Australian Securities and Investments Commission v Marco (No 13) [2023] FCA 83

Federal Court of Australia

Australian Securities and Investments Commission v Marco (No 13) [2023] FCA 83 File number: WAD 481 of 2018

Judgment of: FEUTRILL J

Date of judgment: 13 February 2023

Catchwords: CORPORATIONS – unregistered managed investment schemes – receivers and managers appointed – liquidators appointed – insolvent scheme and corporate and individual scheme operators - whether liquidators justified in treating scheme as a Ponzi scheme - whether liquidators justified in treating proceeds of company and scheme as trust property – whether liquidators justified in tracing into scheme operators' property – whether liquidators justified in pooling trust property – whether liquidators justified in disregarding accrued and rolled-over interest on scheme investments – whether scheme members must account for distributions received prior to liquidation – application of hotchpot principle in calculation of the distribution from the common deficient fund

Legislation: Corporations Act 2001 (Cth) ss 9, 90-15, 553C, 556, 579E, 579G, 601EB, 601ED(1)(a), 601EE, 601EE(1), 601EE(2), 601ED(5), 911A, 1323 Federal Court Rules 2011 (Cth) r 39.05(e) Trustees Act 1962 (WA) s 92

Cases cited: Australian Securities and Investments Commission v Idylic Solutions Ltd [2009] NSWSC 1306; (2009) 76 ACSR 129 Australian Securities and Investments Commission v Letten (No 20) [2012] FCA 1283; (2012) 92 ACSR 630 Australian Securities and Investments Commission v Nelson [2003] NSWSC 129; (2003) 44 ACSR 719 Australian Securities and Investments Commission v Marco (No 3) [2020] FCA 719; (2020) 145 ACSR 265 Australian Securities and Investments Commission v Marco (No 6) [2020] FCA 1781 Australian Securities and Investments Commission v Piggott Wood & Baker (A Firm) (No 6) [2019] FCA 672 Australian Securities and Investments Commission v Tasman Investment Management Ltd [2006] NSWSC 943; (2006) 202 FLR 343 Barclays Bank Ltd v Quistclose Investments Ltd [1970] AC 567; [1968] 3 All ER 651 Bastion v Gideon Investments Pty Ltd (In Liq) [2000] NSWSC 939; (2000) 35 ACSR 466 Baxter Global Investments Pty Ltd (ACN 159 246 670) v Marco [2020] NSWSC 1293 Black v S Freedman & Co [1910] HCA 58; (1910) 12 CLR 105 Blatchford v Laine [2018] WASC 207; (2018) 17 ASTLR 455 Byrnes v Kendle [2011] HCA 26; (2011) 243 CLR 253 Caron v Jahani (No 2) [2020] NSWCA 117; (2020) 102 NSWLR 537 Cleaver v Delta American Reinsurance Co [2001] AC 328 Evans v European Bank Ltd [2004] NSWCA 82; (2004) 61 NSWLR 75 Foskett v McKeown [2001] 1 AC 102 Georges v Seaborn International (Trustee) [2012] FCA 75; (2012) 288 ALR 240 Goldus Pty Ltd (Subject to a Deed of Company Arrangement) v Cummins (No 4) [2021] FCA 1095 Grimaldi v Chameleon Mining NL (No 2) [2012] FCAFC 6; (2012) 200 FCR 296 Hancock v Rinehart [2019] NSWSC 1451 HIH Casualty & General Insurance Ltd v Building Insurers' Guarantee Corporation [2004] NSWSC 910; (2004) 51 ACSR 21 Heperu Pty Ltd v Belle [2009] NSWCA 252; (2009) 76 NSWLR 230 Kauter v Hilton [1953] HCA 95; (1953) 90 CLR 86 Kelly (Liquidator), in the matter of Halifax Investment Services Pty Ltd (in liquidation) v Loo [2021] FCA 531; (2021) 390 ALR 669 Markopoulus v Marco [2020] WASC 79 Ponzi v Fessenden (1922) 258 US 254 Rambaldi (Trustee) v Commissioner of Taxation, Alex (Bankrupt), Re [2017] FCAFC 217; (2017) 107 ATR 1 Re Application of Perpetual Trustee Company Ltd [2003] NSWSC 1185 Re BBY Limited (Receivers and Managers appointed) (in liquidation) (No 2) [2018] NSWSC 346; (2018) 363 ALR 492 Re BBY Limited (Receivers and Managers appointed) (in liquidation) (No 3) [2018] NSWSC 1718 Re Bernard L Madoff Investment Securities LLC 654 F 3d 229 (2d Cir 2011) Re Courtenay House Capital Trading Group Pty Ltd (in liq) [2018] NSWSC 404; (2018) 125 ACSR 149 Re Courtenay House Capital Trading Group Pty Ltd (In Liq) [2020] NSWSC 780; (2020) 147 ACSR 1 Re French Caledonia Travel Service Pty Ltd (in liq) [2003] NSWSC 1008; (2003) 59 NSWLR 361 Re GB Nathan & Co Pty Ltd (In Liq) (1991) 24 NSWLR 674 Re Hobourn Aero Components Ltd's Air Raid Distress Fund; Ryan v Forrest [1946] Ch 86 Re Hobourn Aero Components Ltd's Air Raid Distress Fund; Ryan v Forrest [1946] Ch 194 Re MF Global Australia Ltd (in liq) [2012] NSWSC 994; (2012) 267 FLR 27 Re York Street Mezzanine Pty Ltd (in liq) [2011] FCA 1028; (2011) 196 FCR 479 Toksoz v Westpac Banking Corporation [2012] NSWCA 199; (2012) 289 ALR 577 Trident General Insurance Co Ltd v McNiece Bros Pty Ltd [1988] HCA 44; (1988) 165 CLR 107 Wambo Coal Pty Ltd v Ariff [2007] NSWSC 589; (2007) 63 ACSR 429