Court of Appeal
Supreme Court
New South Wales
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Medium Neutral Citation: Sunnya Pty Ltd v He [2025] NSWCA 79 Hearing dates: 25 and 26 November 2024 Date of orders: 24 April 2025 Decision date: 24 April 2025 Before: Bell CJ at [1];
Leeming JA at [2];
Basten AJA at [3]Decision: (1) As to the commercial invoices and under-value sales:
(a) Declare that Mr He and Ms Lu –
(i) contravened s 181(1)(b) of the Corporations Act in causing Sunnya to adopt the practice of issuing commercial invoices; and
(ii) contravened the Corporations Act, s 181(1)(a) and (b) and s 182, and breached their fiduciary duties to Sunnya, by causing or permitting Sunnya in April 2021 to engage in the under-value sales.
(b) Declare that GNT –
(i) was involved in Mr He and Ms Lu’s contraventions referred to in (a) above within s 79 of the Corporations Act;
(ii) knowingly assisted the breaches of fiduciary duty by Mr He and Ms Lu referred to in (a)(ii) above.
(c) In respect of the breaches identified at (a) and (b) above, order that each of Mr He, Ms Lu and GNT
(i) pay compensation to Sunnya pursuant to of the of the Corporations Act, s 1317H, in an amount to be determined, or
(ii) account to Sunnya for any benefit or gain obtained,
at the election of Sunnya.
(2) As to the Neurio product sales:
(a) Declare that Mr He and Ms Lu breached fiduciary duties owed to Sunnya in relation to the Neurio product sales.
(b) Order that Mr He and Ms Lu:
(i) pay equitable compensation to Sunnya for loss suffered by reason of Mr He and Ms Lu’s breaches of fiduciary duty in relation to the Neurio product sales, in an amount to be determined; or
(ii) account to Sunnya for any benefit or gain, obtained or received, by Mr He and Ms Lu by reason of their breaches of fiduciary duty in relation to the Neurio product sales,
at the election of Sunnya.
(c) Declare that each of GABT, GNT, Supermega and Megadairy knowingly assisted the breaches of fiduciary duty by Mr He and Ms Lu in relation to the Neurio product sales.
(d) Order that each of GABT, GNT, Supermega and Megadairy:
(i) pay equitable compensation to Sunnya for loss suffered by reason of their knowing assistance in the breaches of fiduciary duty in relation to the Neurio product sales, in an amount to be determined; or
(ii) account to Sunnya for any benefit or gain, obtained or received, by reason of their knowing assistance in the breaches of fiduciary duty in relation to the Neurio product sales,
at the election of Sunnya.
(3) As to the Neurio/NRIO sales:
(a) Declare that GNT knowingly assisted the breaches of fiduciary duty by Mr He and Ms Lu referred to in orders (22) and (26) made by the trial judge.
(b) Order that GNT:
(i) pay equitable compensation to Sunnya for…
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- AGLC
- Sunnya Pty Ltd v He [2025] NSWCA 79
- Case
- [2025] NSWCA 79
- Decision Date
CaseChat Overview and Summary
The court was required to determine whether Mr He and Ms Lu contravened sections 181 and 182 of the *Corporations Act 2001* (Cth) by improperly exercising their powers and using their positions. Additionally, the court had to consider whether the third parties were involved in these contraventions within the meaning of section 79 of the *Corporations Act* and whether they knowingly assisted in the breaches of fiduciary duties owed by Mr He and Ms Lu to Sunnya. The legal issues extended to the interpretation of "improper purpose" under the *Corporations Act*, including whether dishonesty was a necessary element and the circumstances under which an honest belief would be considered rational, as well as the application of the second limb of the rule in *Barnes v Addy* concerning knowing assistance by third parties.
The court found that Mr He and Ms Lu had contravened sections 181(1)(b) and 181(1)(a) and (b) of the *Corporations Act*, and breached their fiduciary duties to Sunnya, in relation to the commercial invoices and under-value sales. It was also declared that GNT was involved in these contraventions and knowingly assisted in the breaches of fiduciary duty. Regarding the Neurio product sales, the court declared that Mr He and Ms Lu breached their fiduciary duties, and that GABT, GNT, Supermega, and Megadairy knowingly assisted in these breaches. Furthermore, GNT was found to have knowingly assisted in breaches of fiduciary duty concerning Neurio/NRIO sales.
The court ordered that Mr He, Ms Lu, and GNT were liable to pay compensation to Sunnya or account for any benefit or gain obtained, at Sunnya's election, for the breaches identified. Similarly, GABT, GNT, Supermega, and Megadairy were ordered to pay equitable compensation or account for benefits received in relation to the Neurio product sales. GNT was also ordered to pay compensation or account for gains in relation to the Neurio/NRIO sales. The court also made orders regarding the costs of the appeal and varied certain orders made by the trial judge.
Orders
Orders of the court
(1) As to the commercial invoices and under-value sales:
(a) Declare that Mr He and Ms Lu –
(i) contravened s 181(1)(b) of the Corporations Act in causing Sunnya to adopt the practice of issuing commercial invoices; and
(ii) contravened the Corporations Act, s 181(1)(a) and (b) and s 182, and breached their fiduciary duties to Sunnya, by causing or permitting Sunnya in April 2021 to engage in the under-value sales.
(b) Declare that GNT –
(i) was involved in Mr He and Ms Lu’s contraventions referred to in (a) above within s 79 of the Corporations Act;
(ii) knowingly assisted the breaches of fiduciary duty by Mr He and Ms Lu referred to in (a)(ii) above.
(c) In respect of the breaches identified at (a) and (b) above, order that each of Mr He, Ms Lu and GNT
(i) pay compensation to Sunnya pursuant to of the of the Corporations Act, s 1317H, in an amount to be determined, or
(ii) account to Sunnya for any benefit or gain obtained,
at the election of Sunnya.
(2) As to the Neurio product sales:
(a) Declare that Mr He and Ms Lu breached fiduciary duties owed to Sunnya in relation to the Neurio product sales.
(b) Order that Mr He and Ms Lu:
(i) pay equitable compensation to Sunnya for loss suffered by reason of Mr He and Ms Lu’s breaches of fiduciary duty in relation to the Neurio product sales, in an amount to be determined; or
(ii) account to Sunnya for any benefit or gain, obtained or received, by Mr He and Ms Lu by reason of their breaches of fiduciary duty in relation to the Neurio product sales,
at the election of Sunnya.
(c) Declare that each of GABT, GNT, Supermega and Megadairy knowingly assisted the breaches of fiduciary duty by Mr He and Ms Lu in relation to the Neurio product sales.
(d) Order that each of GABT, GNT, Supermega and Megadairy:
(i) pay equitable compensation to Sunnya for loss suffered by reason of their knowing assistance in the breaches of fiduciary duty in relation to the Neurio product sales, in an amount to be determined; or
(ii) account to Sunnya for any benefit or gain, obtained or received, by reason of their knowing assistance in the breaches of fiduciary duty in relation to the Neurio product sales,
at the election of Sunnya.
(3) As to the Neurio/NRIO sales:
(a) Declare that GNT knowingly assisted the breaches of fiduciary duty by Mr He and Ms Lu referred to in orders (22) and (26) made by the trial judge.
(b) Order that GNT:
(i) pay equitable compensation to Sunnya for the loss suffered by it by reason of those breaches of duty, in an amount to be determined; or
(ii) account to Sunnya for any benefit or gain, obtained or received, by reason of GNT’s knowing assistance in the breaches of duty,
at the election of Sunnya.
(4) As to costs, order that:
(a) the first and second respondents pay the appellants’ costs of the appeal;
(b) the NZ parties be jointly and severally liable with the first and second respondents for 20% of the appellants’ costs of the appeal;
(c) Order 1 of the orders made by Williams J in proceeding 2022/329426 on 5 June 2024 be set aside;
(d) Order 4(a) of the orders made by Williams J in proceeding 2022/329426 on 5 June 2024 be varied to add the words “the fourth defendant (GNT)” after the words “the third defendant (GABT)”.
(5) Liberty to all parties to apply by notice of motion for variation of these orders within 28 days of this judgment.
(6) Direct that these orders not be entered for 28 days.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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