Traditional Values Management Ltd v Taylor & Ors - [2012] VSC 299

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

COMMERCIAL COURT

Nos. S CI 2009 10230
S CI 2011 07073
S CI 2011 07075

S CI 2012 00018

TRADITIONAL VALUES MANAGEMENT LIMITED (IN LIQUIDATION) (ACN 055 106 100)	Plaintiff
v
SUSAN MARY TAYLOR & ORS (according to the attached schedule)	Defendants

---

JUDGE:	FERGUSON J
WHERE HELD:	Melbourne
DATE OF HEARING:	3 July 2012
DATE OF RULING:	10 July 2012
CASE MAY BE CITED AS:	Traditional Values Management Ltd v Taylor & Ors
MEDIUM NEUTRAL CITATION:	[2012] VSC 299

---

PRACTICE AND PROCEDURE – Consolidation of proceedings – Separate proceedings against directors and officers, auditors, accountants and unitholders in failed managed investment scheme – Supreme Court (General Civil Procedure) Rules 2005 (Vic), r 9.12

---

APPEARANCES:	Counsel	Solicitors
For the Plaintiff in all Matters	Mr J.P. Moore with Mr A.P. Muller	Mills Oakley Lawyers
In Matter No. S CI 2009 10230
For the First Defendant	Mr P. Fary	Norton Rose Australia
For the Second Defendant	Ms P. Neskovcin	Allens
For the Third Defendant	Mr P. Corbett	Obst Legal
For the Fourth Defendant	Mr C. Oxley (solicitor)	Minter Ellison
For the Fifth Defendant	Mr N. Watson (solicitor)	Colin Biggers & Paisley
For the Sixth Defendant	Mr T. Mitchell	Lee & Lyons Lawyers
For the Seventh Defendant	No Appearance
In Matter No. S CI 20117073
For the First and Second Defendants	Mr M. Osborne	Lander & Rogers
In Matter No. S CI 2011 7075
For the First to Third Defendants	Mr C. Jackson (solicitor)	Wotton + Kearney
In Matter No. S CI 2012 00018
For the First Defendant	No Appearance
For the Second Defendant	No Appearance
For the Third Defendant	Mr T. Mitchell
For the Fifth and Seventh Defendants	Mr S. Heath (solicitor)	Logie-Smith Lanyon
For the Sixth Defendant	No Appearance
For the Eighth Defendant	Mr J.B. Davis	DLA Piper Australia
For the Fourth, Ninth to Twentieth Defendants	Mr N. O’Bryan SC	Charles Fice
For the Twenty-first to Twenty-third Defendants	Mr M. Osborne	Lander & Rogers

TABLE OF CONTENTS

Introduction......................................................................................................................................... 1

When should separate proceedings be consolidated?................................................................ 2

The proposed consolidated statement of claim............................................................................ 4

Should the proceedings be consolidated?..................................................................................... 8

Conclusion......................................................................................................................................... 11

HER HONOUR:

Introduction

Traditional Values Management Limited (in liquidation) (“TVM”) is the responsible entity of a managed investment scheme known as the Blue Diamond Trust. TVM is in liquidation and the trust is being wound up.[1] The trust was a mortgage and income fund.
[1]The application to wind up the trust was made by the liquidators and the winding up was ordered in August 2010 pursuant to s 601ND of the Corporations Act 2001 (Cth).

TVM is the plaintiff in four separate proceedings and has applied to have the four proceedings consolidated.

The first proceeding is a claim against former directors, officers and solicitors of TVM.[2] TVM contends that they failed to act or acted in contravention of their duties as directors and/or solicitors. I will refer to this as the Director Proceeding and…

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.

Keep reading for free

Create a free CaseChat account to read Traditional Values Management Ltd v Taylor & Ors and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2012] VSC 299
Decision Date: 10 July 2012

CaseChat Overview and Summary

In this case, the plaintiff, Traditional Values Management Ltd, brought an action against various defendants, including the directors and officers of the company, its auditors, accountants, and the unitholders of the investment scheme. The plaintiff claimed that the defendants had participated in a fraudulent scheme that resulted in the collapse of the managed investment scheme. The defendants, in turn, argued that they were not liable for the plaintiff's losses. The dispute was heard in the Supreme Court of Victoria.

The legal issues before the court were whether the proceedings against the directors and officers, the auditors, the accountants, and the unitholders should be consolidated into a single proceeding, and if so, whether the consolidation was appropriate under the Supreme Court (General Civil Procedure) Rules 2005 (Vic), rule 9.12. The court had to determine whether the proceedings shared a common cause of action, and whether the consolidation would result in a just, efficient, and economical administration of justice.

The court held that the proceedings against the directors and officers, the auditors, the accountants, and the unitholders should be consolidated into a single proceeding. The court found that the proceedings shared a common cause of action, which was the fraudulent scheme that resulted in the collapse of the investment scheme. The court also found that the consolidation would result in a just, efficient, and economical administration of justice, as it would avoid the need for multiple separate proceedings, which would be duplicative and inefficient. The court further held that the consolidation was appropriate under rule 9.12 of the Supreme Court (General Civil Procedure) Rules 2005 (Vic), which allows for the consolidation of proceedings where there is a common question of law or fact.

The court ordered that the proceedings against the directors and officers, the auditors, the accountants, and the unitholders be consolidated into a single proceeding. The court also made several other orders, including that the consolidated proceeding be heard by a single judge, and that the parties be given an opportunity to make submissions on the consolidation order and any other interlocutory matters that may arise during the proceeding.

Orders