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\qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid14757649 \fs20\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\b\fs24\lang2057\langfe1033\langnp2057\insrsid14757649\charrsid6709970 COURT OF APPEAL OF COOK ISLANDS
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid14757649\charrsid6709970 HELD AT RAROTONGA
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid14757649\charrsid6709970 (CIVIL DIVISION)
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid1323928 {\fs24\lang2057\langfe1033\langnp2057\insrsid1323928\charrsid6709970 
\par }\pard \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid1323928 {\fs24\lang2057\langfe1033\langnp2057\insrsid1323928\charrsid6709970 1 OFLR 003
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid1323928 {\fs24\lang2057\langfe1033\langnp2057\insrsid1323928\charrsid6709970 
\par }\pard \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid14757649 {\b\fs24\lang2057\langfe1033\langnp2057\insrsid1323928\charrsid6709970 515 SOUTH ORANGE GROVE OWNERS ASSOCIATION & OTHERS}{
\b\fs24\lang2057\langfe1033\langnp2057\insrsid14757649\charrsid6709970 
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid14757649 {\fs24\lang2057\langfe1033\langnp2057\insrsid14757649\charrsid6709970 
\par }\pard \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid14757649 {\fs24\lang2057\langfe1033\langnp2057\insrsid7937222 v}{\fs24\lang2057\langfe1033\langnp2057\insrsid14757649\charrsid6709970 
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid14757649 {\fs24\lang2057\langfe1033\langnp2057\insrsid14757649\charrsid6709970 
\par }\pard \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid14757649 {\b\fs24\lang2057\langfe1033\langnp2057\insrsid1323928\charrsid6709970 ORANGE GROVE PARTNERS & OTHERS}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 

\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid7351543 {\fs24\lang2057\langfe1033\langnp2057\insrsid7351543\charrsid6709970 
\par }\pard \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid7351543 {\b\fs24\lang2057\langfe1033\langnp2057\insrsid7351543\charrsid6709970 (South Orange Grove Case (No 2))
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid11160865 {\fs24\lang2057\langfe1033\langnp2057\insrsid11160865\charrsid6709970 
\par }\pard \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid3608021 {\fs24\lang2057\langfe1033\langnp2057\insrsid3608021\charrsid6709970 Plaint No. 31/96
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid13067009 {\fs24\lang2057\langfe1033\langnp2057\insrsid3608021\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 SIR DUNCAN MCMULLIN CJ, HILLYER J }{\fs24\lang2057\langfe1033\langnp2057\insrsid13067009\charrsid6709970 & MCHUGH J
\par 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 HEARING}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970  - 25/26 SEPTEMBER 1996
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 JUDGMENT}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970  - 2 DECEMBER 1996
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid12720612\charrsid6709970 
\par }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 Trust - asset protection trust - Cook Islands international trust }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid6950949\charrsid6709970 \endash }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970  time}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid6950949\charrsid6709970  }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 bar to action by}{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8661940\charrsid6709970  }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 creditors }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid6950949\charrsid6709970 \endash }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970  action}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid6950949\charrsid6709970  }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 
time barred if the trust established before the cause of action }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8661940\charrsid6709970 '}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 accrued or had arisen}{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8661940\charrsid6709970 ' }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid6950949\charrsid6709970 \endash }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970  time}{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid6950949\charrsid6709970  }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 
when cause of action arose different from the time when it accrued - trust not established before the cause of action had arisen }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid6950949\charrsid6709970 \endash }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970  action}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid6950949\charrsid6709970  }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 by creditors not time barred }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid6950949\charrsid6709970 \endash }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970  s}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid11811968 1}{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 3B(4) International Trusts Act 1984 (Cook Islands)
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid11932312\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 The defendants in this action were the same as the respondents in the first }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid808428 South Orange Grove}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218  }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 
 (Plaint No: 208/94 in which judgment was given by the Court of Appeal of the Cook Islands on 6 November 1995), save that the fifth respondent}{\fs24\lang2057\langfe1033\langnp2057\insrsid4981551\charrsid4936218  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid11811968 1}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218  in Plaint No: 208/94 was an international trust registered pursuant to the }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 International Trusts Act 1984}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218  and known as the }{
\fs24\lang2057\langfe1033\langnp2057\insrsid4981551\charrsid4936218 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 Victor trust}{\fs24\lang2057\langfe1033\langnp2057\insrsid4981551\charrsid4936218 '}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 . The fifth defendant in this case was an international trust known as the}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218  }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid4981551\charrsid4936218 '}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 Evangeline trust}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid4981551\charrsid4936218 '}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 . The first South Orange Grove }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid4981551\charrsid4936218 
 is referred to as the '}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid4981551\charrsid4936218 '}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218  and this action is referred to as the }{\fs24\lang2057\langfe1033\langnp2057\insrsid4981551\charrsid4936218 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 
Evangeline }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid4981551\charrsid4936218 '.}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid4981551\charrsid732815 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 1 The fifth respondent in that case was }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid2315331\charrsid4936218 '}{
\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 25/25}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid2315331\charrsid4936218  }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 
1993 Investment Trust - Victor J Illig}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid2315331\charrsid4936218 '}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid2315331\charrsid4936218 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 Both the Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 
 and this action arose out of a judgment awarded on 13 April 1994 by the Superior Court of California for the County of Los Angeles in favour of the 
plaintiffs for US$5,753,874. That judgment was issued against the first, second and third defendants. The action arose out of the faulty construction of apartments in}{\fs24\lang2057\langfe1033\langnp2057\insrsid8220389\charrsid4936218 
 a condominium project known as }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 515 South Orange}{\fs24\lang2057\langfe1033\langnp2057\insrsid8220389\charrsid4936218  Grove.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4936218 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8528017\charrsid4290089 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 
Subsequent to obtaining judgment in the Californian Court, the plaintiffs learned that the first, second and third defendants had transferred assets to the Victor Trust. The plaintiffs then commenced the Victor case in the High Court of the Cook Islands t
o enforce the judgment of the Californian Court. The Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089  was commenced on 22 of December 1994. On 24}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8528017\charrsid4290089  }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 
December 1994 an interim injunction was awarded, but this was set aside on 10 March 1995. The interim injunction was reinstated on 10 November 1995 in accordance with the judgment of the Court of Appeal of the Cook Islands.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid8528017\charrsid732815 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid6950949\charrsid4290089 In February 199}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 6, the plaintiffs learned for the first time that a second international trust had been established 
}{\fs24\lang2057\langfe1033\langnp2057\insrsid6950949\charrsid4290089 \endash }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089  the}{\fs24\lang2057\langfe1033\langnp2057\insrsid6950949\charrsid4290089  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 Evangeline Trust. The Evangeline Trust had been establishe
d on 21 December 1993, and funds had been transferred to that trust in December 1993 and February 1994. The plaintiffs commenced the present proceedings }{\fs24\lang2057\langfe1033\langnp2057\insrsid6950949\charrsid4290089 \endash }{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089  the Evangeline }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid11497410\charrsid4290089 \endash }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089  on}{\fs24\lang2057\langfe1033\langnp2057\insrsid11497410\charrsid4290089  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 12 March 1996. They obtained a mareva injunction and an order that the sixth
 defendant (Southpac Trust International Inc) disclose to the plaintiffs the Evangeline Deed of Trust together with the value of the assets of the trust and particulars of dispositions to and from the trust. The defendants applied to strike out the action
 and to discharge the mareva injunction on the grounds that the procee}{\fs24\lang2057\langfe1033\langnp2057\insrsid808428 dings were time-barred under s 1}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 3B of the }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 International Trusts Act 1984}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 .}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid11497410\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 In the }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 Victor}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 
 litigation, the issue was whether the plaint}{\fs24\lang2057\langfe1033\langnp2057\insrsid8403590\charrsid4290089 iffs had commenced their action w}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 
ithin two years of the cause of action accruing. The Court of Appeal of the Cook Islands}{\fs24\lang2057\langfe1033\langnp2057\insrsid8403590\charrsid4290089  }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 
had held that the cause of action accrued on the date when judgment was ordered by the Californian Court, that is 13 April 1994. The plaintiffs in the }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 Victor}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089  litigation had, therefore, commenced their action within two years of the cause of action accruing.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid8403590\charrsid4290089 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 In the current litigation, the defendants argued that the pl}{\fs24\lang2057\langfe1033\langnp2057\insrsid8403590\charrsid4290089 aintiffs were time-barred under s1}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 3B(4) of the }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 International Trusts Act 1984}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 
 which provided as follows:
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid8403590\charrsid4290089 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid11616598 {\fs24\lang2057\langfe1033\langnp2057\insrsid8403590\charrsid4290089 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 
(4) An international trust settled or established and a disposition of property to such trust shall not be fraudulent as against a creditor of a se}{\fs24\lang2057\langfe1033\langnp2057\insrsid8403590\charrsid4290089 ttlor}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089  if the settlement establishment or disposition of property took place before that creditor's cause of action against the settlor accrued or had a}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8403590\charrsid4290089 risen.'}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\langnp2057\insrsid8403590\charrsid4290089 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 The defendants argued that the establishment of the Evangeline trust and the dispositions to that trust all arose before the cause of action accrued or had arisen on 13 April 1994.

\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid10492089\charrsid4290089 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 The plaintiffs accepted that the cause of action had accrued on 13 April 1994. However, they argued that the use of the separate term }{
\fs24\lang2057\langfe1033\langnp2057\insrsid10492089\charrsid4290089 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 or had arisen}{\fs24\lang2057\langfe1033\langnp2057\insrsid10492089\charrsid4290089 '}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089  in s13B(4) referred to a different date.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid10492089\charrsid4290089 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 The proceedings were removed into the Court of Appeal of the Cook Islands.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid10492089\charrsid4290089 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 HELD}{\fs24\lang2057\langfe1033\langnp2057\insrsid4547085\charrsid4290089 : the use of the words '}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 had arisen}{
\fs24\lang2057\langfe1033\langnp2057\insrsid4547085\charrsid4290089 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid11616598  in s1}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 
3B(4) must have been intended to refer to a different date from that on which the cause of action }{\fs24\lang2057\langfe1033\langnp2057\insrsid4547085\charrsid4290089 'accrued'. The cause of action 'had arisen'}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089  when notice of the existence of the cause of action was given to the settlor o
f the international trust. The settlor of the Evangeline Trust was notified that a cause of action had arisen}{\fs24\lang2057\langfe1033\langnp2057\insrsid4547085\charrsid4290089  }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 on 2}
{\fs24\lang2057\langfe1033\langnp2057\insrsid4547085\charrsid4290089 5}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 
 October 1991. The establishment of the Evangeline trust and the dispositions of property to the Evangeline trust had, therefore, not taken place before the cause of action had aris}{\fs24\lang2057\langfe1033\langnp2057\insrsid4547085\charrsid4290089 
en. Accordingly, the plaintiffs'}{\fs24\lang2057\langfe1033\langnp2057\insrsid1067586\charrsid4290089  action was not time b}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4290089 arred.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid4547085\charrsid6709970 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 Cases referred to
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid4547085\charrsid11478249 
\par }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 CIR v Taylor [1961}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid4547085\charrsid11478249 ]}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid11616598  }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 1 NZLR 923
\par Electricity Corporation Ltd v Geotherm Energy Ltd [1992}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid4547085\charrsid11478249 ]}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249  2 NZLR 641}{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid4547085\charrsid11478249 
\par }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 General Steel Industries Inc v Commissioner for Railways (NS}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid4547085\charrsid11478249 W)}{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249  (1964) 112 CLR 128
\par Higgs (Inspector of Taxes) v Olivier [1952] 1 Ch 311}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid4547085\charrsid11478249 
\par T v H [1995] }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 3 NZLR 37
\par Takaro Properties Ltd v Rolling [1978] 2 NZLR 314
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid4547085\charrsid4290089 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 Parties}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 PLAINTIFFS:}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249  515 South Orange Grove Owners Association & others}{
\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 DEFENDANTS: }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249 1}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 .}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249  Orange Grove Partners, }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 2.}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249  Victor Illig, }
{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 3.}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249  Evangeline Illig. }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 4.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249  25/25 Holdings LL}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 C, }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 5.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249  25/25 1993 Investment}{\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249  }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 Trust }{
\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249 \endash }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249  Evangeline}{\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid8931456 M }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7937222 Ill}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 ig, }{
\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 6.}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249  Southpac Trust International Inc as trustee of the 25/25 1993 Investment Trust }{
\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249 \endash }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249  Evangeline}{\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 Illig }{\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249 \endash }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 
 & the 25/25 1993 Investment Trust }{\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249 \endash }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249  Victor}{
\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249  }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 J Illig, }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 7.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249  25/25 1993 Investment Trust }{\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249 \endash }{\fs24\lang2057\langfe1033\langnp2057\insrsid11478249\charrsid11478249  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 Victor}{\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249  J}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249  Illig
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 Counsel}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid15665235\charrsid4290089 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 PLAINTIFFS: }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 B H Giles QC}{\fs24\lang2057\langfe1033\langnp2057\insrsid15665235\charrsid11478249 
, Mrs W N Brandon
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 DEFENDANTS: }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11478249 M D O'Brien
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1539781\charrsid11478249 
\par }\pard \qr \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid1539781 {\i\fs24\lang2057\langfe1033\langnp2057\insrsid1539781\charrsid11478249 Cur adv vult}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid1539781\charrsid6709970 
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\langnp2057\insrsid1539781\charrsid6709970 
\par }\pard \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid11616598 {\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 Judgment}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\langnp2057\insrsid1539781\charrsid141348 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid1539781\charrsid141348 SIR DUNCAN McMU}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 LLIN:}{\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid141348  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 
this proceeding is closely related to that issued by the plaintiffs in the High Court of the Cook Islands under Plaint No. 208/94. The defendants in the present proceeding (Plaint 31/96) are, with one exception, the defendants in Plaint No 208/94. That ex
ception is the fifth defendant which in Plaint No 208/94 was }{\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid141348 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 25/25 1993 Investment Trust }{
\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid141348 \endash }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348  Victor}{\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid141348  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 J Illig}{\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid141348 ',}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 
 an international trust registered pursuant to the }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 International Trusts Act 1984}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 
. The fifth defendant in the present proceeding (Plaint No 31/96) is }{\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid141348 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 25/25 1993 Investment}{
\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid141348  }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 Trust }{\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid141348 \endash }{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348  Evangeline}{\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid141348  }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 M}{
\fs24\lang2057\langfe1033\langnp2057\insrsid11478249\charrsid141348  }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 Illig}{\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid141348 '}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 , a similarly registered trust. It will be convenient to re}{\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid141348 fer to Plaint No 208/94 as the '}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 case}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid141348 '}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348  and to this}{\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid141348  case, Plaint No 31/96, as the 'Evangeline case'}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid141348 .}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid3816956\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7229401 
Both cases have their genesis in the judgment of the Superior Court of California for the County of Los Angeles entered on 13 April 1994 following the return of a jury verdict earlier on the same day in favour of the plaintiffs against the defendants in t
he Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7229401 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7229401 
 for US$5,753,874 with interest thereon at the rate of ten per cent per annum from April 12, 1994. The plaintiffs had sued in that Court for damages for the faulty construction of some apartments in a condominium project, known as 515}{
\fs24\lang2057\langfe1033\langnp2057\insrsid89781\charrsid7229401  }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7229401 South Or
ange Grove in Los Angeles, which they had purchased between 30 November 1988 and 16 November 1989 and for breach of warranty arising in the same sale and purchase transaction.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid6233365\charrsid141348 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4278034 Following the entry of judgment in the Californian Court, the plaintiffs endeavoured to }{\fs24\lang2057\langfe1033\langnp2057\insrsid14445149\charrsid4278034 e}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4278034 
nforce their judgment only to find that the first, second and third defendants had divested themselves of the assets they had formerly owned in California. There is evidence that they did this quite deliberately for the purposes of defeati}{
\fs24\lang2057\langfe1033\langnp2057\insrsid14445149\charrsid4278034 ng the plaintiffs'}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4278034 
 claim. Some of the assets had been transferred to international trusts set up in the Cook Islands. The plaintiffs then sued in the High Court of the Cook Islands to recover the amount of their Californian judgment. They brought their pro
ceeding in the Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4278034 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4278034  pursuant to Section 13B of the }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4278034 International Trusts Act 1984}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4278034 
 enacted by the Cook Islands Parliament and they applied for a mareva injunction to restrain the first, fifth and sixth respondents in the Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4278034 case}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4278034  from removing the 
administration of the trust and any property from the jurisdiction of the Cook Islands to entities elsewhere in the world, including Mexico, where the second and third respondents now live.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14437755\charrsid141348 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2970255 On 24 December 1994 the plaintiffs in the }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2970255 Victor action}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2970255  obtained 
an interim mareva injunction but this was set aside on 10 March 1995 on an application by the defendants. In setting aside the mareva injunction the High Court accepted the defendants' argument that the plaintiffs' cause of action arose in 1988 and 1989 w
h
en they purchased the apartments and that these dates fell outside the two year limitation period provided by the International Trusts Act. An order reinstating the mareva injunction pending the hearing of an appeal from the High Court decision was subseq
uently made. On 10 November 1995 this Court reinstated the mareva injunction in the Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2970255 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2970255 .
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid16074492\charrsid141348 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2317327 This Court's judgment in the Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2317327 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2317327 
 turned principally on the construction to be given to s13B(8) of the International Trusts Act and held, contrary to the submissions of the defendants, that the proceeding was in fact brought within the time limit prescribed by s13B(8)(b). An application 
to the Privy Council for leave to appeal against that judgment was dismissed by the Council on 29 July 1996.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid7750988\charrsid141348 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid2844707\charrsid4669966 Following on the reinstatement of the mareva injunction in the Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid2844707\charrsid4669966 case }{
\fs24\lang2057\langfe1033\langnp2057\insrsid2844707\charrsid4669966 the plaintiffs in that case sought and obtained an order from the High C
ourt that the defendants provide details of all dispositions made to and by the Victor trust. In February 1996 the plaintiffs learned, for the first time, that in fact two trusts had been established under the }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid2844707\charrsid4669966 International Trusts Act}{\fs24\lang2057\langfe1033\langnp2057\insrsid2844707\charrsid4669966  by the one trust deed
, a fact which had not previously been known to them. The one trust deed established both a Victor trust an Evangeline trust.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid7605718 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7605718 Other matters material to both the Victor and the Evangeline trusts have since become known to the plaintiffs. A Mr P F McDonnell
, a solicitor engaged by the plaintiffs' solicitors, has deposed in an affidavit sworn on 13 March 1996 and filed in support of an application for a mareva injunction in the Evangeline case that between the discharge of the mareva injunction}{
\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid7605718  in the Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid7605718 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid7605718 
 and its reinstatement pending the resolution of the}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7605718  appeal, certain dispositions were made by both the Victor and Evangelin}{
\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid7605718 e trusts. On 23 February 1996 a }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7605718 
Miss L M Corvette, a legal counsel employed by Southpac Trust Limited, trustee of both the Victo
r and Evangeline trusts, swore an affidavit disclosing that on or about 15 March 1995 securities to the value of approximately US$510,000 were transferred at the direction of Victor Illig from an account in the name of Southpac (the sixth defendant) to an
 account in the name of Southpac in respect of the Evangeline trust.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid7750988\charrsid141348 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid11029129 
The plaintiffs then brought the Evangeline case. They did so on 12 March 1996, that is within 12 months of the disposition of the US$510,000 just referred to and within two years of the p
laintiffs' cause of action accruing, namely 13 April 1994. They thereby complied with s13(B)(3)(b) of the International Trusts Act. They also obtained a mareva injunction on 17 March 1996 and an order that the sixth defendant (Southpac) disclose to the pl
aintiffs the Evangeline Deed of Trust together with the full value of the assets of the trust with particulars of dispositions to and from the trust.}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1249710 The defendants in the Evangeline case then applied to strike out that action and to discharge the mareva i
njunction upon the ground, inter alia, that, having regard to the provisions of the International Trusts Act, the proceedings were time barred. On 9 May 1996}{\fs24\lang2057\langfe1033\langnp2057\insrsid11029129\charrsid1249710  the Chief J}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1249710 ustice of the Cook Islands made an order under Section 53 of the }{\fs24\lang2057\langfe1033\langnp2057\insrsid11029129\charrsid1249710 J}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1249710 udicature Act 1980}{\fs24\lang2057\langfe1033\langnp2057\insrsid1249710\charrsid1249710 /}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1249710 81
 removing these applications into the Court of Appeal.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid1249710 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1249710 In the Evangeline case the plaintiffs seek, }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1249710 inter alia}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1249710 , a declaration that the Evangeline trust and the Victor trust are liable to satisfy the plaintiffs' judgment in the Californian Court out of pr
operty settled by the defendants in the Cook Islands and they seek judgment against the Evangeline trust and the Victor trust for the US$5,703,379, which remains owing on the judgment entered in the Californian Court.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1249710 Reference has already been made to an
 affidavit sworn by Miss Corvette on 23 February 1996. In fact Miss Corvette seems to have made three affidavits. On 9 February 1996 she made an affidavit in compliance with the mareva injunction made in the Victor }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1249710 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1249710 . This affidavit set out the assets of the Victor trust.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid16586638 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid16586638 
On 23 February 1996 she swore the affidavit already referred to correcting information she had given in the earlier affidavit. Then on 2 May 1996 she swore an affidavit for the purposes of complying with the mareva injunction of 17 Mar
ch 1996 in the Evangeline }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid16586638 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid16586638  and to discharge the mareva }{
\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid16586638 injunction made on the same day.}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid16586638 
 Attached to her affidavit was a copy of an affidavit made by a Mr Bruce Gridley who acted as counsel for the first, second and third defendants in the Californian p
roceedings. Mr Gridley's affidavit said that the Evangeline trust was set up on 21 December 1993, which was the date upon which Southpac executed the trust deed constituting the Evangeline trust (Evangeline signed it on 10 December 1993), and that upon th
e establishment of the Evangeline trust, Evangeline Illig assigned to the trust on 10 December 1993 promissory notes for $50,000, $100,000 and $50,000 and $60,000 and on the same day}{\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid16586638  }
{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid16586638 transferred an interest in a partnership in Far West South Coast Limited. 
In addition to this Evangeline Illig made a telegraphic transfer on 7 February 1994 in the sum of $1,182,000 to an account held by Southpac with the Bank of New Zealand at Singapore. Miss Corvette also claimed that certain properties set out in the plaint
iffs' statement of claim were not property which had been settled upon the Evangeline trust or transferred to it at any time.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid7750988\charrsid1249710 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2752580 The significance of Miss Corvette's affidavits to the defendants' motion to strike out the plaintiffs' case in the Evangeline trus
t and discharge the mareva injunction is to attempt to establish the dates on which transactions were entered into in the Evangeline trust and transfers of property made to it. The Evangeline trust itself, as already stated, was established on 21 December
 1993 and the assets vested in it were transferred to it between 21 December 1993 and February 1994.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid2752580 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2752580 In our judgment in the Victor case we held that the plaintiffs' caus}{\fs24\lang2057\langfe1033\langnp2057\insrsid11616598 e of action arose in terms of s1}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2752580 3B(8)}{\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid2752580 (b) of the }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid2752580 International Trusts }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2752580 Act}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2752580 
 on 14 April 1994 when the judgment was sealed in the Superior Court of Los Angeles. It would seem that the date on which the judgment was sealed was 13 April 1994 and not 14 April 1994. That date would also be the date when the cause of action arose in t
he Evangeline }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2752580 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2752580 
. The present application is founded specifically on the provisions of s13B(4) of that statute which we discuss later.}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1515256 It is convenient now t}{\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid1515256 o set out the provisions of s1}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1515256 3B of the International Trusts Act:
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid1515256 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid7750988 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1515256 '13B. }{\fs24\ul\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2102142 Fraud}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1515256  - (1) Where it is proven beyond reasonable doubt by a creditor that an international trust settled or established or property disposed to an international trust}{
\fs24\lang2057\langfe1033\langnp2057\insrsid10957033\charrsid1515256 -}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1515256 
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid1978114 {\fs24\lang2057\langfe1033\langnp2057\insrsid10957033\charrsid1515256 
\par }\pard \ql \li1440\ri0\widctlpar\faauto\adjustright\rin0\lin1440\itap0\pararsid10957033 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1515256 
(a) Was so settled established or disposed by or on behalf of the settlor with principal intent to defraud that creditor of the settlor; and
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\langnp2057\insrsid7750988\charrsid1515256 
\par }\pard \ql \li1440\ri0\widctlpar\faauto\adjustright\rin0\lin1440\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1515256 (b) }{\fs24\lang2057\langfe1033\langnp2057\insrsid11616598 D}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1515256 id at the time such settlement establishment or disposition took place render the settlor, insolvent or without property by which that creditor's claim (if successful) could have been s
atisfied, then such settlement establishment or disposition shall not be void or avoidable and the international trust shall be liable to satisfy the creditor's claim out of the property which but for the settlement establishment or disposition would have
 
been available to satisfy the creditor's claim and such liability shall only be to the extent of the interest that the settlor had in the property prior to settlement establishment or disposition and any accumulation to the property (if any) subsequent th
ereto.
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid15889054 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid13259932 
(2) In determining whether an international trust, settled or established or a disposition, has rendered the settlor insolvent or without property by which a creditor's claim (if successful) may be satisfied, regard shall be had to the fair market v
alue of the settlor's property, (not being property of or relating to the trust) at the time immediately after the settlement establishment established or the disposition referred to in subsection (1)(b) and in the event that the fair market value of such
 property exceeded the value of the creditor's claim, at that time, after the settlement establishment or disposition, then the trust so settled or established or the disposition shall for the purposes of this Act}{
\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid13259932  }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid13259932 be deemed not to
 have been so settled established or the property disposed of with intent to defraud the creditor.
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid11616598 {\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid15889054 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid13259932 
(3) An international trust settled or established and a disposition to such trust shall not be fraudulent as against a creditor of a }{\fs24\lang2057\langfe1033\langnp2057\insrsid7937222 settler-}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid13259932 
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid13259932 
\par }\pard \ql \li1440\ri0\widctlpar\faauto\adjustright\rin0\lin1440\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid13259932 (a) if settle
d established or the disposition takes place after the expiration of 2 years from the date that creditor's cause of action accrued; or
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid13259932 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid13259932 
\par }\pard \ql \li1440\ri0\widctlpar\faauto\adjustright\rin0\lin1440\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid13259932 
(b) where settled, established or the disposition takes place before the expiration of 2 years from the date that the cr
editor's cause of action accrued, that creditor fails to commence such action before the expiration or 1 year from the date such settlement establishment or disposition took place.
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid15889054 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744 (4) An international trust settled or established and a disposition of pro
perty to such trust shall not be fraudulen}{\fs24\lang2057\langfe1033\langnp2057\insrsid7937222 t as against a creditor of a set}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744 
tlor if the settlement establishment or disposition of property took place before that creditor's cause of action against the settlor accrued or had arisen.
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid15365744 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid13259932 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744 (5) A settlor shall not 
have imputed to him an intent to defraud a creditor, solely by reason that the }{\fs24\lang2057\langfe1033\langnp2057\insrsid13259932\charrsid15365744 settler \endash  
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid13259932 {\fs24\lang2057\langfe1033\langnp2057\insrsid13259932\charrsid15365744 
\par }\pard \ql \li1440\ri0\widctlpar\faauto\adjustright\rin0\lin1440\itap0\pararsid13259932 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744 
(a) Has settled or established an international trust or has disposed of property to such trust within two years from the date of that creditor's cause of action accruing;
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid15365744 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid15365744 
\par }\pard \ql \li1440\ri0\widctlpar\faauto\adjustright\rin0\lin1440\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744 
(b) Has retained, possesses or acquires any of the powers or benefits referred to in paragraphs (a) to (f) of section 13C;
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid15365744 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid15365744 
\par }\pard \ql \li1440\ri0\widctlpar\faauto\adjustright\rin0\lin1440\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744 (c) Is a beneficiary.}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 

\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid6709970 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744 
(6) Where an international trust is liable to satisfy a creditor's claim in the manner provided for i
n subsection (1) but is unable to do so by reason of the fact that the property has been disposed of, other than to a bona fide purchaser for value, then any such disposition shall be void.
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid15365744 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid15365744 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744 (7) For the purpose of this section the onus of proof of the sett
lor's intent to defraud the creditor lies on the creditor.
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid15365744 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid15365744 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid15365744 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744 (8) For the purpose of this section}{\fs24\lang2057\langfe1033\langnp2057\insrsid7937222 \endash }{
\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid15365744 
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid15365744 {\fs24\lang2057\langfe1033\langnp2057\insrsid15365744\charrsid15365744 
\par }\pard \ql \li1440\ri0\widctlpar\faauto\adjustright\rin0\lin1440\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744 
(a) the date of the cause of action accruing shall be, the date of that act or omission which shall be relied upon to either partly or wholly establish the cause of action. And if there is more than one act or the omission shall be a continuing one, the d
ate of the first act or the date that the omission shall have first occurred, as the case may be, shall be the date that the cause of action shall have accrued.
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid15365744 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid15365744 
\par }\pard \ql \li1440\ri0\widctlpar\faauto\adjustright\rin0\lin1440\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744 (b) in the case of an action upon a judgment, }{
\fs24\lang2057\langfe1033\langnp2057\insrsid15365744\charrsid15365744 the}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744  date of the cause of action accruing shall be
, the date of that act or omission or where there is more than one act or the omission shall be a continuing one, the date of the first act or the date that the omission shall have first occurred, as the case may be, which gave rise to the judgment itself
.
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid15365744 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744 
(9) The provisions of this section shall apply to all proceedings by every creditor alleging fraud against a settlor of an international trust, or against any person who shall settle property upon, or dispose of property to, or establish an international
 trust on behalf of that settlor, to the exclusion of any other remedy, principle or rule of law whether provided by statute or founded in equity or common law.
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid15365744 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid15365744 (10}{\fs24\lang2057\langfe1033\langnp2057\insrsid2102142 ) In this section the terns '}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid15365744 creditor' includes any person}{\fs24\lang2057\langfe1033\langnp2057\insrsid11616598  who alleges a cause of action.'}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 

\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1791069 As mentioned, the argument in the Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1791069 case}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1791069  turne}{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid1791069 d on the interpretation of s13B}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid1791069 
(8). The written submissions of counsel presented in that case were directed to that sub-section but sub-section (4) was mentioned orally and as a backstop to the main argument of counsel who then appeared for the defendants.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid13583904 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9913937 But in the Evangeline }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9913937 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid11616598  s1}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9913937 3B(4) has become the focus of the argument. Mr O'Brien did not seek to re-argue }{\fs24\lang2057\langfe1033\langnp2057\insrsid9913937\charrsid9913937 the}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9913937  defendants' contention in the Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9913937 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9913937 
 that the cause of action upon which the plaintiffs sued had arisen in 1988 and 1989 and consequently was out of time on that ground. He accepted, at least for the purposes of the argument, this Court's decision in the Victor }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9913937 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9913937  that the cause of action arose on 13 April 1994. He co}{\fs24\lang2057\langfe1033\langnp2057\insrsid11616598 
nfined his argument solely to s1}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9913937 3B(4)}{\fs24\lang2057\langfe1033\langnp2057\insrsid9913937\charrsid9913937 .}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9913937 
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid13583904 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 
In essence, Mr O'Brien's argument is that all the dispositions of property to the Evangeline trust were made between 21 December 1993 and February 1994, that is before the plaintiffs' cause of action had arisen and, for that reason, th
ose transactions are deemed to be not fraudulent}{\fs24\lang2057\langfe1033\langnp2057\insrsid11616598  and cannot be attacked under s1}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 
3B. Mr O'Brien submitted that, given the plain meaning of the words }{\fs24\lang2057\langfe1033\langnp2057\insrsid2102142 \lquote }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 ac}{
\fs24\lang2057\langfe1033\langnp2057\insrsid11616598 crued or had arisen', used in s1}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 3B(4), only settlements and dispositions that took place after the jur}{
\fs24\lang2057\langfe1033\langnp2057\insrsid11616598 y verdict could be outside the }{\fs24\lang2057\langfe1033\langnp2057\insrsid11616598\charrsid7351210 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 
not fraudulent' deeming provisions and therefore susceptible to the provisions of s}{\fs24\lang2057\langfe1033\langnp2057\insrsid11616598 1}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 3B(}{
\fs24\lang2057\langfe1033\langnp2057\insrsid11616598 1}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 
). It follows from Mr O'Brien's argument that, if the Evangeline trust was established before 13 April 1994, the establishment is deemed not fraudulent as against the plaintiffs, and that, on the meaning we gave to Section 13B(}{
\fs24\lang2057\langfe1033\langnp2057\insrsid11616598 8)}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 (b) in the Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 case}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 , only settlements and dispositions that took place after the ju}{\fs24\lang2057\langfe1033\langnp2057\insrsid11616598 ry verdict will be outside the }{
\fs24\lang2057\langfe1033\langnp2057\insrsid11616598\charrsid7351210 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 not fraudulent' deeming provisions of s13B(4).
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid7351210 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 In developing his submissions Mr O'}{\fs24\lang2057\langfe1033\langnp2057\insrsid2102142 Brien contended that the words 'accrued' and '}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 arisen' were used interchangeably in s}{\fs24\lang2057\langfe1033\langnp2057\insrsid4660284\charrsid7351210 1}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 
3B(4) and so a cause of action can be said to accrue when it arises or arise when it accrues. In support of his contention he referred to }{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid7351210 two revenue cases}{
\fs24\lang2057\langfe1033\langnp2057\insrsid2117087\charrsid7351210  -}{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid7351210  }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid7351210 Higgs }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 (Inspector of Taxes) v Olivier}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210  [1952] 1 Ch 311; and }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 CIR v Taylor}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210  [1961] 1 NZLR 923; and a case decided under the }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 Limitation Act}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210  1950 - }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210 T v H}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid7351210  [1995] 3 NZLR 37.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid13583904 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid8586292 If Mr O'Brien's submission is projected to its logical conclusion
 then under s13B a settlement or disposition is deemed to be not fraudulent if it took place two years or more after the cause of action accrued (ss3(a)), or took place before the creditor's}{\fs24\lang2057\langfe1033\langnp2057\insrsid16460110 
 cause of action arose at all (s}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid8586292 s4).
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid13583904 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid16736590 On this submission, any settlement or disposition is free from attack as fraudulent if it was made before 13 April 1994 (in which case the cause of action expire}{
\fs24\lang2057\langfe1033\langnp2057\insrsid16460110 d before it was ever born (s13B(}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid16736590 4)) OR after 13 April 1996 (s13B(3)(a)) OR, if between 13 April
 1994 and 13 April 1996, the creditor does not commence an action within one year from the date of such settlement or disposition.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid13583904 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid16736590 This analysis of the relevant provisions, particularly ss4, which would effectively bar the cause of action before it arose, demonstrates the}{
\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid16736590  }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid16736590 
absurdities which could follow from the suggested construction and would indicate that there may be another, and preferable, construction to place on ss4.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid13583904 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid5976692 
While noting the cases cited by Mr O'Brien, we think that there is a danger in seeking to import the construction given to a word or phrase in one statutory enactment into another. A statute must be looked at as a whole before its particular provisions ca
n be interpreted and applied to a given factual situation.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid16736590\charrsid13583904 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid5976692 Mr Giles, whose submission was supported by Mrs Brandon, submitted that:
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid5976692 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid5976692 
(i) Section 13B(4) has no application to the present case as there was in fact a disposition made on 13 March 1995 which was after, and not before 13 April 1994, when the cause of action accrued;
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid13583904 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid5976692 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid5976692 
(ii) That there is no inconsistency between s13B(8) and s13B(4) and, in fact, the provisions of s13B all sit together quite comfortably;
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid13583904 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid5976692 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid5976692 (iii) That s13B(4) addresses the intention o
f the settlor when the settlor establishes the trust or disposes of property to it;
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid13583904 {\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid13583904 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid5976692 (iv) That s13B(4) allows for both the p}{
\fs24\lang2057\langfe1033\langnp2057\insrsid5976692\charrsid5976692 ossibilities provided for in s1}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid5976692 3B(8) and deliberately addresses two quite separate events, namely:
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid13583904 
\par }\pard \ql \li1440\ri0\widctlpar\faauto\adjustright\rin0\lin1440\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid5976692 (a) the date at which a creditor's cause of action against the settlor accrues;
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid13583904 {\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid13583904 
\par }\pard \ql \li1440\ri0\widctlpar\faauto\adjustright\rin0\lin1440\itap0\pararsid14384188 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid5976692 (b) the time at which a creditor's cause of action against the settlor has arisen.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid6709970 
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid13583904 {\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid6709970 
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid8132766 {\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid14448525 
Mr Giles made a second submission. It was that, whatever view we took of s13(4), the Court should not make an order strikin
g out the Evangeline case and, with it, the mareva injunction. He based this submission on the well established principle that the jurisdiction to strike out proceedings without enquiring into their merits should be used sparingly. For cases supporting th
is principle see }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid14448525 General Steel Industries inc v Commissioner for Railways}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid14448525  (NSW}{
\fs24\lang2057\langfe1033\langnp2057\insrsid2184265\charrsid14448525 )}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid14448525  (1964) 112 CLR 128}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid14448525 
; Electricity Corporation Ltd v Geotherm Energy Ltd}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid14448525 
 [1992] 2 NZLR 641. It has been held that on such an application the Court should assume in favour of the plaintiffs that all the assertions in the statement of claim are correct. }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid14448525 
Takaro Properties Ltd v Rolling}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid14448525  [1978] 2 NZLR 314.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid14448525 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid11736448\charrsid14448525 In the light of this principle this Court could not possibly strike these proceedings out nor discharge the mareva injunction. As Mr Giles said}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1846569\charrsid14448525 ,}{\fs24\lang2057\langfe1033\langnp2057\insrsid11736448\charrsid14448525 
 in the affidavits earlier referred to there have been admissions of significant movements of money out of the trust and thus out of rea
ch of the plaintiff during the period between the discharge of the mareva injunction in the Victors case and its reinstatement. It is important that the mareva injunction remain in }{\fs24\lang2057\langfe1033\langnp2057\insrsid2844707\charrsid14448525 
place}{\fs24\lang2057\langfe1033\langnp2057\insrsid11736448\charrsid14448525  to preserve the stat}{\fs24\lang2057\langfe1033\langnp2057\insrsid1846569\charrsid14448525 us quo pending the determination of the plaintiff\rquote }{
\fs24\lang2057\langfe1033\langnp2057\insrsid11736448\charrsid14448525 s claims. Moreover, when the merits of the various transactions we refer }{\fs24\lang2057\langfe1033\langnp2057\insrsid2844707\charrsid14448525 
to in the next paragraph are enquired into on a substantive hearing other matters relevant to the plaintiff\rquote s claim may be discovered. It is proper that the plaintiffs should be allowed to explore other allegations of dealings made in their claim.}
{\fs24\lang2057\langfe1033\langnp2057\insrsid11736448\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid6709970 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid5472074 
If the present application to strike out were successful the plaintiffs as judgment creditors would have no recourse to the High Court for an enquiry although it seems apparent from the rec
ord in the case that there may well have been dispositions made by the defendants which, on the wording of s13B, do not exclude an inquiry into fraud.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid14448525 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid984012 In an affidavit sworn on 2 May 1996, Ms Corvette refers to a number of transactions made after 13 April 
1994. There is, for example, the disposition of US$510,000 made between the two trusts on 15 March 1995. There may well be others including the setting up of a separate deposit amount on 29 March 1996 comprising payments received for the period 8 December
 
1995 and 9 February 1996; payments of US$25,000 made on or about 23 January 1996; a transfer of sums totalling US$1,193,675 between 17 May 1994 and 29 August 1994 from the Evangeline trust; a distribution of approximately US$910,000 to a beneficiary of th
e
 Evangeline trust on or about 21 December 1994; the transfer on or about 21 December 1994 of $5,000 from the Evangeline trust from an account in the name of the sixth defendant as trustee for the Victor trust; the transfer to an account in the name of the
 sixth defendant as trustee for the Evangeline trust of $14,985 on or about 26 August 1995. There are also transactions involving the movement of funds into and from the Bank of New Zealand account of the Evangeline trust.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2184265 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid2184265 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4350752 Dispositions made after 
13 April 1994 may fall outside the provisions of s13B(4) and may or may not be fraudulent. Some may fall within the provisions of s13B(3)(b), such as the disposition of US$510,000 made on 15 March 1995. This disposition, and possibly others, may not be ex
e
mpt as non-fraudulent transactions and consequently would be open for further inquiry. The plaintiffs are entitled to this. The defendants will still be able to answer any allegations of fraud by producing evidence at the substantive hearing where the var
ious transactions and their import, and others which may emerge from the evidence, can be analysed much more closely than could be the case on the hearing of the present application.}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2184265 

\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid2184265 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4350752 While adherence to these general principles would be enough to dispose of
 the present applications in favour of the plaintiffs, we think that we should indicate our tentative views on the construction of s13B(4) to which the whole of Mr Q'Brien's, and most of Mr Giles' submissions, were directed. We think that Mr Giles may wel
l
 be right in his approach to s13B as a whole. When the individual sub-sections are analysed the overall purpose of s13B becomes apparent. Section 13B(1) enables a creditor to have recourse to assets in an international trust to satisfy his claim where it 
is proved to the requisite standard that the trust was established or prope}{\fs24\lang2057\langfe1033\langnp2057\insrsid2102142 rty transferred to it with the '}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid4350752 
principal intent to defraud' the creditor.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid14105506 
\par Section 13B(2) provides that where the fair market value of the settlor's property (not being property of 
or relating to the trust) exceeds the value of the creditor's claim, then the settlement of the trust or the disposition of property to it shall be deemed not to have been settled or disposed of with intent to defraud the creditor.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2184265 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid2184265 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid14105506 Section 13B(3) is a deeming}{\fs24\lang2057\langfe1033\langnp2057\insrsid16460110  provision. It relates only to }{\fs24\lang2057\langfe1033\langnp2057\insrsid16460110\charrsid7351210 
'}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid14105506 accru}{\fs24\lang2057\langfe1033\langnp2057\insrsid16460110 ed' causes of action. The word }{\fs24\lang2057\langfe1033\langnp2057\insrsid16460110\charrsid7351210 '}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid14105506 accrued' is used both in subparagraphs (a) and (b) of the sub-section. Thus s13B(3) deems any settlement or transaction, even though it might otherwise be fraudulent, not to be such i
f it takes place later than two years from the accrual of the cause of action. Therefore, under s 13B(3) dispositions after 13 April 1996 could not be held to be fraudulent under s13B(1). Section 13B(3)(b) relates to a settlement or disposition occurring 
d
uring the period of two years after the accrual of the cause of action, that is, between 13 April 1994 and 13 April 1996 but in that case a creditor must institute proceedings within a year of the disposition taking place. Against the background of the pr
esent case, if a disposition takes place between 13 April 1994 and 13 April 1996 (which is the case with the US$510,000 transferred to the Evangeline trust on 15 March 1995) proceedings must be brought by 15 March 1996, (which they were).}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2184265 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid2184265 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid12861209 Section 13B(4) co
ntains a new element in its use of the word 'arisen' following the word 'accrued'. The question is whether those responsible for the legislation used the word 'arisen' as having the same meaning as 'accrued'. It would be strange if they did when 'accrued'
 would have been sufficient to express their purpose. Some other meaning must be given to the word 'arisen' to give purpose to its use in the sub-section.}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2184265 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid2184265 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid12861209 It is only reasonable to expect that a creditor should have some knowledge of a fraudulent dispositio
n before a limitation provision begins to run against him. Parliament could be expected to give a creditor the opportunity to enquire into and question dispositions made by a settlor after the settlor had notice of the creditor's claim. As recorded in our
 earlier judgment in the Victor }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid12861209 case}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid12861209 
, on 25 October 1991 a letter was written on behalf of the plaintiffs to the first respondent seeking redress for the faulty construction of the apartments and on 23 April 1992 they issued proceedings in the Superior Cour
t of California. As now seems to be admitted, from December 1993 onwards the first, second and third defendants took steps to dispose of property which would otherwise have been available to satisfy the judgment which plaintiffs obtained on 13 April 1994.
}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2184265 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid2184265 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9836542 Viewed in this way s13B(4) left it open to a creditor to open up transactions of thi}{\fs24\lang2057\langfe1033\langnp2057\insrsid16460110 s kind for scrutiny under s13B(1}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9836542 ). As was put to us by Mr Giles, without the words 'or had arisen' and the interpretation we have placed upon them, the protection for creditors afforded by sub-section }{
\fs24\lang2057\langfe1033\langnp2057\insrsid9836542\charrsid9836542 8(b) would be rendered nugatory.}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9836542 
 A debtor could, upon being sued, deliberately delay entry of judgment by whatever means possible while moving assets out of the jurisdiction with the intention of ultimately defeating the judgment creditor. He could then c}{
\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid9836542 ontend, as do the present defen}{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9836542 
dants, that although the s13B(3) time limit might be met, all would be lost for the plaintiff creditor because he had lost all rights before the cause of action on the judgment had arisen.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid2184265 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid14384188\charrsid2184265 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid9836542 
In our view the words 'accrued or had arisen' set up two periods. The word 'accrued' refers to 13 April 1994 and the words 'or had arisen' refer to a prior date upon which notice of the existence of the cause of action was given to the settlor.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid14384188\charrsid9836542 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid12876592 For the ab
ove reasons we incline to the view that the plaintiffs' submission that s13B(4) is to be construed in its ordinary sense as providing alternative dates before which a settlor must have settled or established a trust or made dispositions if seeking the exe
m
ptive protection of the section is a correct interpretation. That date is not just 13 April 1994 being the date of the accrued cause of action. The words 'or had arisen' could establish a much earlier date and the settlor would have to prove dispositions 
occurred prior to that earlier date.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid13268541\charrsid9836542 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid13056479 
The present action should proceed to a hearing where evidence of specific transactions and the settlement of the trust can be enquired into in more detail and to provide a factual basis for findings of the Court. Then s
13B can be examined against the background of individual dealings.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid13268541\charrsid13056479 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid8132766\charrsid13056479 
For the reasons given the application to strike out the proceedings and to discharge the mareva injunction is refused. Plaintiffs are entitled to costs on the hearing of the application. A
 memorandum should be supplied to the Court as to the amount claimed.
\par }{\fs24\lang2057\langfe1033\highlight4\langnp2057\insrsid8132766\charrsid9836542 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid13268541\charrsid3045332 Solicitors
\par PLAINTIFFS}{\fs24\lang2057\langfe1033\langnp2057\insrsid13268541\charrsid3045332 : Clarkes, Rarotonga
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid13268541\charrsid3045332 DEFENDANTS}{\fs24\lang2057\langfe1033\langnp2057\insrsid13268541\charrsid3045332 : Timothy Arnold, R}{\fs24\lang2057\langfe1033\langnp2057\insrsid3045332\charrsid3045332 a}{
\fs24\lang2057\langfe1033\langnp2057\insrsid13268541\charrsid3045332 rotonga}{\fs24\lang2057\langfe1033\langnp2057\insrsid13268541\charrsid6709970 
\par }}