Australian Securities and Investments Commission v Diversa Trustees Limited

The Australian Securities and Investments Commission (ASIC) commenced proceedings against Diversa Trustees Limited (Diversa), alleging breaches of the Corporations Act 2001 (Cth) in relation to their role as trustee of a superannuation fund. ASIC's allegations included that Diversa failed to ensure the fund was managed efficiently, honestly, and fairly, and that Diversa did not take reasonable steps to ensure its representatives complied with financial services laws. The court was tasked with determining whether Diversa's knowledge of certain business practices of an adviser group could be attributed to it, despite the group not being a direct representative, and whether the obligations under the Act applied to Diversa given the contractual arrangements with other licensees for various services.

The court considered the nature of Diversa's contractual relationship with the entities that provided services such as administration, promotion, and platform functions for the fund. The contracts included "no agency" clauses, and there was no evidence to suggest that the entities acted as Diversa's agents. The court needed to decide whether the services performed by these entities were services performed as an agent of Diversa or services provided to Diversa. Additionally, the court examined whether the obligations under the Act could apply to Diversa despite the services being provided by entities other than its direct representatives.

The court concluded that the services provided by the entities were not performed as Diversa's agents but were services provided to Diversa. There was insufficient evidence to attribute the knowledge of the entities' business practices to Diversa. The court found that the obligations under the Act did not apply to Diversa in relation to the services provided by the entities that were not its direct representatives. Consequently, ASIC's claims against Diversa were dismissed.

The court ordered that the plaintiff's originating process dated 8 October 2021 be dismissed with costs. This decision was in line with the Federal Court Rules 2011, which govern the entry of orders in such cases.