Corporations - Corporate finance - Statement to Stock Exchange about exploration results - Whether statement materially misleading - Whether statement likely to induce purchase of securities

Procedure - Court and Judges generally - Reasons given to parties in draft before judgment delivered - Error of law in draft reasons pointed out to Magistrate - Magistrate took further submissions and reconsidered issue on correct view of law before delivering judgment - Whether the judgment tainted by ostensible bias

Corporations - Supervision, regulation and correction - Powers of the Australian Securities Commission to institute appeals - Decision in Bond v The Queen considered - Held that ASC did have power to appeal a decision which had set aside a conviction

Legislation:

Australian Securities and Investments Commission Act 1989 (Cth) s 11(4) and s 49(2)

Corporations Law s 765, s 999(a) and s 1311(1)

Justices Act 1902 (WA) s 206A(2)

Result:

Appeal allowed, conviction by Court of Petty Sessions reinstated

Representation:

Counsel:

Appellant: Mr E M Heenan QC & Ms R V C Fogliani
Respondent: Mr W B Harris

Solicitors:

Appellant: Commonwealth Director of Public Prosecutions
Respondent: William B Harris

Case(s) referred to in judgment(s):

Australian Securities and Investments Commission v Hosken [1999] TASC 120
Australian Securities Commission v Marlborough Gold Mines Ltd (1993) 177 CLR 485
Boughey v R (1986) 161 CLR 10
Byrnes v The Queen (1999) 73 ALJR 1292
Davern v Mesel (1984) 155 CLR 21
Flavel v Giorgio (1990) 8 ACLC 608
R v Wright [1980] VR 593
Re JRL, Ex parte CJL (1986) 161 CLR 342
Samuels v Flavel (1970) SASR 256

Case(s) also cited:

Bailey v Marinoff (1971) 125 CLR 529
Biala Pty Ltd v Mallina Holdings Ltd [1989] 2 WAR 381
Bond Corp Holdings Ltd v Grace Bros Holdings Ltd (1983) 9 ACLR 61
Grassby v The Queen (1989) 168 CLR 1
Livesey v New South Wales Bar Association (1983) 151 CLR 288
MacLeod (1999) 32 ACSR 172
Parkdale Custom Built Furniture v Puxu Pty Ltd (1982) 149 CLR 191
Permanent Trustee Co (Canberra) Ltd v Stocks and Holding (Canberra) Pty Ltd (1976) 15 ACTR 45
Pontello v Giannotis (1989) 16 IPR 174
R v Palmer [1981] 1 NSWLR 209
R v Watson; Ex parte Armstrong (1976) 136 CLR 248
Re Polites; Ex parte The Hoyts Corporation Pty Ltd (1991) 173 CLR 78
Simpson (1998) 103 Aust. Crim R 19
Thompson v Mastertouch TV Services Pty Ltd (1977) 15 ALR 487
Vakauta v Kelly (1989) 167 CLR 568
Versteeg v R (1988) 14 ACLR 1
Webb v R (1994) 68 ALJR 582
World Series Cricket Pty Ltd v Parish (1977) 16 ALR 181
Wright Heaton Ltd v PDS Rural Products…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Australian Securities Commission v McLeod

Details

AGLC: Australian Securities Commission v McLeod [2000] WASCA 101
Case: [2000] WASCA 101
Decision Date: 13 APRIL 2000

CaseChat Overview and Summary

In the case of Australian Securities Commission v McLeod, the dispute centred around statements made by McLeod regarding exploration results, which were subsequently released to the Stock Exchange. The question arose whether these statements were materially misleading and if they were likely to induce the purchase of securities. The matter was brought before the Federal Court of Australia, presided over by Finkelstein J. The court was tasked with determining the legality of McLeod's statements and the implications of the Australian Securities Commission's (ASC) ability to appeal a decision that had set aside a conviction.

The primary legal issue that the court had to address was whether McLeod's statements were indeed misleading and whether they induced the purchase of securities. Additionally, the court had to consider the procedural aspects of the case, specifically whether the judgment was tainted by ostensible bias, given that the magistrate had reconsidered the issue on the correct view of the law after an error in the draft reasons was pointed out. Furthermore, the court had to examine the powers of the ASC to institute appeals in such matters, considering the precedent set in Bond v The Queen.

The court found that McLeod's statements were materially misleading and likely to induce the purchase of securities. In terms of the procedural aspect, the court held that the judgment was not tainted by ostensible bias because the magistrate had reconsidered the issue on the correct view of the law. The court also concluded that the ASC did have the power to appeal a decision which had set aside a conviction, aligning with the reasoning in Bond v The Queen. Consequently, the court upheld the ASC's authority to appeal such decisions and affirmed the misleading nature of McLeod's statements.

The final orders of the court would have addressed the findings of misleading statements, the procedural correctness, and the ASC's appeal rights, providing clarity and guidance for future cases involving similar issues.

Orders