Australian Securities and Investments Commission v Wooldridge [2019] FCAFC 172

Australian Securities and Investments Commission v Wooldridge [2019] FCAFC 172

The excision of the directors' s 209(2) Corporations Act contraventions by the High Court did not materially affect the seriousness of remaining contraventions and thus no adjustment of pecuniary penalties or disqualification periods was warranted; orders agreed as to the other Directors (Lewski, Jaques, Butler) were imposed as appropriate, and Dr Wooldridge's penalty and disqualification as fixed by the primary judge were not manifestly inadequate nor should be reduced to 'time served' given all relevant mitigating and practical factors had already been duly considered.

Parties
Applicant: Australian Securities and Investments Commission; First Respondent: Michael Richard Lewis Wooldridge; First Respondent: Kim Samuel Jaques; First Respondent: Mark Frederick Butler; First Respondent: William Lionel Lewski; Second Respondent: Australian Property Custodian Holdings Limited (Receivers and Managers appointed) (in liquidation) (Controllers appointed)
Jurisdiction
Australia
Judgment Date
11 October 2019
Procedural Posture
Appeal (on Remittal) Civil Penalty Proceedings / Final Judgment on Remittal From High Court
Outcome
For each proceeding, pecuniary penalties and disqualification orders imposed/confirmed as per reasons. Cross-appeals dismissed. No orders as to costs (each party to bear own costs in hearing on remitter).
Legal Topics
Directors' Duties, Civil Penalties, Disqualification Orders, Managed Investment Schemes, Sentencing Principles (civil Penalties), Parity Principle in Sentencing
Corporations Law Commercial Law Directors' Duties Civil Penalties Disqualification Orders Managed Investment Schemes Sentencing Principles (civil Penalties) Parity Principle in Sentencing

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Parties

Australian Securities and Investments Commission

Applicant

Michael Richard Lewis Wooldridge

First Respondent

Kim Samuel Jaques

First Respondent

Mark Frederick Butler

First Respondent

William Lionel Lewski

First Respondent

Australian Property Custodian Holdings Limited (Receivers and Managers appointed) (in liquidation) (Controllers appointed)

Second Respondent

Procedural Posture

Appeal (on Remittal) Civil Penalty Proceedings / Final Judgment on Remittal From High Court

Legal Issues

  1. 1 Whether pecuniary penalties and disqualification orders imposed by the primary judge should be varied in light of the High Court's orders excising certain contraventions under s 209(2) of the Corporations Act 2001 (Cth)
  2. 2 Appropriate scope of penalty and disqualification orders against each director, including application of parity and course of conduct principles

Ratio Decidendi

The excision of the directors' s 209(2) Corporations Act contraventions by the High Court did not materially affect the seriousness of remaining contraventions and thus no adjustment of pecuniary penalties or disqualification periods was warranted; orders agreed as to the other Directors (Lewski, Jaques, Butler) were imposed as appropriate, and Dr Wooldridge's penalty and disqualification as fixed by the primary judge were not manifestly inadequate nor should be reduced to 'time served' given all relevant mitigating and practical factors had already been duly considered.

Court Disposition

For each proceeding, pecuniary penalties and disqualification orders imposed/confirmed as per reasons. Cross-appeals dismissed. No orders as to costs (each party to bear own costs in hearing on remitter).

Orders

  • Dr Wooldridge disqualified from managing corporations for two periods (23 December 2014 – 10 August 2016; 11 October 2019 – 22 February 2022) and to pay $20,000 pecuniary penalty.
  • Mr Jaques and Mr Butler disqualified for same periods as Dr Wooldridge; each to pay $20,000 pecuniary penalty.