Case: Re Magna Alloys and Research Pty Ltd (1975) 1 ACLR 203
Outcome: followed
The question for the court was succinctly stated by Bowen, CJ in Eq in Re Magna Alloys and Research Pty Ltd (1975) 1 ACLR 203 at 205. His Honour noted that an applicant who came seeking relief bore an onus of establishing that the general policy of the legislature laid down in an analogue of section 206B ought be made the subject of an exception in his or case. His Honour continued: 'The court in exercising its discretion will have regard to the nature of the offence of which the applicant has been convicted, the nature of his involvement and the general character of the applicant including his conduct in the intervening period since he was removed from the board and from management. Where, as here, the applicant seeks leave to become a director and to take part in the management of particular companies the court will consider the structure of those companies, the nature of their businesses and the interests of their shareholders, creditors and employees. One matter to be considered will be the assessment of any risks to those persons or to the public which may appear to be involved in the applicants assuming positions on the board or in management' 10 In this case, the two offences I have described appeared to me, as they did to both the applicant and the Chief Judge of the District Court, to differ in character. The offence involving the false statement about the company not being a party to any legal proceedings is one which, in its true context, does not appear to me to involve any serious issue of lack of probity or anything other than a clear and wrong, but, in all the circumstances, unfortunate slip by the applicant in filling in and signing a form on advice. 11 The other conviction, which was the one that attracted the more serious penalty, is of a different order and involved an attempt, on one view, to avoid paying a substantial sum of money due to the State by making a false statement that there were no outstanding liabilities. I have considered the evidence on this matter and the applicant's attitude that he has now clearly set out to resolve this issue and to pay what is due to the State Authorities subject to, what seems to me to be not unreasonable, trying to find from the State Authorities any offsetting amounts that might be due back to Aluform. The evidence before me shows that Mr Lahood has made some considerable efforts to ascertain from the relevant New South Wales Authorities the amount of registration moneys which ought be refunded but has not even received the courtesy of a reply to any of his attempts to find this information out. Hopefully that situation will remedy itself in the period allowed in the proposed orders. 12 I have formed the view that the applicant is genuinely contrite and remorseful for the errors which he committed and recognises that what he did was wrong. It seems to me to be a lapse in an otherwise clean and good record. The applicant has managed these companies with his family for over 20 years. The transport industry is one which is notoriously difficult in economic terms and yet the evidence shows that the companies in the Transtar Group have over 70 employees and also engage something in the order of about 10 contractors. They appear to be otherwise well managed. There are no matters which the Australian Securities and Investments Commission ('the Commission'), which intervened in the proceedings, was able to bring to attention as to the business practices of the applicant or the Transtar Group which might give any rise to concerns that there was a risk to the public or to those in the companies from the applicant being allowed to be a director, once again, as he seeks. 13 At the conclusion of the oral evidence I inquired of counsel for the Commission whether it was the Commission's position that the disqualification should remain and that there be no leave granted. Counsel, on instructions, said that that was not the Commission's position and that the Commission considered that appropriate conditions could be imposed.