Australian Securities and Investments Commission v Marco (No 4) [2020] FCA 881

Australian Securities and Investments Commission v Marco (No 4) [2020] FCA 881

In the context of interim receivers appointed under statutory powers at ASIC’s application, the appropriate course is that ASIC should provide any general indemnity required beyond statutorily mandated ones, and the costs of the receivers’ reports should be met by ASIC. Receivers' determination (rather than automatic Court approval) governs whether legal fees from pre-appointment related litigation are to be paid. These conclusions serve to avoid premature depletion of defendants’ assets in the absence of final determination of their liability.

Jurisdiction
Australia
Judgment Date
23 June 2020
Procedural Posture
Corporations/interlocutory Application / Determination of Applications Regarding Indemnity, Costs, Receivers’ Powers and Variation of Freezing Orders
Outcome
Interlocutory applications granted in part; orders varied regarding indemnity, payment of expenses and legal costs, with ASIC to bear costs of receivers' reports and provide indemnity beyond what is given under section 419A; further orders as set out.
Legal Topics
['interim Receivers' 'freezing Orders' 'indemnities' 'statutory Receiverships' 'costs of Receivers' 'exercise of Powers by Receivers']
['corporations Law' 'equity' 'civil Procedure'] ['interim Receivers' 'freezing Orders' 'indemnities' 'statutory Receiverships' 'costs of Receivers' 'exercise of Powers by Receivers']

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Procedural Posture

Corporations/interlocutory Application / Determination of Applications Regarding Indemnity, Costs, Receivers’ Powers and Variation of Freezing Orders

Legal Issues

  1. 1 ['Should ASIC provide a general indemnity to interim receivers?' "Who should meet the costs and expenses of the interim receivers' reports?" 'Whether expenses of defendants and their legal costs in other proceedings should be approved and how determined?' 'Appropriate sources for indemnity and payment of receiver costs in a statutory receivership under the Corporations Act']

Ratio Decidendi

In the context of interim receivers appointed under statutory powers at ASIC’s application, the appropriate course is that ASIC should provide any general indemnity required beyond statutorily mandated ones, and the costs of the receivers’ reports should be met by ASIC. Receivers' determination (rather than automatic Court approval) governs whether legal fees from pre-appointment related litigation are to be paid. These conclusions serve to avoid premature depletion of defendants’ assets in the absence of final determination of their liability.

Court Disposition

Interlocutory applications granted in part; orders varied regarding indemnity, payment of expenses and legal costs, with ASIC to bear costs of receivers' reports and provide indemnity beyond what is given under section 419A; further orders as set out.

Orders

  • ['Orders of 1 November 2018 continue subject to variations.' 'Variation allowing individual and corporate receivers to pay reasonable expenses and disbursements from specified defendants’ assets, with detailed categories outlined.' 'ASIC (Plaintiff) to pay all costs associated with the provision of the Reports as...