Australian Securities and Investments Commission v Blue Star Helium Limited (No 4)

• Jurisdiction: Australia Federal only
• Court: Federal Court (Australia)
• Judgment Date: 16 December 2021
• Neutral Citation: [2021] FCA 1578
• Date: 16 December 2021

FEDERAL COURT OF AUSTRALIA

Australian Securities and Investments Commission v Blue Star Helium Limited (No 4) [2021] FCA 1578

File number:	WAD 588 of 2017
Judgment of:	BANKS-SMITH J
Date of judgment:	16 December 2021
Catchwords:	CORPORATIONS - penalties and relief - where failure to comply with continuous disclosure obligations under s 674(2) of Corporations Act 2001 (Cth) by listed public company - where director of company who was chair and chief executive officer contravened s 180 of the Corporations Act by failing to exercise care and diligence in causing or permitting the company to contravene s 674(2) - declarations of contraventions by company and by director - where Australian Securities and Investments Commission sought disqualification of director from managing companies - whether as a matter of statutory construction pecuniary penalties must be considered before disqualification - where appropriate that disqualification be considered first - whether contraventions serious - factors to be taken into consideration - application of totality principle - whether disqualification order justified - whether pecuniary penalty justified - director disqualified and pecuniary penalty imposed
Legislation:	Corporations Act 2001 (Cth) ss 180, 206C, 674, 1317DA, 1317E, 1317EA, 1317F, 1317G, Parts 2D.6, 9.4B Federal Court of Australia Act 1976 (Cth) s 21
Cases cited:	Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 Australian Competition and Consumer Commission v Renegade Gas Pty Ltd (trading as Supagas NSW) [2014] FCA 1135 Australian Securities and Investments Commission v Adler [2002] NSWSC 483 Australian Securities and Investments Commission v Beekink [2007] FCAFC 7 Australian Securities and Investments Commission v Big Star Energy Limited (No 3) [2020] FCA 1442 Australian Securities and Investments Commission v Citrofresh International Ltd (No 3) [2010] FCA 292 Australian Securities and Investments Commission v Flugge (No 2) [2017] VSC 117 Australian Securities and Investments Commission v Forex Capital Trading Pty Limited, in the matter of Forex Capital Trading Pty Limited [2021] FCA 570 Australian Securities and Investments Commission v Healey (No 2) [2011] FCA 1003; (2011) 196 FCR 430 Australian Securities and Investments Commission v Helou (No 2) [2020] FCA 1650 Australian Securities and Investments Commission v Hochtief Aktiengesellschaft [2016] FCA 1489 Australian Securities and Investments Commission v Macdonald (No 12) [2009] NSWSC 714 Australian Securities and Investments Commission v Soust (No 2) [2010] FCA 388 Australian Securities and Investments Commission v Vocation Limited (in liq) (No 2) [2019] FCA 1783 Australian Securities and Investments Commission, in the matter of Padbury Mining Limited v Padbury Mining Limited [2016] FCA 990 Australian Securities and Investments Commission, in the matter of Sino Australia Oil and Gas Limited (in liq) v Sino Australia Oil and Gas Limited (in liq) [2016] FCA 1488 BMW Australia Ltd v Brewster [2019] HCA 45; (2019) 269 CLR 574 Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate [2015] HCA 46; (2015) 258 CLR 482 Forster v Jododex Australia Pty Limited (1972) 127 CLR 421 Gillfillan v Australian Securities and Investments Commission [2012] NSWCA 370 Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs v BFW20 by his Litigation Representative BFW20A [2020] FCAFC 121; (2020) 279 FCR 475 Morley v Australian Securities and Investments Commission (No 2) [2011] NSWCA 110 Pattinson v Australian Building and Construction Commissioner [2020] FCAFC 177; (2020) 282 FCR 580 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 Re Idylic Solutions Pty Ltd; Australian Securities and Investments Commission v Hobbs [2013] NSWSC 106 Rich v Australian Securities and Investments Commission [2004] HCA 42; (2004) 220 CLR 129 Rural Press Limited v Australian Competition and Consumer Commission [2003] HCA 75; (2003) 216 CLR 53 SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; (2017) 262 CLR 362 Trade Practices Commission v CSR Ltd [1990] FCA 762; [1991] ATPR ¶41-076
Division:	General Division
Registry:	Western Australia
National Practice Area:	Commercial and Corporations
Sub-area:	Regulator and Consumer Protection
Number of paragraphs:	128
Date of hearing:	19 February 2021
Counsel for the Plaintiff:	Mr JA Halley SC with Mr M Sherman
Solicitor for the Plaintiff:	Australian Securities and Investments Commission
Counsel for the First Defendant:	The First Defendant did not appear
Counsel for the Second Defendant:	Mr SM Davies SC with Mr AJC Mossop
Solicitor for the Second Defendant:	DLA Piper Australia

ORDERS

		WAD 588 of 2017
BETWEEN:	AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION Plaintiff
AND:	BLUE STAR HELIUM LIMITED (ACN 009 230 835) First Defendant ; JAMES ANDREW CRUICKSHANK Second Defendant

order made by:	BANKS-SMITH J
DATE OF ORDER:	16 december 2021

THE COURT DECLARES THAT:

1. Pursuant to s 1317E(1) of the Corporations Act 2001 (Cth), the first defendant contravened s 674(2) of the Corporations Act during the period between 7 September 2015 and 15 September 2015 by failing to comply with Listing Rule 3.1 of the Australian Securities Exchange (ASX) Listing Rules by not notifying the ASX that Wade Energy Corporation (Wade Energy) was the purchaser of the assets known as the Northern Star Assets and Big Star Assets under the purchase and sale agreements (PSAs) for those assets.

2. Pursuant to s 1317E(1) of the Corporations Act, the first defendant contravened s 674(2) of the Corporations Act during the period between 7 September 2015 and 15 September 2015 by failing to comply with Listing Rule 3.1 of the ASX Listing Rules by not notifying the ASX of the cumulative information that:

(a) Wade Energy was the purchaser of the assets known as the Northern Star Assets and Big Star Assets under the PSAs;

(b) Antares Energy Ltd (now Blue Star Helium Limited) had not, prior to 15 September 2015, independently verified or otherwise determined the capacity of Wade Energy to complete under the PSAs; and

(c) Antares Energy Ltd (now Blue Star Helium Limited) had been informed by Wade Energy that it had not yet received all funding approval necessary to complete the purchase of the assets known as the Big Star Assets.

3. Pursuant to s 1317E(1) of the Corporations Act, the second defendant contravened s 180(1) of the...