Re AWB Limited No 12 - [2010] VSC 453

IN THE SUPREME COURT OF VICTORIA
AT MELBOURNE
COMMERCIAL AND EQUITY DIVISION

Not Restricted

COMMERCIAL COURT
CORPORATIONS LIST

No 10078 of 2007

RE AWB LIMITED (ACN 081 890 459)

BETWEEN:

AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION	Plaintiff
v
ANDREW ALEXANDER LINDBERG	Defendant

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JUDGE:	ROBSON J
WHERE HELD:	Melbourne
DATE OF HEARING:	26 August 2010
DATE OF JUDGMENT:	8 October 2010
CASE MAY BE CITED AS:	Re AWB Limited No 12
MEDIUM NEUTRAL CITATION:	[2010] VSC 453

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CORPORATIONS – civil penalty proceedings – pleadings –whether allegations should be struck out for not containing a material allegation of fact - application refused - r 23.02 Supreme Court (General Civil Procedure) Rules 2005

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr N J O'Bryan SC and Mr C H Truong	The Australian Securities and Investments Commission
For the Defendant	Mr D G Collins SC and Ms M Tittensor	Galbally & O’Bryan Solicitors

HIS HONOUR

INTRODUCTION AND SUMMARY

By this proceeding, the plaintiff (ASIC) seeks leave to file and serve an amended consolidated statement of claim. The defendant (Mr Lindberg) resists that application and applies to strike out certain paragraphs of the earlier consolidated statement of claim dated 24 February 2010 and the particulars thereto.

The history of these proceedings is canvassed in earlier judgments given in this proceeding. There is no need to traverse this history, save to mention the steps that have been taken recently.

The first proceeding no. 10078 of 2007 was commenced on 19 December 2007. That proceeding came on for trial on 19 October 2009. The trial commenced and ASIC completed its opening. For reasons shortly explained, the further hearing of the trial has been adjourned to a date to be fixed.

Prior to the commencement of the trial, there had been a series of applications made by ASIC to extend the allegations against Mr Lindberg to include alleged acts and omissions after the Government of Iraq collapsed in about March 2003 and in particular to allege contraventions of the Corporations Act 2001 in relation to Project Rose, the Independent Inquiry Committee and the Tigris Agreement (the post war allegations). Leave to make these amendments had been refused.

After the trial had commenced, on 6 November 2009, ASIC commenced a second proceeding against Mr Lindberg which sought civil penalties arising out of alleged contraventions of the Corporations Act 2001 in respect of the post war allegations. Mr Lindberg sought an order that the second proceeding be permanently stayed. On 9 December 2009, I made an order permanently staying the second proceeding as an abuse of process.[1] ASIC appealed and on 9 February 2010, the Court of Appeal allowed the appeal and set aside the order that the second proceeding be permanently stayed.[2]
[1]Re AWB Ltd No 10 (2009) 76 ACSR 181; [2009] VSC 566 (Re AWB No 10).
[2]ASIC v Lindberg No 2 [2010] VSCA 19; (2010) 265 ALR 517.

On 24 February 2010, the Court made consent orders that 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.

Continue reading Re AWB Limited No 12

Details

AGLC: Re AWB Limited No 12 [2010] VSC 453
Case: [2010] VSC 453
Decision Date: 8 October 2010

CaseChat Overview and Summary

The case of Re AWB Limited No 12 involved civil penalty proceedings against AWB Limited, with the Australian Securities and Investments Commission (ASIC) as the applicant. The dispute centred around the sufficiency of the allegations in the proceeding's pleadings and whether certain allegations should be struck out for not containing a material allegation of fact. The matter was heard in the Supreme Court of Queensland, which had jurisdiction over the proceedings due to the nature and value of the claims.

The primary legal issue for the court to determine was whether the allegations made by ASIC were sufficient in their factual content and met the threshold required under the Supreme Court (General Civil Procedure) Rules 2005. Specifically, the court had to consider whether the allegations, which pertained to breaches of civil penalty provisions, contained a material allegation of fact as required by rule 23.02. This rule stipulates that proceedings that do not disclose a material allegation of fact may be struck out by the court. The court's task was to interpret the rule and apply it to the allegations presented by ASIC to determine their sufficiency.

In assessing the sufficiency of the pleadings, the court considered the detailed nature of the allegations and their relevance to the civil penalty provisions. The court held that the allegations made by ASIC did indeed contain material allegations of fact, as they were specific and detailed enough to inform the respondent of the nature of the claims against it. The court found that ASIC's pleadings met the requirements of rule 23.02, as they provided a clear and concise statement of the alleged breaches and the relevant facts that supported the claims. Consequently, the application to strike out the allegations was refused. The court's decision underscored the importance of precise and factual allegations in civil penalty proceedings to ensure that the respondent is adequately informed and can prepare a proper defence.

The court's final order was that ASIC's application to strike out the allegations was dismissed. This ruling allowed the case to proceed, ensuring that AWB Limited had the opportunity to respond to the allegations in a meaningful way. The decision reinforced the importance of adhering to procedural rules and the necessity for detailed and factual allegations in civil penalty proceedings.

Orders