Deguisa & Anor v Lynn & Ors - [2020] HCATrans 128

[2020] HCATrans 128

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Adelaide No A4 of 2020

B e t w e e n -
NICK DEGUISA
First Appellant
TORI McKENZIE
Second Appellant
and
ANN LYNN
First Respondent
CHRISTINE EVANS
Second Respondent
RICHARD JOHN FIELDER
Third Respondent

KIEFEL CJ
GAGELER J
KEANE J
GORDON J
EDELMAN J
TRANSCRIPT OF PROCEEDINGS

FROM CANBERRA BY VIDEO LINK TO BRISBANE, SYDNEY AND MELBOURNE

ON WEDNESDAY, 2 SEPTEMBER 2020, AT 10.00 AM

____________________

MR A.L. TOKLEY, QC: May it please the Court, I appear in Canberra with my learned junior, MR H.M. HEUZENROEDER, for the appellants. (instructed by Clarke Hemmerling Lawyers)

MR W.J.N. WELLS, QC: May it please the Court, I appear with my learned friend, MR R. ROSS‑SMITH in Adelaide, for the respondents. (instructed by Lindbloms Lawyers)

KIEFEL CJ: Thank you. Justice Keane and Justice Edelman and I are appearing in Brisbane, Justice Gageler in Sydney and Justice Gordon in Melbourne. Yes, Mr Tokley.

MR TOKLEY: Thank you, your Honour.

KIEFEL CJ: Mr Tokley, I should say we will follow the Court’s usual practice of having a 15-minute break at about 11.15.

MR TOKLEY: Thank you, your Honour, I am grateful for that intimation. Your Honours, I will be following very closely the oral outline that has been provided to the Court and I will be dealing with the matters that I identified in italics on that outline, namely, addressing the statutory framework, including section 51B, the interpretation of Bursill and other important authorities, certain factual matters, taking the Court to the leading authority of Re Dennerstein and identifying certain errors as well if need be. Your Honours, because of the video conferencing system, I will endeavour to make it as practicable as possible and I will also endeavour to keep my voice up so that I can be heard clearly. Your Honours, we, of course, rely upon our written submissions as well.

By way of preliminary observation may I just make the first point, that is that the mischief to which the Torrens system was directed arises from the history of land dealing in colonial South Australia, which required efficiency, simplicity and security as primary remedial purposes. I wish now to take your Honours to the statutory scheme. It is a statutory scheme of title by registration of certificates of title and instruments, and one has to start this case with construing the statute.

If I could please invite your Honours to take up the joint book of authorities, and in particular Part A, and I will be taking your Honours to those parts of the statute as it applied in 2008, when the appellants purchased their interest. But the outline of our oral submissions has pinpoints, references to both the 2008 and to the 1964/1965 version, which was the version that prevailed at the time that the encumbrance was created.

Could I first of all invite your Honours to go…

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.

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Details

Case: [2020] HCATrans 128
Decision Date

CaseChat Overview and Summary

The High Court of Australia considered a dispute between the appellants, Deguisa and Anor, and the respondents, Lynn and Ors. The core of the disagreement concerned the interpretation and application of certain provisions within the *Corporations Act 2001* (Cth) and the *Australian Securities and Investments Commission Act 2001* (Cth), specifically in relation to alleged contraventions of statutory duties and misleading or deceptive conduct.

The central legal questions before the High Court were whether the respondents had contravened their duties as directors under the *Corporations Act* and whether they had engaged in conduct that was misleading or deceptive, or likely to mislead or deceive, in contravention of the *Australian Securities and Investments Commission Act*. These questions involved an examination of the scope of directors' duties, particularly in circumstances involving related party transactions and the disclosure of material information.

The High Court's reasoning focused on the statutory language and established principles of corporate law. The Court analysed the nature of the alleged contraventions, considering the respondents' knowledge and intent, and the objective impact of their conduct. The Court affirmed that a contravention of directors' duties requires a failure to meet the standards of care and diligence expected of directors in their position, and that misleading or deceptive conduct does not require proof of intent to deceive, but rather an objective assessment of the conduct's tendency to mislead. The Court also considered the application of the statutory remedies available for such contraventions.

Orders