Asden Developments Pty Ltd (in liq) v Dinoris

The case of Asden Developments Pty Ltd (in liq) v Dinoris involved an appeal against the dismissal of an application for the primary judge to disqualify himself on the ground of appended bias, and a cross-appeal against the findings that Mr Dinoris breached s 180 of the Corporations Act 2001 (Cth) and that certain statutory defences were not available to him. The underlying facts of the case were not contentious and involved the financial mismanagement of a property development company by its sole director and shareholder, Ms Nichols. Ms Nichols had directed Mr Levis, a pre-insolvency expert, to advise her on the company's financial difficulties and he had recommended that she establish a new bank account and transfer funds from the company's account to that of another company, Urban Property, which was controlled by Mr Levis. The liquidators had sought to recover the funds from Ms Nichols, alleging that she had breached her statutory duties under s 180 of the Corporations Act 2001 (Cth).

The legal issues before the court were whether the primary judge had erred in rejecting evidence, whether the primary judge had erred in respect of an order that the applicant pay the respondents’ costs of the proceeding, whether the liquidator had breached s 180 of the Corporations Act 2001 (Cth), and whether statutory defences under ss 1317S and 1318 were available with respect to a finding of breach of s 180 of the Act. The court found that the primary judge had not erred in rejecting Ms Nichols’ evidence, as the question put to her in evidence-in-chief was leading and imprecise, and the answer was ambiguous. The court also found that there was no error of principle in the primary judge's exercise of discretion in awarding costs against the company as the unsuccessful party, and that it was open to the primary judge to do so. The court found that the primary judge had not erred in finding that Mr Dinoris breached s 180 of the Act, as he had failed to contact Ms Nichols personally about the missing funds, and that it was unnecessary to consider statutory defences relied on by Mr Dinoris under ss 1317S and 1318 of the Act.

The appeal and the cross-appeal were dismissed and the final orders were that the appeal be dismissed and the cross-appeal be dismissed. The entry of orders was dealt with in Rule 39.32 of the Federal Court Rules 2011.