Provident Capital Limited (receivers and managers appointed) (in liquidation) v Andrew Boyd French

The dispute arose between Provident Capital Limited, a company in liquidation with receivers and managers appointed, and Andrew Boyd French, a former employee. The case was heard in the Federal Circuit and Family Court of Australia. The liquidators sought to set aside a consent judgment that had been entered into with French. The primary issue for the court was whether the consent judgment could be set aside on the grounds of irregularity, illegality or lack of good faith.

The court considered the circumstances under which the consent judgment was entered. It was established that French had entered into the consent judgment in good faith, as he had no intention to cause harm to the liquidators. However, the court held that the consent judgment could be set aside if it was entered into due to an irregularity or illegality. The court found that there was no evidence of any irregularity or illegality in the entry of the consent judgment. However, the court also noted that the conduct of the parties during the negotiations leading up to the consent judgment was relevant. The court found that the liquidators had acted in bad faith by pressuring French into entering the consent judgment without fully disclosing all the relevant facts.

The court held that the consent judgment could be set aside on the grounds of bad faith. The court noted that it was not enough for the party seeking to set aside the consent judgment to show that they acted in good faith. Instead, the court must consider the conduct of both parties during the negotiations leading up to the consent judgment. The court found that the liquidators had acted in bad faith by pressuring French into entering the consent judgment without fully disclosing all the relevant facts. The court held that the consent judgment was therefore set aside. The court made no further orders as the matter was to be remitted to the primary judge for further consideration.