Australian Securities and Investments Commission v Wellington Capital Limited (No 2) [2013] FCAFC 70

Australian Securities and Investments Commission v Wellington Capital Limited (No 2) [2013] FCAFC 70

Because the Full Court had found that Wellington's relevant conduct was in breach of the Fund Constitution, cl 21.5 excluded Wellington's entitlement to indemnification out of the Fund for the trial costs, appeal costs, and its own costs unless it obtained the consent of the unit holders. The reasonableness of Wellington's conduct or advice obtained about the construction of the Constitution did not displace the express exclusion.

Jurisdiction
Australia
Judgment Date
02 July 2013
Procedural Posture
Appeal; Costs Determination / After Full Court Decision, Determining Costs Orders
Outcome
Costs orders made; Wellington to pay ASIC's costs and not be indemnified out of Fund assets absent unit holder consent.
Legal Topics
['costs' 'indemnification of Responsible Entity Out of Fund Assets' 'managed Investment Scheme Constitution' 'breach of Fund Constitution']
['corporations Law' 'civil Procedure'] ['costs' 'indemnification of Responsible Entity Out of Fund Assets' 'managed Investment Scheme Constitution' 'breach of Fund Constitution']

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Procedural Posture

Appeal; Costs Determination / After Full Court Decision, Determining Costs Orders

Legal Issues

  1. 1 ["Whether Wellington should pay ASIC's costs of the proceedings at first instance and the appeal." "Whether Wellington was entitled to be indemnified out of the assets of the Premium Income Fund for ASIC's costs and Wellington's own costs absent consent of unit holders."]

Ratio Decidendi

Because the Full Court had found that Wellington's relevant conduct was in breach of the Fund Constitution, cl 21.5 excluded Wellington's entitlement to indemnification out of the Fund for the trial costs, appeal costs, and its own costs unless it obtained the consent of the unit holders. The reasonableness of Wellington's conduct or advice obtained about the construction of the Constitution did not displace the express exclusion.

Court Disposition

Costs orders made; Wellington to pay ASIC's costs and not be indemnified out of Fund assets absent unit holder consent.

Orders

  • ['Paragraph 2 of the orders made on 28 May 2013 be varied, nunc pro tunc, by inserting before the words "be set aside" the words ", except Order 5a,".' 'The First Defendant (Wellington) pay the Appellant (ASIC) its costs of the proceedings at first instance subject to paragraph 5a of the orders made by Jagot J on 17...