Aviation 3030 Pty Ltd (in liq) v Lao, in the matter of Aviation 3030 Pty Ltd (in liq) [2022] FCA 458

FEDERAL COURT OF AUSTRALIA

Aviation 3030 Pty Ltd (in liq) v Lao, in the matter of Aviation 3030 Pty Ltd (in liq) [2022] FCA 458 File number: VID 174 of 2020

Judgment of: ANASTASSIOU J

Date of judgment: 29 April 2022

Catchwords: CORPORATIONS – application brought by Plaintiffs as liquidators – where liquidators of the company were appointed pursuant to winding up orders made – where company is solvent – where the company purchased land and subsequently sold it for a substantial profit – where Defendants are founding shareholders – where Defendants exercised rights under an "option agreement" to issue founder shares – where Defendants failed to give adequate disclosure in relation to founder shares – where exercise of options and subsequent share issue significantly diluted interests of existing shareholders – where First Defendant was also a director at the time of share issue – whether transaction in issue was an unreasonable director-related transaction pursuant to s 588FDA of the Corporations Act 2001 (Cth) – whether relief under s 588FF(4) of the Corporations Act was available for a solvent company – whether term creditor includes shareholder for the purposes of s 588FF(4) – scope of orders and remedies available under s 588FF(4) – whether First Defendant breached directors' duties pursuant to ss 180(1), 181(1) and 182(1) – whether First Defendant breached fiduciary duties – accessorial liability of other Defendants pursuant to s 79 of Corporations Act – claim for knowing assistance and knowing receipt – remedy fashioned according to specific circumstances of case PRACTICE AND PROCEDURE – application by Plaintiffs pursuant to r 30.21 of the Federal Court Rules 2011 (Cth) that the trial proceed in respect of all Defendants, notwithstanding First Defendant's failure to appear – application granted