Fair Go Group Pty Ltd v Riseley - [2020] VSC 27

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMON LAW DIVISION
EMPLOYMENT AND INDUSTRIAL LIST

S ECI 2019 3468

FAIR GO GROUP PTY LTD (ACN 616 511 507)	Applicant
v
JILLIAN RISELEY	First Respondent
COMMUNITY BUYING GROUP PTY LTD (ACN 612 156 448)	Second Respondent

---

JUDGE:	Daly AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	5 December 2019
DATE OF JUDGMENT:	13 February 2020
CASE MAY BE CITED AS:	Fair Go Group Pty Ltd v Riseley
MEDIUM NEUTRAL CITATION:	[2020] VSC 27

---

PRACTICE AND PROCEDURE – Application for preliminary discovery under rule 32.05 of Supreme Court (General Civil Procedure) Rules 2015 (‘Rules’) – Dispute between the current director and the former director of the applicant – Alleged breach of duties by the former director in the process of winding up the business of the applicant – Principles in relation to each of the prerequisites under rule 32.05 of the Rules – Victorian Tax Families Inc & Anor v Taxi Services Commission [2018] VSC 594, referred to – Applicant already has sufficient information to determine whether to issue a proceeding in relation to most claims – Claims rather weak given involvement and oversight of current director’s accountants of the relevant transactions – Alex Fraser Pty Ltd v Minister for Planning [2018] VSC 391, referred to – Order for production of invoices over the relevant period – Application otherwise dismissed

---

APPEARANCES:	Counsel	Solicitors
For the Applicant	Mr J S Mereine	Mills Oakley
For the First and Second Respondents	Mr E J Batrouney	Maddocks

HER HONOUR:

Background

The applicant, Fair Go Group Pty Ltd (‘Fair Go’), is controlled by Mr Glenn Riseley (‘Glenn’).[1] Glenn is a distant cousin of the first respondent, Ms Jillian Riseley (‘Jill’).
[1]The parties’ first names are used in these reasons to avoid confusion given they are related. No disrespect is intended.

In November 2015, Jill founded the second respondent, Community Buying Group Pty Ltd (‘CBG’). From November 2016, Jill was CBG’s sole director and shareholder. CBG was a social enterprise designed to assist entities in the not-for-profit sector to obtain discounted rates on utilities and other services using their combined purchasing power.

In December 2016, Fair Go was established by Jill and Glenn to, in effect, take over the business of CBG, with Glenn (through his nominated entity) owning 49.5% and Jill (through her nominated entity) owning 50.5% of the share capital of Fair Go. The parties agreed that both Glenn and Jill would provide funding to Fair Go, with Glenn to make contributions of $350,000, and Jill contributing $150,000 plus her labour in the business.

However, in or around October 2017, Glenn decided to stop funding Fair Go, after providing approximately $120,000 in funding.

On 14 November 2017, Mr Clive Marriott became a director of Fair Go. He served as a director of Fair Go until his resignation on 21 March 2018. Jill also ceased to be a director of Fair Go on that date. Their resignations took place in the…

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.

Keep reading for free

Create a free CaseChat account to read Fair Go Group Pty Ltd v Riseley and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2020] VSC 27
Decision Date: 13 February 2020

CaseChat Overview and Summary

The matter before the court was an application by Fair Go Group Pty Ltd, a company in liquidation, for preliminary discovery against its former director, Riseley, under rule 32.05 of the Supreme Court (General Civil Procedure) Rules 2015. The applicant sought discovery of certain documents to ascertain if the former director had breached his duties during the winding up of the business. The applicant argued that this information was necessary to determine whether to issue proceedings against the former director. Riseley opposed the application, arguing that the applicant already had sufficient information and that the claims were weak due to the current director's oversight of the relevant transactions.

The court considered whether the application met the criteria under rule 32.05, which requires the applicant to demonstrate that discovery is necessary to determine whether to issue proceedings, that the documents are not readily available, and that there are reasonable prospects of success. The court noted that the applicant had already obtained much of the relevant information and that the claims were weakened by the involvement of the current director's accountants. The court also considered the case of Victorian Tax Families Inc & Anor v Taxi Services Commission [2018] VSC 594, which highlighted the need for a strong case for preliminary discovery. Ultimately, the court found that the applicant did not meet the threshold for the application, given the current director's oversight and the availability of much of the necessary information.

The court dismissed the application for preliminary discovery, except for the request for production of invoices over a specific period. The court found that these invoices were not readily available and were necessary to determine whether to issue proceedings. The court also noted that the claims against the former director were weak and that the application was largely speculative. The applicant was ordered to pay Riseley's costs of the application.

Orders