ASIC v Burke

AND THE COURT NOTES THAT reasons for judgment will be published in due course.

Note: The form of the order is subject to the entry in the Court's records.

Note: This copy of the Court's Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Galip & Galip has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).

1. The applicant wife and respondent husband are engaged in litigation pursuant to Part VIII of the Family Law Act 1975 (Cth) ("the Act"), the final hearing of which commenced on 14 July 2025 and was adjourned part heard on 18 July 2025 to a further three days in November 2025. Joined to the proceedings are 12 further respondents, albeit that to date the 7th, 8th, 9th and 13th respondents have not taken part.
2. On the last day of the hearing, there was, adjourned to Tuesday 22 July 2025, an application to appoint a receiver and manger to various companies controlled by the husband. The orders sought were in the following terms:

1. For the purpose of appointing a receiver and manager only:

1. [Galip Investments Pty Ltd] be joined as the Fourteenth respondent.

2. [FF Pty Ltd] be joined as the Fifteenth respondent.

3. [EE Pty Ltd] be joined as the Sixteenth respondent.

4. [J Pty Ltd] be joined as the Seventeenth respondent.

5. [JJ Pty Ltd] be joined as the Eighteenth respondent.

6. [KK Pty Ltd] be joined as the Nineteenth respondent.

7. Pursuant to Family Law Act 1975 (Cth) (Act) Pt VIII ss 79 and 80(1)K, until further order of the Court, [Ms AX] and [Mr AY] of [AZ Company] be appointed without security as joint and several Receivers and Managers (Receivers) as agents over the following corporate entities, which includes all the property, assets and undertakings, including the shares held by the Respondent Husband [(Mr Galip)] held in them:

a. [Galip Investments Pty Ltd];

b. [FF Pty Ltd];

c. [EE Pty Ltd];

d. [J Pty Ltd];

e. [JJ Pty Ltd]; and

f. [KK Pty Ltd].

(together, the Companies).

1. In each case, the Receivers have the powers that a receiver and manager of a corporation's property would have pursuant to section 420 of the Corporations Act 2001 (Cth), provided that the conferral of such power on the Receiver in relation to property of the Companies does not:
   1. affect any rights in relation to that property of any other person other than the Companies (such order to be construed in the same manner as s 420(3) of the Corporations Act 2001 (Cth)); and
   2. expressly affect, or prejudice, the rights of any registered secured creditor of any of the Companies, including the rights of that registered secured creditor to take enforcement action in relation to any property of the Companies.
2. Subject to, order 3 above, the Receivers have control over each of the Companies as a going concern and without limitation to their powers set forth in these orders, is vested with the control and authority to deal with any secured creditors of the Companies.
3. Subject to order 7, the Receivers are to notify the Applicant, First Respondent and Third Respondent when their remuneration is $10,000 from exceeding the sum of $50,000 to undertake the tasks set out in these orders and either the Applicant and/or the Third Respondent is to notify each active party of this occurrence.
4. Where the Receivers seek further remuneration, any further sum must be approved by the Court, if it cannot be agreed between all active parties.
5. Order that the Receivers be indemnified out of the real property assets of the Companies for their remuneration, costs and expenses in the following order of priority:
   1. In circumstances where any registered security holder has taken, or takes after the date of these orders, enforcement steps pursuant to the security holder's security over property, then after the secured creditor's sale costs and expenses have been paid and the secured creditor's debt secured by that property has been discharged, from any net sale proceeds then remaining;
   2. Where the Receivers' are tasked with any sale themselves then in the following order of priority:
      1. payment of the Receivers' fees in respect of the sale of that property;
      2. payment of the agent's commission, marketing and advertising costs, auctioneer's fees and any other expense properly incurred in respect of the sale of the Properties;
      3. payment of legal costs of sale;
      4. payment of any amount outstanding to any water authority or local council in respect of the Properties not otherwise taken up as a credit in favour of the vendor;
      5. payment of the amount required to effect a discharge of the registered mortgagees secured on the title of the relevant property; and
      6. payment of any then remaining Receivers' fees; and
      7. the balance being the net sale proceeds to be paid into Court if appropriate or otherwise a controlled monies account, or alternatively, the Wife's solicitor's trust account, earning interest pending further order of the Court.
6. Subject always to order 7 and either, the Court's approval or the approval by all active parties, until further order of the Court:
   1. the Receivers' remuneration, costs and expenses is to be paid from the income of the respective company for which such task is undertaken; and
   2. the Receivers' remuneration, costs and expenses does not take priority to the secured debt of any registered secured creditor, except in the limited circumstances provided for in order 7(b).
7. The costs, expenses and remuneration of the Receivers are to be ; calculated in accordance with the schedule of charge out rates as set out in the consent provided by the Receivers dated 18 July 2025.
8. The Receivers may apply to the Court for directions relating to the enforcement or fulfilment of these orders by filing the appropriate application supported by evidence to be returnable on no less than 72 hours' notice on a date nominated by the Chambers of Schonell J.
9. If any party holds concern regarding the conduct of the Receivers, the necessary party is at liberty to restore the matter on 48 hours' notice, giving reasons for the re-listing.
10. By 21 August 2025, direct the Receivers to provide a report in relation to the companies referred to in order 1(a)-(f) addressing the following:
    1. Whether any of the companies are corporate trustees;
    2. The value of each of the Companies' assets and liabilities (including any assets and liabilities held as a trustee);
    3. A valuation of each of the Companies' as a going concern;
    4. A valuation of the value of the shares held by the Respondent Husband.
11. Grant liberty to any party to seek any order for the Receivers remuneration to be borne by the husband and wife prior to the resumption of the hearing.
12. (Omitted)
13. By 21 August 2025, the Applicant Wife serve a report in relation to [DD Pty Ltd] addressing the following:
    1. Whether the company is a corporate trustee;
    2. The value of the company's assets and liabilities (including any assets and liabilities held as a trustee);
    3. A valuation of the company as a going concern; and
    4. A valuation of the value of the shares held by the Applicant Wife.
14. The costs of, and incidental to, the making of these orders to be reserved.
15. Liberty granted to the Receivers to restore the matter on 48 hours' notice before Schonell J to vary any orders relating to their appointment and or otherwise deal with matters arising with their appointment or remuneration.
16. During the appointment of the Receivers, they are directed to re-list the matter before Schonell J if any of the Companies assets are in jeopardy of being liquidated or realised, other than pursuant to any enforcement steps being taken, or which may be taken, by a registered secured creditor.
17. The Receivers are directed not to interfere with any enforcement steps taken, or which may be taken, by any secured registered creditor of any of the Companies.
18. Direct the Respondent Husband to make available all the books and records of each of the Companies to the Receivers.
19. Permit the Receivers to make any request to any active party for production of documents to fulfil their obligations under these orders.
20. By 23 July 2025, the Applicant Wife is to provide the Receivers with copies of all current real property valuation reports prepared by [AZ Group] in July 2025.

1. As between the wife and the 2nd-6th and 10-12th respondents, Orders 1-22 were the subject of agreement, with the exception of Order 15. Order 14 was not pressed. A consent to act was provided.
2. The wife opposed the necessity for Order 15 and raised issues as to who should meet the cost. The 5th and 6th respondents proposed an alternately named receiver and manager, but such application was only meekly pressed should the Court consider an alternate receiver appropriate. The National Australia Bank who holds registered mortgages over some of the properties owned by the companies the subject of joinder appeared as an interested party and did not oppose the orders being made.
3. The husband opposed the making of any of the orders.
4. Following submissions, orders were made in the terms of the orders sought as well as making an order that the wife in the first instance meet the costs of the valuation the subject of Order 15. Reasons were reserved.
5. These are those Reasons.

1. At the commencement of the final hearing the wife set out in her Case Outline document the orders and declarations that she sought which were as follows:
   1. Pursuant to section 106B of the Family Law Act 1975 (Cth), the Court set aside each of the following instruments on the basis that they were made with the intention, or had the effect, of defeating anticipated orders in these proceedings:
      1. The Private Loan Agreement executed by [Mr Galip] and [Ms WW] on 2 February 2017;
      2. The Private Loan Agreement executed by [Mr Galip] and [Ms WW] on 2 February 2022;
      3. The Private Loan Agreement executed by [Mr Galip] and [Mr AC] on 1 May 2019;
      4. The Private Loan Agreement executed by [Mr Galip] and [XX Pty Ltd] on 9 July 2020;
      5. The Private Loan Agreement executed by [Mr Galip] and [Ms YY] on 9 June 2021;
      6. The Private Loan Agreement executed by [Mr Galip] and [Mr Donnelly] on 10 June 2021;
      7. The Private Loan Agreement executed by [Mr Galip] and [Mr AG] on 1 June 2022;
      8. The Private Loan Agreement executed by [Mr Galip] and [Mr AF] on 9 August 2021.

2. Pursuant to section 106B of the Family Law Act 1975 (Cth):

1. The Consent Orders made in the Supreme Court of New South Wales in [early 2025] concerning the transfer of shares in [GG Pty Ltd] to [Mr AV] be set aside; and

2. The ASIC share transfer recorded on [...] 2025 (document ...) purporting to transfer those shares be set aside.

3. Pursuant to section 78 of the Family Law Act 1975 (Cth), the Court declare that:

   1. The shares in [GG Pty Ltd] Are property of the First Respondent which may be the subject of relief claimed by the applicant under s 79 of the Family Law Act 1975 (Cth);
   2. [Mr AW] holds the shares in [P Pty Ltd] on trust for the First Respondent; and
   3. The shares in [P Pty Ltd] are property of the First Respondent which may be the subject of the relief claimed by the applicant under s 79 of the Family Law Act 1975 (Cth).

4. Pursuant to s 79 of the Family Law Act 1975 (Cth), the First Respondent's interest in the shares of the following companies be vested in the Applicant:

a. [Galip Investments Pty Ltd];

b. [J Pty Ltd];

c. [KK Pty Ltd];

d. [FF Pty Ltd];

e. [EE Pty Ltd];

1. [JJ Pty Ltd]; and

g. [GG Pty Ltd].

1. Pursuant to s 79 of the Family Law Act 1975, the First Respondent's interest in [BC Street], [Suburb BD], being the whole of the land comprised in certificate of title folio identifier [...], be vested in the Applicant.
2. Pursuant to s 80(1)(k) of the Family Law Act 1975 (Cth), the Applicant be appointed as trustee for the sale of the following real property, with the net proceeds of sale, after payment of any registered mortgage and reasonable selling costs, to be paid to the Applicant:
   1. [BB Street], [Suburb CC], being the whole of the land comprised in certificate of title folio identifier [...],
   2. [1 PP Street], [Suburb QQ], being the whole of the land comprised in certificate of title folio identifier [...],
   3. [2 PP Street], [Suburb QQ], being the whole of the land comprised in certificate of title folio identifier [...],
   4. [3 PP Street], [Suburb QQ], being the whole of the land comprised in certificate of title folio identifier [...],
   5. [LL Street], [Suburb MM], being the whole of the land comprised in certificate of title folio identifier [...],
   6. [NN Street], [Suburb CC], being the whole of the land comprised in certificate of title folio identifiers [..., ...] and [...],
   7. [K Street], [Suburb L], being the whole of the land comprised in certificate of title folio identifier [...],
   8. [SS Street], [Suburb H], being the whole of the land comprised in certificate of title folio identifiers [...], [...], [... and ...],
   9. [AM Street], [Suburb AN], being the whole of the land comprised in certificate of title folio identifier [...],
   10. [RR Street], [Suburb AO], being the whole of the land comprised in certificate of title folio identifier [...]; and [ BC Street], [Suburb BD], being the whole of the land comprised in certificate of title folio identifier ....
3. For the purpose of Order 6, the First Respondent shall vacate the properties within seven (7) days of the date of these Orders and shall deliver up all keys, security codes, garage remotes, and any other means of access to the Applicant and/or her authorised agent or representative.
4. The First Respondent be restrained from returning to or attending within 100 metres of the Properties following compliance with Order 7, unless by written agreement of the Applicant or pursuant to a further Order of this Court.
5. The Applicant's costs of the proceedings from 29 December 2024 be paid on the ordinary basis by:
   1. The Second and Eleventh Respondent jointly and severally as to 20%;
   2. The Third Respondent as to 50%;
   3. The Fourth Respondent as to 10%;
   4. The Fifth and Sixth Respondents jointly and severally as to 10%; and
   5. The Twelfth Respondent as to 10%.
6. The Applicant's costs of the proceedings be paid by the First Respondent on the indemnity basis, with the First Respondent's liability reduced by any amount paid to the Applicant pursuant to Order 9.
7. That except as otherwise provided by these Orders, as between the parties, the Applicant is declared the sole legal beneficial owner of all property, assets and financial resources held in her name (whether solely or jointly with any other person), possession or control, including her right and title in and to:
   1. Any funds in her bank accounts;
   2. The motor vehicles registered in her name;
   3. Her household contents;
   4. Her superannuation entitlements and benefits;
   5. All shareholdings;
   6. All real property; and
   7. All other assets, property and financial resources of whatsoever nature and kind.

1. The utility of the proposed declarations at Order 3(b) and Order 3(c) is not immediately apparent in circumstances where no order is sought consequent upon the making of the declaration. On the last day of the hearing, the wife's counsel advised that proposed Order 2(a) was no longer pressed.
2. By proposed Order 1, the wife seeks to set aside various loan agreements pursuant to s 106B of the Act. By proposed Order 6, she seeks to be appointed trustee for sale of various items of real property owned by the companies the subject of proposed Order 4 and for her to retain the net proceeds. With the exception of GG Pty Ltd, the husband is the sole director and shareholder of each of the companies.
3. The parties the subject of the relief pursuant to s 106B of the Act are joined as respondents. The Private Loan Agreements contain interest clauses that vary as between the respondents at between 15-25 percent. Each of the respondents contend that the terms of the Private Loan Agreement create an equitable charge such that they are secured creditors of the husband and thus contend that their claims rank in priority ahead of the wife's claim pursuant to s 79 of the Act.
4. At the commencement of the hearing, the wife tendered a Balance Sheet (Exhibit 1) which identifies the property of the parties and the contended for liabilities albeit she does not admit many of the liabilities. That document refers to the companies the subject of the wife's relief and the orders the subject of the appointment of a receiver and manager.
5. There has not been undertaken any valuation of the companies, or the shares held by the husband. The Balance Sheet merely ascribes in relation to each company a reference to one asset of the company being real estate and a corresponding bank liability. The accuracy of the secured bank liabilities is questionable in circumstances where in a number of instances the Court has been advised that banks are seeking to enforce their security. In that event what the properties sell for and what the net proceeds are is likely to be different to that set out in the Balance Sheet.
6. Enquiries made of the wife's counsel as to whether there are other creditors of the companies or whether the companies hold the real estate in their own right or as trustee of a trust was met with an unsatisfactory response that the wife did not know, asserting her ignorance is as a result of the failure by the husband to make disclosure. The failure to articulate what is a fairly obvious and fundamental proposition informs in part the necessity for the making of the orders.
7. On the second last day of the hearing, the wife tendered the 2024 Financial Statements for the companies (Exhibit 41). The respondents, with the exception of the husband, did not object to the tender but disputed the accuracy of the Financial Statements. The submissions of the respondents would appear to have some merit as within Exhibit 41 are two different Financial Statements for the same year for something called Galip Trust. The Financial Statements on their face would also appear to reveal that in the case of some of the companies they appear to be Trustees of trusts one of them described as FF Unit Trust. Who holds the units is not apparent to the Court. Trust Deeds for the Trusts are not in evidence.
8. Exhibit 1 ascribes a net value after secured bank liabilities of $9,216,956 before the interest of the other respondents is considered. Of that sum, the companies hold real estate having a value according to Exhibit 1 totalling $7,488,732. What other assets the companies hold is unknown, as is the position of any other creditors.
9. The question of the capacity in which the companies hold the real estate, and its ultimate value is of central importance to determination of some of the issues in these proceedings. If the companies are mere trustees of discretionary trusts, then it is possible that the property of the husband may be limited to his shareholding in the trustee and as an object of a discretionary trust (whatever that may be) assuming he is even a beneficiary which at this stage the wife seems unable to identify or establish. The answer to those questions is a necessary precondition before consideration can be given to the relief sought.
10. The wife contends that the source of the difficulties she faces in the proceedings arises as a consequence of the way in which the husband has conducted the litigation, in part by his failure to comply with orders including orders by way of disclosure. It is not in issue that the husband has failed to comply with orders to sell some of the property held by the companies, failed to pay debts the subject of the respondent's claims, and failed to pay the mortgages securing bank liabilities over assets of the companies.
11. In the affidavit of one of his daughters the subject of the anti-suit injunction, she contended:
    1. As detailed in my sister's affidavit, [Mr Galip] has failed to complied with court orders, neglected his obligations to government authorities including the Australian Taxation Office (ATO), and has demonstrated a sustained inability to manage financial and legal affairs.
12. I note the husband supported the relief sought by his daughters and opposed the granting of the anti-suit injunction. It is open to infer that he does not dispute this assertion.
13. On the second-last day of the hearing at a time when the cross-examination of all but one of the respondents had been completed, the Court raised with the wife the difficulties the Court perceived it would have in determining the Part VIII proceedings in part for the reasons referred to above. The wife's submission in effect was that she was doing the best that she could in circumstances where the husband had failed in his disclosure obligations.
14. The Court thereafter enquired of each of the parties as to why it should not appoint either a receiver and manager to the companies and/or the shares or alternatively appoint a liquidator. The response to such enquiry led, after a somewhat drawn out and tortuous process, to the orders identified in [2] of these Reasons.

1. Section 79(3) of the Act provides that the Court in considering what order if any it should make under Part VIII is to identify the existing legal and equitable rights and interests of the parties in any property as well as determining the existing liabilities of the parties. Given the current state of the evidence, the parties are unable to identify to the Court the legal and equitable rights and interests of the parties in property.
2. In that respect, the evidence at this stage:

(1) Does not establish a value for the husband's shares in the companies.

(2) Does not identify whether the companies hold the real estate the subject of the wife's proposed Order 6 in their own right or as trustee.

(3) Does not identify, if holding the real estate as a trustee, whether that is as a trustee of a discretionary or unit trust.

(4) Does not identify, if a unit trust, who holds the units.

(5) Does not identify, if a discretionary trust, who holds the power of appointment and whether the husband and or wife is an object of the trust.

(6) Where the wife seeks pursuant to proposed Order 6 a sale of an asset of the company and to receive the net proceeds of sale what impact that might have on other creditors of the companies (if any) including the Australian Tax Office.

1. It is reductive and with respect quite inappropriate for the Court to proceed in ignorance of the legal ownership of company assets and upon an assumption that a value of a company is constituted by reference to only one asset of the company and a secured liability.
2. The companies have entered into mortgages with the National Australia Bank and other banks. At an earlier mention of the proceedings, a representative for the National Australia Bank appeared before the Court and indicated that the bank had already commenced proceedings for recovery of one of its debts and proposed to do so in relation to others. The Court was advised from the bar table by one of the respondents that another secured interest holder, BE Bank, was also seeking to move on its security. Thus, the values ascribed in the Balance Sheet to the properties and the underlying indebtedness is likely to change, that is, properties will be sold; what their sale price is may be very different to that ascribed in the Balance Sheet and further the underlying mortgage indebtedness ascribed in the Balance Sheet is likely to change. All of these are unknowns at the time of hearing and consequently impact upon the task of the Court under s 79(3) of the Act.
3. It is not in issue that the Court has power pursuant to s 80(1)(k) of the Act to make any order which it thinks it is necessary to do justice. The Full Court in D Pty Ltd and Ors & Sadler and Ors [2016] FamCAFC 187; (2016) FLC 93-736 observed as follows:
   1. The power to appoint receivers clearly arises from s 80(1)(k) of the Act (Jones v Jones (1968) 10 FLR 493 and Dimov v Dimov (1971) 17 FLR 462). The power is to make "any other order" necessary to do justice. This enables the court to make "whatever orders it regards as appropriate" (R v Ross-Jones & Anor, Ex Parte Beaumont [1979] HCA 5; (1979) 141 CLR 504 at 509 per Gibbs J).
   2. As is common with many statutes that permit courts to appoint receivers, s 80(1)(k) of the Act does not make provision for the powers that may be exercised by the receivers. The Rules are similarly silent. Thus, orders which appoint the receivers must also clothe the receivers with the powers to be exercised by them. A common and shorthand way of providing for this is by giving the receivers some or all of the powers referred to in s 420 of the Corporations Act, as if they had been appointed under that section. In doing so, the Court is exercising power conferred pursuant to s 80(1)(k) of the Act and not the Corporations Act.
4. French J, as his Honour then was, in University of Western Australia v Gray (No 6) [2006] FCA 1825 observed that while the power to appoint a receiver is statutory it is an equitable remedy stating as follows:
   1. ...The class of circumstances in which such power may be exercised is not closed. Nor are the purposes for which a receiver may be appointed and the powers and conditions attaching to such an appointment. There may be many circumstances of considerable diversity which would warrant such an order and it is important that the discretion not be unnecessarily confined by any particular line of cases to which it has been applied.

... the general ground upon which a court appoints a receiver is ultimately in every case the protection or preservation of property for the benefit of persons who have an interest in it.

1. While Austin J in ASIC v Burke [2000] NSWSC 694, stated:
   1. Without wishing to lay down any general rules, it appears to me that the extraordinary step of appointing a receiver may be justified, even though Mareva Orders are in place, in a case where there is real doubt about the existence and location of assets such as investments, and about the number and identity of claimants and the nature of their claims, and additionally the defendants are engaged in business activities which entail that any Mareva Orders must allow assets to be turned over in the course of business. Where these circumstances exist in combination, and especially where there are allegations of serious fraud involved, the Court may conclude ...that the Mareva Orders are not enough to ensure that the assets are preserved and protected, and indeed identified and brought in for the benefit of investors.
2. Despite orders having been made requiring the husband to do certain things with assets of the companies, he has failed to comply with those orders. The husband has failed to meet obligations to banks and his daughters raise issues about his compliance with statutory obligations, liabilities to the Australian Tax Office and an inability to manage his affairs including those of the companies. In addition, there are issues about the accuracy of financial accounts for the companies and in what capacity the companies hold various parcels of real estate and for whom.
3. I am satisfied for the above reasons that the appointment of a receiver and manager is necessary to protect the assets of the companies. I am also satisfied that it is necessary to appoint a receiver and manager to investigate and report on the financial position of the companies, to opine as to the value of the companies, and to identify in what capacity the companies hold the assets and for whom.
4. I am not satisfied that the 5th and 6th respondents have advanced a compelling case for the appointment of an alternate receiver to one who is agreed upon by the other respondents (with the exception of the husband), has indicated a consent to act, and whom I am informed can provide a report in compliance with the Court's timetable. I propose therefore to appoint Ms AX and Mr AY of AZ Company as receivers and managers.
5. I am satisfied that it is appropriate that a valuation be prepared in relation to the wife's company the subject of Order 15 particularly in light of the cross-examination of the wife. In the first instance, the wife will be ordered to meet the cost which can be revisited at the conclusion of the hearing.
6. These are the Reasons for the orders made.

I certify that the preceding thirty-four (34) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Schonell.