Dracoma Pty Ltd v Changela [2025] NSWSC 83

Supreme Court New South Wales

Medium Neutral Citation: Dracoma Pty Ltd v Changela [2025] NSWSC 83 Hearing dates: 2-5, 9, 19 December 2024; further written submissions 20 and 23 December 2024 Date of orders: 21 February 2025 Decision date: 21 February 2025 Jurisdiction: Equity - Commercial List Before: Stevenson J Decision: Fifth defendant did not act in position of director; third defendant did act in position of director; assignment of claims under Part 5.7B of the Corporations Act 2001 (Cth) and for breach of fiduciary and general law directors' duties effective; advances made to the Company were loans; Company was insolvent by 31 December 2017; certain of the assigned claims succeed Catchwords: EQUITY – assignment – of causes of action – where liquidator of company associated with the defendants entered deed of assignment with plaintiff – where plaintiff as assignee seeks to recover from defendants on various bases – whether causes of action regarding voidable transactions, fiduciary duties, statutory directors' duties, and general law directors' duties capable of assignment CORPORATIONS – directors and officers – de facto directors – where first and second defendants were directors of company but played no role in company's affairs – where plaintiff contends third, fourth, and fifth defendants acted in the position of directors of the company – where defendants admitted that third and fourth defendants were directors – whether fifth defendant acted in the position of director CORPORATIONS – winding up – voidable transactions – where plaintiff contends payments to defendants and related parties from company were unfair preferences or unreasonable director-related transactions or otherwise voidable – where defendants contend payments were loans Legislation Cited: Conveyancing Act 1919 (NSW) Corporations Act 2001 (Cth) Sale of Goods Act 1923 (NSW) Cases Cited: Alora Davies Developments 104 Pty Ltd (in liq) v Raphael [2024] NSWSC 547 Anderson v Canaccord Genuity Financial Ltd [2022] NSWSC 58 Anderson v Canaccord Genuity Financial Ltd (2023) 113 NSWLR 151; [2023] NSWCA 294 ASIC v ABC Fund Managers Ltd (No. 2) [2001] VSC 383 Barre v Barre [2021] FamCA 101 Breen v Williams (1996) 186 CLR 71; [1996] HCA 57 Cant, in the matter of Novaline Pty Ltd (in liq) [2011] FCA 898 Cussen v Sultan [2009] NSWSC 1114 Deputy Commissioner of Taxation v Austin [1998] FCA 1034; (1998) 28 ACSR 565 EC Dawson Investments Pty Ltd v Crystal Finance Pty Ltd (No 3) [2013] WASC 183 Elfic Ltd v Macks [2003] 2 Qd R 125; [2001] QCA 219 Featherstone v Ashala Model Agency Pty Ltd (in liq) [2018] 3 Qd R 147; [2017] QCA 260 Fisher v Divine Homes Pty Ltd; Allen v Harb [2011] NSWSC 8 Galati v Deans [2021] NSWSC 1094 H2 Migration & Education Pty Ltd v Gu [2023] WASC 199 In the matter of ACN 091 518 302 Pty Ltd (In Liquidation) (formerly Pinnacle Investments Pty Ltd) [2019] VSC 699 In the matter of Colorado Products Pty Ltd (in prov liq) [2014] NSWSC 789 In the matter of Lawrence Waterhouse Pty Ltd (in liq) – Shaw v Minden Pty Ltd [2011] NSWSC 964 In the matter of SSET Construction Pty Ltd (in liq) - Sims v Khattar [2010] NSWSC 102 Kitay v Frigger [2022] WASC 284 Lifestyle Holdings Australia & New Zealand Pty Ltd, in the matter of Re Venice Lane Pty Ltd (in liq) v Wu [2023] FCA 795 Lottah Mining Pty Ltd (in liq) v Summers [2024] VSC 47 Marcolongo v Chen (2011) 242 CLR 546; [2011] HCA 3 McDonald v Hanselmann (1998) 144 FLR 463 Natcomp Technology Australia Pty Limited v Graiche [2001] NSWCA 120 Pentridge Village Pty Ltd (in liq) v Capital Finance Australia Ltd (2018) 339 FLR 35; (2018) 58 VR 1; [2018] VSC 633 Re Italiano Family Fruit Company Pty Ltd (in liq) (2010) 190 FCR 474; [2010] FCA 1355 Schlegel v Gourmania Holdings Pty Ltd [2019] WASC 277 Woodgate v Fawcett [2008] NSWSC 868 Category: Principal judgment Parties: Dracoma Pty Ltd (Plaintiff) Radhika Rajan Changela (First Defendant) Sweta Prashant Changela (Second Defendant) Vijay Chandrashanker Pandya (Third Defendant) Prashant Girishbhai Changela (Fourth Defendant) Rajan Girishbhai Changela (Fifth Defendant) Changela Food Pty Ltd (Sixth Defendant) Vijay Pandya Pty Ltd (Seventh Defendant) Representation: Counsel: G Laughton SC / J Hynes (Plaintiff) Dr A J Greinke (Defendants)