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Australian Securities and Investments Commission v Atlantic 3 Financial (Aust) Pty Ltd[2004] QSC 422

Australian Securities and Investments Commission v Atlantic 3 Financial (Aust) Pty Ltd[2004] QSC 422

SUPREME COURT OF QUEENSLAND

CIVIL JURISDICTION

DOUGLAS J

No 4426 of 2003

AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

Applicant

and

 

ATLANTIC 3 FINANCIAL (AUST) PTY LTD (ACN 056 262 723)

First Respondent

BRISBANE

DATE 11/11/2004

JUDGMENT

HIS HONOUR: This is an application for an order that the remuneration and disbursements of the applicants, Gregory Michael Moloney and Peter Ivan Felix Geroff, as investigative accountants appointed by order of this Court dated 27 May 2003 incurred in relation to an application filed in these proceedings on 11 September 2003, be determined in the amount of $178,555.64 inclusive of GST.

They had been appointed investigative accountants by Mcmurdo J on 27 May 2003 and had previously sought remuneration for work performed from 27 May 2003 through to 17 July 2003. This application for remuneration is for work done by them in preparing and bringing a remuneration claim for the period commencing 22 September 2003.

The procedure for the Court to follow was set out in reasons for judgment delivered by Justice Mullins on 7 May 2004 in ASIC v. Atlantic 3 Financial (Aust) Pty Ltd [2004] QSC 133 at [15] in reliance upon some earlier decisions referred to there by her Honour and I propose to adopt a similar course here.

It is worth setting out in a little detail what led to this application being brought. On 11 September 2003 the applicants filed an application and an affidavit seeking remuneration for the period 27 May 2003 to 17 July 2003. That application was resisted, particularly by the second and third respondents who are not represented here before me today because no order affecting their interests is sought.

The objectors were required by Justice Mullins to provide a notice of objection on 25 September 2003. On 30 December 2003 it was served on the applicants, consisted of 89 pages containing 696 separate objections. It required a very significant amount of work by the applicants and their employees to respond to the 696 separate objections, the response including five volume of exhibits.

There was a three day hearing of the matter between 2 February 2004 and 4 February 2004 and on 7 May 2004 her Honour determined that the applicants were entitled to remuneration for $183,451.40 for fees and $17,742.21 for outgoings. That was almost entirely the full amount they had sought, apart from a deduction of less than $3,000 made by her Honour.

The second and third respondents lodged an appeal from that decision which was subsequently discontinued with them paying the applicants' costs of and incidental to the appeal.

On 7 September 2004 her Honour ruled on the costs of the first hearing, ordering that the bulk of the applicants' legal costs incurred be awarded on an indemnity basis against the second and third respondents in respect of the matters arising or incidental to the service of the respondent's notice of objection which was criticised stringently by her Honour. Notably, she said it had an immense effect on the work required on the part of the accountants to respond and prepare for the hearing of the application for the approval of their remuneration and disbursements; see ASIC v. Atlantic 3 Financial (Aust) Pty Ltd [2004] QSC 284 at [15].

This application is as a result of the work that the applicants had to perform to support their claim allowed by her Honour for fair and reasonable remuneration, dealing with material which required them to go far beyond what they should reasonably have been required to do.

There is an affidavit by Mr Maloney, filed 14 October 2004, dealing with the claimed expenses. Notably, the amount claimed before the service of the notice of objection is only $11,855.50 in fees and $319.40 in outlays. Her Honour's view of the matter was such that even that sum would not have been necessary but for the objections because she was satisfied that the material provided in support of the claim originally was enough to establish it. One can then see from Exhibit GMM3 to that affidavit the costs incurred in respect, essentially of the notice of objection and the hearing of the matter, and the subsequent appeal. Those figures were $141,340 for fees and $7,194.11 in outlays, with some further minor expenses incurred after 26 June 2004 detailed in Exhibit GMM4, comprising $1,611 in fees and 30 cents in outlays.

The fee charges and scales applied by the applicants' firm have been proved before me and seem to me to be reasonable and I feel that I can infer from her Honour's comments and the nature of the hearing that a great deal of work was required to respond to the objections by the second and third respondents which is reflected in the work that has been done. There is no opposition to the application, either from the applicant Australian Securities and Investments Commission or from the first respondent's liquidators.

It seems to me that the material does establish that the remuneration claimed is fair and reasonable and although there is no objector I am persuaded that the work done was required by the nature of the opposition to the previous claim for remuneration.

I have been provided with a statement of account reflecting in appropriately itemised form the details of the work done, the identity of the persons who did the work, the time taken for doing the work and the remuneration claimed accordingly. That statement has been verified by Mr Maloney's affidavit and it seems to me that I have been provided with sufficient information to enable me to perform my function.

Accordingly, I propose to make an order granting the application in the form of a draft which I expect to be handed to me.

HIS HONOUR: I have added in the words after “2003” in paragraph 2 “(including the sums referred to in the affidavit of Neil John Abercrombie filed 9 January 2004)”.

Close

Editorial Notes

  • Published Case Name:

    Australian Securities and Investments Commission v Atlantic 3 Financial (Aust) Pty Ltd

  • Shortened Case Name:

    Australian Securities and Investments Commission v Atlantic 3 Financial (Aust) Pty Ltd

  • MNC:

    [2004] QSC 422

  • Court:

    QSC

  • Judge(s):

    Douglas J

  • Date:

    11 Nov 2004

Litigation History

EventCitation or FileDateNotes
Primary Judgment[2003] QSC 26519 Aug 2003Appointment of liquidators to wind up unregistered managed investment schemes: Mullins J.
Primary Judgment[2003] QSC 36631 Oct 2003Application for directions by court appointed liquidators as to justification of entering deed of relinquishment: Mullins J.
Primary Judgment[2003] QSC 386 [2004] 1 Qd R 59114 Nov 2003Application by court appointed accountants for an injunction restraining winding up of unregistered managed investment scheme ordered pursuant to s 601EE(2) Corporations Act pending the payment of fees; role as investigative accountants and supervising accountant are analogous, in the circumstances, to the role of court appointed receiver and that they should have the same protection; grant the injunctive relief sought in support of an equitable lien for fees and expenses claimed: Mullins J.
Primary Judgment[2003] QSC 398 (2003) 48 ACSR 33527 Nov 2003Application for directions by court appointed liquidators as to being justified in refusing to sign deed providing for the transfer of assets in the unregistered managed investment scheme to investors; support of the investors for the proposed deed does not outweigh the considerations which fall under the umbrella of public interest which would not justify the liquidators entering into the proposed deed for this scheme: Mullins J.
Primary Judgment[2004] QSC 13307 May 2004Application for approval of remuneration and disbursements by court appointed investigative accountants for unregistered managed investment scheme; satisfied that fair and reasonable remuneration for the work undertaken by the accountants as investigative accountants pursuant to the order made on 27 May 2003 for preparing the report and undertaking the supervision is $183,451.40 and that the disbursements should be determined in the amount of $17,742.21: Mullins J.
Primary Judgment[2004] QSC 28407 Sep 2004Costs following judgment in [2004] QSC 133; costs following successful application for approval of remuneration of court appointed investigative accountants over unregistered managed investment scheme; notice of objection was so oppressive and speculative, that it warrants a departure from the usual order for costs, as from the service of the notice of objection on the accountants; accountants awarded costs on indemnity basis after service of notice of objection: Mullins J.
Primary Judgment[2004] QSC 42211 Nov 2004Application for an order determining the remuneration and disbursements of court appointed investigative accountants for work performed in relation to an application; orders made per draft: Douglas J.
Primary Judgment[2006] QSC 13205 Jun 2006Application by ASIC for declarations regarding the operation of unregistered managed investment schemes, not holding a dealer's licence or AFSL, and the offering of securities without disclosure documents in contravention of the Corporations Act; seeking disqualification orders arising from the alleged contraventions; declarations made and disqualifications ordered: Atkinson J.
Primary Judgment[2006] QSC 15223 Jun 2006Application for directions to the Registrar for the assessment of costs; seeking to overturn decision of Registrar to find client agreement was void under s 48F QLS Act, on the basis that the cost agreement did not comply with s 48 QLS Act; declared sufficient to amount to cost agreement for r 704(3)(b) UCPR: Mullins J.
Primary Judgment[2008] QSC 9 [2008] 2 Qd R 29808 Feb 2008Application following [2004] QSC 284 to fix costs; costs fixed in the amount of $84,000: Mullins J
Primary Judgment[2008] QSC 5320 Mar 2008Costs following judgment in [2008] QSC 9; respondents pay costs to be assessed: Mullins J.
Appeal Determined (QCA)[2004] QCA 23002 Jul 2004Appeal following [2004] QSC 133 dismissed with costs; no reasons for judgment: Davies JA.
Appeal Determined (QCA)[2006] QCA 540 [2007] 2 Qd R 39915 Dec 2006Appeal against [2006] QSC 152 dismissed with costs; appeal against decision declaring client agreement complied with s 48 QLS Act: Williams and Jerrard JJA and McMurdo J (Jerrard JA dissenting).

Appeal Status

Appeal Determined (QCA)

Cases Cited

Case NameFull CitationFrequency
Australian Securities and Investments Commission v Atlantic 3 Financial (Aust) Pty Ltd [2004] QSC 133
1 citation
Australian Securities and Investments Commission v Atlantic 3 Financial (Aust) Pty Ltd [2004] QSC 284
1 citation

Cases Citing

No judgments on Queensland Judgments cite this judgment.

1

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