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Dear Sir/Madam

Courtenay House Capital Trading Group Pty Ltd (In Liquidation) ACN 152 224 149 Courtenay House Pty Ltd (In Liquidation) ACN 130 607 644 (Collectively “the Companies”) I refer to my correspondence of 6 December 2017.

Executive Summary 1 On 5 April 2018, the Court found that the Brexit investors are the beneficial owners of

the funds deposited by them into the NAB Brexit account and that the Liquidators are justified in distributing the funds (c.$29m) held by them that were in the NAB Brexit Account to the NAB Brexit creditors only;

2 The Court further found that as the funds were held on trust for the Brexit investors only, there could be no set-off of any previous returns received by the Brexit creditors from the Companies by way of investment returns in either the general investments (Swing, Elite etc) or the previous one-off specials;

3 The Liquidators are now in the process of agreeing the procedural steps in relation to how the Brexit funds should be paid to the Brexit creditors and how the costs of the Court proceedings should be allocated between the NAB and Westpac accounts. It is estimated that a dividend will be paid to the Brexit investors by 30 June 2018, if the Court’s decision is not appealed. The dividend rate at this stage is unknown, however, Brexit creditors whose funds can be identified in the NAB Brexit Account will be paid their Brexit investment less the allocation of costs and expenses incurred through the Liquidation;

ALL CREDITORS/INVESTORS

10 April 2018 PRIVATE AND CONFIDENTIAL

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4 As a result of this finding by the Court, it is likely that the Westpac funds will also be deemed to be held on trust for the benefit of the creditors who deposited their funds into this account. However, as the fund is deficient (i.e. there is insufficient funds to repay all creditors in full) and due to the mixing of the money in the account, we cannot identify precisely to whom all the funds belong. It is likely that the non-Brexit creditors will only receive a pro-rata share of these monies less the costs and expenses of the Liquidation. In addition, previous returns received by non Brexit investors may also need to be taken into account in calculating a dividend;

5 Directions will be sought from the Court as to the proper distribution of the funds that were in the Westpac account;

6 Due to the lack of available books and records and the volume of transactions through the Westpac account, it is unlikely that the Liquidators will be in a position to make a dividend payment to the Non-Brexit creditors for at least 9 months. This is to ensure that any creditor that ranks for a dividend in the Westpac fund is entitled to receive one (all investments verified to the bank statements) and that any capital redemptions received by creditors prior to our appointment are excluded from a creditor’s claim; and

7 The Liquidators are due to publicly examine a number of individuals, including Mr Iervasi and Mr Sipina during April and May 2018. The public examinations are open to the public/all creditors. However, creditors are advised that seating will be limited and that they are not permitted to address the Court and/or the examinees.

Court Proceedings (Brexit Hearing) On 29 March 2018, Justice Brereton heard submissions from each of the representative creditors and was asked to consider the following questions:

1 Are the pre-21 April 20171 Brexit investors the beneficial owners of the funds deposited by the pre-21 April 2017 Brexit investors into the NAB account. If the Court determines that the answer is yes:

(a) whether the Liquidators are justified in distributing the funds in the NAB account to the pre-21 April 2017 Brexit investors only and not to other creditors of the Companies; or

(b) alternatively, whether the Liquidators should set-off any funds received by the pre-21 April 2017 investors from the Companies prior to the Liquidations, against distributions to be made arising from the determination of 1 above.

2 Are the post-21 April 2017 Brexit investors the beneficial owners of the funds deposited by the post-21 April 2017 Brexit investors into the NAB account. If the Court determines that the answer is yes:

(a) whether the Liquidators are justified in distributing the funds in the NAB account to the post-21 April 2017 Brexit investors only and not to other creditors of the Companies; or

1 21 April 2017 was the date of the ASIC freezing orders obtained from the court against the assets of the Companies.

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(b) alternatively, whether the Liquidators should set-off any funds received by the post-21 April 2017 investors from the Companies prior to the Liquidations, against distributions to be made arising from the determination of 1 above.

In the Liquidators' opinion all viable arguments were raised by Counsel for each Representative Creditor on behalf of the various Creditor classes. The Court was fully informed of the facts and all legal arguments were before the Judge in considering his decision.

On 5 April 2018, Justice Brereton handed down judgement and found in favour of the Brexit representatives. A copy of the judgement can be found at Appendix A. In summary, Justice Brereton found that the answers to the above questions was:

1. Question 1, 1 (a), 2 and 2 (a) – Yes.

2. Question 1(b) and 2(b) need not be addressed (i.e. that there will be no set-off) as it was not possible to do so given the funds are held on trust.

In providing judgement, Justice Brereton made the following comments in relation to the following key issues being heard: Funds held on trust in relation to both Brexit and Non Brexit 1. “I accept that Courtenay House held the funds subscribed by non-Brexit investors on trust for the clients

who invested them”. Paragraph 32

2. “There has been no mixing of the Brexit funds with other funds, and the fund is sufficient to meet the claims of all those who contributed to it. Just because all deposits from investors were received on trust for the relevant depositor does not mean that somehow there was a single trust fund; to the contrary, the capital deposited by each investor was held on trust for that investor”. Paragraph 36

No Pooling of Investors funds 1. Pooling “will be warranted only when the funds have become so intertwined that each client’s entitlement

to one account may reasonably be regarded as identical to its entitlement to the other(s), and this will be so when it is reasonable in all the circumstances to regard each as having a rateably equal interest in the mixed fund”. Paragraph 33

2. “Where there is no difficulty in identifying the beneficial entitlements to the Brexit funds, no deficiency in them, and they have not been mixed with any other money, there is no warrant for pooling, which would amount to no more than disregarding clear property interests in particular property on account of some notion of common misfortune”. Paragraph 38

Right of set-off of other investments 1. “A beneficiary’s entitlement to recover its property from one fund is not affected by what the same

beneficiary has received from another fund”. Paragraph 40

2. “There is no proper basis for setting off returns derived by Brexit investors from their investments in non-Brexit products against their entitlement to recover their Brexit investments”. Paragraph 41

The Representative Creditors have an entitlement to appeal. The deadline for filing of an appeal is 4 May 2018.

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Dividend Payments (Brexit) The Liquidators are now working with the representative creditors’ solicitors regarding procedural matters to enable them to commence the process to make a distribution to the NAB Brexit creditors. At present, the Liquidators estimate that they will be in a position to make a dividend distribution to the Brexit creditors by 30 June 2018. However, creditors should note that this will be dependent upon the procedural matters being agreed by all parties and no appeal being filed in the case. Please note that any Brexit investor, whose funds were paid into a bank account of the Companies other than the NAB Brexit account, will not be paid as part of the distribution. The Court only found in favour of returning the funds to those creditors who deposited into the NAB account. The Liquidators will be in contact with all Brexit investors in the forthcoming weeks asking them to reconfirm the amount of funds that they are owed from the NAB account, based upon the Liquidators' forensic review of the NAB account. Thereafter, once all claims are adjudicated on by the Liquidators, we will look to make a distribution. Dividend Payments (Non-Brexit) Based upon the judgement received, it appears likely that the Westpac funds will be deemed to be held on trust for the non-Brexit investors. However, this trust will be deemed to be a ‘deficient trust’ as there are insufficient funds held in the Westpac accounts (c.$21million) to pay all creditors of the non-Brexit fund (c.$164 million) in full. It is the Liquidators' intention to seek directions from the Court to confirm this prior to any distribution. Due to the lack of available books and records of the Companies, it is necessary for the Liquidators to reconcile the Companies’ Westpac account, to the best of their ability, prior to making any distribution to creditors. This is to ensure that creditors are only admitted to rank for a dividend for which they are entitled to (all investments verified to the bank statements) and any return of capital and / or interest previously paid by the Companies are taken into account when calculating the amount of a creditors claim in accordance with further court directions. Unfortunately, this process is time consuming, due to the large volume of transaction in the Companies Westpac bank account (20,000 + ) in the last 7 years, and the time taken to obtain trace requests and/or banking information from Westpac. The Liquidators will be in contact with the Non-Brexit creditors in the forthcoming months once the Westpac account has been fully reconciled (i.e. all deposits and payments allocated to investors or third parties) asking them to reconfirm their claim for the purposes of paying a dividend. Appropriate Court direction will be sought. Thereafter, the Liquidators will look to make a dividend payment to the Westpac creditors. It is likely that a dividend payment will not be made for at least 9 months. Public Examinations The Liquidators give notice that they are to hold public examinations of a number of individuals in regards to the Companies affairs between 16 April 2018 to 20 April 2018 and 7 May 2018 and 11 May 2018.

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Attached as Appendix B is a list of the examinees and the proposed dates on which they will be examined. Creditors should note that the dates on which each individual is to be publically examined may change at short notice and that unfortunately there is no way for the Liquidators to advise creditors of these changes. The purpose of the public examinations are twofold: 1. Firstly, to assist with the liquidators investigation into the affairs of the Companies; and

2. Secondly, to determine if there are any other avenues of asset recoveries for the benefit of creditors.

All creditors are entitled, if they wish, to attend the public examinations. However, creditors are reminded:

3. They cannot be heard and/or ask any questions during the Court proceeding;

4. They should not approach or question privately in or outside the Court building any of those being publically examined;

5. There is a significant amount of creditors, however, limited seating available at Court (approx. 20 seats will be available in the public gallery); and

6. They must respect the Court protocol - discussions between creditors, taking phone calls, making comments during the proceedings in the Court room, is not permitted.

The public examinations will take place at the Supreme Court of Australia, 184 Phillip Street, Sydney 2000. The public examinations will be conducted each day between 11am and 4pm.

A full update on the public examinations will be provided to all creditors once they are concluded and a copy of the transcripts of the examinations made available on request. Should creditors have any questions regarding this update, please do not hesitate to contact my office on (02) 8297 2400 or email CourtenayHouse@au.gt.com. Yours faithfully

Said Jahani Joint and Several Liquidator

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Case Name: In the matter of Courtenay House Capital TradingGroup Pty Limited (in liquidation) and CourtenayHouse Pty Limited (in liquidation)

Medium Neutral Citation:

Hearing Date(s):

Date of Orders:

Date of Decision:

Jurisdiction:

Before:

[2018] NSWSC 404

29 March 2018

Thursday, 5 April 2018

Thursday, 5 April 2018

Corporations List

Brereton J

Decision: The Pre-21 April 2017 Brexit Investors are thebeneficial owners of the funds deposited by them intothe NAB-1 Account, and the liquidators are justified indistributing the funds deposited by the Pre-21 April2017-Brexit Investors to them only, and not to othercreditors of the Companies. The Post-21 April 2017Brexit Investors are the beneficial owners of the fundsdeposited by them into the NAB-1 Account, and theliquidators .are justified in distributing the fundsdeposited by the Post 21 April 2017 Brexit Investors tothem only, and not to other creditors of theCompanies.

Catchwords: CORPORATIONS —managed investment scheme —unregistered managed investment scheme —windingup —whether funds deposited by investors held ontrust for investors or part of general assets —whetherreceipts by investors from other investors should beset off against entitlement to trust property

TRUSTS —express trust —intention —certainty —where documentation contains statement that funds"held in trust" —resulting trust — Quistclose trust —contrastive trust — Black v Freedman trust arising fromfraudulent scheme

Legislation Cited: (CTH) Corporations Act 2007, s 579E, s 579G, s601 EE, s 981 D, Sch 2, s 90-15(NSV1n Trustee Act 1925, s 63(NSW) Uniform Civil Procedure Rules 2005, r 28.2(NSW) Supreme Court (Corporations) Rules 1999,2.13

Cases Cited: Associated Alloys Pty Ltd v ACN 001 452 106_ Pty Ltd[2000] HCA 25; (2000) 202 CLR 588Australasian Conference Association Ltd v MainlineConstructions Pty Ltd [1978] HCA 45; (1978) 141 CLR335; 22 ALR 1; 53 ALJR 66Australian Elizabethan Theatre Trust Ltd, Re [1991 ]FCA 344; (1991) 30 FCR 491; 102 ALR 681; 5 ASCR587Australian Securities and Investments Commission vIdylic Solutions Ltd [2009] NSWSC 1306; (2009) 76ACSR 129Australian Securities and Investments Commission vLetten (No 7) [2010] FCA 1231; (2010) 190 FCR 59;(2010) 80 ACSR 401Australian Securities Commission v Buckley (1996) 7BPR 15,024Barclays Bank Ltd v Quistclose Investments Ltd[1970] AC 567; [1968] 3 All ER 65; 3 WLR 1097BBY Limited (Receivers and Managers appointed) (inliquidation), In the matter of [2016] NSWSC 1366BBY Ltd (No 2), In the matter of [2018] NSWSC 346Black v S Freedman & Co [1910] HCA 58; (1910) 12CLR 105; 17 ALR 541Byrnes v Kendle [2011 ] HCA 26; (2011) 243 CLR 253;279 ALR 212; 85 ALJR 798Compass Resources Ltd v Sherman [2010] WASC 41;(2010) 42 WAR 1Courtenay House Trading Group Pty Ltd & CourtenayHouse Pty Ltd, In the matter of [2018] NSWSC 55Courtenay House Trading Group Pty Ltd, In the matterof [2017] NSWSC 1792Courtenay House Trading Group Pty Ltd, In the matterof [2017] NSWSC 1834Freelance Global Ltd (in Liq) v Bensted [2016] VSC181Grocers of Wyong Pty Ltd v Retech Global Pty Ltd[2004] NSWSC 488Kayford Ltd (in Liquidation), Re [1975] 1 All ER 604;(1975] 1 WLR 279Korda v Australian Executor Trustee (SA) Limited[2015] HCA 6; (2015) 255 CLR 62; 317 ALR 225; 145ALD 495; 89 AJLR 340Legal Services Board vGillespie-Jones [2013] HCA

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35; (2013) 249 CLR 493; 300 ALR 430; 87 ALJR 985Magarey Farlam Lawyers Trust Accounts (No 3), Re[2007] SASC 9; (2007) 96 SASR 337MBF Australia Limited v Malouf [2008] NSWCA 214

-MF Global Australia Ltd (in liq), In the matter of [2012]NSWSC 994 ; (2012) 267 FLR 27Orix Australia Corporation Ltd v Moody Kiddell andPartners P/L [2005] NSWSC 1209Russell-Cooke Trust Co v Prentis [2002] EWHC 2227;[2003] 2 All ER 478Schebsman, Re [1944] Ch 83; 2 All ER 768Sons of Gwalia Ltd (subject to deed of companyarrangement) v Margaretic [2006] FCAFC 92; (2006)232 ALR 119Stephens Travel Service International Pty Ltd vQantas Airways Ltd (1988) 13 NSWLR 331TVSN Ltd, Re [2005] NSWSC 692

Texts Cited: Thomas SB, "Clayton's Case and the 'Common Pool'Exception" (2004) 15 JBFLP 177

Category: Procedural and other rulings

Parties: Said Jahani (1 P)John McInerney (2P)Courtenay House Capital Trading Group Pty Limited(in liquidation) (3P)Courtenay House Pty Limited (in liquidation) (4P)J.P. Melocco Pty Ltd (1 D)Alamaidan Investments Pty Ltd ATF Del VecchioFamily Trust (2D)Lifesmart Trading Pty Limited (3D)

Representation: Counsel:V. Whittaker w L. Hulmes (Ps)M. Izzo (1 D)C.R. Newlinds SC w P. Strickland (2D)I. Pike SC (3D)G. Phelps (Kyle Lester Sheridan, a creditor)

Solicitors:Colin Biggers &Paisley (Ps)Ashurst (1 D)Diamond Conway (2D)Johnson Winter Slattery (3D)Vardanega Roberts (Sheridan)

File Number(s): 2017/269831

JUDGMENT

1 The plaintiffs are the Court-appointed liquidators of Courtenay House Pty

Limited and Courtenay House Capital Trading Group Pty Ltd, pursuant to

orders made on 16 May 2017 ("the appointment date") on the application of

the Australian Securities and Investments Commission (ASIC).

2 Since 2010, Courtenay House Pty Limited and Courtenay House Capital

Trading Group Pty Ltd have accepted funds from investors for the ostensible

purpose of investment in foreign exchange trading. The finro companies

appear to have been operated as a single enterprise and for convenience

shall refer to them together as Courtenay House. Courtenay House offered

investors a number of "standard products", by which funds were to be

invested for general foreign exchange trading. In addition, in 2016, Courtenay

House began to offer one-off "special products" for the stated purpose of

exploiting foreign exchange movements associated with significant world

events. The first of these was the "US Election Special", associated with the

November 2016 United States presidential election; the second was the

"Inauguration Day Special", associated with the inauguration of the President

of the United States in January 2017; and the third was the "Brexit Special",

associated with the exit of the United Kingdom from the European Union in

May 2017.

3 Courtenay House provided prospective investors with a client information

booklet and an investor pack. While these did not specify how investor funds

were to be held in the companies' bank accounts, the investor pack included

the following statement (emphasis added):

Throughout the year we have little losses each month and then instead oftaking these from clients' accounts, we pool the losses and every 6 months ortwice a year in February and October we send out an email advising investorsthat the losses will be paid out of the trust account, to clear this amount andthen start with a clean slate.

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4 Once an investor decided to proceed, they were provided with an investor

application form, to be completed and returned. The investment did not

proceed until the form was returned and the funds were deposited.

5 The US Election Special was marketed by email to existing clients in about

September 2016. Befinreen 6 September and 31 October 2016, investors

deposited approximately $20.87 million into an account in the name of

Courtenay House with the National Australia Bank ("the US Election NAB

Account"). Of this, approximately $4.38 million was paid in returns to

investors, $12.6 million was later rolled over into another account in the name

of Courtenay House with the National Australia Bank numbered 6250 ("the

NAB-1 Account"), and other amounts were paid to various other bank

accounts, leaving a nil balance as at the appointment date.

6 The Inauguration Day Special was marketed in December 2016. Between

December 2016 and January 2017; investors deposited approximately $27.5

million into the NAB-1 Account. On 13 January 2017, $25 million was

transferred from the NAB-1 Account to the US Election NAB Account and paid

as returns to investors in the Inauguration Day Special, rolled over into

standard products, or paid into other bank accounts. This ~ left a balance of

$4,945 in the NAB-1 Account, which was ultimately withdrawn on 16 March

2017.

7 In about March 2017, Courtenay House emailed material. promoting the Brexit

Special to its clients. It was a condition that capital invested in the Brexit

Special be new, and not drawn — or "rolled-over" —from funds already

invested in standard products. The application form -entitled "Trading

Agreement: Extreme 3 New Account Form..— Brexit" - included the following

(emphasis added):

Courtenay House Pty Ltd has an agreement in place with <client name>whereby he/she has deposited an amount of <contract amount> into ourtrading account held in trust. The parties agree to invest capital on live tradingin the Forex &Futures markets, with CHCTG placing and managing trades onbehalf of the investor.

C:

The agreement will commence on the 1St of May 2017 when the depositedmonies have been cleared in full and all documents have been returned.

Please note that this is a One Month Only Trading Agreement and the initialcapital plus returns will be returned to the clients approx 15-06-2017.

Our Conditions:

A) You agree to all Courtenay House Capital Trading terms and conditionspreviously signed with your existing account and are aware that this is aonce off agreement whereby you invest an additional new amount ofcapital. No Account shuffles are available. Your full amount plus any profitwill be returned to your account by approx 15-06-2017.

Extreme 3 Trading Agreement (Mav Product) — BREXIT

G) It is very important to understand the following trading strategy. Please letme know if you do not. This is how we trade every $100,000 of yourcapital.

I) Extreme 3 is traded on Live news and we need to use a different softwarepackage and platform to gain returns. This also means we do not mix upfunds with your other account. If a client has multiple accounts they aretreated separately.

8 The form identified the NAB-1 account as the account into which deposits

were to be made.

9 Between 15 March and 26 April 2017, clients invested approximately $28.95

million in the "Brexit Special", all of which was deposited into the NAB-1

Account ("the Brexit Funds"). The Liquidators have been able to trace the

entirety of the Brexit Funds to the investors who deposited them, with the

exception only of $15,000 which was deposited in cash. The Brexit Funds

remained in the NAB-1 Account on the appointment date, and have since

been transferred by the Liquidators to a term deposit in their name.

10 It appears that, despite what was represented to clients, Courtenay House

undertook very little foreign exchange trading and generated minimal returns

from it; in fact, they operated a Ponzi scheme, using capital deposited by

more recent investors to repay earlier investors. Neither the US Election

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Special nor the Inauguration Day Special funds were ever traded. After

returns were paid to investors (22.87% on the US Election Special, and 13%

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on the Inauguration Day Special) most investors would roll-over the invested

funds into standard products.

On 21 April 2017, at 3.11 pm, following an investigation, ASIC obtained

freezing orders over Courtenay House's bank accounts; the orders were

served shortly after 4.00pm the same day. A number of deposits were made

by investors to the NAB-1 Account on 21 April, both before and after the

making and service of the freezing orders.

As at the appointment date, the Companies appear to have held six bank

accounts:

(1) The "Westpac 1" account, used to pay returns and to return capital to

investors, fund some limited trading services, and pay individuals and

expenses. It had a nil balance.

(2) The "Westpac 2" account, used to receive capital deposits from

investors for standard products, which had a balance of $21.02 million.

(3) The "Westpac 3" account, which had been used for an international

telegraphic transfer of $134,800, and had a nil balance.

(4) The "US Election NAB Account", which had been used to receive

investor funds for the US Election Special, and had a nil balance.

(5) The "NAB-1 Account", which had originally been used to receive

investor funds for the Inauguration Day Special, and subsequently for

the Brexit Special, which had a balance of approximately $29 million.

(6) The "Business Cash Maximiser" NAB Account, which was used as a

conduit for certain transfers of funds between other accounts, and had

virtually a nil balance.

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13 The total investor funds which the liquidators have been able to identify, and

the claims on them, are approximately summarised in the following table:

Funds ($) Claims ($) Surplus/Deficiency~$)

Non-Brexit 28,999,978 -29,150,000 -150,022

Brexit 22,318,367 -164,036,000 -141,717,633

Other 690 -0 690

Total 51,319,035 -193,186,000 -141,866,965

14 Thus, if the Brexit funds are treated as exclusively the beneficial property of

the Brexit investors, they will receive a return of 100 cents in the dollar, or

close to it (subject, perhaps, to the impact of liquidation costs and expenses),

while the non-Brexit investors would receive a dividend in the order of 13

cents in the dollar; whereas, if all funds are "pooled", all investors would

receive a dividend in the order of 26 cents in the dollar.

15 By originating process filed on 5 September 2017, the Liquidators applied

pursuant to (CTH) Corporations Act 2001, Sch 2, s 90-15, and ss 579E, 579G

and 601 EE, (NSW) Trustee Act 1925, s 63, (NSW) Uniform Civil Procedure

Rules 2005, r 28.2, and (NSW) Supreme Court (Corporations) Rules 1999, r

2.13(5), for advice and directions as to the manner in which they should

distribute the funds in those accounts, for the winding up of the unregistered

managed investment scheme under Corporations Act, s 601 EE, and for the

joinder of representative defendants to represent various classes of

defendants. On their interlocutory process filed on 4 December 2017, an order

was made that the following questions be determined separately and before

the other issues in the proceedings:

These figures are taken from the Liquidators' report at [337] and [409]. There is a small discrepancybetween the Liquidators' advice that all the Brexit funds are accounted for, and the apparentdeficiency according to these figures of $150,000; however the point of the table is to indicate theimpact of pooling, and the slight discrepancy does not materially affect this.

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(a) whether the Pre-21 April 2017 Brexit Investors are the beneficial owners ofthe. funds deposited by the Pre-21 April 2017 Brexit Investors into the NAB-1Account;

(b) if the Court determines question (a) in the affirmative:

(i) whether the Liquidators are justified in distributing the fundsdeposited by the Pre-21 April 2017 Brexit Investors to the Pre-21 April2017 Investors only and not to other creditors of the Companies; or

(ii) alternatively, whether the Liquidators should set off any fundsreceived by the Pre-21 April 2017 Brexit Investors from theCompanies prior to the Liquidations, against distributions to be madearising from the determination of question (a) above.

(c) whether the Post-21 April 2017 Brexit Investors are the beneficial ownersof the funds deposited by the Post-21 April 2017 Brexit Investors into theNAB-1 Account;

(b) if the Court determines question (c) in the affirmative:

(i) whether the Liquidators are justified in distributing the fundsdeposited by the Post-21 April 2017 Brexit Investors to the post 21April 2017 Investors only and not to other creditors of the Companies;or

(ii) alternatively, whether the liquidators should set off any fundsreceived by the Post 21 April 2017 Brexit Investors from theCompanies prior to the Liquidations, against distributions to be madearising from the determination of question (d) above.

16 Although in their report the Liquidators, for whom Ms Whittaker and Ms

Hulmes appeared, expressed some_ opinions as to what they consider fair or

equitable, on the hearing they adopted a neutral position, leaving the

representative defendants to advance the interests of the respective classes.2

The first defendant J.P. Melocco Pty Ltd, for whom Mr Izzo appeared,

represents the class of investors who invested in the Brexit Special whose

investment funds were deposited into the NAB-1 Account on or before 21

April 2017, the date on which the freezing orders were made ("the Pre-21

April 2017 Brexit Investors"). The second defendant Alamaidan Investments

Pty Ltd (as trustee for the Del Vecchio Family Trust), for whom Mr Newlinds

SC and Mr Strickland appeared, represents the class of investors who

invested in the Brexit Special whose investment funds were deposited into the

2 Cf Sons of Gwalia Ltd (subject to deed of company arrangement) v Margaretic [2006] FCAFC 92;(2006) 232 ALR 119 at 121 [6j (Finkelstein J); Re MF Global Australia Ltd (in Liq) [2012] NSWSC 994at [2]; (2012) 267 FLR 27 (Black J).

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NAB-1 Account after 21 April 2017 ("the Post-21 April 2017 Brexit Investors").

The third defendant Lifesmart Trading Pty Ltd, for whom Mr Pike SC

appeared, represents other investors —that is, the class who invested in

products other than the Brexit Special. In separate proceedings, Lord Kyle

Lester Sheridan has at various times sought orders for the return to him of

funds invested with the Companies.3 He is a non-Brexit investor as to $2.8

million, and apost-21 April Brexit investor as to $7.8 million. In the light of the

quantum of his interest, and the pendency of his separate proceedings, he

was granted leave pursuant to Corporations Rules, r 2.13(1), to be heard as a

creditor, without being joined as a party.

17 The Brexit Investors advanced three bases on which the Brexit funds were

said to be held on trust for them. The first was an express trust, arising from

the language of the documentation. The second was a resulting "Quistclose"

trust, arising from the failure of the purpose for which the funds were

advanced to the companies. The third was a constructive Black v Freedman4

trust, arising from what was said to be the fraudulent Ponzi scheme.5

Express trust

18 The non-Brexit Investors argued that there was insufficient certainty of

intention to create a trust, there being various textual and contextual reasons,

some blowing in different directions.s

19 In this context, references to "intention" are to be understood, in the same way

as in the law of contract, as references to the intention imputed to the parties

3 See In the mafter of Courtenay House Trading Group Pty Ltd [2017] NSWSC 1792; In the matter ofCourtenay House Trading Group Pty Ltd [2017] NSWSC 1834; In the matter of Courtenay HouseTrading Group Pty Ltd & Courtenay House Pty Ltd [2018] NSWSC 55.4 Black v S Freedman & Co [1910] HCA 58; (1910) 12 CLR 105; 17 ALR 5415 The same arguments were advanced by the Pre-21 April Brexit Investors and the Post-21 AprilBrexit Investors. There is no material difference in their position, although the Post-21 April Investorsargued that their position was somewhat stronger, especially on the Quistclose trust argument, giventhat the freezing order made on 21 April rendered the implementation of the purpose of theinvestment impossible.6 Cf Korda v Australian Executor Trustee (SA) Limited [2015] HCA 6; (2015) 255 CLR 62 at [5], [49];317 ALR 225; 145 ALD 495; 89 AJLR 340 (French CJ).

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by the objective manifestations of the words they use in their context.' Where

the indicia are finely balanced, the necessary certainty of intention will not

likely be found.$ This is particularly so in a "commercial" context, where the

imposition of trust relationships may defeat the interests and expectations of

creditors, as explained by Keane J in Korda v Australian Executor Trustee

(SA) Limited (citations omitted):9

[204] In Kauter v Hilton [(1953) 90 CLR 86 at 97; [1953] HCA 95. See alsoAssociated Alloys at [29]], Dixon CJ, Williams and Fullagar JJ referred to:

... the established rule that in order to constitute a trust the intention todo so must be clear and that it must also be clear what property issubject to the trust and reasonably certain.who are the beneficiaries.

[205] The need for clarity as to the intention to create a trust and its subjectmatter is of particular importance in a commercial context where acceptanceof an assertion that assets are held in trust is apt to defeat the interests ofcreditors of the putative trustee. The traditional inclination of the courts is toprotect creditors against the use of a straw company as a trading trustee [ReExhall Coal Co Ltd (1866) 35 Beav 449; 55 ER 970; Octavo InvestmentsPty Ltd v Knight (1979) 144 CLR 360 at 367 and 372; 27 ALR 129 at 134and 139; [1979] HCA 61 (Octavo)].

[206] AET placed considerable reliance upon the following observations ofBell, Gageler and Keane JJ in Legal Services Board vGillespie-Jones [(2013)249 CLR 493; 300 ALR 430; [2013] HCA 35 (at [113]):

"[U]nless there is something in the circumstances of the case toindicate otherwise, a person who has ̀ the custody and administrationof property on behalf of others' or who ̀has received, as and for thebeneficial property of another, something which he is to hold, apply oraccount for specifically for his benefit' is a trustee in the ordinarysense" [Registrar of the Accident Compensation Tribunal v FederalCommissioner of Taxation (1993) 178 CLR 145 at 165-6; 117 ALR 27at 39; [1993] HCA 1 (Registrar of the Accident CompensationTribunan, quoting Taylor v Davies [1920] AC 636 at 651 and Cohen vCohen (1929) 42 CLR 91 at 100; [1929] ALR 204 at 207-8; (1929]HCA 15. See also Mann v Hulme (1961) 106 CLR 136 at 141; [1962]ALR 75 at 77-8; [1961] HCA 45] (footnotes omitted). A legalpractitioner who receives money from a client to be held for and onbehalf of the client or another person archetypally answers thatdescription.

Byrnes v Kendle [2011] HCA 26 at [13]-[18], [46]-[66], [98]-[118]; (2011) 243 CLR 253; (2011) 279ALR 212; 85 ALJR 798.a Korda v Australian Executor Trustee (SA) Limited [2015] HCA 6; (2015) 255 CLR 62 at 72 [10]; 317ALR 225; 145 ALD 495; 89 AJLR 340 (French CJ).9 Korda v Australian Executor Trustee (SA) Limited [2015] HCA 6; (2015) 255 CLR 62 at 123-124[204]-[208]; 317 ALR 225; 145 ALD 495; 89 AJLR 340 (Keane J).

12

[207] This passage identifies the nature of the inquiry which must occur inorder to determine whether a person is a trustee; it does not suggest anaffirmative answer to the critical questions in this case, namely whether theForest Company or the Milling Company had "the custody and administrationof property on behalf of the covenantholders, or had "received, as and for thebeneficial property of [the covenantholders], something which [they were] tohold, apply or account for specifically for [their] benefit". Indeed, the contrastbetween the receipt of moneys by a legal practitioner to be held specificallyfor the benefit of a client or a third party and the receipt of investment fundsby the Forest Company tells against an affirmative answer.

[208] The language of the relevant documents is not to be strained todiscover an intention to create a trust of the broad scope for which AETcontends. In Byrnes [Byrnes at [49]], Gummow and Hayne JJ noted theapproval by Mason CJ and Dawson J in Bahr v Nicolay (No 2) [(1988) 164CLR 604 at 618; 78 ALR 1 at 9; [1988] HCA 16] of the proposition statedearlier by Du Parcq LJ [Re Schebsman [1944] Ch 83 at 104; [1943] 2 All ER768 at 779 (Re Schebsman)] that:

... unless an intention to create a trust is clearly to be collected fromthe language used and the circumstances of the case, I think that thecourt ought not to be astute to discover indications of such anintention.

20 However, it is important to observe that this restraint in finding that a trust was

intended applies "unless an intention to create a trust is clearly to be collected

from the language used and the circumstances of the case".10 As Gummow

and Hayne JJ pointed out in Byrnes v Kendle, use of such words as "upon

trust" will manifest such an intention:"

[49] In Bahr v Nicolay (No 2) [(1988) 164 CLR 604 at 618; 78 ALR 1 at 9;[1988] HCA 16] Mason CJ and Dawson J approved of the expression of the"traditional attitude" by du Parcq LJ [Re Schebsman; Ex pane OfficialReceiver v Cargo Superintendents (London) Ltd [1944] Ch 83 at 104; [1943] 2All ER 768 at 779] that "unless an intention to create a trust is clearly to becollected from the language used and the circumstances of the case, I thinkthat the court ought not to be astute to discover indications of such anintention". In the present case there was no degree of informality, the trustbeing manifested and proved by deed using the technical term "upon trust".Accordingly, to adopt what was said in Associated Alloys Pty Ltd v ACN 001452 106 Pty Ltd (In liq) (at [34] )[ (2000) 202 CLR 588; 171 ALR 568; [2000]HCA 25 at [34]]:

This is not one of those cases where the language employed by theparties for the transaction is inexplicit so that the court is left to inferthe relevant intention from other language used by them, from thenature of the transaction and from the circumstances attending therelationship between the parties. [Footnote omitted.]

10 Re Schebsman [1944] Ch 83 at 104; 2 All ER 768 (Du Parcq LJ).~ ~ (2011) 243 CLR 253; (2011) 279 ALR 212; [2011 ] HCA 26 at [49].

13

21 Likewise, Heydon and Crennan JJ:12

[117] ... Did the 1997 acknowledgment of trust create a trust? The openinglanguage twice described it as a trust. Clause 1, a key operative provision,used the language of trust. These indications, not countered by any otheraspect of the document, are more than sufficient to support the conclusionthat it was a trust.

22 To similar effect, French CJ said:13

[18] ... In the Full Court, Doyle CJ said (at (28]):

... The terms of the Acknowledgement are clear. So are the terms ofthe earlier Acknowledgement. Mr Kendle might not have fullyunderstood what he was doing, but that is neither here nor there.

His Honour was correct in so holding. Mr Kendle's challenge to the findingthat he had created a trust cannot succeed.

23 In the present case, the formal document by which the parties agreed to the

terms of the investment described it as being held in trust. Other aspects of

the document were less explicit, but favour the same view:

(1) Courtenay House were to place and manage trades on behalf of the

investor,

(2) it was said that the initial capital plus returns will be returned to the

clients, and that your full amount plus any profit will be returned to your

account;

(3) the investment was described as your capital; and

(4) it was explained that we do not mix up funds with your other account,

and that if a client has multiple accounts they are treated separately.

12 Byrnes v Kendle [2011 ] HCA 26 at [117]; (2011) 243 CLR 253; (2011) 279 ALR 212; 85 ALJR 798.13 Byrnes v Kendle [2011 ] HCA 26 at [18]; (2011) 243 CLR 253; (2011) 279 ALR 212; 85 ALJR 798.

14

24 Absent the express reference to "in trust" there may arguably have been

insufficient certainty, but the presence of those unambiguous and explicit

words is decisive.

25 The possibility that there were also oral communications befinreen investors

and the companies does not detract from the force of the documentation.

First, there is no evidence of any particular communication inconsistent with

an intention that the funds invested be held on trust for the client. Secondly,

the terms of an express trust are decisive, in the absence of any fraud, undue

influence or duress; what needs to be ascertained is the intention as revealed

by the words used by the parties, and further inquiry into the subjective or real

intention of the settlor is unnecessary.14

26 Nor is the reference to a "trading account", or the notion that funds deposited

would be pooled with those of other investors to "live trade", inconsistent with

an intention to create a trust. Receipt of funds from multiple beneficiaries into

a single account is not inconsistent with a trust; the paradigm case is a

solicitor's trust account. Segregation of funds, while an indicium of a trust, is

not essential, and a trustee is not always obliged to keep the trust funds

separate.15 An agreement that money be paid into a general account does not

defeat a trust that would otherwise exist.'s Particularly in the context of

managed investment schemes, the idea of trust money being "pooled" for the

purposes of trading, and even being used to meet certain obligations of the

trustee, even in connection with other clients, is established." Moreover, a

14 Byrnes v Kendle [2011 ] HCA 26 at [17]-[18] (French CJ), [94], [102], [104]-[105], [113]—[116]~Heydon and Crennan JJ); (2011) 243 CLR 253; (2011) 279 ALR 212; 85 ALJR 798.5 Freelance Global Ltd (in Liq) v Bensted [2016] VSC 181 at [32] (Riordan J); Associated Alloys PtyLtd v ACN 001 452 106 Pty Ltd [2000] HCA 25; (2000) 202 CLR 588 at 605-6 [34] (Gaudron,McHugh, Gummow and Hayne JJ); Stephens Travel Service International Pty Ltd (Receivers andManagers Appointed) v Qantas Airways Ltd (1988) 13 NSWLR 331 at 349 (Hope JA); Re Kayford Ltd(in Liquidation) [1975] 1 All ER 604 [1975] 1 WLR 279 at 282 (Megarry J); Grocers of Wyong Pty Ltd vRetech Global Pty Ltd [2004] NSWSC 488 at [27] (Campbell J).'s Stephens Travel Service International Pty Ltd (Receivers and Managers Appointed) v QantasAirways Ltd (1988) 13 NSWLR 331 at 344-9 (Hope JA)." (CTH) Corporations Act 2001, s 981 D; Australian Securities and Investments Commission v IdylicSolutions Ltd [2009] NSWSC 1306; (2009) 76 ACSR 129 at 136 [45]-[46] (Barrett J); and see In thematter of BBY Limited (Receivers and Managers appointed) (in liquidation) [2016] NSWSC 1366 at[91 ]-[93]; In the matter of BBY Ltd (No 2) [2018] NSWSC 346 at [23]-[25].

15

trust may be recognised over the funds when first received, and over any

returns from trading in them.$

27 In my judgment, funds deposited by Brexit Investors were plainly to be held on

trust by Courtenay House for the relevant Brexit Investor, who remained

beneficially entitled to the funds.

Quistclose trust

28 Where funds are transferred from one party to another with the intention that

they not become part of the general assets of the transferee and are to be

used by the transferee for a specific purpose, then -absent contrary

stipulation - it is implied that if the purpose cannot be effectuated, the money

is held upon trust for the transferor.19 This involves the application of

established trust principles to particular facts.20

29 In the present case, it is abundantly clear that the funds were not intended to

become part of the general assets of Courtenay House, but were to be used

by the companies to trade on behalf of investors. They were never used for

that purpose, and the freezing orders made it impossible that they be so used.

This provides an alternative basis for the conclusion that they are held on trust

for the Brexit Investors.

Black v Freedman trust

30 Where money has been stolen, or obtained by fraud, it is held on trust by the

recipient.21 Here, contrary to what was represented to investors, funds were

procured by the companies, not for the .purpose of undertaking foreign

'$Associated Alloys Pty Ltd v ACN 001452 106 Pty Ltd [2000] HCA 25; (2000) 202 CLR 588 at 605-6~34] (Gaudron, McHugh, Gummow and Hayne JJ).9 Barclays Bank Ltd v Quistclose Investments Ltd [1970] AC 567; [1968] 3 All ER 651; [1968] 3 WLR1097; Australasian Conference Association Ltd v Mainline Constructions Pty Ltd [1978] HCA 45;(1978) 141 CLR 335 at 353; 22 ALR 1; 53 ALJR 66 (Gibbs ACJ); Compass Resources Ltd v Sherman2010] WASC 41; (2010) 42 WAR 1 at 9-12 [57j-[78] (Beech J).° Re Australian Elizabethan Theatre Trust Ltd [1991 ] FCA 344; (1991) 30 FCR 491 at 503-4; 102ALR 681; 5 ASCR 587 (Gummow J); Legal Services Board vGillespie-Jones [2013] HCA 35; (2013)249 CLR 493 at 523 [112j; 300 ALR 430; 87 ALJR 985 (Bell, Gageler and Keane JJ).Z' Black v S Freedman & Co [1910] HCA 58; (1910) 12 CLR 105; 17 ALR 541; Orix AustraliaCorporation Ltd v Moody Kiddell and Partners P/L [2005] NSWSC 1209 at [155] (White J); MBFAustralia Limited v Malouf [2008] NSWCA 214 at [31 ]-[32] (Hodgson JA).

exchange trading, but to return capital and return on investment to earlier

investors, in the course of a Ponzi scheme. While the non-Brexit investors

submitted that whether a trust arose must depend on the facts of each

individual case, and that - as the Brexit Investors were all existing clients with

an established relationship with the companies -there may well be more to

the relationship, in my view it is inconceivable that any would have invested

had they understood that their funds were to be used not for foreign exchange

trading, but to pay out earlier investors, and that repayment to them would be

dependent upon the survival of the scheme. Accordingly, this is a further

alternative basis for concluding that the funds invested with Courtenay House

were held on trust for the investors.

Pooling and set-off

31 The non-Brexit investors submitted that if the Court were to conclude that the

funds invested by the Brexit Investors were held on trust for those investors,

then the funds invested by non-Brexit Investors were also held on trust, and

that the funds should be "pooled", or at least returns derived by Brexit

Investors from their investments in non-Brexit products should be set off

against their entitlement to recover their Brexit investments.

32 The first limb of this proposition is in my judgment correct. The documentation

for the other special products was relevantly indistinguishable from that used

for the Brexit Special, and the documentation for standard products in more

recent times was to similar effect. Although it is conceivable that Courtenay

House still held some funds which had been invested under the earlier

documentation which did not contain the explicit reference to being "held in

trust", it is likely that the overwhelming proportion of the funds held as at the

appointment date had been subscribed under documentation which did

contain those words. Accordingly, I accept that Courtenay House held the

funds subscribed by non-Brexit investors on trust for the clients who invested

them.

17

33 Mr Pike SC submitted that a direction should be made (under Corporations

Act, s 601 EE(2)) for pooling, in order to avoid a situation in which one trust

(the Brexit Investments) benefits at the expense of another (the non-Brexit

Investments). This submission was founded on a passage in BBY No 2,22

which —when the context is examined —was directed to a situation in which

trust funds had been mixed. In BBY No 2, I endeavoured to explain that

pooling was a pragmatic remedy which a liquidator might be directed to adopt

where the identification and tracing of the interests of individual clients is not

in the circumstances of the particular case reasonably and economically

practical, on the basis that it is reasonable in the circumstances that the funds

be regarded as irreversibly deficient and mixed. The theoretical basis for

pooling is the principle that all contributors to a deficient mixed fund hold an

equitable charge over the entire fund and its traceable proceeds to the value

of their contributions, subject to any dealings and costs, or are equitable

tenants in common of the mixed fund as a whole, including its traceable

proceeds, subject to such deductions, so that each contributor has an

"entitlement" in each fund, although the pragmatic nature of the jurisdiction to

give advice and directions to a liquidator means that neither strict proof of

mixing such as would entitle a beneficiary to an equitable proprietary remedy,

nor absolute impossibility of tracing, is required. However, because the effect

of pooling two or more accounts is to treat each client's entitlement to one as

identical to its entitlement to the other(s), and so to treat each client as having

a rateably equal interest in each fund, it will be warranted only when the funds

have become so intertwined that each client's entitlement to one account may

reasonably be regarded as identical to its entitlement to the other(s), and this

will be so when it is reasonable in all the circumstances to regard each as

having a rateably equal interest in the mixed fund.23

34 Generally, the Court's power (under Corporations Act, s 601 EE(2)), to make

any orders it considers appropriate for the winding up of an unregistered

managed investment scheme does not authorise a distribution of surplus

ZZ In the matter of. BBY Limited (Receivers and Managers appointed) (in liquidation) (No 2) [2018]NSWSC 346 at [52].23 In the matter of BBY Limited (Receivers and Managers appointed) (in liquidation) (No 2) [2018]NSWSC 346 at [38]-[83].

l

assets other than to those entitled to the assets in proportion to their

entitlements,24 although that general principle yields in cases where it is not

pragmatic to ascertain the proprietary rights.25 As Black J observed in MF

Global, "the case law has recognised that, where there are relatively clear

property interests in particular property, this cannot "be altered by reference to

some notion of common misfortune",26 and that "accounts should only be

pooled ... if mixing or another proper basis for pooling is established".27

35 This is not a case in which it is not pragmatic to ascertain entitlements to the

Brexit funds: the Liquidators have (with the insignificant exception already

mentioned) traced every contribution to the Brexit funds. Whether it is

possible to trace the deposits of the ,non-Brexit investors remains under

inquiry but appears improbable, not only due to the number of transactions,

but also because the fund is manifestly deficient. But it has been possible to

trace the deposits of each Brexit Investor, and to establish that the trust

property is still in existence, in the NAB-1 account, and that there is no

deficiency.

36 There has been no mixing of the Brexit funds with other funds, and the fund is

sufficient to meet the claims of all those who contributed to it. Just because

all the deposits from all investors were received on trust for the relevant

depositor does not mean that somehow there was a single trust fund; to the

contrary, the capital deposited by each investor was held on trust for that

investor. The money deposited by the Brexit Investors remained a separate

extant fund, which was always segregated from other non-Brexit funds, was

not mixed, and was not deficient. There has been no mixture into them of

Z4 Australian Securities and Investments Commission (ASIC) v Letten (No 7) [2010] FCA 1231; (2010)190 FCR 59; (2010) 80 ACSR 401; [2010] FCA 1231 at [268] (Gordon J).25 Australian Securities and Investments Commission (ASIC) v Letten (No 7) [2010] FCA 1231; (2010)190 FCR 59; (2010) 80 ACSR 401; [2010] FCA 1231 at [259], [332] (Gordon J).Zs In the matter of MF Global Australia Ltd (in liq) [2012] NSWSC 994 at [78]; (2012) 267 FLR 27;citing Russell-Cooke Trust Co v Prentis [2002] EWHC 2227; [2003] 2 All ER 478 at [44]; AustralianSecurities Commission v Buckley (1996) 7 BPR 15,024; Re Magarey Farlam Lawyers Trust Accounts(No 3) [2007] SASC 9; (2007) 96 SASR 337 at [123], [145]; S B Thomas, "Clayton's Case and the'Common Pool' Exception (2004) 15 JBFLP 177 at 183.27 In the matter of MF Global Australia Ltd (in liq) [2012] NSWSC 994 at [78]; (2012) 267 FLR 27;(Black J).

19

non-Brexit funds which might give non-Brexit investors a claim on the Brexit

funds.

37 The non-Brexit Investors submitted that but for the freezing orders made on

21 April 2017, the Brexit money would have been used to repay other

investments. There are two answers to that proposition: the first is that they

were not so used; and the second is that, had they been so used, that would

have represented a mixture of the Brexit funds into the other funds, giving the

Brexit investors a claim to trace into the other funds, and if (as appears to be

the case) the other funds were deficient, to a charge over the other funds to

the extent of the contributions made to them by the Brexit funds. On no basis

would it give non-Brexit Investors a claim to the Brexit funds.

38 Where there is no difficulty in identifying the beneficial entitlements to the

Brexit funds, no deficiency in them, and they have not been mixed with any

other money, there is no warrant for pooling, which would amount to no more

than disregarding clear property interests in particular property on account of

some notion of common misfortune.

39 The "set-off' argument, which was also mentioned in the Liquidators' report,

says that it would be unfair for Brexit Investors to receive back their Brexit

Investment and also to retain such return as they may already have received

in respect of any other investment. It was argued that this would somehow

confer an unfair windfall on the Brexit Investors.

40 An endeavour was made to illustrate this by reference to the amount which a

selected Brexit investor had already received by way of return from

investment in non-Brexit products, as well the amount which would be

received from a 100c in the dollar return from the Brexit investment.

However, I did not find this persuasive. It might have been otherwise if Brexit

funds had been used to repay earlier investments, but they were not.

Moreover, a beneficiary's entitlement to recover its property from one fund is

not affected by what the same beneficiary has received from another fund.

20

Insofar as the argument is analogous to the rule in Cherry v Boultbee,28 that

rule concerns set-off of claims and liabilities in respect of a single fund. And

while, in the context of a deficient mixed fund, it may be appropriate that

returns received by some beneficial owners be taken into account in order to

do equity in distribution of what remains in the fund,29 the Brexit Investment

fund is, as has been explained above, neither deficient, nor mixed with non-

Brexit funds.

41 There is no proper basis for setting off returns derived by Brexit Investors from

their investments in non-Brexit products against their entitlement to recover

their Brexit investments.

Conclusion and orders

42 For the foregoing reasons, I have concluded that:

(1) the Pre-21 April 2017 Brexit Investors are the beneficial owners of the

funds deposited by them into the NAB-1 Account, and the liquidators

are justified in distributing the funds deposited by the Pre-21 April 2017

Brexit Investors to them only, and not to other creditors of the

Companies; and

(2) the Post-21 April 2017 Brexit Investors are the beneficial owners of the

funds deposited by them into the NAB-1 Account, and the liquidators

are justified in distributing the funds deposited by the Post 21 April

2017 Brexit Investors to them only, and not to other creditors of the

Companies.

43 The Court orders that the preliminary questions be answered as follows:

28 [1839] EngR 1099; 41 ER 17129 Australian Securities and Invesment Commision v Idylic Solutions Ltd [2009] NSWSC 1306; (2009)76 ACSR 129 at [77].

21

(a) whether the Pre-21 April 2017 Brexit Investors are the beneficial

owners of the funds deposited by the Pre-21 April 2017 Brexit Investors

into the NAB-1 Account.

Answer.' Yes

(b) if the Court determines question (1)(a) in the affirmative:

(i) whether the liquidators are justified in distributing the funds

deposited by the Pre-21 April 2017 investors to the Pre-21 April

2017 Investors only and not to other creditors of the Companies;

•Ti

Answer.• Yes

(ii) alternatively, whether the liquidators should set off any funds

received by the Pre-21 April 2017 Investors from the Companies

prior to the liquidations against distributions made arising from

the determination of question 1(a) above.

Answer.• Does not arise.

(c) whether the Post-21 April 2017 Brexit Investors are the beneficial

owners of the funds deposited by the Post-21 April 2017 Brexit

Investors into the NAB-1 Account.

Answer.• Yes

(b) if the Court determines question (1)(c) in the affirmative:

(i) whether the liquidators are justified in distributing the funds

deposited by the Post-21 April 2017 investors to the Post-21

April 2017 Investors only and not to other creditors of the

Companies; or

22

Answer.• Yes

( ii) alternatively, whether the liquidators should set off any funds

received by the Post -21 April 2017 Investors from the

Companies prior to the liquidations against distributions made

arising from the determination of question 1(d) above.

Answer.• Does not arise.

23

Appendix B

Courtenay House Capital Trading Group Pty Ltd (in liquidation)

Courtenay House Pty Ltd (in liquidation)

Collectively "the Companies")

Proposed Examinee Indicative DateLuke Laria (Trader) Monday, 16 April 2018 (11:00am)

Steven Ly (Trader) Monday, 16 April 2018 (2:00pm)

Darrin Stewart (Trader) Monday, 16 April 2018 (3:00pm)

Justin Ajaka (Promoter) Tuesday, 17 April 2018 (11:00am)

Susana Lukic (EA) Tuesday, 17 April 2018 (2:00pm)

Charlie Tripodis (Trader) Wednesday, 18 April 2018 (11:00am)

Anshul Gupta (Finance Manager) Wednesday, 18 April 2018 (2:00pm)

David Sipina Week commencing 7 May 2018. Day TBC

Tony Iervasi Week commencing 7 May 2018. Day TBC

Athan Papoulias Week commencing 7 May 2018. Day TBCOther (TBC) Week commencing 7 May 2018. Day TBC