Rapsey, in the matter of Australasian Mortgage Finance Limited (Administrator Appointed) [2021] FCA 189

Federal Court of Australia

Rapsey, in the matter of Australasian Mortgage Finance Limited (Administrator Appointed) [2021] FCA 189 File number: NSD 15 of 2021

Judgment of: NICHOLAS J

Date of judgment: 9 March 2021

Catchwords: CONTRACTS – where directors of company remunerated under consulting agreements made with them or their related entities – where directors made statements to auditors stating that they agreed to take equity in lieu of cash under those agreements – where financial statements and shareholder updates reference that agreement – where two of the contracts contain express provision allowing for agreement to receive payment in form of shares in the company – where contracts contain a no oral modification clause – whether consultants and company agreed to accept equity in lieu of cash – where directors failed to take any steps to procure allotment of shares – whether modification required to be in writing – whether any agreement to vary consultancy agreement supported by consideration CONTRACTS – whether company breached consultancy agreements – whether consultants estopped from relying on alleged breach – time at which damages for breach of contract should be assessed – whether consultants have suffered any loss in circumstances where shares in company are now worthless

Legislation: Corporations Act 2001 (Cth) ss 208-211, 436A

Cases cited: Cenric Group v TWT Property Group [2018] NSWSC 1570 GEC Marconi Systems Pty Ltd v BHP Information Technology Pty Ltd (2003) 128 FCR 1 Hawcroft General Trading Co Pty Ltd v Hawcroft [2017] NSWCA 91 Hill v Forteng Pty Ltd [2019] 138 ACSR 344 Johnson v Agnew [1980] AC 367 (HL) Johnson v Perez (1988) 166 CLR 351 MWB Business Exchange Centres Ltd v Rock Advertising Ltd [2019] AC 119 The Millstream Pty Ltd v Schultz [1980] 1 NSWLR 547 Toprak v Finagrain [1979] 2 Lloyd's Rep 98