Australian Securities and Investments Commission v Administrative Appeals Tribunal [2010] FCA 807

Australian Securities and Investments Commission v Administrative Appeals Tribunal [2010] FCA 807

The Tribunal erred in its construction and application of s 1041A by treating Mr Bond's sale of his own shares as irrelevant to whether the transactions had or were likely to have the effect of creating an artificial price. Although s 1041A does not directly proscribe intention, the concept of an artificial price requires attention to whether the transaction was between a buyer and seller each seeking the most advantageous price. ASIC had raised that the client buy orders were used as a device enabling Mr Bond to sell his own shares at about $1.00. The Tribunal should not have put that fact aside. The appeal under s 44 of the AAT Act was therefore allowed, the Tribunal decision set aside,...

Jurisdiction
Australia
Judgment Date
30 July 2010
Procedural Posture
Application for Judicial Review and Appeal From an Administrative Appeals Tribunal Decision Concerning an ASIC Banning Order / Federal Court Judgment on QUD 50 of 2009 and QUD 55 of 2009
Outcome
QUD 50 of 2009 application dismissed; QUD 55 of 2009 appeal allowed; Administrative Appeals Tribunal decision set aside and matter remitted.
Legal Topics
['market Manipulation' 'artificial Price' 'asic Banning Order' 'appeal From Administrative Appeals Tribunal' 'judicial Review']
['corporations Law' 'administrative Law' 'financial Services Regulation'] ['market Manipulation' 'artificial Price' 'asic Banning Order' 'appeal From Administrative Appeals Tribunal' 'judicial Review']

Case Brief

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Procedural Posture

Application for Judicial Review and Appeal From an Administrative Appeals Tribunal Decision Concerning an ASIC Banning Order / Federal Court Judgment on QUD 50 of 2009 and QUD 55 of 2009

Legal Issues

  1. 1 ['Whether transactions in Prime shares had or were likely to have the effect of creating an artificial price for trading in financial products within s 1041A of the Corporations Act 2001 (Cth).' 'Whether intention is relevant to the construction and application of s 1041A of the Corporations Act 2001 (Cth).' 'Whether the Tribunal erred by putting aside the fact that Mr Bond sold his own shares when assessing whether the transactions created an artificial price.' 'Whether ASIC had reason to believe that Mr Bond would not comply with a financial services law for the purposes of s 920A(1)(f) of the Corporations Act 2001 (Cth).' "Whether ASIC's ADJR Act proceeding should proceed alongside its appeal under s 44 of the Administrative Appeals Tribunal Act 1975 (Cth)."]

Ratio Decidendi

The Tribunal erred in its construction and application of s 1041A by treating Mr Bond's sale of his own shares as irrelevant to whether the transactions had or were likely to have the effect of creating an artificial price. Although s 1041A does not directly proscribe intention, the concept of an artificial price requires attention to whether the transaction was between a buyer and seller each seeking the most advantageous price. ASIC had raised that the client buy orders were used as a device enabling Mr Bond to sell his own shares at about $1.00. The Tribunal should not have put that fact aside. The appeal under s 44 of the AAT Act was therefore allowed, the Tribunal decision set aside,...

Court Disposition

QUD 50 of 2009 application dismissed; QUD 55 of 2009 appeal allowed; Administrative Appeals Tribunal decision set aside and matter remitted.

Orders

  • ['In QUD 50 of 2009, the application be dismissed.' 'In QUD 50 of 2009, the parties have liberty to apply within seven days as to costs.' 'In QUD 55 of 2009, the appeal be allowed.' 'In QUD 55 of 2009, the decision of the Administrative Appeals Tribunal dated 23 January 2009 be set aside.' 'In QUD 55 of 2009, the...