Re Krypton Nominees Pty Ltd

In the case of Re Krypton Nominees Pty Ltd, the plaintiff, Krypton Nominees, sought relief against the defendants for alleged misleading and deceptive conduct and failure to provide a Product Disclosure Statement in the sale of shares. The dispute was heard in the Supreme Court of Queensland. The plaintiff argued that it relied on representations made by the defendants, who were involved in a group of companies, and sought to set aside the contract of sale and recover damages for misleading and deceptive conduct and the failure to provide the required disclosure statement.

The court was required to determine whether the plaintiff had relied on the misrepresentations made by the defendants, whether the plaintiff was a "sophisticated investor" under the Corporations Act, and whether the defendants' conduct was unconscionable. Additionally, the court needed to decide if the plaintiff was at a special disadvantage and if the nominated company was entitled to ratify the contract and exercise remedies available to the initial contracting company.

The court found that the plaintiff was entitled to ratify the contract and exercise the remedies available to the initial contracting company. The court held that the nominated company could rely on the representations made to the director who negotiated the contract in seeking to have the contract of purchase set aside for misleading and deceptive conduct and failure to provide a Product Disclosure Statement. The court also determined that the defendants' conduct was not unconscionable and that the plaintiff was not at a special disadvantage. Consequently, the plaintiff's claim for unconscionability was rejected.

The court ordered that the nominated company, Krypton Nominees, be entitled to ratify the contract of sale and exercise the remedies available to the initial contracting company. The court further found that the plaintiff was not a "sophisticated investor" and that the sale of shares was on terms that satisfied the exemption in section 708(8)(a) of the Corporations Act. The court dismissed the plaintiff's claims for relief based on misleading and deceptive conduct and failure to provide a Product Disclosure Statement.