ASIC v Vines [2005] NSWSC 738

Reported Decision : 55 ACSR 617 (2005) 23 ACLC 1387

New South Wales Supreme Court

ASIC v Vines [2005] NSWSC 738 CITATION : This decision has been amended. Please see the end of the judgment for a list of the amendments.

HEARING DATE(S) : 21-24, 27-31 October, 3-7, 10,11,13,14, 17-20, 24-28 November, 1-5, 8, 10-12, 15-19 December 2003, 3-6, 10, 11 February, 13, 15, 16, 20-23, 28-30 April 2004 and written submissions

JUDGMENT DATE : 22 August 2005

JURISDICTION : Equity

JUDGMENT OF : Austin J

DECISION : See under heading "Conclusions"

CATCHWORDS : CORPORATIONS - Officers of a corporation - chief financial officer - executive director of reinsurance business - meaning of "executive officer" - statutory standard of care and diligence - content of standard - application to profit forecast in target's statement in response to takeover bid - application to due diligence process in respect of profit forecast - statutory duty to act honestly - application to statements made during a meeting with auditors and financial experts - application to letter offering to take back risk in order to obtain financial reinsurance

Corporations Act 2001 (Cth) ss 1400, 1401 LEGISLATION CITED : Corporations Law ss 9, 232, 1317FA Evidence Act 1995 (NSW) s 140

Adler v ASIC (2003) 46 ACSR 504 Andrews v DPP [1937] AC 576 ASIC v Vines (2003) 48 ACSR 322 Australian Growth Resources Corporation Pty Ltd v Van Reesema (1988) 13 ACLR 261 Australian Securities Commission v Gallagher (1993) 11 WAR 105 Briginshaw v Briginshaw (1938) 60 CLR 336 Callaghan v The Queen (1952) 87 CLR 115 Chew v The Queen (1992) 173 CLR 626 Clout v Hutchinson (1950) 51 SR (NSW) 32 Commissioner for Corporate Affairs v Bracht [1989] VR 821 Commonwealth Bank of Australia v Friedrich (1991) 5 ACSR 115 Corporate Affairs Commission v Papoulias (1990) 20 NSWLR 503 Customs and Excise Commissioners v A [2003] 2 All ER 736 Dabholkar v The King [1948] AC 221 Digi-Tech (Australia) Ltd v Brand [2004] NSWCA 58 Feil v Commissioner of Corporate Affairs (1991) 9 ACLC 811 Fitzsimmons v R (1997) 23 ACSR 355 CASES CITED : Forge v ASIC (2004) 52 ACSR 1 Forkserve Pty Ltd v Jack (2001) 19 ACLC 299 Hksar v Lee Ming Tee & Securities and Futures Commission [2004] 1 HKLRD 513 Marchesi v Barnes [1970] VR 434 Mercer v Commissioner for Road Transport and Tramways (NSW) (1936) 56 CLR 580 Moukhayber v Camden Timber & Hardware Co Pty Ltd [2002] NSWCA 58 R v D [1984] 3 NSWLR 29 R v White (1951) 51 SR (NSW) 188 Rich v ASIC (2004) 78 ALJR 1354 Southern Resources Ltd v Residues Treatment & Trading Co Ltd (1990) 56 SASR 455 Standard Chartered Bank Ltd v Antico (No 1) (1995) 38 NSWLR 290 Swinton v The China Mutual Steam Navigation Co Ltd (1951) 83 CLR 553 Sycotex Pty Ltd v Baseler (No 2) (1994) 51 FCR 425 Tesco Supermarkets Ltd v Nattrass [1972] AC 153 Trust Co of Australia v Perpetual Trustees Ltd (1997) 42 NSWLR 237 Watson v Foxman (2000) 49 NSWLR 315 Whitlam v ASIC (2003) 46 ACSR 1 Wyong Shire Council v Shirt (1980) 146 CLR 40