The current claim
2 On 9 November 2021, I ordered that the part-heard interlocutory application against Ms Lacey be set down for hearing today and that the applicants serve her with any further affidavits on which they wished to rely on or before 12 November 2021. I am satisfied by the evidence of Andrew Williams, a process server, that he attended Ms Lacey's home on 12 November 2021 and left there for her a copy of the sealed affidavit of Trevor Hauff sworn and filed on 11 November 2021 and the orders made on 9 November 2021. I am also satisfied by the affidavit of Mr Hauff, sworn 19 November 2021, that he emailed Ms Lacey with a copy of those documents on 12 November 2021. As I found in Henry (No 3) [2021] FCA 728, Ms Lacey had been served with the other documents relied on against her on that occasion and therefore she is aware of their content in respect of today's proceeding.
3 Relevantly, cl 7.3 of the constitution of the seventh respondent, Western Downs Group Limited, provided that the 11 groups of descendants of various apical ancestors identified in schedule 1 of the constitution could nominate a group representative company. Clause 7.5 required that, where a group had not nominated a group representative company, or the group representative company did not meet the requirements in cl 7.2, Western Downs had to pay or apply the group's share of the distribution amounts that it had received under the Indigenous Land Use Agreement (ILUA) with Arrow Energy Pty Limited dated 10 December 2012 for the benefit of that group, as directed in writing by the signatories to the ILUA representing the relevant group, the director appointed by that group, or the authorised representatives of that group, or as reasonably determined by the board.
4 The third further amended statement of claim relevantly pleaded that:
Gloria Corliss, Ms Lacey's mother, established MOBAC, which was registered as an indigenous corporation under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth), on 23 April 2012 (par 13B(b));
since 20 February 2013, Ms Lacey was a director and secretary of Western Downs and a signatory of its bank account;
Ms Lacey and Annette Rabbitt signed the ILUA on behalf of the Barunggam Group (par 23);
Ms Lacey was the director on the board of Western Downs representing the Barunggam Group (par 27);
the constitution described the Barunggam Group (in sch 1) as comprising the descendants of the apical ancestors Arthur Bundi (Bundai), Matilda Daylight and John Warner (par 28);
MOBAC was not authorised by Patrick Bundai or any other representative of the Barunggam Group, except Ms Lacey, to be their group representative company under the constitution (par 50A(a));
MOBAC did not comply with cl 7.4 of the constitution, and therefore could not be a representative company (par 50A(b));
Ms Lacey knew that MOBAC was not entitled to receive the Barunggam Group's share of any distribution amounts under cl 7.3 of the constitution and, in particular, the sum of $359,452.64 that it received on 28 March 2014 from Western Downs (pars 50A and 50B);
Ms Lacey authorised and effected the payment of that sum to MOBAC in breach of, first, Western Downs' constitution, secondly, her fiduciary duty as a director of Western Downs and, thirdly, her fiduciary duties owed to the Barunggam Group (pars 50C and 50D);
Ms Lacey breached her fiduciary duty as director of Western Downs by (pars 81A, 83(b)):
- establishing herself as the point of contact for all Western Downs' groups, including those who sought to receive benefits under the ILUA;
- after paying $359,452.64 as benefits intended for the Barunggam Group to MOBAC, she abandoned her position as a director and secretary of Western Downs and the contact person for the various groups without notice to any of them;
- by not advising the other directors of her resignation or causing it to be shown in any register of the Australian Securities and Investments Commission for Western Downs; and
- by receiving $359,452.64 from MOBAC with knowledge that she had no entitlement to receive it and that the sum was not paid to her pursuant to the provisions of the ILUA or Western Downs' constitution and therefore MOBAC had misapplied it;
Ms Lacey now holds the sum on constructive trust for Western Downs (pars 81A, 82, 83);
alternatively, Ms Lacey, as the person authorised to represent the Barunggam Group and deal with the financial benefits and entitlements due to it under the ILUA, owed its members fiduciary duties including the following obligations:
- not to place herself in a position where her private or personal interests came into conflict with the interests of members of the Barunggam Group;
- not to pursue or secure a personal benefit; and
- not to make a profit from her position of trust, unless expressly permitted to do so with the full consent of the Barunggam Group;
Ms Lacey caused the sum of $359,452.64 that MOBAC received to be paid out of its bank account otherwise than for the benefit of the Barunggam Group members and failed to pay any of those moneys to members of the Barunggam Group other than herself;
accordingly, she breached her fiduciary obligations to the Barunggam Group members (par 84)
5 In her affidavit of 31 July 2019, Ms Lacey admitted that she had received a cheque for the $359,452.64. She asserted that:
I was instructed to take this cheque to Coorparoo Westpac Bank to meet Annette Rabbit and her nephew, Mr ? Brown, and divide this amount in two: one half to MOBAC and the other half of $179,726.32 to Annette Rabbit's Boonjoon PTD Account.
6 She asserted that from that time onwards she had not heard from Ms Rabbitt, Mr Doctor, Mr Jarro, or Sandlewood and that Mr Doctor, as chair of Western Downs, had ceased contact with her. She asserted that in March 2014, she resigned as a director of Western Downs and moved to Melbourne in April 2014, "for job opportunities", but later returned to Katherine in the Northern Territory to work, as she had before, as a child protection worker in remote communities.
7 Since 25 June 2021, when I decided Henry (No 3) [2021] FCA 728, Mr Hauff has caused subpoenas to be issued to Westpac in respect of both MOBACs and Ms Lacey's bank accounts. He annexed to his affidavit the bank statements from those accounts together with reconciliations he had prepared of each. These reveal that, after the deposit into MOBAC's bank account on 28 March 2014, Ms Lacey paid a total $351,731.49 out of it on 2 April 2014. The total of $351,731.49 comprised cash withdrawals in three tranches of, respectively, $12,000, $30,000 and $149,731.49, electronic transfers totalling $155,000, in two tranches of $55,000 and $100,000, and one cheque for $5000. The $55,000 electronic transfer was paid into Ms Lacey's personal account. Mr Hauff was unable to ascertain to where the balance of the money was paid. Some of the money appears subsequently to have been deposited back into MOBAC's account over 17 deposits, totalling $55,269.26, between 4 April and 17 November 2014, but the provenance of those deposits is unknown. Ms Lacey was the sole signatory authorised to operate on MOBAC's account. Accordingly, all the transactions on it were effected by her.
8 There is no independent corroboration of Ms Lacey's assertion in her affidavit that she paid Ms Rabbitt half of the $359,452.64 deposited into MOBAC's bank account on 28 March 2014. I note that the cash withdrawals of $30,000 and $149,131.49 approximate roughly to the $179,726.32 that Ms Lacey asserted in par 16 of her affidavit that she had caused to be paid to Ms Rabbitt at the Westpac Coorparoo Branch. There is no explanation for the mathematical discrepancy.
9 Instead, Mr Hauff's analysis reveals that Ms Lacey appears to have applied $230,162.18 from the MOBAC account for her own purposes, leaving $129,290.18 unaccounted for in the material to which he has been able to have access and trace. Mr Hauff established these matters by analysing entries in both MOBAC's and Ms Lacey's personal bank statements. These showed that during the period 4 April to 18 December 2014 Ms Lacey withdrew from MOBAC's account a total of $74,974.95, comprising $50,612.43 in cash from bank branches, $8500 from ATM withdrawals, and $15,862.52 in EFTPOS purchases. She made over 100 EFTPOS purchases from entities such as McDonalds, Coles, Kmart, restaurants, pharmacies, clothing stores, and fees for bank cheques.
10 Ms Lacey's personal account revealed that she received $155,493.14 into it during the period between 19 November 2013, when she commenced on Centrelink benefits following her last payment of a salary, until she appears to have received a subsequent salary payment on 21 January 2015. Her spending from her personal account that occurred during the period 2 April 2014 to 11 November 2014 comprised cash withdrawals totalling $61,795, internet transfers totalling $60,350, ATM withdrawals totalling $4100, and discretionary spending on EFTPOS accounts totalling $29,273.87.
11 On 7 March 2018, Deirdre Daylight, a Barunggam elder, made an affidavit in which she deposed that she was the granddaughter of the apical ancestor, Matilda Daylight. At that time she had only recently become aware of the ILUA and learned that Ms Lacey and Ms Rabbitt had signed it on behalf of the Barunggam family group. She had not heard of MOBAC or the fact that she had been named as one of its members, and she had never applied for that membership. She said that she had not been informed of any moneys that might be available from the ILUA to be applied for the benefit of the Barunggam people generally.
12 Patrick Bundai said in his affidavit sworn 20 May 2020 that he is a direct descendent of his grandmother Alice Dutton and Jack Bundai, and thus a descendent of Arthur Bundai, an apical ancestor of the Barunggam group. Mr Bundai was a member of the applicant in the Barunggam native title claim lodged with the National Native Title Tribunal on 21 May 2010, but he only recently became aware of the ILUA. He had not been aware that Ms Lacey or Annette Rabbitt had claimed to represent the Barunggam group and was not aware of any basis on which Ms Rabbitt claimed to have such a connection. He said that neither he nor any member of his family group had received any financial benefit from the ILUA, Ms Lacey or Ms Rabbitt.
13 As the applicants submit, Ms Lacey's range of expenditures out of the MOBAC and her personal accounts appears to have been solely for her personal benefit or purposes. There does not appear to have been any suggestion that she made any payment to any person within the Barunggam family group, other than herself and, possibly, Ms Rabbitt. Accordingly, she appears to have made payments, commencing with her causing Western Downs to transfer the money on 28 March 2014 to MOBAC and, thereafter, through her control of MOBAC's bank account, for her benefit or at her direction, and not for the only purposes for which Western Downs could have distributed the money.