Lui, In the matter of an application for leave to issue a proceeding

This matter concerned an application by Mr Lui for leave to issue a proceeding against the respondent, the Australian Securities and Investments Commission (ASIC). The application arose from ASIC's investigation into the affairs of a company, and the subsequent commencement of proceedings by ASIC against Mr Lui and others in the Federal Court of Australia. Mr Lui sought leave to commence a proceeding against ASIC, alleging that ASIC had acted in bad faith in its conduct of the investigation and in its decision to commence proceedings against him.

The primary legal issue before Crennan J was whether Mr Lui had established a sufficient prima facie case to warrant the grant of leave to issue a proceeding against ASIC. This involved considering the threshold for granting such leave, particularly in circumstances where the applicant alleges bad faith on the part of a regulatory body. The court was required to assess whether the material before it disclosed a serious question to be tried regarding ASIC's alleged bad faith.

Crennan J applied the principles governing the grant of leave to issue proceedings against a statutory body, noting that such leave is not granted as a matter of course. The court considered the evidence presented by Mr Lui, which included allegations of improper motives and a predetermined outcome in ASIC's investigation. However, Crennan J found that the evidence did not disclose a sufficient prima facie case of bad faith to justify granting leave. The court reasoned that the allegations, while serious, were not supported by sufficient factual material to meet the required threshold for a preliminary finding of bad faith.

Consequently, Crennan J dismissed the application for leave to issue a proceeding against ASIC.