ASIC v Adler & 4 Ors [2002] NSWSC 483

Reported Decision : 42 ACSR 80 (2002) 20 ACLC 1146

New South Wales Supreme Court

CITATION : ASIC v Adler & 4 Ors [2002] NSWSC 483 CURRENT JURISDICTION: Equity FILE NUMBER(S) : SC 2753/01 HEARING DATE(S) : 06/05/02, 07/05/02 JUDGMENT DATE : 30 May 2002

In the matter of HIH Insurance Limited (in provisional liquidation) ACN 008 636 575 and HIH Casualty and General Insurance Limited (in provisional liquidation) ACN 008 482 291 Australian Securities & Investments Commission Plaintiff Rodney Stephen Adler First Defendant Raymond Reginald Williams PARTIES : Second Defendant Dominic Fodera Third Defendant Adler Corporation Pty Ltd (ACN 054 924 373) Fourth Defendant Lynda Sharon Adler Fifth Defendant JUDGMENT OF : Santow J

R B S Macfarlan QC/ P Durack/ A Abadee (Plaintiff) B W Walker, SC (First and Fourth Defendants) COUNSEL : P Crutchfield (Second Defendant) J E Sexton, SC (Third Defendant)

Jan Redfern, Solicitor for ASIC (Plaintiff) Gilbert & Tobin (First and Fourth Defendant) SOLICITORS : Arnold Bloch Leibler (agent: Sparke Helmore) (Second Defendant) Dibbs Crowther & Osborne (Third Defendant) Speed and Stracey (Fifth Defendant) CATCHWORDS : CORPORATIONS - Disqualification order from managing a corporation - Relevant principles and factors - Contrition - Impossibility of order limited to public companies - disqualified person can later apply for permission on a restricted or conditional basis - Compensation order - Relevant principles - Difficulty of differentiation between Defendants - Pecuniary penalty order - Relevant principles and factors - Totality principle - Relevance of multiple contraventions - Exoneration - Appearance of honesty - Relationship between civil and criminal prosecution. LEGISLATION CITED : Corporations Act 2001; s180 to s183; s206E; s206G; s208; s209; s260; s260A; s260C; s260D; s1317G; s1317H; s1317P; s1317Q; s1317S; s1318 Evidence Act 1995 (NSW) s128 Australian Competition and Consumer Commission v ABB Transmission and Distribution Limited (No. 2) ([2002] FCA 559 ,3 May 2002, unreported) Australian Competition and Consumer Commission v George Weston Foods Ltd (2000) ATPR 41-763 ACC v Rural Press Limited [2001] ATPR 41-833 ACCC v Universal Music Australia Pty Limited (No. 2) [2002] FCA 192 ASIC v Adler & Ors [2002] NSWSC 171; (2002) 41 ACSR 72 ASC v Donovan (1998) 28 ACSR 583 ASC v Forem- Freeway Enterprises (1999) 30 ACSR 339 Beech Petroleum NL v Kennedy (1999) 48 NSWLR 1 Brickenden v London Loan and Savings (1934) 3 DLR 465 Commonwealth Bank of Australia v Friedrich (1990-1) 5 ACSR 115 Re Gold Coast Holdings Pty Ltd ASIC v Papatto (2000) 35 ACSR 107 ASIC v Hutchings (2001) 38 ACSR 387 ASIC v Parkes (2001) 38 ACSR 355 ASIC v Pegasus Leveraged Options Group P/L & Anor [2002] NSWSC 310 ASC v Roussi (1999) 32 ACSR 568 ASC v Donovan at 609; ASC v Spencer (1997) 25 ACSR 143 CASES CITED : Barisic v Devenport [1978] 2 NSWLR 111 Bell v Thompson (1943) 34 SR(NSW) 431 Commissioner for Corporate Affairs v Ekamper (1987) 12 ACLR 519 D'Angola v Rio Pioneer Gravel Co Pty Ltd [1979] 1 NSWLR 495 Re Magna Alloys & Research Pty Ltd (1975) ACLR 203 NW Frozen Foods Pty Ltd v ACC (1996) 71 FCR 285 P.O. Morris Ltd v Perrott and Bolton [1945] 1 All ER 567 Pearce v the Queen (1988) 194 CLR 610 Power (Brett) Wayne [1999] NSWCCA 25, 5 March 1999, unreported) Queensland v JL Holdings Pty Limited (1997) 189 CLR 146 R v Towey (1996) 21 ACSR 46 Re Strikers Management P/L;ASC v Dimitri (Burchett J, Federal Court of Australia, 7 May 1997, unreported) Re Tasmanian Spastics Association; ASC v Nolan (1996) 23 ACSR 743 Trade Practices Commission v CSR Limited [1991] ATPR 52-135 Trade Practices Commission v Simpson Pope Ltd (1980) 30 ALR 544 Trade Practices Commission v Stihl Chain Saws (Aust) Pty Ltd (1978) ATPR 17-882 Wong v R (2002) 185 ALR 233 DECISION : Orders for relief made; see paras 110, 124, 160, 187, 188.