Krejci (liquidator) v Panella, in the matter of Richmond Lifts Pty Ltd

ARMSTRONG SCALISI HOLDINGS PTY LTD (ACN 114 980 586) (and others named in the Schedule)

1. The plaintiffs be granted leave to file the interlocutory process emailed to the Associate to Moore J on 10 March 2025 (Interlocutory Process).
2. The Interlocutory Process be returnable instanter.
3. Prayers 1, 2, 6, 7, 12, and 14 of the Interlocutory Process be determined on an ex parte basis.
4. Pursuant to section 57(1) of the Federal Court of Australia Act 1976 (Cth), Peter Krejci and Jonathon Keenan be appointed as receivers and managers (Receivers), without security, over the property, undertaking and assets including, without limitation, the proceeds of any such property (Assets) of the:

(a) ASH Discretionary Trust (ASH Trust);

(b) Marginata Securities Trust (Marginata Trust);

(c) Reliance Discretionary Trust (Reliance Trust); and

(d) RFS Trust (RFS Trust),

1. The plaintiffs have, in respect of each the Assets of Trusts, all of the powers:

(a) provided by section 420 of the Corporations Act 2001 (Cth) (other than in section 420(2)(s), (t), (u), and (w)) as if references therein to "the corporation" were to the ASH Trust, Marginata Trust, Reliance Trust, and RFS Trust; and

(b) that a liquidator has in respect of property of a company by reason of s 477(2) of the Corporations Act 2001 (Cth).

1. The Receivers have liberty to apply to the Court for further orders, directions and/or advice with respect to their appointment, including in relation to the Receivers' remuneration.
2. Within seven (7) days of the making of these orders, the plaintiffs to take all reasonable steps to give notice of these orders to creditors (including persons claiming to be creditors) of the Trusts, the Australian Securities and Investments Commission, and the known beneficiaries of the Trusts:

(a) to be sent by email to creditors for whom the plaintiff has a current email address; or

(b) to be sent by ordinary post to creditors for whom the plaintiff has only a postal address.

(a) dispose of the Assets; or

(b) distribute the Assets to creditors or beneficiaries,

of each of the Trusts, without further direction or order of the Court.

1. The proceeding be listed for a case management hearing at 2:15 pm on 11 March 2025.
2. Any person or entity who wishes to seek to apply to set aside, discharge, or otherwise to vary these orders is to file and serve any evidence and submissions in respect of that application by 4:00 pm on 13 March 2025.
3. If any application is made pursuant to order 10 above, the plaintiffs are to file and serve any evidence and any submissions in reply by 4:00 pm on 14 March 2025.
4. Any application made pursuant to Order 10 above to be returnable before Moore J at 9.30am on 19 March 2025.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

1. These reasons relate to an ex parte interlocutory application which came before me on 11 March 2025. Shortly after the hearing, I made orders appointing Mr Peter Krejci and Mr Jonathon Keenan as receivers and managers (Receivers) of four trusts.
2. This proceeding first came before this Court on 18 February 2025. On 19 February 2025, orders were made by the Corporations and Commercial Duty Judge that Mr Peter Krejci and Mr Jonathon Keenan be appointed as:

(a) provisional liquidators of:

(i) Marginata Securities Pty Limited (Marginata);

(ii) Reliance Financial Services Pty Limited (Reliance); and

(iii) Armstrong Scalisi Holdings Pty Limited (trading as CAP Accounting),

(b) receivers of Capital Financial Advisory Pty Limited (Accolade).

1. The background to the present application is set out in the judgment of Cheeseman J in Krejci (liquidator) v Panella, in the matter of Richmond Lifts Pty Limited (in liquidation) [2025] FCA 151 (Krejci) and I will not repeat it here. As observed by Cheeseman J in Krejci at [13]-[14], the plaintiffs seek orders against the defendants in respect of alleged breaches of directors' duties and the alleged receipt of funds the product of those breaches in connection with an alleged tax avoidance scheme. It is alleged that at least $5.3 million that should have been remitted to the Deputy Commissioner of Taxation in respect of PAYG tax has been diverted to, inter alia, Marginata, Reliance, CAP Accounting and Accolade.
2. In Krejci, Cheeseman J was dealing with applications to set aside the appointment of a provisional liquidator to Marginata, Reliance and CAP Accounting, and the appointment of a receiver to Accolade. Those applications were refused. Cheeseman J expressed the matter as follows (at [72]):

In the case of each of the three companies, I was satisfied that there are good prospects that the companies will be wound up on the just and equitable ground. I was further satisfied that the appointment is needed in the public interest, to preserve the status quo, and to preserve and protect each company's assets or affairs for the benefit of their creditors, including by facilitating an effective investigation to enable the company's assets, including choses in action, being identified and preserved. The evidence led on this interlocutory application amply supported that conclusion.

(a) at [75], that the evidence established that each of the companies appeared to be controlled by Mr Cassaniti, and not the de jure directors appointed to them;

(b) at [82], that the companies appeared to be conducting their affairs in a casual manner and in neglect of their obligations under the Corporations Act 2001 (Cth);

(c) at [87] - [92] that there is a risk of dissipation of assets.

1. In relation to the appointment of interim receivers to Accolade, Cheeseman J concluded that this was appropriate, in light of evidence that Accolade was under the control of Mr Cassaniti, not its de jure director, and having regard to the lesser impact of the appointment of a receiver rather than a liquidator.
2. I am not, on this application, engaging in a reconsideration of the conclusions of Cheeseman J. The conduct of the affairs of these companies will have to be considered by me in due course on admissible evidence at a final hearing. Rather, the present application seeks to preserve the utility of the relief already granted by the Court in light of the circumstances that assets are held on trust, and in light of the likelihood that ipso facto clauses are contained within the trust deeds.
3. The plaintiffs have brought an ex parte interlocutory application seeking, inter alia:

(a) appointment of Peter Krejci and Jonathon Keenan as receivers and managers (Receivers) of the assets of the:

(i) ASH Discretionary Trust (ASH Trust);

(ii) Marginata Securities Trust (Marginata Trust);

(iii) Reliance Discretionary Trust (Reliance Trust); and

(iv) RFS Trust (RFS Trust),

(b) that the Receivers be granted powers:

(i) pursuant to section 420 of the Corporations Act 2001 (Cth) (other than in section 420(2)(s), (t), (u), and (w)) as if references therein to "the corporation" were to the ASH Trust, Marginata Trust, Reliance Trust, and RFS Trust; and

(ii) that a liquidator has in respect of property of a company by reason of s 477(2) of the Corporations Act 2001 (Cth).

1. In his evidence, Mr Krejci explains that, based on the limited books and records to which he has had access, an affidavit of Alexander du Maurier (a solicitor employed by the solicitors for Mr Sam Cassaniti, Marginata, Reliance and CAP Accounting), and other evidence identified by him:

(a) Marginata is the trustee of the Marginata Trust;

(b) Reliance is the trustee of that Reliance Trust and the RFS Trust;

(c) CAP Accounting is the trustee of the ASH Trust; and

(d) Accolade is the trustee of the Accolade Advisory Trust.

1. This interlocutory application has arisen in circumstances where the applicants have recently received a copy of the Accolade trust deed and discovered that the deed contains what is often described as an ipso facto clause in the following terms:

26. RESIGNATION OF TRUSTEE

26.1 The Trustee may at any time resign its trusteeship upon giving three months notice in writing.

26.2 The office of the Trustee shall be ispo facto determined and vacated if the Trustee shall enter into liquidation, administration, receivership or bankruptcy whether compulsory or voluntary (not being merely a voluntary liquidation for the purposes of amalgamation or reconstruction) or if a receiver or official manager shall be appointed of the undertaking of the Trustee or any part thereof.

1. The liquidators had also received, on the morning of the hearing, a copy of the trust deed for the Reliance Trust, which has an equivalent form of ipso facto clause to that in the Accolade trust deed.
2. The effect of this clause in the Reliance trust deed is that Reliance, now placed into provisional liquidation, will be removed as trustee for the Reliance Trust, leaving Reliance to hold any trust assets for the Reliance Trust as a bare trustee. The powers of the bare trustee to deal with trust assets do not include a power of sale of the assets: Jones (Liquidator) v Matrix Partners Pty Ltd, in the matter of Killarnee Civil & Concrete Contractors Pty Ltd (in liq) (2018) 260 FCR 310; [2018] FCAFC 40 at [44] per Allsop CJ, [196] per Farrell J; Apostolou v VA Corp Aust Pty Ltd [2011] FCAFC 103 at [45] per Perram, Nicholas and Yates JJ; Brereton, in the matter of MyHouse (Aust) Pty Limited (administrators appointed) [2020] FCA 610 (MyHouse) per Farrell J at [30]; In the matter of Stansfield DIY Wealth Pty Limited (in liquidation) (2014) 291 FLR 17; [2014] NSWSC 1484 per Brereton J.
3. In MyHouse at [31], Farrell J observed, by reference to authority, that appointing the administrator of a corporate trustee as receiver of a trust's assets facilitates and simplifies the administration of the corporate trustee by providing for the trust's business and assets to be under the same control as the corporate trustee while it is in administration, which aids in the vindication of the trustee company's right of indemnity out of the trust's assets. This approach was adopted in Re Mecfab Holdings Pty Ltd [2015] NSWSC 46 at [9] per Brereton J; Trenfield, In the matter of Crusaders Managers Pty Ltd (Administrators Appointed) [2018] FCA 876 at [16]- [19] per Derrington J; Griffiths (Administrator) v The Trustee for Chrisamanda Trust (trading as Chrisamanda Trust) [2017] FCA 1222 at [11]- [12] per Gleeson J; Kite v Mooney, in the matter of Mooney's Contractors Pty Ltd (in liq) [2016] FCA 886 per Yates J; and In the matter of Stansfield DIY Wealth Pty Ltd (in liquidation) (2014) 291 FLR 17; [2014] NSWSC 1484 at [10]- [33], [55]-[57] per Brereton J.
4. The evidence of Mr Krejci was that:

(a) Marginata had been said, by its counsel, to provide a "treasury function" to Mr Cassaniti's group, and yet had relatively modest assets in bank accounts held in its own name;

(b) neither Mr Cassaniti nor any of the parties the subject of penal notices had made disclosure of their assets prior to the hearing of the application;

(c) Marginata, as mortgagee in possession, had entered into a contract for the sale of a property in Wilson Road, Windeyer in New South Wales (the Windeyer Property), which was due to settle three days after the hearing; and

(d) in light of those and other matters, he was concerned that steps were being taken to distance or otherwise remove the assets of the Trusts, including by appointing new trustees.

1. The plaintiffs have not received a copy of the Marginata trust deed despite requesting this. The plaintiffs are aware that in its capacity as trustee, Marginata has extant obligations to deal with the sale of certain real property on 14 March 2025. In that regard, the evidence of Mr Krejci was that:

(a) on 4 April 2010, Mr Graham Robert Killeen entered into a deed of loan with Reliance in respect of the Windeyer Property;

(b) pursuant to the deed of loan, Reliance registered a mortgage over the Windeyer Property;

(c) on or about 20 August 2024, Reliance assigned its right under the deed of loan to Marginata in its capacity as trustee for the Marginata Trust;

(d) on or about 28 August 2024, Reliance transferred its rights under the mortgage to Marginata;

(e) Mr Killeen has defaulted under the deed of loan;

(f) on or about 31 January 2025, Marginata, as mortgagee in possession, entered into a contract for sale of the Windeyer Property for consideration of $171,000;

(g) that contract was due to settle on 14 March 2025; and

(h) Mr Krejci is concerned about settling the loan on behalf of Marginata if he is not receiver of the assets of the Marginata Trust.

1. In relation to the relevant books and records, Mr Krejci gives the following evidence in his affidavit:

...my investigations into the affairs of the Richmond Prov Liq Group and Accolade (together, the Companies) have been restricted or otherwise impeded, including because:

(a) I have received no, or very limited, assistance from the directors of the Companies. Indeed, it was only on 4 March 2025 that I received certain contact details of the directors, from McEvoy Legal and Sam Cassaniti;

(b) as at the date of making this affidavit, I have been provided with limited books and records of the Companies. Indeed, there remains an extant debate over items seized by Independent Lawyers under search orders issued by this Court;

(c) I have only been provided with, despite the contents of the Information and Belief Affidavit, the trust deed with respect to the Accolade Trust (Accolade Trust Deed). I have not been provided with, despite request, among other things, copies of the trust deeds with respect to Reliance Trust, RFS Trust, Marginata Trust or ASH Trust deeds; and

(d) requests for information and assistance have either been ignored or in some instances, we have been prevented with complying with the Court's orders appointing me to access books and investigate.

1. I note that subparagraph (c) above must be qualified by the circumstance that Mr Krejci now has the trust deed of the Reliance Trust. I do not otherwise need to determine whether this description is a fair and balanced characterisation. It is sufficient for present purposes to observe that there is evidence that Mr Krejci has experienced challenges in obtaining access to relevant books and records of Marginata, Reliance and CAP Accounting.
2. These matters arise in the present case in circumstances where the provisional liquidators were appointed, and subsequently not removed, for reasons that included the risk of dissipation of assets.

Appropriate approach, including in relation to proceeding ex parte

1. Mr Krejci explained that he was concerned that, based on the conduct of the defendants to date, including in failing to provide the trust deeds of the Trusts, if notice of this application was given to the defendants there was a risk that they would take steps to dissipate assets or change trustees. One concern, as expressed, was that there could be the appointment of a new trustee, who could then call for the assets of the trust. As an aspect of that, it was said that a trustee could redirect the payment of loans. For example, a new trustee could direct a loan that is repayable to the Marginata Trust to instead be paid to a third party. Although these assets could be traced, it was said that this could give rise to practical difficulties.
2. In my view, it is not necessary to multiply examples or to consider further the precise mechanism by which dissipation could occur. I accept that there is a risk of dissipation if notice is provided.
3. There is a risk that the appointment of receivers and managers could have some impact on the assets of the relevant trusts, for example by triggering some clause in a relevant contract, such as a finance contract. However, it appears to me that there is a relatively small risk that the appointment of receivers and managers would trigger some provision that was not already triggered by the appointment of provisional liquidators to the companies which have legal title to the assets and which are (or were at the time of the appointment of provisional liquidators) the trustees of the Trusts.
4. In my view, in the circumstances, it is appropriate that I make the orders sought. As observed in the authorities, the orders will facilitate and simplify the administration of the corporate trustee by providing for the trust's business and assets to be under the same control as the corporate trustee, which aids in the vindication of the trustee company's right of indemnity out of the trust's assets.
5. Consistently with the approach adopted in a number of the authorities cited earlier, there will also be an order that the receivers will not dispose of the assets, or distribute them to creditors or beneficiaries, without an order of the Court. Conscious that this application was ex parte, I will also make procedural orders for the bringing of any application to set aside these orders.

I certify that the preceding twenty-three (23) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Moore.

UNITED LIFT TECHNOLOGIES PTY LTD (ACN 659 501 532) (IN LIQUIDATION)

FINANCIAL ADVISORY AUSTRALIA PTY LTD (ACN 669 266 228) (ADMINISTRATOR APPOINTED)

DOMINIC STEPHEN CALABRIA & BEN DIBDEN IN THEIR CAPACITY AS INDEPENDENT SOLICITORS APPOINTED PURSUANT TO ORDERS MADE BY THE COURT ON 19 FEBRUARY 2025

CAPITAL FINANCIAL ADVISORY PTY LTD (FORMERLY KNOWN AS ACCOLADE ADVISORY PTY LTD) (ACN 604 214 100)

RELIANCE FINANCIAL SERVICES PTY LTD (ACN 146 317 919)

WENTWORTH WILLIAMS AUDITORS PTY LTD (ACN 099 391 189)

FRASER HOLDINGS NSW PTY LTD (ACN 640 331 791) (IN LIQUIDATION)