Salary Packaging Australia Pty Limited v Andropov

Salary Packaging Australia Pty Limited brought a claim against several defendants for breaches of fiduciary duty and to account for benefits gained. The plaintiff was in the business of salary packaging services, including organising novated leases and administering them. The plaintiff's general manager, one of the defendants, assisted a company owned by him and his wife to earn brokerage and insurance commissions from organising novated lease services in 391 transactions. The court was required to determine whether the general manager's involvement in his family company's business had the informed consent of the plaintiff, whether his involvement breached the fiduciary duty he owed to the plaintiff, and whether the commissions he received constituted a secret profit.

The court found that the general manager's family company's business was not materially different to the plaintiff's business and that he failed to prove his involvement had the informed consent of the plaintiff. The court held that the general manager's involvement in his family company's business was a breach of the fiduciary duty he owed to the plaintiff. The court also found that the general manager's receipt of commissions from the insurer under an incentive program for insurance products sold by the plaintiff in connection with novated leases was a secret profit in respect of his employment. The court held that the general manager's wife, who had limited participation in the transactions undertaken by the family company, was not aware that the family company's business in novated leases was conducted without the permission of the plaintiff.

The court dismissed the plaintiff's claim against the fourth defendant and ordered the plaintiff to pay the fourth defendant's costs of the proceeding. The court awarded judgment for the plaintiff against the first and second defendants for equitable compensation in the sum of $978,335 together with interest. The court also awarded judgment for the plaintiff against the first defendant for equitable compensation in the sum of $41,900 together with interest.