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Creditors

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B v U [2012] NSWSC 1416. Pembroke J.

21 The plaintiff had no judgment against the first defendant at 21 March 2012 but the expression "creditors" in Section 37A is not limited in its scope and meaning to persons to whom debts are currently owing. It includes future creditors.

And an "impending liability" to a future creditor is sufficient: Barton v Deputy Commissioner of Taxation [1974] HCA 20; (1974) 131 CLR 370 at 374 (Stephen J, with whom Menzies and Gibbs JJ agreed); Hardie v Hanson [1960] HCA 8; (1960) 105 CLR 451 at 456 (Dixon CJ). 

Barton was decided in the context of bankruptcy legislation but its reasoning was applied to Section 37A of the Conveyancing Act in Green v Schneller [2002] NSWSC 671 at [87]-[88] (Barrett J). See also P T Garuda Indonesia Limited v Grellman (1992) 35 FCR 515 at 525-526 (Wilcox, Gummow and von Doussa JJ) and Langdon v Gruber [2001] NSWSC 276 at [58]-[60] (Austin J).

22 Silvera v Savic (1999) 46 NSWLR 124 is a case involving similar facts to this case. In November 1995 consent orders relating to the transfer of property were made under the De Facto Relationships Act 1984. Some months earlier the transferor had been served with a statement of claim by a victim of his sexual assault. She did not obtain judgment until November 2006. Hodgson CJ in Eq upheld her claim for avoidance of the transfer pursuant to Section 37A notwithstanding that at the time of the disputed transfer the transferor had no more than an impending liability for her claim.


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