Australia, Sept. 1 -- New South Wales Land and Environment Court issued text of the following judgement on Aug. 1:

1. THE COURT: Grapple Pay Pty Ltd, the appellant (Grapple), appeals against orders made by Nixon J (the primary judge) in the Equity Division of the Supreme Court (the Court below) on 18 February 2025. The proceedings in the Court below ultimately turned on whether the transfer of rural property at Bentley, north-west of Lismore (the property), by Jarrod Conroy (whose trustee in bankruptcy is the second respondent) to his mother, Ingrid Conroy, was voidable at the instance of Grapple pursuant to s 37A of the Conveyancing Act 1919 (NSW) (the Act). The primary judge found that it was not and dismissed Grapple's amended summons: Grapple Pay Pty Ltd v Conroy [2025] NSWSC 64 (J).

2. Section 37A of the Act relevantly provides:

37A Voluntary alienation to defraud creditors voidable

(1) Save as provided in this section, every alienation of property, made ... with intent to defraud creditors, shall be voidable at the instance of any person thereby prejudiced.

...

(3) This section does not extend to any estate or interest in property alienated to a purchaser in good faith not having, at the time of the alienation, notice of the intent to defraud creditors.

3. The primary judge was not satisfied that the transfer of the property had been made with the intent to defraud creditors within the meaning of s 37A(1). His Honour was satisfied that Ms Conroy was, in any event, a purchaser in good faith who did not know of any intent to defraud creditors within the meaning of s 37A(3).

4. In 16 separate grounds of appeal (1-14, 8A and 9A) set out in its amended notice of appeal, Grapple seeks to challenge these determinative findings and several that underpinned them.

5. All references to legislation in these reasons are, unless otherwise stated, references to the Act.

The facts

6. Mr Conroy was the sole director and shareholder of Prana Energy Co Pty Ltd (Prana), which was engaged in commercial solar installations. Ms Conroy was employed as Prana's book-keeper from about the time of its incorporation in mid-2017 until it was placed in liquidation on 10 October 2022. Her sign-off on two emails dated June and September 2021 represented that she was Prana's Accounts and Finance Manager. Mr Conroy explained that Prana's new Chief Executive Officer changed the titles of all employees.

7. Prior to June 2021, Mr Conroy was in a relationship with Isabel Lucas. They decided to purchase the property with a view to growing food and keeping bees with "community involvement". Ms Lucas suggested that the property be purchased and held by a trust of which Mr Conroy would be trustee and Mr Conroy, Ms Conroy and Ms Lucas would be beneficiaries. Although Mr Conroy and Ms Lucas were no longer in an intimate relationship in June 2021, the Bungabbee First Light Trust (the trust) was established by settlement deed at that time and Mr Conroy was appointed as trustee. Mr Conroy engaged solicitors, Wall & Co, to act on his behalf on the purchase of the property.

*Rest of the document can be viewed at: (https://www.caselaw.nsw.gov.au/decision/1985e08d71ed01ee7c9aa99b)

Disclaimer: Curated by HT Syndication.