References: [2012] FCAFC 6, (2012) 200 FCR 296, (2012) 287 ALR 22, (2012) 87 ACSR 260
Links: Austlii
Coram: Finn, Stome, and Perram JJ
Federal Court of Australia
CORPORATIONS – Corporations Act 2001 (Cth), s 9 – ‘director’ – ‘officer’ – de facto director – no single test for determining whether a person is such – assuming or performing the functions of a director of the company in question – directors or consultants or both – blurring of ‘de facto’ and ‘shadow’ – de facto officer – unnecessary to differentiate de facto director from de facto officers
CORPORATIONS – Corporations Act 2001 (Cth), ss 181 and 182 – director and de facto director misappropriating corporate funds – effecting a transaction in which they had a personal interest – using position in expectation of obtaining an introduction fee
CORPORATIONS – Corporations Act 2001 (Cth), s 1317H – construction of provision – inclusion of ‘profits’ within ‘damage suffered’ – whether profits can be sought without claim for, or proof of, loss
CORPORATIONS – knowledge of corporation – imputation of director’s knowledge to corporation – knowledge of own wrongdoing – ‘fraud on the company’ exception – receipt of a secret commission
EQUITY – Fiduciary obligations – imposing standards of conduct – overlap of conflict of duty and interest and misuse of fiduciary position – defining the subject matter over which fiduciary obligations extend
EQUITY – Fiduciary obligations – receipt of civil law bribe or secret commission – characteristics of secret commission – third party payer’s position – assumption of risk of agent’s nondisclosure to its principal
EQUITY – Participation in the wrongdoing of a trustee or fiduciary – classes of case – Barnes v Addy – liabilities as a knowing recipient or a knowing assistant – fault based liabilities – the ‘knowledge’ of wrongdoing required of a knowing recipient – present Australian law – unhelpful formulae
EQUITY – Corporate property as ‘trust property’ for Barnes v Addy purposes – money paid or property transferred under a contract – breach of fiduciary duty – whether the transaction must be avoided before proprietary relief can be awarded – Daly v Sydney Stock Exchange – constructive trusts and tracing corporate property
EQUITY – Remedies – fashioning remedy to fit the nature of the case and its facts – doing what is ‘practically just’ – awarding the remedy which is ‘appropriate’ in the circumstances – the remedial constructive trust and appropriateness – discretionary considerations
EQUITY – Fiduciaries’ Liability to Account and the Account of Profits – purpose and limits of an account of profits – breach of duty only one of several sources of profit – misuse of ‘trust moneys’ in a fiduciary’s trade or business – applicable principles – the ‘just allowance’ device
EQUITY – Account of Profits – accounting for the profits actually made – when parties may be jointly and severally liable for profits
EQUITY – Interest awards where trust moneys misused – presumption of profit made reflected in award of interest – award of compound interest and periodic rests
EQUITY – Remedies – against knowing recipients and knowing assistances – whether joint and several as between fiduciary/trustee and the third party participants
EQUITY – Remedies – for bribes and secret commissions – Lister & Co v Stubbs not followed – constructive trust of the property received an available remedy if appropriate in the circumstances
PRACTICE AND PROCEDURE – Appeals – application to amend – application to reopen decision to refuse amendment to Notice of Contention – application to reopen on grounds of legal error – Grimaldi v Chameleon Mining NL (No 1) [2011] FCAFC 95 reopened – Federal Court Rules 2011 r 39.04 – application to further amend notice of appeal
This case is cited by:
- Cited – FHR European Ventures Llp and Others -v- Cedar Capital Partners Llc SC (Bailii, [2014] UKSC 45, [2014] 2 Lloyd’s Rep 471, [2014] 2 All ER (Comm) 425, [2014] WTLR 1135, [2014] 4 All ER 79, [2015] 1 AC 250, [2014] Lloyd’s Rep FC 617, [2014] 3 WLR 535, [2014] WLR(D) 317, [2014] 2 BCLC 145, [2015] 1 P &CR DG1, Bailii Summary, WLRD, UKSC 2013/0049, SC, SC Summary, SC Video)
The Court was asked whether a bribe or secret commission received by an agent is held by the agent on trust for his principal, or whether the principal merely has a claim for equitable compensation in a sum equal to the value of the bribe or . .
