owner - so as to recover the full value of the chattel damaged by a third party, or to sue in trespass or for conversion, Mr Stack referring in this regard to Specialised Transport v Domimak (1989) 16 NSWLR 657 at 663F and Bailment (Palmer) 2nd edition at 308 . ) 68It is also noted that where a bailee has the benefit of a lien over chattels, the bailor is required to honour that lien and cannot recover the chattels unless and until the lien has been satisfied ( Standard Electric Apparatus Laboratories Ply Ltd v Stenner (1960) WN (NSW) 833 at 836; [1960] NSWR 447 at 450-451). 69Thus Mr Stack asserts a statutory lien in respect of the administrator's costs and expenses charged against the artworks even if the administrator is no more than a bailee of those artworks. 70(In the context of the bailment argument, Ms Drolz argued that, as a bailee, International Art Holdings could have no greater priority of title or rights than those attaching to her rights as trustee of the superannuation fund (and that those rights did not extend to a right to grant a lien over the artwork). This argument was put as being a very strong public policy reason against the imposition of a lien in the present case. 71As I understand her submission, Ms Drolz contends that because she, as trustee of a superannuation fund, cannot allow a lien to be asserted over the assets of the fund, this has the effect that the administrator cannot seek to have such a lien imposed (an argument sought to be illustrated by reference to the analogy of an administrator asserting title to a house including a granny flat if there were in fact no granny flat there T 19.15-18; and an analogy of an administrator of an insolvent manufacturing company that had leased premises refusing to return the premises to the owner unless the owner had paid the cost of removing the equipment on the property - T 19.36). Ms Drolz expressed concern at the prospect that "the locus of the assets that an administrator can access in this kind of situation continues to spread", by which I understood her to be suggesting that there was a public policy concern in not permitting the administrator to be able to seek the imposition of a lien over assets in the possession of the company if the owner of the assets could not itself have created such a lien. I consider these submissions later in the context of whether an equitable lien should be imposed. However, for present purposes I do not consider that the fact that a bailor might be prohibited from granting a lien over the property bailed to a bailee (assuming that is the case here) precludes the bailee asserting a lien over the property in its possession by reference to circumstances that have arisen during the course of the bailment and I have found no authority to that effect. 72As noted earlier, I consider that the interest as lessee of artwork the subject of a rental agreement is an interest in property to permit the creation of a statutory lien. I am not satisfied that even giving the definition of property a broad scope, it would mean that a possessory interest was sufficient. However, nothing ultimately turns on this as I consider that even if the interest of International Art Holdings in the artworks does not satisfy the definition of the "company's property" for the purposes of a statutory lien, Mr Arnautovic is able to maintain his claim for an equitable lien. In this regard, Mr Stack relies on the authorities that have held that the statutory lien provided under section 443F does not replace or prevent an equitable lien ( Commonwealth Bank v Butterell (1994) 35 NSWLR 64 at 71; Weston v Carling Constructions Pty Ltd (2000) 35 ACSR 100 at [18]; Lockwood v White (2005) 11 VR 402 at [34]; and Coad v Wellness Pursuit Pty Ltd [2009] WASCA 68 at [60] to [64].) 73An equitable lien has been described as "an equitable remedy, created by the court, regardless of the intent of the parties , as a remedial device to protect a party against some inequitable loss" (McClintock, Handbook of the Principles of Equity (2 nd edn) p 118 (my emphasis), as quoted in Stephenson Nominees Pty Ltd v Official Receiver (1987) 16 FCR 536 per Gummow J, then sitting in the Federal Court, at [554]). 74An equitable lien does not depend upon either contract or possession. It arises by operation of law under equitable doctrine as part of a scheme of equitable adjustment of mutual rights and obligations ( Hewett v Court (1983 46 ALR 87 at [90] per Gibbs CJ and Davies v Littlejohn (1923) 34 CLR 174 at [185] per Isaacs J). It is a right against property that arises automatically by implication of equity to secure the discharge of an actual or potential indebtedness ( Hewett v Court at [104] per Deane J). In Coad v Wellness Pursuit Pty Ltd (in liq) 71 ACSR 250 (paragraph 4) it was said that an equitable lien arises in any circumstances where equity considers that fairness dictates. 75It has been said that an equitable lien "makes the administrator a secured creditor" and, to the extent that it attaches, gives the administrator priority over the secured creditors referred to in s 556 of the Corporations Act ( Hamilton v Donovan Oates Hannaford Mortgage Corporation Ltd [2007] NSWSC 10; (2007) 61 ACSR 82 at [26]; Shirlaw v Taylor (1991) 31 FCR 222; Weston v Carling Constructions Pty Ltd (2000) 35 ACSR 100). 76The rationale for the imposition of an equitable lien in this context was considered by the Full Federal Court in Shirlaw v Taylor . Sheppard, Burchett and Gummow JJ there said at [228] that: "[I]n addition to equitable liens arising from contractual dealings in property, equity may impose liens based either upon general considerations of justice or upon the principle that he who seeks the aid of equity in enforcing some claim, for example in the administration of assets, must admit the equitable rights of others directly connected with or arising out of the same subject matter. 77In the present case, the equitable lien sought is of the kind described in Re Universal Distributing Co Ltd (in liq) (1933) 48 CLR 171 by Dixon J, namely, a lien to which an official who has incurred expenses in assembling a fund for the benefit of creditors is entitled, in relation to the fund, to priority over a secured creditor who derives benefit from the assembling of the fund. As Barrett J stated in Hamilton v Donovan Oates Hannaford Mortgage Corporation Ltd at [18]: "[t]he lien arises from the principle that the fund itself must bear the costs of realisations and other actions involved in its creation, with those costs being satisfied out of the fund before striking the balance available to the secured creditor and thereafter to creditors generally." 78Similarly, in Re Application of Central Commodities Services Pty Ltd Needham J noted that the powers of the court to impose an equitable lien in this context are derived from the general equitable principle that such an administrator or receiver, as an officer of the court, working for the benefit of all who have legitimate interests in the assets, is entitled to look to the assets of the company of which he is an administrator to meet his remuneration and his liabilities and outgoings (see also, for example, Moodemere Pty Ltd (in liq) v Waters [1988] VR 215 at [229-30] per Tadgell J and Clark Equipment Credit of Australia Ltd v Como Factors Pty Ltd (1988) 14 NSWLR 552 at [568 ] per Powell J). Sir John Romilly MR in Bertrand v Davies (1862) 54 ER 1204 at [1207] similarly said: Where a receiver or manager is appointed by the court, in a suit properly constituted, such manager is to be considered as appointed on behalf of all persons interested in the property, and he is entitled to his ordinary commission and allowance, and also to a lien on the estate, as against all persons interested in it, for the balance, whatever it may be, that shall be found due to him on taking his accounts. 79In Shirlaw v Taylor, Sheppard, Burchett and Gummow JJ observed at [560] that, in addition to the anxiety of the court to protect the position of its officer (particularly lest there be in the future an absence of persons willing to take such appointments), the claims of the officer under a court appointed administration may be seen as in the nature of "salvage":"The principle is that those taking benefit of the administration should not escape bearing the burden of the proper cost of it." (see also, for example, Matter of Tharp (1852) 65 ER 533). 80Again in re Berkeley Applegate (Investment Consultants) Ltd (in liq); Harris v Conway [1988] 3 All ER 71, Edward Nugee QC, sitting as Deputy Judge of the High Court, stated at [83] that there was: ... a general principle that where a person seeks to enforce a claim to an equitable interest in property, the court has a discretion to require as a condition of giving effect to that equitable interest that an allowance be made for costs incurred and for skill and labour expended in connection with the administration of the property. It is a discretion which will be sparingly exercised ; but factors which will operate in favour of its being exercised include the fact that, if the work had not been done by the person to whom the allowance is sought to be made , it would have had to be done either by the person entitled to the equitable interest (as in Re Marine Mansions Co (1867) LR 4 Eq 601 and similar cases) or by a receiver appointed by the court whose fees would have been borne by the trust property (as in Scott v Nesbitt 14 Ves Jun 438); and the fact that the work has been of substantial benefit to the trust property and to the persons interested in it in equity (as in Phipps v Boardman [1964] 1 WLR 993). (my emphasis) 81It seems to me that this reasoning is not limited to the position of an administrator or receiver appointed by the court but should extend to a person performing the function of an administrator appointed under the provisions of the Corporations Act . (The safeguard for those on whom the burden of the lien falls is that the costs and expenses of one who has by his efforts brought into court a fund for administration must be reasonably and properly incurred.) 82As noted by Mr Stack, an equitable lien arises in a "diversity of cases" where the "general principles of justice" support such a lien ( Hewett v Court [1983] HCA 7; 149 CLR 639 at [7], page 646) and examples of cases where such a lien will arise when a person has employed a material part of his/her time and energy for the "care, preservation and realisation of the property" are numerous (for example , Re Universal Company Ltd [1933] HCA 2; 48 CLR 171 at 174; Shirlazv v Taylor ( 1991) 31 FCR 222; 5 ACSR 767 at 776; Commonwealth Bank v Butterell (1994) 35 NSWLR 64 at 70; Re Application of Sutherland (2003) 59 NSWLR 361 at 422ff; Grossman v E Katz Manufacturing Jewellers (2004) 213 ALR 373 at [6]ff; Dean-Willcocks v Nothmtoolmrd [2006] NSWCA 311 at [9] and [62] to [65]; and Coad v Wellness Pursuit Pty Ltd [2009] WASCA 68 at [60]ff). 83Do the interests of justice in this case warrant the imposition of an equitable lien? As noted earlier, Ms Drolz has argued against the imposition of an equitable lien on two bases - first, that it will operate to her detriment in depriving her superannuation fund of its protected status (having assets unencumbered by any such lien) and, secondly, on the basis that she disputes having obtained any real benefit from the administrators' efforts in relation to the preservation of the artworks and identification of claims thereto. 84I address those issues as follows. Effect on superannuation status of fund 85I am not satisfied that the concerns Ms Drolz has raised as to the consequences of the imposition of a lien on her superannuation fund, are soundly based. 86Ms Drolz referred to regulation 13.14 of the Superannuation Industry (Supervision) Regulations 1994 (Cth) (the SIS Regulations) and submitted that this regulation precludes her, as trustee of the superannuation fund, from allowing a lien to be imposed on the assets of the fund. Regulation 13.14 provides that: For the purposes of subsections 31(1) and 32(1) of the Act, it is a standard applicable to the operation of regulated superannuation funds and approved deposit funds that, subject to regulations 13.15 and 13.15A, the trustee of a fund must not give a charge over, or in relation to, an asset of the fund. 87Section 31 of the SIS Act gives the power to prescribe standards applicable to the operation of regulated superannuation funds, by the making of regulations. The operating standards are, in effect, a set of rules governing the operation of regulated superannuation funds (and other funds). Compliance with the standards is necessary to achieve the status of a complying fund and hence to qualify for income tax concessions available to complying funds. Section 34 of the SIS Act requires each trustee of a superannuation entity to ensure that the prescribed standards applicable to the operation of the superannuation fund are complied with at all times. 88Regulation 13.14, in its terms requires trustees of regulated superannuation funds (and approved deposit funds) not to give any charges over or in relation to, fund assets. This is a standard that must be complied with for 'complying fund status' to be afforded to the superannuation fund. ( The Law of Superannuation in Australia at [81,250]). I assume that when Ms Drolz refers to the superannuation fund assets losing their "protected status" upon the imposition of an equitable lien, she is referring to their 'complying fund status' in the context of regulation 13.14. 89From the time a regulated fund lodges its election to become a superannuation fund, it must ensure that it meets all of the requirements and prudential standards of the SIS Act. 90As noted, it is 'complying superannuation fund status' under Pt 5 ss 37 - 50 of the SIS Act that qualifies the fund for income tax concessions. Broadly speaking, a complying superannuation fund is a fund that has received an unrevoked notice from the Regulator (APRA or the Tax Office) stating that the fund is a complying superannuation fund in relation to the income year and has not subsequently received a notice that it is not a complying fund ( Australian Superannuation Handbook, 2010-11, Stuart Jones, at [2,400]). 91Section 42(1) of the SIS Act provides that a fund (other than a self-managed fund) is a 'complying superannuation fund' in relation to a particular year of income if the following conditions are satisfied: (a)either: (i)the entity was a resident regulated superannuation fund at all times during the year of income when the entity was in existence; or (ii)the entity was a resident regulated superannuation fund at all times during the year of income when the entity was in existence other than a time, before it became a resident regulated superannuation fund, when the entity was a resident approved deposit fund; and (b)either of the following conditions is satisfied: (i)no trustee of the entity contravened any of the regulatory provisions in relation to the entity in respect of the year of income; (my emphasis) (ii)both: (A) a trustee of the entity contravened one or more of the regulatory provisions in relation to the entity in respect of the year of income on one or more occasions; and (B) the entity did not fail the culpability test set out in subsection (1A) in relation to any of those contraventions; and (c)the entity was not a self-managed superannuation fund at any time during the year of income . 92Ms Drolz' superannuation fund, according to the materials contained in Exhibit 1, is a regulated self-managed fund with 'complying' status. 93Under s 42(1)(b)(i) of the SIS Act, a contravention of any of the regulatory provisions by the trustee will result in the superannuation fund losing its 'complying fund status' for the respective income year. 94Ms Drolz' submission, as I understand it, is that if she, as trustee, "allows" an equitable lien to be imposed over the superannuation fund assets, she will be in contravention of regulation 13.14 of the SIS Regulations and will not satisfy the requirement in s 42(1)(b)(i) of the SIS Act. Her submission is thus that the superannuation fund of which she is trustee will thereby lose its 'complying fund status' if an equitable lien is imposed over its assets. 95However, regulation 13.14 in its terms applies only to the imposition of a charge or lien by the trustee of a superannuation fund. It seems to me that this is distinguishable from the situation in which the court imposes an equitable lien or a statutory lien arises as a matter of law. 96The SIS Act and Regulations do not address the situation where the court in the exercise of its discretion imposes an equitable lien on the assets of a superannuation fund. It does not seem to me that there is in that instance any basis on which it might be said that the trustee had 'allowed' the creation of a charge over the assets of the fund (and, were that to be the case, then it could hardly be said that Ms Drolz has 'allowed' something that occurs over her objection). 97Of course, there might conceivably be an argument that Ms Drolz has 'allowed' a situation to occur in which a lien is later imposed by the court by refusing to pay the levy imposed by the administrator. It seems to me that this would be drawing a very long bow. (However, if there were a reasonable basis for such a concern it would be met by not imposing the lien until after a period in which Ms Drolz would have the opportunity to pay what she says is the relatively trivial amount required to be paid by way of levy.) 98Ms Drolz submits that it is not in the public interest or good public policy for an equitable lien to be imposed over assets of a superannuation fund. I am not satisfied that there is anything in the SIS Act that compels the conclusion that a statutory lien arising under the Corporations Act or an equitable lien imposed in the general interests of justice would be against public policy. 99Therefore, the only question is whether it is appropriate to do so in the circumstances. I have considered the general principles in that regard above and, subject to consideration of the second issue raised by Ms Drolz, I am satisfied that it is appropriate to do so. 100For completeness I note that Ms Drolz also submitted that under clause 6(g) of the Rental Agreement, International Art Holdings is prohibited from granting a lien over any of the artworks in its possession. I have set out clause 6(g) earlier. I do not accept that this operates as a contractual matter to preclude International Art Holdings from seeking the imposition of an equitable lien in the circumstances that have arisen or that it precludes it from invoking a statutory lien arising from the operation of the provisions in the Corporations Act . Benefit from administrator's efforts 101In the alternative, Ms Drolz submits that even if it is, in the circumstances, appropriate for the Court to impose an equitable lien over the artworks held in the possession of the administrator (in order to reflect the work undertaken to recover and identify the artworks to which the investors have a claim), the amount of work that has been undertaken by the administrator is excessive and unnecessary. 102Ms Drolz claims that the present circumstances can be differentiated from those in Crouch Re: Heritage Fine Wines [2007] NSWSC 1055; (2007) 214 FLR 244 and Coad , in that the body of work undertaken by the administrators in those cases was very substantial and technical, and required hours of labour which directly benefited the people involved. She submits that the level of work undertaken by the administrators was vitally necessary in those cases, and not something that an ordinary person could do. Ms Drolz contends that the present circumstances can be distinguished in that an ordinary person could have completed the tasks of the administrator, and she asserts that such a person could have done so in a significantly more efficient and effective manner. 103Ms Drolz provides examples of particular enquiries made by the administrator in respect of the location of artworks belonging to the superannuation fund of which she is trustee. She claims that the process undertaken to make those enquiries was far too cumbersome and unnecessary. She contends that when she herself attempted to make the same enquiries herself, the work involved was very minimal. Ms Drolz does not believe that the administrator should be indemnified out of the assets of the fund on the basis of what she submits was, more often than not, futile work. 104Ms Drolz seems to have been actively involved in the investigation of competing claims, as a member of the Committee of Creditors and has a firm view as to the usefulness of the tasks undertaken by the administrator. However, I do not accept that the procedures undertaken by Mr Arnautovic and his staff were not properly engaged in by them (and ultimately the responsibility lies with the administrator not the Committee of Creditors - in that regard I note the consideration given by Barrett J to the role of the committee in the context of a liquidation in the case of the winding up of OneTel - see Onefone Australia Pty Ltd v One Tel Ltd [2010] NSWSC 1120). 105Ms Drolz deposed in her affidavit (and expanded on this from the bar table) to investigations and inquiries that had been carried out by her (such as her review of a CRM spreadsheet provided to her by a particular investor) and suggested that the steps that had been taken by the administrator had been unreasonable and excessive. Ms Drolz says that the level of work was work carried out by the administrator was either not required or was work which could have been dealt with much more efficiently. 106In particular, Ms Drolz submits that the factors that worked to elevate the administrator's claim to an equitable lien in the Coad case are not relevant in the present case (namely that, there, the people who benefited from the administrator's work had known that the administrator was going to be appointed and could have prevented this, thus acquiescing in his conduct, and that had the administrator had not done the work then they would have had to pay someone to do it for them). Ms Drolz submits that here there was not much effort involved in placing the items in storage and there was not anything done by the administrator that she could not have done herself. (She dismisses the efforts of the administrator in resolving retention of title claims from unpaid artists on a similar basis). Ms Drolz also criticised the cursory nature of the investigations she said had taken place (by reference to an example as to failure to check inventory tags, which Ms Drolz submits establishes that some of the disputed artwork claims had no substance). 107As to this issue, it seems to me not surprising that in an administration of this complexity there may be instances when there were omissions from schedules or misdescriptions of artwork or the like. To the extent that errors may have been attributable to Grays Auctioneers, it is difficult to see that the administrator should bear the cost of those by being deprived of compensation for his efforts. 108Further, I do not accept that someone in Mr Arnautovic's position, with responsibilities of the kind he has as an administrator, can be criticised for being careful to ensure that the artworks were identified, located and preserved pending a determination as to who had an interest in those artworks. I do not think it likely that the overall task was as simple as Ms Drolz suggests or as it may indeed have been in the case of individual pieces of artwork. It could not have been open to Mr Arnautovic, for example, simply to rely on what he may have been told by particular investors as to their entitlements or to accept at face value what he might have been told by Mr Hall or his staff - he was required to verify information given to him by them and by the company and its officers. As Mr Stack submits, the fact that ultimately the administrator was satisfied as to Ms Drolz' entitlement to the artworks in question (and that there was no competing claimant thereto) does not mean that he should not have carried out the exercise in the first place. 109Ms Drolz directed my attention to Crouch v Lynne Adams [2006] NSWSC 1029 in which White J gave directions to the liquidator pursuant to s 511 of the Corporations Act as to the basis on which he would be justified in dealing with certain vending machines in the company's possession. In that case there were various categories of vending machine (not unlike the existence of the different categories of artwork in the present case, though there more numerous) depending on whether an owner could be identified or whether there were multiple purchasers or whether the machines sold were not capable of identification or were the subject of buy-back arrangements or, finally, were not the property of any investor or investors. In relation to the first category, his Honour said that the liquidator was justified in acting on the basis that he was "entitled to a lien for reasonable remuneration for work done in the identification, preservation, or realisation of the property" and that such a lien was enforceable against the property that have been identified preserved or realised notwithstanding that it belonged to the investors and not to the company (at [20]). (His Honour also considered it appropriate to provide the advice under s 511 notwithstanding that in many cases the directions so made might well have the practical effect of dictating the course of the liquidation and the amounts received by different classes of investors). 110His Honour expressly held that the liquidator (who there also had proposed raising voluntary levies) would be justified in not delivering the machines to investors if the investor had not agreed to pay the levy and that the liquidator in such a case might apply for an order authorizing him to sell the machine to give effect to the lien. His Honour was satisfied as to the reasonableness of the costs and expenses on the basis of which the levy had been calculated. 111Ms Drolz sought to distinguish that case on the basis that she considered his Honour (when noting that the lien was enforceable against property belonging to the investors not the company) had not implied that the issue as to whether or not the property was that of the company was irrelevant but should be understood as meaning that this was a factor to be weighed against the body of work done and the benefit produced to the property owner by the party asserting the lien. Ms Drolz asserted that where, as in the case of the levy artworks, the property was not that of the company then the work to be done by the administrator in order to prove any right to a certain lien had to be substantially more than if the property were not that of the company. I do not read his Honour's judgment as suggesting that there has to be a quantitative or qualitative increase in the burden of work performed by the administrator in order to justify a lien over property belonging to investors. Rather, his Honour in approving the liquidator's remuneration had regard to the time consuming nature and complexity of the work there involved and was satisfied that the remuneration claimed was reasonable (as am I in this case) and went on to note (at [59]) that the liquidator was entitled to remuneration not only from the company's property but also from the property of investors which he had identified and preserved and which he may realise (and had an equitable lien to secure that entitlement). There are obvious similarities between the issues there considered and those in this case (albeit that the property there in question was not as unique as the artwork in this case - that distinction being a factor that has led me to consider that there should be a further process of advertisement in relation to the unclaimed artworks before any sale and that claimants to the disputed artworks should have an opportunity to preserve the subject matter of the dispute). 112I do not accept that it was not for the benefit generally of investors that the administrator carry out the tasks required in order properly to satisfy himself as to the identification of the artwork and the determination of those parties with an interest or claimed interest therein. Mr Stack points out that Mr Arnautovic was obliged to consider matters such as retention of title claims from artists, liens asserted by framers and the like (and notes that Ms Drolz herself has acknowledged the difficulty of identification of some of the indigenous artworks). 113It seems to me that the criticisms made by Ms Drolz are largely made with the benefit of hindsight and having regard to her own conclusions as to what should have happened. There may be instances in which her criticism is justified. I am not satisfied, however, that in the overall scheme of things there was no benefit to owners of the levy artwork of the exercise in which the administrator was necessarily required to engage in order to identify and preserve artwork and to determine potential claims in relation to the artwork before acceding to their claims to particular items of artwork (nor am I satisfied that there was so little benefit as to warrant the view that there should be no equitable lien imposed on the artworks to secure the recovery of the administrator's costs and expenses). I do not accept that the tasks performed by the administrator were all ones that an individual investor could have performed - the fact that some of them may have been is not to the point. I also consider that the evidence establishes the reasonableness of the amount of the proposed levy and the fairness of the basis on which it has been calculated. 114In summary, therefore, I consider that a statutory lien in respect of the administrator's costs has arisen over such of the artworks in respect of which International Art Holdings has a leasehold interest. I have more difficulty in seeing a possessory interest in the artworks as "property" in this context even having regard to the breadth of the definition in s 9 of the Corporations Act . Ultimately, however, nothing turns on this because even in cases where International Art Holdings is no more than a bailee of the artworks, I am satisfied that an equitable lien should be imposed on those artworks to secure the reimbursement to Mr Arnautovic of what I accept have been his reasonable costs and expenses of dealing with the artworks. Schedule C - Unclaimed artworks 115Schedule C lists artworks where no claim of ownership has been made. There are some 76 items of artwork in this category. Mr Arnautovic expressed surprise at the number of items in respect of which no claim has been made on the basis that the books and records he has reviewed show only 16 artworks owned by International Art Holdings and it was not the company's core business to purchase artwork in its own right. For what it is worth, Mr Arnautovic notes that Mr Hall maintains that the books and records are accurate (though given that they are said to be incomplete I doubt that much assistance can be gained from this). 116Mr Stack notes that possession of a chattel is prima facie evidence of ownership, referring to what was said in Gatward v Alley (1940) 40 SR (NSW) 174 by Jordan CJ at 180 : De facto possession of a chose in possession is prima facie evidence of ownership, and also of itself creates a legal right to possess which is enforceable against anyone who cannot prove that lie has a superior right to possess: any person who interferes with this legal right, without being able to prove a superior right, is therefore a wrongdoer. and also to Standard Electric Apparatus Laboratories at 450-451 (for the proposition that if there is a lien attaching to artworks then the fact that International Art Holdings is a bailee does not preclude it holding onto its artwork against the bailor) ; Perpetual Trustees & National Executors of Tasmania Ltd v Perkins (1989) Aust Torts Reports 80-295 at 69,201-69,204; Flack v Chairman, National Crime Authority (1997) 80 FCR 137; and Hoath v Connect Internet Services [2006] NSWSC 158 at [152]). 117However, Mr Arnautovic, not unreasonably, has expressed the concern that if he were to sell a piece of artwork where no claim is currently made then he may later be sued by an investor who can establish ownership to that piece of artwork. He has deposed to the belief that if such artwork is not sold by him then he will have no alternative but to disclaim interest in the artwork and that this may also give rise to claims by investors with costs incurred to the detriment of the creditors of the company. 118It cannot be in the interest of creditors for the unclaimed artworks to be disclaimed (if there is no person asserting a better title to them than the administrator) or stored indefinitely at a cost to the company pending any such claim being made. Whether the point has been reached at which an investor may be said to have abandoned any such claim is not, however, clear. 119Mr Stack notes that s 442C(2)(c) has the effect that there can be a disposal by the administrator of property in the possession of the company in administration, but of which someone else is owner or lessor, if the leave of the court is obtained (but sub-s (3) provides that the court may only give such leave if satisfied that arrangements have been made adequately to protect, relevantly, the owner). 120Here the difficulty is that it is not clear whether all of the unclaimed artworks belong to the company or whether there is any person with better title to the unclaimed artworks. The orders proposed by the administrator would not enable me to be satisfied as required by s 442C(2)(c), if it were to be the case that the rightful owner was a third party. 121It seems to me that, provided there is adequate publication of the intention of Mr Arnautovic to sell the unclaimed artwork (such that the court can be confident that all reasonable steps have been taken to draw to the attention of persons who may consider they have a claim to the artwork in question the need to articulate such a claim), the view could properly be taken that there is no other person with better title than the company (or any such person has abandoned any such claim). 122Therefore in my view the appropriate course is to give directions for there to be a further process of advertisement in relation to the unclaimed artworks in order to provide a final opportunity to ascertain if there is any legitimate claimant to those artworks. I note that Mr Arnautovic himself (see paragraph 59 of his first affidavit) seemed to accept that there should be a further process of advertising the artwork in order to give the public a final opportunity to notify of any claims to the artwork in question. 123In Commonwealth v ABC2 Group Pty Ltd [2008] NSWSC 1383; (2008) 69 ACSR 229, Barrett J (having noted that the court may appoint a receiver in a wide range of circumstances and, notably, whenever the interests of justice so warrant) said: Appointments are most often made to protect the subject matter of legal proceedings pending determination of those proceedings by the court. But the jurisdiction is wider than that. ...A receiver may be appointed to hold property affected by a lien pending a judicial sale. 124I was also taken to what was said by Brereton J, in explaining the relevant principles concerning a trustee's right of indemnity against trust assets, in relation to an equitable lien in Lemery Holdings v Reliance Financial Services Pty Ltd (2008) 74 NSWLR 550 (at [18]), namely that "..being an equitable lien, the security is enforceable by the trustee only by judicial sale or appointment of a receiver and not by foreclosure nor by sale out of Court" (his Honour citing, inter alia, Hewett v Court and Davies v Littlejohn ). 125I am not satisfied that I should make a declaration as to the ownership of the unclaimed works given the objective unlikelihood that the company had retained ownership of such a large collection of artworks (ownership thereof not being recorded in the books) and in circumstances where I am not satisfied that at common law a claimant would be said by this stage to have abandoned any interest in the goods (even though I accept that International Art Holdings has de facto possession and there has been no other potential owner identified as yet). 126I consider that the appropriate course is to appoint Mr Arnautovic as the receiver of all of the unclaimed works and to make orders that will permit him (after further advertisement of the artworks) to sell any remaining unclaimed artworks and, after discharge of the lien, to deal with the balance of the proceeds in the ordinary course of the administration so as to facilitate the expeditious completion of the administration. (If an owner is identified and able to establish a claim to an unclaimed artwork in the period following the further advertisement of the unclaimed artworks, then the procedure in relation to the levy artworks should apply.) Orders 127For the reasons set out above, I propose to make the following orders. However, as they encapsulate a slightly different regime from that proposed by the administrator, I will hear any further submissions as to the actual orders to be made to reflect my reasons. In particular, I will hear submissions as to whether the orders made should permit the administrator to sell any items of disputed artworks in respect of which proceedings to determine the title to the artwork has not been commenced within a particular period of time. Schedule A artworks - disputed artworks: 1.Order that Sule Arnautovic of Jirsch Sutherland, level 4, 55 Hunter Street, Sydney, registered official liquidator, be appointed as Receiver of each of the artworks identified in the Amended Schedule A ("Schedule A ") to the Further Amended Originating Process . 2.Order that, subject to the directions made in 3 - 4 below, Sule Arnautovic, as Receiver of each of the artworks identified in the Amended Schedule A, has, in relation to those artworks, powers of the kind set out in section 420 (2) (a), (b), (c), (e) and (g) of the Corporations Act. 3.Direct that, before any sale by the Receiver of the artworks identified in the Amended Schedule A, Sule Arnautovic notify the claimants to the disputed artworks of his intention to sell the disputed artworks and that any person claiming an interest in a disputed artwork and who does not wish the artwork to be sold pending a determination as to the title to the artwork must provide security to the reasonable satisfaction of the administrator within 21 days for the cost of storage and insurance of the claimed artwork. 4.Order that if security is not provided within 21 days of the notification referred to in 3 above for the cost of storage and insurance of artwork identified in the Amended Schedule A, the Receiver would be justified in selling the artwork and in holding the proceeds of sale (less the Receiver's remuneration) pending the determination of proceedings by the persons claiming an interest in the artwork to establish that interest. 5.Order that the remuneration ("the Schedule A Remuneration") of Sule Arnautovic, as Receiver of each of the artworks identified in the Amended Schedule A, be calculated in accordance with the Scale of Rates of Jirsch Sutherland, a copy of which is attached to the Consent of Receiver. 6.Order that the Schedule A Remuneration shall be apportioned amongst each of the artworks identified in the Amended Schedule A, on the basis that each of the artworks shall bear that percentage ("the Schedule A Percentage Sum") of the Schedule A Remuneration calculated by the percentage determined by dividing the sum paid for that art by the sum paid for all of the artworks (by way of example, if the Schedule A Remuneration totals $1,000, and the relevant artwork sells for $5,000 and all of the artwork sells for $50,000, then the relevant art work will bear 10% of the remuneration being $100). 7.Declare that Sule Arnautovic has a lien over the artworks identified in the Amended Schedule A for the Schedule A Percentage Sum. 8.Direct that after the sale of the artworks referred to in the Amended Schedule A, and after payment of the Schedule A Percentage Sum, the monies remaining shall be paid in accordance with any agreement between the parties claiming an interest in the said artwork or any determination by a court or tribunal as to the person who, at the time of the sale, had the better title to the said artwork. Schedule B artworks - levy artworks 9.Declare that in respect of any of the artworks identified in the Amended Schedule B ("Schedule B") to the Further Amended Originating Process in respect of which the Levy referred to below is not paid to the administrator within 14 days, the First, Second and Fifth Plaintiffs have a lien (being a statutory lien over the artworks the subject of rental agreements under which the First or Second Plaintiff is a lessee and, in the case of other artworks an equitable lien) to secure the amount (Levy) of the administrator's reasonable costs and expenses of dealing with the artworks, calculated as follows: (a)in the case of the artworks with a specified value in the Administrator's current catalogue of more than $5,000, a Levy of $500 in respect of each artwork; (b)in the case of the artworks with a specified value in the Administrator's current catalogue of between $1,500 and $5,000, a Levy of $300 in respect of each artwork; and (c)in the case of the artworks with a specified value in the Administrator's current catalogue of less than $1,500, a Levy of $100 in respect of each art work. 10.Order that Sule Arnautovic of Jirsch Sutherland, level 4, 55 Hunter Street, Sydney, registered official liquidator, be appointed as Receiver of each of the artworks identified in the Amended Schedule B. 11.Order that Sule Arnautovic, as Receiver of each of the artworks identified in the Amended Schedule B, has, in relation to those artworks, powers of the kind set out in section 420(2) (a) and (e) of the Corporations Act. 12.Direct that within 7 days of these orders, Sule Arnautovic send by pre-paid ordinary post, a letter substantially in the form of that in tab 17 to Exhibit A in these proceedings (being Exhibit "SA-1" to the first affidavit of Mr Arnautovic), with such modification as necessary to reflect declaration 9 above, to each of the persons recorded in the Amended Schedule B as the owner of each of the artworks. 13.Direct that in the event that Sule Arnautovic receives payment of the Levy from a person recorded in the Amended Schedule B as the owner of an artwork within 21 days of these orders, Sule Arnautovic release that artwork to that person. 14.Order that in relation to the artworks ("the Remaining Schedule B Art Works") identified in the Amended Schedule B which have not been released in accordance with the direction referred to in paragraph 13 above, Sule Arnautovic, as Receiver of each of the artworks identified in the Amended Schedule B, shall have, without more, powers of the kind set out in section 420 (2) (b), (c) and (g) of the Corporations Act. 15.Order that on and from 21 days after these orders, the remuneration ("the Schedule B Remuneration") of Sule Arnautovic, as Receiver of the Remaining Schedule B Art Works, shall be calculated in accordance with the Scale of Rates of Jirsch Sutherland, a copy of which is attached to the Consent of Receiver. 16.Order that the Schedule B Remuneration shall be apportioned amongst each of the Remaining Schedule B Art Works, on the basis that each of the art works shall bear that percentage ("the Schedule B Percentage Sum") of the Schedule B Remuneration calculated by the percentage determined by dividing the sum paid for that art by the sum paid for all of the art works (by way of example, if the Schedule B Remuneration totals $1,000, the relevant artwork sells for $5,000 and all of the artwork sells for $50,000, then the relevant artwork will bear 10% of the remuneration being $100). 17.Declare that Sule Arnautovic has a lien over the Remaining Schedule B Art Works for the Schedule B Percentage Sum. Schedule C artworks - unclaimed artworks 18.Direct that Sule Arnautovic advertise in a newspaper with national daily circulation the unclaimed artworks listed in Schedule C to the Further Amended Originating Process, notifying his intention to sell the said artworks and that any person claiming an interest in any of the unclaimed artworks should notify that claim in writing within 21 days. 19.Direct that in respect of any artworks listed in Schedule C in respect of which no notification of a claim is received within 21 days of the advertisement above, Sule Arnautovic would be justified in treating the artworks as the property of International Art Holdings Pty Ltd (Administrator Appointed) and in treating any claim by any other person in relation thereto as having been abandoned; and that he would be justified in selling the artworks and distributing the proceeds of sale in the ordinary course of the administration of the company. 20.Direct that if notification of a claim in respect of any of the hitherto unclaimed the artworks is received within 21 days of the advertisement in accordance with 18 above (or prior to the sale of the artwork), such artwork is to be treated as an Amended Schedule B or Amended Schedule A artwork (depending on whether any competing claim is made in relation to the said artwork and on whether any identified owner at that stage pays the Levy) and the orders and directions made in respect of that category of artwork shall apply as if the Schedule C artwork had been listed in Amended Schedule B or Amended Schedule A as the case may be. 128Finally I propose to order that the costs of the plaintiffs be met out of the administration of the said plaintiffs and that no order as to costs otherwise be made. I direct that short minutes of order be prepared in accordance with these reasons. ********** Amendments 28 October 2011 - amended paragraph numbering Amended paragraphs: 10 - 130 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 31 October 2011