Australian Securities and Investments Commission v Storm Financial Limited (Receivers and Managers Appointed) (In Liq) [2011] FCA 763

Australian Securities and Investments Commission v Storm Financial Limited (Receivers and Managers Appointed) (In Liq) [2011] FCA 763

Leave to amend was granted because the objection that the application was colourable depended on the unresolved strike-out issue of whether the proceedings were fundamentally unsound; if they were unsound, the amendment would fall with them, and if not, the colourable allegation would be unsustainable. The proposed s 1324 injunctive relief was not so obviously futile or unsustainable that it should be excluded at the amendment stage. ASIC's explanation for the timing, the early stage of the proceedings, the largely legal nature of the amendment, and the absence of claimed relevant prejudice weighed against refusing leave. Defects in form could be addressed in later case management, and...

Jurisdiction
Australia
Judgment Date
09 June 2011
Procedural Posture
Proceeding by ASIC Concerning Alleged Managed Investment Schemes and Alleged Knowing Involvement by Banks Under the Corporations Act 2001 (cth) / Interlocutory Application by ASIC for Leave to Amend Its Originating Application and Statement of Claim
Outcome
ASIC was granted leave to amend its originating application and statement of claim.
Legal Topics
['leave to Amend Originating Application and Statement of Claim' 'statutory Injunction Under S 1324(1) of the Corporations Act 2001 (cth)' 'strike Out Applications' 'case Management' 'managed Investment Scheme Registration' 'knowing Involvement']
['corporations Law' 'civil Procedure' 'managed Investment Schemes'] ['leave to Amend Originating Application and Statement of Claim' 'statutory Injunction Under S 1324(1) of the Corporations Act 2001 (cth)' 'strike Out Applications' 'case Management' 'managed Investment Scheme Registration' 'knowing Involvement']

Case Brief

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Procedural Posture

Proceeding by ASIC Concerning Alleged Managed Investment Schemes and Alleged Knowing Involvement by Banks Under the Corporations Act 2001 (cth) / Interlocutory Application by ASIC for Leave to Amend Its Originating Application and Statement of Claim

Legal Issues

  1. 1 ['Whether ASIC should be granted leave to amend its originating application and statement of claim to seek an injunction under s 1324(1) of the Corporations Act 2001 (Cth).' 'Whether the proposed amendment was colourable because it was allegedly a ploy to keep fundamentally unsound proceedings alive.' "Whether the proposed injunctive relief was futile because Storm Financial Limited and the relevant schemes had been wound up and because the relief would not advance ASIC's position on declarations." "Whether ASIC's delay in seeking the amendment and its explanation justified refusal of leave." 'Whether defects in the form of the proposed amendment or absence of supporting pleaded facts justified refusal of leave.' 'Whether leave should be conditioned on ASIC pleading details of representative claimants.']

Ratio Decidendi

Leave to amend was granted because the objection that the application was colourable depended on the unresolved strike-out issue of whether the proceedings were fundamentally unsound; if they were unsound, the amendment would fall with them, and if not, the colourable allegation would be unsustainable. The proposed s 1324 injunctive relief was not so obviously futile or unsustainable that it should be excluded at the amendment stage. ASIC's explanation for the timing, the early stage of the proceedings, the largely legal nature of the amendment, and the absence of claimed relevant prejudice weighed against refusing leave. Defects in form could be addressed in later case management, and...

Court Disposition

ASIC was granted leave to amend its originating application and statement of claim.

Orders

  • ['Leave is granted to the Australian Securities and Investments Commission to amend its originating application and statement of claim in accordance with the notice of motion filed on 2 June 2011.']