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[2026] NSWCA 49
respondent. Appeal dismissed. The appellants were ordered to pay the respondents’ costs of the appeal: [70].
The Court of Appeal did not decide Crown’s new interpretation of the security deed. Crown had argued below that the receiver lacked authority because the shares were not covered by the security, but it had not argued that the shareholders’ agreement made shareholder consent a condition of the charge. The Court held that the new argument could not be introduced on appeal through general denials in the pleadings. Because Crown had not put consent in issue at trial, it could not complain that the receiver had not led evidence about consent. The appeal was dismissed, with costs payable by the appellants.
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2,348 words · generated 08/10/2026
The dispute concerned 10,432,818 shares in Ailo Holdings Pty Ltd (Ailo), which Ailo’s register recorded as held by Resilient Investment Holdings Pty Ltd (RIH). The receiver, Costa Nicodemou, had been appointed over certain property of RIH and other companies. He sought to sell the Ailo shares and asked the Supreme Court to declare that RIH owned them. The primary judge made that declaration on 23 October 2025: [2], [12]-[13], [39], [41].
4 cited instruments linked from this judgment.
Crown and Coronam Family Office Custodian Pty Ltd (together, Crown) disputed the receiver’s authority in relation to the shares. Crown said a share transfer dated 26 September 2024 showed that the shares had been transferred from RIH to Coronam Family Office. The receiver disputed the transfer’s effectiveness, including because Ailo’s register still recorded RIH as shareholder and the receiver said Ailo had not received the transfer before 13 June 2025: [13]-[18], [22]-[24].
The security arrangements mattered because RIH had entered a General Security Deed (GSD) on 3 May 2022. Clause 2.1 granted security over “Collateral”, defined to include present and after-acquired property. Clause 2.2(a) excluded specified collateral in circumstances involving a relevant contract or constituent document and a requirement for counterparty consent, unless that consent had been given. The Ailo shares were equity interests in a company that was not RIH’s wholly owned subsidiary: [7]-[10].
At first instance, Crown argued that the receiver lacked standing because cl 2.2(a)(ii) excluded equity in a company that was not a wholly owned subsidiary. Crown did not, however, develop the argument that the shareholders’ agreement made consent from Ailo’s other shareholders necessary for the security to extend to the shares. The Court of Appeal treated the latter as a new argument, not as a point already preserved by Crown’s pleadings: [27], [30]-[34], [51]-[58].
The Court dismissed the appeal and ordered the appellants to pay the respondents’ appeal costs: [70]. Its central decision was procedural. It declined to determine the new contractual-construction point because it had not been raised in the Court below and the respondents had not had a fair opportunity to meet it there: [55]-[61].
The Court first identified the difference between Crown’s case at trial and its appeal case. At trial, Crown’s written submissions said the receiver was not appointed over the Ailo shares because they were equity in a company that was not a wholly owned subsidiary. The submissions did not address the remaining language in cl 2.2(a)(ii), including the requirements about a relevant contract, a counterparty’s consent, and whether consent had been given: [27], [51].
On appeal, Crown advanced a more developed construction. It said the shareholders’ agreement was the relevant contract, that Ailo’s other shareholders were the relevant counterparties, and that the receiver had not established that they consented to the charge. On that basis, Crown said the GSD’s security did not cover the shares and the receiver lacked standing to seek the declaration: [45]-[48].
The Court considered the procedural context important. At trial, the question whether RIH or Coronam Family Office owned the shares remained live. The receiver’s allegations about the shareholders’ agreement were made in the context of whether the alleged September 2024 transfer to Coronam Family Office was effective. If Crown had succeeded on ownership, the security carve-out argument would not have arisen in the way Crown later framed it, because Crown did not suggest that the security covered Coronam Family Office’s property: [55].
The evidence also had been tendered for a different forensic purpose. The receiver relied on the Deed of Accession and shareholders’ agreement to address whether RIH had complied with the requirements when it acquired the shares in 2020. Nothing in the pleadings, evidence, or submissions gave notice that Crown would argue that the shareholders’ agreement prevented the charge from extending to the shares unless Ailo’s shareholders consented: [56].
The Court therefore rejected Crown’s attempt to rely on broad denials in its Amended Response as preserving the new argument. It read the denials in their context. For instance, a denial that RIH’s property was “controlled by the receiver” was understood as a denial based on Crown’s case that RIH no longer owned the shares, not as an assertion that cl 2.2(a)(ii) excluded them for want of shareholder consent: [57]. The Court emphasised that a bare denial could not be “retrofitted” into the positive case later advanced: [57].
The Court referred to the general rule that substantial issues should be settled at trial and new issues should not ordinarily be raised on appeal. It quoted the High Court’s explanation in Bird v DP that a party will generally be refused permission to raise a point not taken below where the point did not arise on the pleadings, might have required evidence, or requires fresh consideration of facts that are not admitted or beyond controversy: [60]. Applying that principle, the Court said it ought not decide Crown’s new issues: [61].
The Court also addressed Crown’s argument about onus, although it said the question did not need to be determined. Crown argued that, as the applicant for declaratory relief, the receiver had to prove that the charge extended to the shares, including proof of the required consent. The Court reasoned that Crown had not put consent in issue at trial. It had instead conducted the case on the basis that the receiver could not deal with the shares because they were not owned by RIH. On that case, the receiver did not need to lead evidence about consent: [62]-[64].
This reasoning was linked to the civil procedure obligation in s 56 of the Civil Procedure Act 2005 (NSW), which requires parties to assist the Court to facilitate the just, quick and cheap resolution of the real issues. The Court contrasted civil proceedings with a criminal prosecution, observing that a civil party cannot leave the other side uncertain about what is disputed and then complain that the other side did not prove that issue: [63]-[64].
The judgment did not announce a new general test for the construction of security deeds or for determining whether shareholder consent is required. Nor did the Court decide whether the shareholders’ agreement was a “Relevant Contract”, whether Ailo’s shareholders were the relevant “Counterparties”, or whether their consent was legally necessary under cl 2.2(a)(ii). It declined to reach those substantive questions because they were advanced too late: [45]-[48], [61].
The procedural principles the Court applied were already reflected in the authorities it cited. Bird v DP supplied the general principle about new issues on appeal and the circumstances in which permission will generally be refused: [60]. Dare v Pulham recognises that pleadings are not always an absolute constraint where parties choose to fight a different case at trial. The Court distinguished that situation because Crown had not raised the present argument in the Court below: [58].
The judgment also refers to r 14.14 of the Uniform Civil Procedure Rules 2005 (NSW), which requires specific pleading of matters that may take the other party by surprise, make the opposing case not maintainable, or raise facts not arising from the preceding pleading. It notes that Commercial List statements and responses stand in the place of pleadings in the relevant proceedings: [53]-[54]. The decision’s practical focus is thus on fair notice and identifying the issues actually contested, rather than on treating every pleading denial as a reservation of any possible argument.
The Court’s discussion of onus is similarly tied to the case as conducted. It did not establish that a party seeking declaratory relief never has to prove matters relevant to the declaration. Instead, it said that the receiver did not have to prove consent where consent had not been made a disputed issue at trial: [62]-[64]. That is a case-specific application of the principle that the evidence required depends on the issues the parties actually put in dispute.
There is also a conditional observation about receivers’ powers. Adamson JA said that, if necessary, he would have considered that s 420(2)(k) of the Corporations Act 2001 (Cth) extended to proceedings determining ownership or control of property secured by the charge. He referred to Land Enviro Corp Pty Ltd (In Liq) v HTT Huntley Heritage Pty Ltd, where the power had been construed broadly to include proceedings concerning property to which a receiver may become entitled: [69]. This observation was not necessary to the appeal’s disposition, because the appeal was dismissed on the new-issue ground.
Accordingly, the judgment’s principal contribution in this case is its application of established appellate and civil procedure principles to the way the parties had framed and tried the dispute. It does not resolve the broader substantive question about the reach of cl 2.2(a)(ii).
At [57], the Court said the bare denial in Crown’s pleading “cannot be retrofitted” to support the new argument about shareholder consent. In plain English, a general denial that made sense as part of Crown’s ownership case could not later be repurposed as if it had clearly raised a distinct contractual argument.
At [60], the Court stated: “Parties to an appeal are generally bound by the way in which they conducted themselves in the Court below.” This means an appeal is not ordinarily an opportunity to reshape the case after the trial, particularly when the new point could have affected what evidence the other side gathered or presented.
The Court’s quotation from Bird v DP at [60] explains why the principle matters. A new point may require evidence or a fresh assessment of facts. If it is raised only on appeal, the opposing party may have lost the opportunity to address it properly at trial. The judgment treated that concern as relevant because Crown’s consent argument had not been put to the receiver below.
At [64], Adamson JA observed that the civil process does not allow a party to remain silent about what is disputed and then complain that the other side failed to prove it. The translation is that a party’s conduct helps define what evidence is needed; the opponent is not necessarily required to anticipate every unraised issue.
At [69], Adamson JA said that, if standing needed to be decided, he would have considered s 420(2)(k) broad enough to permit proceedings about ownership or control of property secured by the charge. This was a conditional view, not the ground on which the appeal was dismissed.
The reasoning is most relevant where a party seeks to raise a substantial new argument on appeal after having conducted the trial on a narrower basis. The judgment identifies several features that mattered here: the new argument was not included in the pleaded case; the party accepted that it had not advanced the argument below; the trial evidence had been tendered for a different purpose; and raising the issue at trial might have affected the evidence or submissions: [51]-[60].
It is also relevant where a party relies on a broad denial as though it had preserved a specific positive case. The Court looked at the denial in the context of the live dispute and the way the parties had presented the case. It did not treat the wording in isolation: [55]-[58].
The decision does not mean every argument omitted from a pleading is necessarily excluded from an appeal. The Court cited Bird v DP for the proposition that the general rule is not absolute. It noted that a point may be permitted where, for example, the other party concedes its case would not have been presented differently had the point been raised earlier: [60]. The judgment’s conclusion turned on the particular procedural history and the lack of notice in this case.
A further relevant pattern is a civil party contesting the opponent’s proof only after failing to identify a particular factual or legal issue as disputed at trial. The Court’s discussion at [62]-[64] indicates that evidentiary requirements are assessed against the real issues the parties presented, rather than every conceivable issue that might be raised later.
The supplied judgment contains no subsequent judicial decisions discussing or applying Crown v Nicodemou. The material therefore does not establish how later courts have treated this decision.
The judgment itself relies on earlier authorities. It applies the appellate principle stated in Bird v DP at [60], considers the pleadings exception discussed in Dare v Pulham at [58], cites Roberts v Goodwin Street Developments Pty Ltd on the status of Commercial List statements and responses at [54], and refers to Land Enviro at [69] in its conditional discussion of a receiver’s statutory power. Those are authorities used by this Court, not evidence of later treatment of Crown v Nicodemou.
The Court did not determine the substantive construction question Crown sought to raise. It did not decide whether the shareholders’ agreement was a relevant contract or constituent document for cl 2.2(a)(ii), whether Ailo’s other shareholders were relevant counterparties, or whether their consent was required before the GSD could extend to the shares. Those questions remained unresolved because the Court did not entertain the new appeal arguments: [45]-[48], [61].
The Court also did not finally determine the onus issue. It addressed it “in general terms” and concluded that Crown could not complain about the absence of consent evidence in the circumstances, because consent had not been put in issue below: [62]-[64]. The judgment does not decide how the evidentiary burden would operate in a case where the contractual consent issue had been clearly pleaded and contested.
The receiver’s standing was not necessary to resolve the appeal. Adamson JA gave a conditional view that s 420(2)(k) would, in his assessment, support proceedings to determine ownership or control of property secured by the charge: [69]. The judgment does not make that observation the basis of its order, and its scope should be understood in that context.
This is general legal information, not legal advice. Zoe can make mistakes. Before acting on this, relying on it, or using any draft, have it checked by a qualified Australian lawyer.
Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: Crown v Nicodemou in his capacity as Receiver and Manager of Coronam Holdings Pty Ltd [2026] NSWCA 49
Hearing dates: 30 March 2026
Decision date: 07 April 2026
Before: Ward P at [1]
Adamson JA at [2]
McHugh JA at [71]
Decision: (1) Dismiss the appeal.
(2) Order the appellants to pay the respondents’ costs of the appeal.
Catchwords: CORPORATIONS — receivers and managers — appeal — standing of receiver to seek declaratory relief in respect of ownership of shares — whether shares formed part of secured property — where bases of grounds of appeal not raised in the Court below
APPEAL — where appellant seeks to run a point not taken in the Court below — parties generally bound by the way they conducted themselves at first instance
Legislation Cited: Civil Procedure Act 2005 (NSW), s 56
Corporations Act 2001 (Cth), s 420(2)(k)
Uniform Civil Procedure Rules 2005 (NSW), r 14.14
Cases Cited: Bird v DP (A Pseudonym) [2024] HCA 41; (2024) 98 ALJR 1349
Dare v Pulham (1982) 148 CLR 658; [1982] HCA 70
Land Enviro Corp Pty Ltd (In Liq) v HTT Huntley Heritage Pty Ltd [2017] NSWCA 207
Roberts v Goodwin Street Developments Pty Ltd (2023) 110 NSWLR 557; [2023] NSWCA 5
Category: Principal judgment
Parties: Thomas Peter Crown (First Appellant)
Coronam Family Office Custodian Pty Ltd (Second Appellant)
Costa Nicodemou in his capacity as Receiver and Manager of Coronam Holdings Pty Ltd in its own capacity and as trustee for Coronam Property Trust (First Respondent)
Costa Nicodemou in his capacity as Receiver and Manager of Resilient Investment Holdings Pty Ltd in its own capacity and as trustee for Resilient Investment Trust (Second Respondent)
Costa Nicodemou in his capacity as Receiver and Manager of Netherfield Holdings Pty Ltd in its own capacity and as trustee for Pemberley Family Trust (Third Respondent)
Costa Nicodemou in his capacity as Receiver and Manager of Evandale Property Pty Ltd in its own capacity and as trustee for Evandale Property Trust (Fourth Respondent)
Costa Nicodemou in his capacity as Receiver and Manager of Leets Vale Property Pty Ltd in its own capacity and as trustee for Leets Vale Property Trust (Fifth Respondent)
Costa Nicodemou in his capacity as Receiver and Manager of Mereworth Property Pty Ltd in its own capacity and as trustee for Mereworth Property Trust (Sixth Respondent)
Costa Nicodemou in his capacity as Receiver and Manager of Panawanica Property Pty Ltd in its own capacity and as trustee for Panawanica Property Trust (Seventh Respondent)
Costa Nicodemou in his capacity as Receiver and Manager of Angelwood Investments Pty Ltd (Eighth Respondent)
Costa Nicodemou in his capacity as Receiver and Manager of Resilient Investment Group Pty Ltd (Ninth Respondent)
Costa Nicodemou in his capacity as Receiver and Manager of TPC Industries Pty Ltd (Tenth Respondent)
Representation: Counsel:
J Jaffray / S Ivantsoff (Appellants)
J Dooley / A Sivanathan (Respondents)
Solicitors:
Panetta Lawyers (Appellants)
Hamilton Locke (Respondents)
File Number(s): 2025/450259
[This headnote is not to be read as part of the judgment]
The appellants appealed against the primary judge’s decision to declare Resilient Investment Holdings Pty Ltd (RIH) the legal and beneficial owner of certain shares in Ailo Holdings Pty Ltd (the Ailo shares). Costa Nicodemou (the receiver) is the respondent to the appeal in his capacity as receiver and manager of several companies including, relevantly, RIH. The receiver sought to sell the Ailo shares which Ailo’s share register recorded were owned by RIH. The appellants claimed that the second appellant owned the shares and denied that the receiver had standing to seek a declaration that RIH owned the Ailo shares.
On appeal, the appellants submitted on bases, none of which was not put in the Court below, that the terms of the charge, properly construed, did not extend to the Ailo shares.
The Court (Adamson JA, Ward P and McHugh JA agreeing) held dismissing the appeal:
(1) The appellants’ appeal ought not be entertained by this Court: [5] and [61].
(2) Parties to an appeal are generally bound by the way in which they conducted themselves in the Court below: [60].
Bird v DP (A Pseudonym) [2024] HCA 41; (2024) 98 ALJR 1349 cited.
(3) Bare denials in pleadings do not provide an avenue through which fresh arguments can be made on appeal: [57]-[58].
Dare v Pulham (1982) 148 CLR 658; [1982] HCA 70 considered.
(4) What a party requires by way of evidence to prove its case depends on the matters put in issue by the opposing party: [62]-[62].
WARD P: I agree with Adamson JA.
ADAMSON JA: The appellants, Thomas Crown and Coronam Family Office Custodian Pty Ltd (Coronam Family Office) (together, Crown), appeal against orders made on 23 October 2025 by Ball JA (the primary judge), sitting in the Equity Division of the Supreme Court (the Court below). These orders included a declaration that Resilient Investment Holdings Pty Ltd in its personal capacity and as trustee for Resilient Investment Trust (RIH) is the legal and beneficial owner of 10,432,818 shares (the Ailo shares) in Ailo Holdings Pty Ltd (Ailo).
The respondents to the appeal are Costa Nicodemou (the receiver) in his capacity as receiver and manager of Coronam Holdings Pty Ltd and other companies in its own capacity and as trustee for the Coronam Property Trust and other trusts.
On appeal, Crown submitted, on various bases not put in the Court below, that the charge granted by RIH to the receiver’s appointor under the General Security Deed dated 3 May 2022 did not extend to the Ailo shares and that, accordingly, the receiver did not have standing to seek the relief claimed in the amended summons.
Crown’s appeal ought not be entertained by this Court. To explain why the appeal must be dismissed on this basis it is necessary to set out in some detail the background facts and the ambit of the proceeding in the Court below, as revealed by the pleadings and the submissions made.
Pursuant to a Land Facility Agreement dated 3 May 2022 (as amended on 29 November 2022) (the Facility Agreement) (Blue 169), MC Coronam Pty Ltd (Merricks) advanced $87,493,606 to certain entities controlled by Mr Crown, including RIH.
On 3 May 2022, RIH and others entered into a General Security Deed pursuant to which they, by cl 2.1, granted a security interest to Merricks over “Collateral” (Blue 70), which was defined to mean all present and after acquired property of a “Grantor” (Blue 74). “Grantor” is defined to mean “[e]ach person listed in Schedule 1” and includes RIH.
Clause 2 of the General Security Deed relevantly provides:
2.1 Creation
(a) Subject to clause 2.2, each Grantor grants a security interest in the Collateral to the Secured Party to secure the payment of the Secured Money.
(b) This security interest is a transfer by way of security of Collateral consisting of:
(i) accounts and chattel paper (each as defined in the PPSA) which are not, or cease to be, Revolving Assets; and
(ii) each Material Document.
To the extent any Collateral is not transferred, this security is a charge. If for any reason it is necessary to determine the nature of this charge, it is a floating charge over Revolving Assets and a fixed charge over all other Collateral.
(c) Each Grantor grants this security interest in respect of Collateral other than Trust Assets which it owns or will own as beneficial owner.
(d) Each Grantor which is a trustee of any Trust grants this security interest in respect of Collateral comprising Trust Assets as sole trustee of each relevant Trust.
2.2 Relevant Collateral
(a) The security interest granted under clause 2.1 does not, at any time, extend to the following Collateral:
(i) any lease, licence, contract or rights under any lease, licence or contract; or
(ii) equity interests in any person other than a wholly owned Subsidiary***,***
in each case where under the relevant lease, licence, contract or constituent document with a Counterparty as at the date of this document (as applicable) (and not at a later date) (such lease, licence, contract or constituent document being the Relevant Contract) the consent of the relevant Counterparty is required before the relevant Grantor may:
(iii) grant a Security Interest in such Collateral; or
(iv) it will be a breach of, or give rise to an event of default or termination event (however described) under, the Relevant Contract for the relevant Grantor to grant a Security Interest in such Collateral,
unless the relevant Counterparty has consented to the granting of the Security Interest over such Collateral under this document.
…
(e) This clause 2.2 applies despite any other provision of a Finance Document.
(Emphasis added in bold to indicate the words in cl 2.2(a)(ii) on which Crown relied in this Court.)
The General Security Deed defines “Counterparty” to mean “a third party who is not an Obligor or a related entity of an Obligor”. “Obligor” is defined to have the same meaning as in the Facility Agreement: namely “each Borrower and each Guarantor”.
It was common ground that “Grantor” includes RIH; that “Collateral” includes any shares which RIH holds in Ailo either for itself or as trustee; and that Ailo is not a wholly owned subsidiary of RIH.
In May and November 2022, Merricks advanced funds to RIH and others pursuant to the Facility Agreement.
On 15 November 2023, Merricks issued a notice of default under the Facility Agreement (Blue 340-342). On 26 March 2025, by Deed of Appointment, Mr Nicodemou was appointed receiver and manager of certain property, including that of RIH (Blue 48-69).
As at 30 April 2025, Ailo’s register of shares recorded that RIH was holder of the Ailo shares. On 23 January 2020 RIH had executed a Deed of Accession pursuant to which it agreed to be bound by an Amended and Restated Shareholders Agreement dated 30 November 2017 between the then shareholders of Ailo (the shareholders’ agreement).
On 13 June 2025, Mr Crown wrote to the receiver and asserted that Coronam Family Office and not RIH owned the Ailo shares (Blue 1326). He sought to substantiate this allegation by enclosing a signed share transfer dated 26 September 2024, apparently recording a transfer of the Ailo shares from RIH to Coronam Family Office which Mr Crown asserted had been sent to Ailo at about that time (Blue 1326). The receiver responded by email on 19 June 2025, refuting the allegation and indicating that Ailo’s records did not include any record of the alleged share transfer having been received before 13 June 2025 (Blue 1336).
In an email sent on 1 July 2025 (Blue 1335), Mr Crown reiterated his assertion as to ownership of the Ailo shares (Blue 1335). He sent a further email on 22 July 2025 to similar effect (Blue 1335). On 31 July 2025, Mr Crown sent an email with a letter of demand to the receiver in which he “reserve[d] all rights to pursue immediate action, including … [i]njunctive and declaratory relief … under the [shareholders’ agreement]” (Blue 1332).
Mr Crown sent a further email to the receiver on 7 August 2025, complaining about the lack of response. He said, in part (Blue 1333):
Furthermore, I again put Ailo on formal notice that Costa Nicodemou and/or Newpoint Advisory have no authority whatsoever to act for or on behalf of me or any related entities, including Coronam Family Office Trust – my current shareholding entity in Ailo – or any former entities previously associated with my interests. Any reliance on purported instructions from such unauthorised parties — particularly in relation to my shareholding or register status — will be treated as a serious and knowing breach of trust property rights and fiduciary responsibility. I will hold Ailo and its directors accountable for such breaches, as you have all been made aware of this position on multiple prior occasions.
On 3 September 2025 (after the receiver had commenced proceedings against Mr Crown (see below)), Mr Crown wrote to the “Ailo Board and Company Secretaries”, alleging that Coronam Family Office was the legal and beneficial owner of the Ailo shares. He referred to the September 2024 transfer and alleged that they had become aware that “Ailo [through the receiver] is apparently engaging with a third party in relation to a draft Share Sale Agreement involving the same shares” (Blue 1242). The email concluded with a list of demands, including that Ailo cease any dealings with the Ailo shares; that the directors confirm that Ailo had not agreed to any dealing relating to those shares; and that they rectify Ailo’s share register to record Coronam Family Office as the legal and beneficial owner of the Ailo shares as a result of the September 2024 share transfer (Blue 1242-1243).
Ailo’s directors responded, through their solicitor, by email on 5 September 2025 (after the receiver had commenced proceedings), asserting that no share transfer for the Ailo shares had been received prior to 13 June 2025. The letter concluded (Blue 1245):
I am instructed that the [receiver] of [RIH] is taking this matter to court for resolution. Ailo awaits the outcome of those proceedings.
On 8 August 2025, the receiver commenced proceedings against Mr Crown by summons filed in the Commercial List of the Supreme Court, claiming relief that included injunctions to restrain Mr Crown from representing that the receiver had no authority to sell the Ailo shares and a declaration that RIH was the owner of the Ailo shares. The summons was returnable for directions on 14 August 2025 (short service having been granted). On that day, Mr Crown gave undertakings to the Court that he would not make representations including that the receiver did not have authority to deal with trust assets. On 14 August 2025, the proceedings were listed for final hearing on 3 October 2025 with an estimate of one day.
The hearing of the matter was expedited to minimise the disruption to the receiver’s negotiations to sell the Ailo shares which had already commenced when the receiver was notified of Mr Crown’s representations and assertions disputing that RIH owned them (Black 1**, Blue 17**).
The receiver filed a Commercial List Statement on 1 September 2025 which, together with the summons, was amended on 12 September 2025 (including to add Coronam Family Office as a second defendant). The allegations and responses of present relevance are referred to below.
In paras 53-72 of his Amended Commercial List Statement (the Amended Statement), the receiver set out the matters on which he relied in support of the allegation in para 73 that even if the September 2024 share transfer were authentic, it was not effective to transfer the Ailo shares from RIH to Coronam Family Office. The receiver alleged, in part, that Coronam Family Office, as putative transferee of the Ailo shares had not complied with the shareholders’ agreement in various respects, including by failing to give notice or to execute a Deed of Accession.
The receiver alleged that:
Mr Crown produced the purported share transfer form dated 26 September 2024 after 26 March 2025, the date on which the receiver was appointed (para 55 of the Amended Statement);
the authenticity of the share transfer form was not admitted (para 56 of the Amended Statement);
no other documents had been produced to substantiate the transfer of the Ailo shares from RIH to Coronam Family Office (para 57 of the Amended Statement); and
cl 20.1 of Ailo’s constitution provides that the directors may refuse to register a transfer without giving any reason for the refusal (para 58 of the Amended Statement).
The receiver also alleged that:
Coronam Family Office was not registered in the register of members of Ailo (para 63 of the Amended Statement);
even if the share transfer form dated 26 September 2024 were authentic, it was lodged after RIH’s property was controlled by the receiver and therefore was not an effective transfer of the Ailo shares by RIH (para 64 of the Amended Statement); and
RIH was a party to the shareholders’ agreement, which prohibited the transfer of shares in Ailo otherwise than in accordance with the agreement (paras 65 and 66 of the Amended Statement).
Crown alleged in the Amended Commercial List Response filed on 3 October 2025 (Amended Response):
23 The Defendants deny the allegations in paragraphs C55 – C57 of the Amended Commercial List Statement and further say that [Ailo] is not captured within the General Security Deed dated 3 May 2022.
24 The Defendants admit the allegation in paragraph C58 of the Amended Commercial List Statement and say further that clause 18.1 of the [shareholders’ agreement] provides that the ‘Agreement overrides the provisions of the Constitution if there is any inconsistency’.
…
28 The Defendants deny the allegations in paragraphs C63 – C65 of the Amended Commercial List Statement.
…
36 Further, the Defendants deny:
(a) that Mr Nicodemou has been appointed receiver over any shares held by [RIH] in [Ailo];
(b) deny that he has any right to deal with those shares; and
(c) deny that he has any standing to seek declarations with respect to those shares.
The receiver’s opening written submissions dated 1 October 2025 set out the matters which were then in dispute, including whether the September 2024 share transfer was authentic and whether it had been provided to Ailo at about the date which it bore (Black 62).
Crown’s written submissions, dated 2 October 2025 (the eve of the hearing) contained various concessions, including by Mr Crown that his emails contained representations which were misleading or deceptive or likely to mislead or deceive and consented to permanent injunctions restraining him from such conduct (Black 70). Of present relevance, Crown submitted:
THE AILO SHARES
7. [Mr Crown] asserts that the receiver was never appointed over the [Ailo] shares held by [RIH] and that the receiver does not have standing to seek the orders 10A-10E of the Amended Summons.
8. The Deed of Appointment appointed Mr Nicodemou as receiver and manager of the “Secured Property” …. Secured Property is defined as property of a Grantor subject to a Security Interest in favour of the Secured Party …. The relevant source of the security interest is in General Security Deed No. 1.
9. One of the Grantors in General Security Deed No 1 is [RIH]. It provides:
9.1. a security interest in cl 2.1; and
9.2. a carve out in cl 2.2 to confirm that such security interest does not, at any time, extend to:
“(i*)* any lease, licence, contract or rights under any lease, licen*[c]e or* contract; or
(ii) Equity interests in any person other than a wholly owned subsidiary***”***
10. [Ailo] was not a wholly owned subsidiary of [RIH] … The shares in that company do not form part of the security interest under the General Security Deed No 1. They do not form part of the Secured Property over which the receiver was appointed. He does not have the power to deal with those shares, let alone standing to seek declarations over their rightful owner.
11. This argument, concerning the receiver’s standing, was not pleaded in the Commercial List Response. [Mr Crown] will seek leave to file an amended Commercial List Response raising this issue.
(Court book references omitted and emphasis added to indicate the limited portion of cl 2.2(a) on which Crown relied in the Court below.)
At the outset of final submissions, the primary judge observed, in exchange with the receiver’s counsel, that what was left of the dispute seemed to be what was contained in paras 7-11 of Crown’s submissions (extracted above) (Black 18): namely, whether the receiver had standing to commence the proceedings (Black 20). The receiver submitted that he had standing to bring the proceedings for the relief claimed on the basis of s 420(2)(k) of the Corporations Act 2001 (Cth) (Black 20).
Before the receiver’s counsel continued with his submissions, the primary judge asked Crown’s counsel whether Crown was advancing a contention based on standing or on the merits of the receiver’s claim. Crown’s counsel responded (Black 21**-22**):
We’ve pleaded a denial that the receiver has been appointed over those shares and a blanket denial that he has rights to deal with those shares. We’ve not sought any declarations or any positive rights. … the conclusion that arises from this my friend correctly says is a standing point that I raise about that.
…
I’ve said the receiver’s appointed over certain assets of the company, and in writing I’ve said there’s an - a reasonably specific exclusion of certain assets over which the receiver’s appointed. One of those assets I say that are excluded from his appointment are [the Ailo shares].
The defendant’s submissions, evidence - though that’s not been read - and list statement seem not to grapple with those words [in cl 2.2(a)(ii)] namely the defendant, in order to make good this submission, needs to show that there’s been some sort of constituent document which requires consent of a relevant counterparty prior to granting of an interest. In my submission, that hasn’t been pleaded, proven or shown, neither as to what the document might be, nor as to what the relevant constriction might be, nor has the defendant, even if they do identify that, identified which - sorry, has identified and proven that there’s been an absence of consent. There’s no notice to produce, no subpoena, no witness called, so they can’t show those things. That, in my submission, is a problem for the defendant.
My friend says a lot about the validity of the transaction document. It’s not necessary for the Court to go down that path. I do not have evidence before the Court that the purported transfer document reached [Ailo] on the date that it, in its covering letter, have set out outside of the date on the covering letter of 24 September.
…
I make the point that overnight concessions have been made and the basis for those concessions has resulted in evidence not being led today. I am placing - I am not asking the Court to make a ruling on the validity of that transaction, as I have crafted the amendment to my client’s Amended Response. It’s limited to really questions of standing and denials of whether the plaintiff has the right to deal with those shares.
I mean it’s circular nonsense. If at any time cl 2.2[(a)] no longer operates then the collateral’s no longer relevant collateral. I don’t know what was attempted in the drafting here, but I can’t follow it.
I might in passing say, if your Honour … thought it was necessary to make a finding that the transfer was actually made in September of last year [2024], then I think that would be inconsistent with any finding against 37A [of the Conveyancing Act 1919 (NSW)] that was it done to defeat creditors, if it was done prior to the appointment of the plaintiff. But my primary submission is it shouldn’t arise. That’s a counterfactual, if your Honour found something I’m not asking the Court to find today.
15 The way the issue has been presented to the Court is somewhat curious. Mr Nicodemou does not seek a declaration that the shares in Ailo Holdings form part of the secured property. Nor does Mr Crown seek a cross-declaration that the shares are not part of the secured property. Instead, both parties skirt around that issue. Mr Nicodemou does so by confining the declarations he seeks to the rights of RIH. He submitted that he had standing to seek those declarations whether or not the shares in Ailo Holdings formed part of the secured property, although he did advance an argument that the shares in Ailo Holdings did form part of the secured property. Mr Crown contested Mr Nicodemou’s standing to seek those declarations. Although his position is not entirely clear, the way Mr Crown appears to put his argument is that in order for Mr Nicodemou to seek the declarations he does, he must establish that the Ailo Holdings shares are part of the secured property and Mr Nicodemou has failed to do that.
16 Notwithstanding the position of the parties, it seems sensible to start with the question whether the shares in Ailo Holdings formed part of the secured property, since it is common ground that if they did, Mr Nicodemou has standing to seek the declarations he does. The only question, then, would be whether the Court should in the exercise of its discretion make those declarations.
(Emphasis added.)
29 Although the clause [cl 2.2(a)(ii)] is somewhat clumsily expressed, it seems clear that what the clause is saying is that the limitation only applies to “equity” in a company where the company’s “constituent document” contains a prohibition on the granting of a Security Interest in its equity without the company’s consent and that consent has not been given “under this document”. If the company’s constituent document does contain such a prohibition and the consent has not been given, then under cl 2.2(d)(i) each Grantor must “comply with any requirement in any Finance Document … to seek consent to the grant of a security interest over any Relevant Collateral”.
30 Clause 2.2(d)(i) itself does not appear to contain an obligation to seek consent. Rather, it simply states that each Grantor must comply with any obligation to seek consent that is to be found elsewhere (in any Finance Document). The only apparent obligation under a Finance Document (which is defined to include the Facility Agreement and the GSD [General Security Deed]) to seek consent is cl 16.1(a) of the GSD, which imposes an obligation on each Grantor to “perform all acts and execute and deliver all further documents as the Secured Party, acting reasonably, requires” to perfect the Security Interest. Under cl 2.2(c), it appears that once consent is given, the equity becomes the subject of a security interest under the GSD. Moreover, if the Collateral is sold, the proceeds of sale become part of the secured property under cl 2.2(b).
31 Clause 2 recognises that the constitutions of some proprietary companies contain restrictions on dealing with the company’s shares without the consent of the company. It excludes shares in companies of that type from the security taken under the GSD unless and until the relevant consent is obtained. The clause uses the broader (and undefined) term “equity” rather than “shares”, recognising that some equity interests may be in other forms, such as units in a unit trust. Similarly, the clause uses the broader (and undefined) term “constituent document”, which would, for example, include a trust deed. However, those points do not change the essential effect of the provision.
(Emphasis added to indicate the conclusion alleged to be erroneous.)
The constitution of Ailo Holdings and the SHA
32 The constitution of Ailo Holdings contains no restrictions on the transfer of the shares in it. Clause 19.1 provides:
“Subject to this constitution, a member may transfer all or any of the member’s shares by instrument in writing in any form that the directors approve.”
33 There is no other provision of the constitution that limits the operation of that clause. However, cl 20.1 provides:
“The directors may in their discretion refuse to register a transfer of shares without giving any reason for refusal.”
And cl 21.1 provides:
“A person transferring shares remains the holder of the shares until the transfer is registered and the name of the person to whom they are being transferred is entered in the register of members in respect of the shares.”
34 Clauses 10 and 16 of the SHA [shareholders’ agreement] relevantly provide:
“10.1 A Shareholder must not Dispose of any Shares except as specifically provided or permitted under this Agreement.
10.2 …
10.3 Subject to clause 16, a Disposal is permitted (Permitted Disposal):
(1) with the written consent of all Ordinary Shareholders;
(2) on the death of the Associate Principal of Reezeh if some or all of the Shares of Reezeh are Disposed of to Avenue C and, if applicable a Disposal pursuant to Ashley’s will of any or all of the balance of the Shares;
(3) on the death of the Associated Principal of Avenue C if some or all of the Shares of Avenue C are Disposed of to Reezeh and, if applicable a Disposal pursuant to Ben’s will of any or all of the balance of the Shares.
10.4 An Ordinary Shareholder must not unreasonably withhold consent to another Shareholder transferring its Shares to an Affiliate who:
(1) complies with clause 16 by signing and delivering a Deed of Accession; and
(2) undertakes to immediately transfer the Shares back to the relevant Shareholder if it ceases to be an Affiliate of that Shareholder.
…
- New shareholders
16.1 No party may transfer or issue, or grant any interest in or Encumbrance over, Shares to a person not already a Shareholder unless that person has executed and delivered to each Shareholder and the Company a Deed of Accession.
16.2 The Company must not register in its records or otherwise recognise any interest in or Encumbrance over Shares unless a Deed of Accession has been executed and delivered as required under clause 16.1, and unless all obligations of the Shareholder under this Agreement have been satisfied.”
35 “Dispose” is defined broadly to mean “sell, transfer, Encumber or otherwise dispose of a legal or beneficial interest in a Share”. It plainly includes the creation of a charge.
Conclusion on standing
36 It follows from what has been said the effect of the GSD [General Security Deed] is to create a charge over the secured property where the GSD cannot operate as a transfer of the “Collateral”. That is the position in relation to the [Ailo] shares …, since any transfer would require the consent of the directors of [Ailo] under cl 20.1 of its constitution; and it is plain from the share register of [Ailo], which still shows RIH as the shareholder, that no such consent has been given.
37 The SHA [shareholders’ agreement] requires the consent of ordinary shareholders to the creation of that charge, but neither the constitution nor the SHA requires the consent of the company itself to the creation of the charge. Consequently, even if it could be said that the SHA forms part of the constituent documents of [Ailo], it cannot be said that the condition for the operation of the limitation contained in cl 2.2(a)(ii) of the GSD (that is, “where under the relevant … constituent document … the consent of the relevant Counterparty [ie Ailo Holdings] is required before the relevant Grantor [ie RIH] may … grant a Security Interest in such Collateral”) has been satisfied. The ordinary shareholders of [Ailo] may have a claim against RIH for breach of the SHA because their consent to the creation of the charge was neither sought no[r] given, but that does not affect application of cl 2.2(a). That exception does not apply because [Ailo’s] consent was not required to the creation of the charge.
38 In view of that conclusion, it is unnecessary to consider the question whether Mr Nicodemou would have had standing to seek the declarations he seeks even if Merricks had not obtained a valid charge over the [Ailo] shares held by RIH.
(1) A declaration that the first defendant has engaged in misleading or deceptive conduct in trade or commerce in contravention of s 18 of the Australian Consumer Law by making representations to the effect that:
…
(b) The plaintiffs have no legal authority to deal with trust assets of the Trusts;
…
(l) “Trusts” means:
…
(ii) [RIH]
…
…
(5) A declaration that [RIH] is the legal and beneficial owner of [the Ailo shares];
(6) An order, pursuant to s 232 of the Australian Consumer Law, that the first defendant (by himself, his employees or agents) be permanently restrained from making representations to the effect set out in (1)(a) to (k) above;
…
1. The primary judge erred in finding at [37] of the Judgment that it was the consent of [Ailo], as the “relevant Counterparty”, that was required for the exception in clause 2.2(a) of the General Security Deed dated 3 May 2022, to apply.
2. The primary judge should have found that the “relevant Counterparty” were the other shareholders in [Ailo].
3. The primary judge should have found that as the other shareholders in [Ailo], as the “relevant Counterparty”, had not given their consent to the creation of the security interest in the shares held by [RIH] over the [Ailo shares], the exception in clause 2.2(a) of the General Security Deed dated 3 May 2022 applied.
4. Consequent upon grounds 1–3, the primary judge erred in making Order 5 because:
(a) [the receiver] lacked standing to seek any relief in respect of the [Ailo shares]; and/or
(b) the declaration in Order 5 lacked any, or any sufficient, utility.
1 Appeal allowed.
2 Order 5 of the orders made by [the primary judge] on 23 October 2025 be set aside.
2A Order 1(b) included in Order 6 of the orders made by [the primary judge] on 23 October 2025 be amended to add “save for the [Ailo shares] held by [RIH], on the basis that those shares fell within the exception in clause 2.2(a) of the General Security Deed dated 3 May 2022” and/or;
2B Order 1(b) of the orders made by [the primary judge] on 23 October 2025 be amended to add “save for the [Ailo shares] held by [RIH], on the basis that those shares fell within the exception in clause 2.2(a) of the General Security Deed dated 3 May 2022”.
1 The primary judge’s conclusion that the [receiver] had standing (at J [36]-[38]) to seek relief in respect of an asset held by [RIH], consisting of [the Ailo] shares, was correct, in addition to the reasons at J [36]-[38], because:
a. [the receiver] had standing to bring any proceedings in the name of and on behalf of [RIH] pursuant to s 420(2)(k) of the Corporations Act 2001 (Cth);
b. further, and in the alternative:
i. there was an issue at the hearing about whether the [Ailo] shares … were owned by [RIH], or [Coronam Family Office];
ii. the presence of that issue was sufficient to confer standing on the [receiver] in respect of order 5 of the primary judge’s orders.
c. further, and in the alternative, [Crown] could not demonstrate that the [receiver] lacked standing to seek paragraph 10E of the Amended Summons because:
i. contrary to the finding of fact at J [37] that the consent of ordinary shareholders of [Ailo] to the creation of the Security Interest created by the General Security Deed was neither sought not given, there was no evidence support that finding such that it was erroneous;
ii. further to (i) that, even if the Counterparties to the Shareholders’ Agreement of [Ailo] were ordinary shareholders, [Crown] did not demonstrate that the ordinary shareholders had not consented to the granting of the Security Interest over the [Ailo] shares … under the General Security Deed;
iii. in the premises of (i) and (ii), [Crown] could not demonstrate that the security interest under clause 2.1 of the General Security Deed did not extend to the [Ailo] shares ...
Crown submitted that “relevant Counterparty” in cl 2.2(a)(ii) is not a “fixed label” with a constant meaning of “the company whose shares are in question”, but rather is a “relational phrase” which has a distributive meaning to apply to any counterparty whose consent is required under the “Relevant Contract”. Crown submitted that the purpose of the carve-out in cl 2.2(a)(ii) is to prevent the General Security Deed security from attaching to equity interests where attachment would require third-party consent (or would result in breach or default) unless and until the third party consents.
Crown submitted that the test for whether cl 2.2(a)(ii) applies involves the following steps:
identify the “Relevant Contract”, which may be a “contract” or a “constituent document with a Counterparty”;
ask whether, under the Relevant Contract, the consent of the “relevant Counterparty” is required before the Grantor may grant the Security Interest (or whether granting it would be a breach/default); and
ask whether that Counterparty has in fact consented.
Crown argued that, applying the test above:
the shareholders agreement was the “Relevant Contract” (as it was both a constituent document with a Counterparty and a “contract”);
under the shareholders agreement, a shareholder must not “Dispose” (which includes “Encumber”) of shares except “with the written consent of all Ordinary Shareholders” who are, therefore, the relevant “Counterpart[ies]” (since the shareholders are neither an Obligor nor a related entity of an Obligor); and
as the receiver had not proved that Ailo’s shareholders had consented, the receiver had not discharged his onus of proving that the charge extended to the Ailo shares.
On this basis, Crown submitted that:
the carve-out in cl 2.2(a)(ii) applies and the security granted under cl 2.1 does not extend to RIH’s shares in Ailo; and
accordingly, the receiver did not have standing to obtain the declaration since the charged property did not include the Ailo shares.
Ultimately, Ms Jaffray only faintly pressed her submission that the receiver did not have standing. Although she did not abandon the submission, she relied exclusively on her written submissions which she did not develop orally (tr 11).
The receiver’s primary submission was that it was not open to Crown to make these new arguments in this Court, having not made them in the Court below. The receiver further submitted that questions of onus were to be viewed by reference to matters which were actually in dispute between the parties and not simply by reference to factual propositions which might have been raised, but were not.
14.14 General rule as to matters to be pleaded specifically
(1) In a statement of claim, the plaintiff must plead specifically any matter that, if not pleaded specifically, may take the defendant by surprise.
(2) In a defence or subsequent pleading, a party must plead specifically any matter—
(a) that, if not pleaded specifically, may take the opposite party by surprise, or
(b) that the party alleges makes any claim, defence or other case of the opposite party not maintainable, or
(c) that raises matters of fact not arising out of the preceding pleading.
(3) Matters which must be pleaded pursuant to subrule (2) include (but are not limited to) fraud, performance, release, statute of limitation, extinction of right or title, voluntary assumption of risk, causation of accident by unknown and undiscoverable mechanical defect and facts showing illegality.
Although Commercial List statements and responses “differ from pleadings in substance, they nevertheless stand in the place of pleadings in proceedings commenced in the Commercial List and Technology and Construction List”: see the summary of authorities in Roberts v Goodwin Street Developments Pty Ltd (2023) 110 NSWLR 557; [2023] NSWCA 5 at [62] (Ward P).
It is plain from the Amended Statement that the allegations concerning Ailo’s shareholders’ agreement were made in the context of the receiver’s case that the alleged transfer of the Ailo shares to Coronam Family Office in September 2024 (on which Crown relied and did not abandon) was ineffective. The question whether RIH or Coronam Family Office owned the Ailo shares remained a live issue in the Court below. If that question had been decided in favour of Crown (which contended that Coronam Family Office owned the Ailo shares), cl 2.2(a)(ii) would have had no operation since it was not suggested that the charge covered any property of Coronam Family Office. In these circumstances, the bare denials made by Crown in their Amended Response did not have the effect of putting in issue whether cl 2.2(a)(ii) applied to the charge granted by RIH over the Ailo shares and, if it did, what the consequences were for the ambit of the charge.
Similarly, the receiver’s forensic purpose in tendering the Deed of Accession (dated 23 January 2020, which had been executed by RIH) and the shareholders’ agreement in the Court below was to enable the primary judge to be satisfied that RIH had complied with the requirements of that deed when it acquired the Ailo shares in January 2020. There was nothing in the pleadings, the evidence or the submissions to indicate to the primary judge, or to the receiver, that Crown would seek to impugn the ambit of the charge by contending that, for the purposes of cl 2.2(a)(ii), the shareholders’ agreement was a “Relevant Contract”; that the shareholders of Ailo were relevant “Counterpart[ies]”; or that, accordingly, the consent of the shareholders of Ailo was required before the charge could validly extend to the Ailo shares. Indeed, as the primary judge observed at J[15] (extracted above), “both parties skirt around the issue”.
Crown, in this Court, seeks to use the blanket denials in its Amended Response as a means to make arguments not put below. For example, Crown denied the receiver’s allegation contained in para 64 of the Amended Statement that, after the receiver’s appointment, RIH’s property was “controlled by the receiver”. In the context of the live issues in the Court below, this denial ought be understood to be a denial that RIH still owned the Ailo shares (because they had been transferred to Coronam Family Office) and that, therefore the receiver had no control over them. The bare denial of para 64 cannot be retrofitted in this Court to accommodate a positive allegation that cl 2.2(a)(ii) excluded the Ailo shares from the charge on the basis that Ailo’s shareholders had not consented to the charge, particularly in circumstances where no issue about consent (whether legal or evidentiary) was raised in the Court below. Indeed, Crown’s counsel in the Court below positively eschewed any reference to the words in cl 2.2(a)(ii) which dealt with consent.
As a general rule**, all substantial issues between parties should be settled at trial and new issues should not be raised on appeal.** That rule, however, is not absolute. A party will generally be refused permission to rely on a point not taken below, among other grounds, where a party seeks to raise a case which did not arise on the pleadings; where if the issue had been raised at the trial, it might have been the subject of evidence; or where the issue requires a fresh consideration of facts that are neither admitted nor beyond controversy. A party may be permitted to rely upon a point not taken below, however, if the other party concedes that its case would not have been presented differently if the point had been taken below.
(Footnotes omitted and emphasis added.)
Although the question of onus need not be determined as it was raised for the first time in this Court, I propose to address it in general terms. Crown submitted that the receiver, as the applicant for the declaratory relief, bore the onus of proving that the charge over RIH’s property extended to the Ailo shares. It submitted that the receiver had failed to discharge that onus because it had not adduced evidence to establish that the requisite consent of the relevant Counterparty had been given under cl 2.2(a)(ii) of the General Security Deed.
Crown was obliged, pursuant to s 56(3) of the Civil Procedure Act 2005 (NSW), to assist the Court to further “the overriding purpose” in s 56(1), being “to facilitate the just, quick and cheap resolution of the real issues in the proceedings”. Crown conducted the proceedings in the Court below (leaving aside the question of standing) on the basis that the reason the receiver could not deal with the Ailo shares was that they were not owned by RIH. As the question of consent to the charge was not put in issue by Crown, it was not necessary for the receiver to adduce evidence on this point.
Thus, in circumstances where Crown, in the Court below, identified the real issues as being whether (on the limited basis discussed above) the receiver had standing and whether RIH owned the Ailo shares, it was not open to Crown to complain in this Court that the receiver had not discharged his onus of proving that the relevant Counterparty had consented to the charge under cl 2.2(a)(ii) of the General Security Deed. The course available to an accused in a criminal prosecution of putting the prosecutor to proof of all elements of a charge, without indicating what is in dispute, is not a course which is open to a party in civil proceedings.
As the appeal must be dismissed, I do not propose to address the amended notice of contention, save in two respects.
First, the receiver alleged in grounds 1c(i) and (ii) that the primary judge’s finding of fact at J[37] (extracted above) “that the consent of ordinary shareholders of Ailo to the creation of the Security Interest created by the General Security Deed was neither sought nor given was erroneous as there was no evidence to support the finding”.
In the course of the hearing in this Court, McHugh JA put to the receiver’s counsel that it was open to read J[37] as if the word “because” meant “on the basis that” in the following sentence:
The ordinary shareholders of Ailo Holdings may have a claim against RIH for breach of the SHA because their consent to the creation of the charge was neither sought not given, but that does not affect application of cl 2.2(a).
The receiver accepted that such a reading was available and, if it were accepted to be the preferable reading, there would be no substance in the allegation of error in that aspect of the notice of contention. I consider that the primary judge’s reasons ought fairly be read as saying no more than, if the consent of Ailo’s shareholders has neither been sought nor given, they may have a claim against RIH for breach of the shareholders’ agreement. This reading is consistent with the absence of evidence, of which the primary judge was plainly aware, as to whether the consent of Ailo’s shareholders had either been sought or given.
Second, had it been necessary to decide the question of standing, I would otherwise have considered that at least ground 1a in the amended notice of contention was made out: namely, that the power conferred on the receiver pursuant to s 420(2)(k) of the Corporations Act “to bring … proceedings” “for the purpose of attaining the objectives for which the receiver was appointed” extends to the determination of issues about the ownership or control of property secured by the charge pursuant to which the receiver was appointed. In light of the dispute which had arisen as to the Ailo shares, that was sufficient to confer standing on the receiver to bring the proceedings in the present case. The power conferred by s 420(2)(k) has been construed broadly to include proceedings concerning property to which a receiver may in future be entitled: see the discussion in Land Enviro Corp Pty Ltd (In Liq*) v HTT Huntley Heritage Pty Ltd* [2017] NSWCA 207 at [26]-[27] (Bathurst CJ, Meagher JA agreeing).
I propose the following orders:
Dismiss the appeal.
Order the appellants to pay the respondents’ costs of the appeal.
McHUGH JA: I agree with Adamson JA.
**********
Crown
Nicodemou in his capacity as Receiver and Manager of Coronam Holdings Pty Ltd [2026] NSWCA 49
(2024) 98 ALJR 1349
(1982) 148 CLR 658
(2023) 110 NSWLR 557
Appeal dismissed. The appellants were ordered to pay the respondents’ costs of the appeal: [70].
Crown, for whom Ms Jaffray appeared with Mr Ivantsoff in this Court, accepted that:
Crown did not, in the Court below, make any of the submissions presently relied upon;
there had been no reference to the nature of the consent required by either Ailo’s constitution or the shareholders’ agreement for the purposes of cl 2.2(a)(ii) of the General Security Deed; and
Crown’s counsel had made no reference in the Court below to cl 2.2(a)(ii) beyond the words which provide that “[t]he security interest does not extend to … equity interests in any person other than a wholly owned Subsidiary”.
However, Crown submitted that the arguments on which they relied in this Court were “open” on the pleaded case. In particular, Crown relied on their blanket denials in their Amended Response (set out above), which they contended permitted them to raise these submissions in this Court. Crown also submitted that the arguments they wished to raise in this Court did not require any further evidence to be tendered beyond that which had been adduced by the receiver in the Court below, which included Ailo’s constitution, the shareholders’ agreement, the Deed of Accession dated 23 January 2020 (executed by RIH) and Ailo’s share register (tr 5).
Rule 14.14 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) provides:
Pleadings do not invariably operate as a constraint on the issues to be determined. An exception arises “where the parties choose to disregard the pleadings and to fight the case on issues chosen at the trial”: Dare v Pulham (1982) 148 CLR 658 at 664 (Murphy, Wilson, Brennan, Deane and Dawson JJ); [1982] HCA 70. However, in the present case, there was not a murmur from Crown in the Court below, whether in pleadings or submissions, that Crown sought to rely on the submissions now sought to be advanced. In the Court below, Crown relevantly submitted no more than that the Ailo shares were not covered by the charge because Ailo was not a wholly owned subsidiary of RIH. Crown made no submission in the Court below as to the meaning and application of the balance of cl 2.2(a)(ii).
Although the primary judge’s reasons reveal that his Honour considered the whole of cl 2.2(a), it having been the subject of submissions by the receiver, his Honour did so expressly for the purposes of determining whether the receiver had standing to seek the declaratory relief. In the course of so doing, the primary judge made the incidental finding at J[38] that the charge over the Ailo shares (being property of RIH) was valid on the basis of his Honour’s construction of cl 2.2(a)(ii). There was no ground of appeal alleging that this finding involved any denial of procedural fairness to Crown.
In substance, what Crown seeks do in this appeal is to run a point which was not taken below and which would have required evidence to be adduced had it been taken. Parties to an appeal are generally bound by the way in which they conducted themselves in the Court below. The passage in Bird v DP (A Pseudonym) [2024] HCA 41; (2024) 98 ALJR 1349 at [39] (Gageler CJ, Gordon, Edelman, Steward and Beech-Jones JJ) which is highlighted in the extract below is apposite to the present appeal: