Grain Technology v Rosewood [2019] NSWSC 1111

“Do I really have to sell that flour mill?”  

A bread researching NFP went through a restructure.  Its subsidiaries held IP and physical assets the plaintffs alleged were held by way of chartiable trust. The assets included a significant landholding (~$62M) which had a “pilot mill” on it; for flour experimentation.  

The plaintiffs claimed the assets were held on charitable trust. 

A receiver was appointed in respect of the assets and granted leave to approach the Court for guidance.  Those overarching charitable trust proceedings settled: [15].  

But the Receiver approached the Court to seek confirmation it would be justified in not selling the property.  

It’s a tricky issue.   

The property might be worth up to $62M, with the potential for that value to fall. Also – if sold – the pilot mill may be demolished (against the spirit of the charitable trust): [19], [20] and [21].  

The Court considered the dominant consideration was the preservation of the pilot mill: [23]; especially as the pilot mill charitable trust would likely be upheld, meaning – if destroyed – the pilot mill would have to be rebuilt.    

The Court gave a direction that the Receiver would be justified in not selling: [24].