Krejci (liquidator) v Panella, in the matter of Richmond Lifts Pty Ltd

David Grant & Co Pty Ltd v Westpac Banking Corporation [1995] HCA 43; (1995) 184 CLR 265

In Re K. L. Tractors Ltd [1954] VicLawRp 70; [1954] V.L.R. 505

In Re Q.B.S Pty Ltd [1967] Qd. R. 218

In the Matter of Bayfoyle Pty Ltd [2025] NSWSC 1373

Krejci (liquidator) v Panella, in the matter of Richmond Lifts Pty Ltd (in liq) [2025] FCA 151

Krejci (liquidator) v Panella, in the matter of Richmond Lifts Pty Ltd (in liq) (No 3) [2025] FCA 1114

L & D Audio Acoustics Pty Ltd v Pioneer Electronic Australia Pty Ltd (1982) 7 ACLR 180

Ocean City Ltd (rec and mgr apptd) v Southern Oceanic Hotels Pty Ltd [1993] FCA 86; (1993) 10 ACSR 483

Offshore Oil NL v Acron Pacific Ltd (1984) 2 ACLC 8

Re Horizon Pacific Ltd (1977) 2 ACLR 495

Re PMC Investments Pty Ltd (1991) 9 ACLC 1559

Tokich Holdings Pty Ltd v Sheraton Constructions (NSW) Pty Ltd (2004) 185 FLR 130

Treadtel International Pty Ltd v Cocco [2016] NSWCA 360; (2016) 316 FLR 318

Waterproofing Technologies Pty Limited v Perri (No 3) [2025] FCA 934

McPherson, The Law of Company Liquidation (3rd ed, 1987)

Counsel for the First, Second, Third, Fourth and Fifth Plaintiffs:

Solicitor for the First, Second, Third, Fourth and Fifth Plaintiffs:

Counsel for the Second, Fourth and Seventh to Twenty-Third Defendants:

Solicitor for the Second, Fourth and Seventh to Twenty-Third Defendants:

Counsel for the external administrators of the Fourth to Sixth Defendants:

Solicitor for the external administrators of the Fourth to Sixth Defendants:

Counsel for First Interested Party (McEvoy Legal Pty Ltd):

Counsel for Second Interested Party (NPC Advisory Pty Ltd)

Solicitor for Second Interested Party (NPC Advisory Pty Ltd)

PETER KREJCI IN HIS CAPACITY AS LIQUIDATOR OF RICHMOND LIFTS PTY LTD (ACN 608 024 719) (IN LIQUIDATION) AND ORS

SYDNEY EXOTIC AQUARIUMS CASULA PTY LTD (ACN 649 148 014) (IN LIQUIDATION)

RICHMOND LIFTS PTY LTD (ACN 608 024 719) (IN LIQUIDATION) (and others named in the Schedule)

ARMSTRONG SCALISI HOLDINGS PTY LTD (ACN 114 980 586) (and others named in the Schedule)

1. The plaintiffs have leave to file an amended originating process in the form the subject of their amended interlocutory process dated 19 November 2025 (Amended Originating Process), but with the removal of Kerrigan Law Pty Ltd.
2. Global Management NSW Pty Ltd (in liquidation) ACN 674 737 770 be joined to this proceeding as the tenth plaintiff.
3. With the exception of Kerrigan Law Pty Ltd, all additional defendants identified in the Amended Originating Process be joined as defendants to this proceeding.
4. Pursuant to s 23 of the Federal Court of Australia Act 1976 (Cth) and r 7.32 of the Federal Court Rules 2011, and upon the plaintiffs giving the undertakings to the Court in Schedule A of Penal Notice V annexed to the orders of Moshinsky J of 13 paragraphs of 9 October 2025, order 5 of the orders of Moshinsky J of 13 paragraphs of 9 October 2025 be extended until the determination of the proceedings or further order.
5. Order 3(b) of the orders of the Court of 15 October 2025 and order 2(b) of the orders of the Court of 8 December 2025 be set aside, such that the time limit imposed by those orders on the variation in the amounts be removed.
6. The parties bring in short minutes of order with a proposed costs order or orders to give effect to these reasons for judgment.
7. The proceedings be listed for a further case management hearing on a date to be fixed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

1. This proceeding has been bedevilled with procedural complexity. It is being case managed with the somewhat related proceeding NSD 193 of 2025. In the 12 months since commencement, over 32 interlocutory processes have been filed across the two proceedings, including 25 in this particular proceeding. More than 260 separate Court documents have been filed across the proceedings, only a small fraction of which will be relied upon at any final hearing. There are also now two further related proceedings being case managed with these proceedings, which have their own interlocutory disputes. There has been a significant number of interlocutory hearings.
2. This level of interlocutory disputation is out of proportion to the scope and complexity of the underlying substantive proceedings. It places a burden on the Court and on other litigants. It may become necessary to limit further interlocutory processes: parties do not have an unlimited ability to conduct interlocutory applications. The Court has an inherent power to supervise and control the proceedings before it which includes ensuring such proceedings are conducted consistently with s 37M of the Federal Court of Australia Act 1976 (Cth).
3. Several interlocutory processes came before me for hearing on 8 December 2025. Some matters were not yet ripe for determination, or were the subject of case management orders made by consent. These reasons for judgment deal with two interlocutory processes.
4. The first is an application by the plaintiffs to seek certain relief on their amended interlocutory process dated 19 November 2025 (Plaintiffs' Amended IP). The plaintiffs seek to:

(a) join an additional 32 entities as defendants to the proceeding;

(b) join an additional plaintiff to the proceeding;

(c) otherwise amend their originating process; and

(d) extend certain freezing orders made by Moshinsky J on 9 October 2025 against 32 of the putative defendants.

1. The plaintiffs initially sought to join a 33rd new defendant, Kerrigan Law Pty Ltd (formerly McEvoy Legal Pty Ltd) (Kerrigan Law), but the plaintiffs accepted that there were deficiencies with their pleading against Kerrigan Law. By consent and without admission, the Court made orders providing for a timetable for the provision of any proposed amended pleading, and dismissing the interlocutory process as against Kerrigan Law with costs.
2. The plaintiffs' interlocutory process (prior to amendment) originally came before Moshinsky J, in his Honour's capacity as Commercial and Corporations Duty Judge, on an ex parte basis on 9 October 2025. His Honour made certain orders sought by the plaintiffs in their interlocutory process, including an order that the then 26th defendant, Fraser Holdings NSW Pty Ltd (in liquidation) (Fraser Holdings), be removed as a defendant and added as a plaintiff, and the joinder of additional entities as plaintiffs. His Honour was not asked to make an order joining one of the proposed new plaintiffs (being Global Management NSW Pty Limited (Global Management) and the plaintiffs seek that order from me.
3. The plaintiffs also propose to amend their statement of claim, including to plead claims against the new defendants. The Plaintiffs' Amended IP contains no prayers for relief concerning any amendment of the statement of claim. In their written submissions, the plaintiffs say that they do not require leave to amend (presumably on the basis that the defendants have yet to file a defence).
4. The second interlocutory process before me is brought by the second defendant, Mr Sam Cassaniti, and 18 other persons or entities who are current defendants to the proceeding, as well as 25 further entities who the plaintiffs seek to add as defendants to the proceeding (Cassaniti Parties' IP). For simplicity, I will refer to these 44 interlocutory applicants collectively as the Cassaniti Parties. By using that term, I merely mean that they are parties who have joined with Mr Cassaniti in making the present application with common legal representation. I am not expressing any view as to whether there is any particular relationship between the various interlocutory applicants. The Cassaniti Parties seek:

(a) the removal of the provisional liquidators appointed to the third defendant by the Court on 19 February 2025;

(b) the removal of the provisional liquidators appointed to the fifth and sixth defendants by the Court on 19 February 2025, and then replaced by different provisional liquidators (on the application of, inter alia, Mr Cassaniti) on 15 September 2025;

(c) an order that leave to the plaintiffs to file their amended originating process be refused;

(d) an order that leave to the plaintiffs to file paragraphs 180 to 499 of their proposed amended statement of claim dated 11 November 2025 be refused (notwithstanding that the plaintiffs are not seeking any such leave);

(e) in the alternative, an order pursuant to r 16.52 of the Federal Court Rules 2011 (Cth) (Rules) that paragraphs 180 to 499 of the plaintiffs' proposed amended statement of claim be disallowed, or alternatively an order pursuant to r 16.21(1) of the Rules that those paragraphs be struck out;

(f) in the alternative, an order that prayers 40 and 41 of the plaintiffs' originating process filed on 19 February 2025 (Originating Process) be dismissed and paragraphs 180 to 331 of the plaintiffs' statement of claim filed 15 April 2025 be struck out; and

(g) an order reducing the amounts the subject of the freezing orders made on 19 February 2025.

The Cassaniti Parties also resist the relief sought by the plaintiffs in the Plaintiffs' Amended IP which was pressed at the hearing.

1. In relation to (a), the orders appointing provisional liquidators have been the subject of a previous substantive challenge by members of the Cassaniti Parties. On 28 February 2025, the Court (Cheeseman J as the Commercial and Corporations Duty Judge) heard a full contested application to set aside the orders appointing the provisional liquidators. That challenge was unsuccessful: see Krejci (liquidator) v Panella, in the matter of Richmond Lifts Pty Ltd (in liq) [2025] FCA 151 (Krejci No 1).
2. Further, some of the Cassaniti Parties brought a separate application in April 2025 to replace the provisional liquidators of certain members of the Cassaniti Parties with alternative provisional liquidators. That application was partially successful, in that the provisional liquidators of the fifth and sixth defendants were replaced with new provisional liquidators: see Krejci (liquidator) v Panella, in the matter of Richmond Lifts Pty Ltd (in liq) (No 3) [2025] FCA 1114 (Krejci No 3). Those provisional liquidators are therefore in place on the application of interlocutory applicants on the Cassaniti Parties' IP who now seek their removal.
3. This history is significant. The application to set aside the appointment of the provisional liquidators in February 2025 was a significant application determined on the merits. The particular arguments propounded by the Cassaniti Parties before me in support of the relief they seek in the Cassaniti Parties' IP were not ventilated in February 2025. However, that alone is not a sufficient basis to have another go at setting aside the orders appointing provisional liquidators. There is an obvious undesirability in facilitating successive interlocutory applications for the same relief. I considered this issue in Waterproofing Technologies Pty Limited v Perri (No 3) [2025] FCA 934 at [18] - [23] (Waterproofing No 3). Ordinarily, in the case of an interlocutory order made after a contested hearing and intended to apply until final hearing (or on an ongoing basis), it would be necessary to demonstrate:

(a) some change in circumstances;

(b) new evidence that was not able to be given previously; or

(c) other circumstances that are exceptional or otherwise of such a nature that justice requires that the interlocutory relief be revisited.

1. It would be conducive of injustice and a waste of judicial time and resources if there was no limit on the ability of a party to have any interlocutory application or order relitigated at will.
2. In the present case, the Cassaniti Parties submit that they should be permitted to advance their repeat application to remove the provisional liquidators because:

(a) they are raising a point that goes to the power of the Court to appoint provisional liquidators; and

(b) there is, in any event, a change in circumstances.

1. In relation to the first basis, the Cassaniti Parties seek to outflank the policy against relitigating interlocutory applications by characterising the question as one concerning the jurisdiction (in the sense of power) of the Court. This asserted characterisation assumes some importance in the analysis that follows. In particular, I am not currently determining whether to make an order for winding up. This is not the occasion for that particular debate. I am instead dealing with the much narrower question of whether the Court has power to entertain the application and, in relation to the relief going to the appointment of provisional liquidators, whether the Court has power (or more accurately had power) to appoint a provisional liquidator.
2. Some of the authorities either elide this distinction or simply do not specify the basis on which the relevant decision is made. The latter is perhaps unsurprising where the forensic context is different. As discussed below, numerous cases have considered whether a winding up order should be made on the application of a creditor whose debt is disputed by the company. I am not addressing that particular question. I am addressing the much narrower question of power. For present purposes, the Cassaniti Parties can only succeed if they can establish that by contesting the debt in the manner in which they have they rob the plaintiffs of the ability to bring a winding up application, and render invalid the previous appointment of provisional liquidators.
3. Before considering the issue of the Court's power, I will deal with the background to the present proceedings.

1. Some of the context for the present proceedings was set out in my earlier judgment of Krejci No 3. Additional background is found in the decision of Krejci No 1 (Cheesman J), being the decision refusing the previous application to, inter alia, remove the provisional liquidators.
2. The plaintiffs are funded by the Australian Taxation Office. In broad terms, the plaintiffs allege a number of schemes to avoid paying tax engaged in by companies under the control of Mr Cassaniti. It is alleged that plaintiff companies (now in liquidation) made payments to various recipient companies of amounts for no proper consideration, including amounts that were properly payable to the Deputy Commissioner of Taxation.
3. When the proceeding was commenced, the Originating Process sought various forms of relief, including judgments for various sums, equitable compensation, and that defendant companies be wound up. Insofar as it sought winding up orders, the Originating Process did so on the just and equitable ground pursuant to s 461(1)(k) of the Corporations Act 2001 (Cth) (Corporations Act). The plaintiffs sought orders that the third defendant (which trades as CAP Accounting), the fifth defendant (Marginata) and the sixth defendant (Reliance), together with 17 further entities (defined as the Recipient Companies) who were alleged to be involved in the contraventions by directors of the third to fifth plaintiffs of their directors' duties, be wound up on the just and equitable ground. This group of 20 companies is defined in the Originating Process as the Richmond Liq Group.
4. The proposed amended originating process adds additional plaintiffs and seeks to expand the grounds of winding up and the companies sought to be wound up. It seeks to add the fourth defendant (Accolade) and 32 new defendant companies described as the Further Recipient Companies to the existing list of 20 companies (i.e. the Richmond Liq Group) which the plaintiffs seek to wind up. Further, the plaintiffs seek to add the insolvency ground, such that the plaintiffs seek the winding up of all 53 companies on the just and equitable ground and, further or alternatively, on the insolvency ground.
5. In terms of quantum, the plaintiffs plead the matter in two main ways. First, the plaintiffs have a claim for monies had and received (or alternatively for repayment of loans) in respect of the specific sums received by each of the 53 companies comprising the Richmond Liq Group, Accolade, and the Further Recipient Companies. For example, in relation to the proposed 26th defendant, 1 Stanmore Road NSW Pty Ltd (1 Stanmore Road), Annexure 19 of the proposed amended statement of claim identifies payments to 1 Stanmore Road totalling $10,000 (this is one of the smallest totals), and in paragraph 334 it is pleaded that each of the impugned payments was:

(a) a payment from funds of one or more of the plaintiffs to which 1 Stanmore Road had no right to receive and provided no consideration for, such that 1 Stanmore Road is liable to (identified) plaintiffs for monies had and received, or alternatively in restitution; and

(b) further or alternatively, a loan made by one or more of the plaintiffs to 1 Stanmore Road.

(a) further or alternatively, a payment received by 1 Stanmore Road by reason of breaches of directors' duties by the first defendant, Mr Teddy Panella, or Mr Cassaniti; and

(b) further or alternatively, received by 1 Stanmore Road in connection with the pleaded schemes.

1. Secondly, the plaintiffs plead a liability for the amounts payable to the Deputy Commissioner of Taxation, and plead that the Deputy Commissioner of Taxation has lodged proofs of debt for sums which total over $14 million (paragraph 40 of the proposed amended statement of claim). In paragraph 109, the plaintiffs plead that this amount forms part of the loss and damage suffered by the plaintiff entities from the breach of directors' duties by Mr Cassaniti and Mr Panella. The plaintiffs also plead (paragraphs 117 - 119D) that the relevant defendant entities were involved in the contraventions of the Corporations Act, are themselves deemed to have contravened the Corporations Act, and are liable to compensate the plaintiffs for the relevant loss and damage.
2. Thus the plaintiffs bring both a money claim for specified sums against each of the relevant defendants in respect of the sums received by each of them, and (apparently) a damages claim against each relevant defendant for the total loss and damage alleged, being more than $14 million. In oral submissions, senior counsel for the plaintiffs confirmed in respect of the latter claim that it was asserted that each accessory was liable for the full loss.
3. I will say something in outline about the schemes alleged by the plaintiffs (the Schemes). In paragraphs [20] and [24] to [27] of Krejci No 3, I outlined the Schemes then alleged. Since that judgment was delivered, those Schemes have been pleaded in more detail in the proposed amended statement of claim and some new Schemes have been added.

1. The third-party payroll schemes involving the third plaintiff, Richmond Lifts Pty Ltd (Richmond), and the fourth plaintiff, United Lift Technologies Pty Ltd (ULT), are described at [20], [24] and [25] of Krejci No 3. In short, it is alleged that the third-party payroll schemes involved Company A engaging Company B (e.g. Richmond) to provide payroll functions for Company A. Company B would employ the staff who did the work for Company A, and Company A would pay Company B monies sufficient to meet the wages, superannuation and PAYG tax liabilities in respect of those employees. Company B would pay the employees their wages and superannuation, but would not make PAYG tax payments to the Deputy Commissioner of Taxation, and would instead remit that money to a third party.
2. The amended statement of claim now includes assertions that the Recipient Companies and Further Recipient Companies were entities which received monies from CAP Accounting, Marginata, Reliance and / or Accolade in connection with the Schemes. The plaintiffs assert that the payments to the Recipient Companies and Further Recipient Companies contributed to Richmond and ULT being unable to meet their taxation liabilities in respect of the payroll functions they were performing.
3. Three new third-party payroll schemes are now pleaded. They are as follows:

(a) Eastrock: It is alleged that Eastrock Civilworks Pty Limited (Eastrock) employed staff utilised by Attcall Civil Pty Ltd (Attcall) and that those staff did not undertake any work for Eastrock. Eastrock received monies for the employment of the Attcall staff and paid the wages of the staff. The monies were sufficient to cover taxation liabilities, however Eastrock did not remit any amounts to the Deputy Commissioner of Taxation in respect of its taxation liabilities. Instead, the plaintiffs plead that the remaining monies were paid either directly to one or more of CAP Accounting, Marginata, Reliance and Fraser Holdings, or indirectly via payments to CAP Accounting, Marginata and Reliance to other entities which included Mr Cassaniti, the Recipient Companies and / or the Further Recipient Companies. The payments from Eastrock to, inter alia, CAP Accounting, Marginata, Reliance, the Recipient Companies and the Further Recipient Companies meant that Eastrock was unable to meet its taxation liabilities.

(b) Platinum: Platinum Logistics Aust Pty Ltd (Platinum) was established to perform payroll functions for Canex Pty Ltd and CBR Water Pty Ltd. Platinum paid the wages of the staff performing work for those entities, but did not discharge the taxation liabilities with respect to the wages. Platinum was not remitted sufficient funds to meet its taxation liabilities.

(c) Global Management: Similar to the Richmond, ULT, Eastrock and Platinum third-party payroll schemes, Global Management performed payroll functions for a group of companies which traded as Metro Workforce. Prior to Global Management being incorporated, the payroll functions for Metro Workforce were performed by Metro on Hire Pty Limited, which is now in liquidation. Global Management did not discharge taxation liabilities associated with the payroll of the Metro Workforce staff because it made payments to an AMEX card which the plaintiffs allege that Mr Cassaniti and his associates had the benefit of. The amount remitted to the AMEX card was $618,000. At the time of Mr Krejci and Mr Keenan's appointment as liquidators of Global Management, $4,890,168.88 was owed to the Australian Taxation Office in respect of unpaid taxation liabilities. The plaintiffs plead that as a result of the AMEX scheme, Global Management was unable to discharge its taxation liabilities (although the payments to the AMEX card do not seem coextensive with the tax owing).

1. In respect of each of the further third-party pay roll schemes pleaded, the plaintiffs allege that Mr Cassaniti was the controlling mind of Eastrock and Platinum. The plaintiffs allege that Mr Cassaniti and his associates, including the Recipient Companies and Further Recipient Companies, benefitted from the working of those schemes.
2. As mentioned earlier, some of the Cassaniti Parties succeeded in removing Mr Krejci and Mr Keenan as liquidators of Marginata and Reliance and appointing replacement liquidators. Those replacement liquidators (Mr Glenn Livingstone and Mr Alan Walker) have issued a report to the Court dated 2 December 2025, which was admitted on the interlocutory hearing (Replacement Provisional Liquidators' Report). In the Replacement Provisional Liquidators' Report, Messrs Livingstone and Glenn say that it is likely that a third-party payroll scheme has been deployed, with Accolade as the common external accountant, and say that:

it appears as though the funds that may have otherwise been used to discharge PAYG liabilities of various entities were directly transferred to, and ended up in the hands of Accolade, Reliance and subsequently Marginata.

They refer to the significant transfers of funds through the bank accounts of various entities. They also note that, in the absence of a complete set of books and records, or complete financial records, the transactions associated with the working of the abovementioned schemes cannot satisfactorily be explained.

1. The Accolade (or in-house) payroll schemes are slightly different. I describe that scheme insofar as it relates to the fifth plaintiff, Financial Advisory Australia Pty Ltd (Financial Advisory), at [27] of Krejci No 3.
2. The amended statement of claim now pleads that a similar in-house payroll scheme existed with respect to Fraser Holdings. As with the other entities, the plaintiffs allege that Mr Cassaniti was the true and controlling mind of Fraser Holdings. It is alleged that Fraser Holdings employed Accolade staff and some McEvoy Legal Pty Ltd (as it was then known) staff. CAP Accounting, Marginata, Reliance, Accolade, Richmond and Eastrock paid Fraser Holdings sufficient monies to meet the tax liabilities associated with those staff. However, instead of being paid to the Deputy Commissioner of Taxation, those monies were paid directly to, inter alios, Mr Cassaniti by way of "bonuses" and indirectly to, inter alios, the Recipient Companies or Further Recipient Companies, meaning that Fraser Holdings could not discharge its taxation liabilities.
3. The plaintiffs plead that various doctored proofs of debt and invoices have been lodged by Accolade in respect of various entities connected with the Schemes. The plaintiffs also plead, by reference to a list of creditors provided to them by the former administrators of Financial Advisory, that Accolade was recorded as a creditor of Financial Advisory despite Accolade having no record of issuing any invoices to substantiate such a claim. The plaintiffs make the following allegations.

(a) Accolade uses the Xero management accounting software for preparation of accounts and invoices. On 28 March 2025, the plaintiffs were granted access to the Xero software and on the basis of that access contend that many of the invoices generated through Xero were fabricated.

(b) For example, Accolade lodged a proof of debt during the liquidation of Richmond. However, the plaintiffs were unable to locate any invoices addressed to Richmond in the Xero accounting records. There was a recorded invoice which matched the Richmond invoice numbers, however, that invoice was addressed to a different entity (i.e., not Richmond), recorded a different amount, was created on a different date and had a different format and layout compared to the Richmond invoice. The Xero history notes record that employees of Financial Advisory edited the Richmond invoice and marked it as "approved" but "unsent", suggesting the invoice was never actually issued to Richmond.

(c) Ms Angelina Cassaniti was also recorded as voiding the Richmond invoice a month after it was recorded as having been created. These doctored invoices were submitted during the external administration to manipulate the creditor pool in an attempt to exercise control over the outcome of votes and therefore the external administration process.

1. Accolade is one of the entities which the plaintiffs seek be wound up on the just and equitable ground.
2. Similar allegations regarding doctored invoices are made by the plaintiffs in respect of ULT, Sydney Exotic Aquariums Casula Pty Ltd, Financial Advisory and Fraser Holdings.
3. Further, and in connection with their claim for winding up on the just and equitable ground, the plaintiffs rely upon material which they say indicates the following.
4. First, that the de jure directors of the companies did not know how the companies were being managed, what the companies did or which companies they were directors of.
5. For example, Mr Panella is the listed director of CAP Accounting and Fraser Holdings, as well as a number of the Recipient Companies and Further Recipient Companies. In Mr Panella's public examination conducted on 10 December 2024, he gave evidence that he was director in name only of CAP Accounting and other entities alleged to be caught up in the Schemes. During those public examinations, Mr Panella stated that he could not remember what Fraser Holdings did, despite being a director. Mr Panella could not remember being the sole director and shareholder of many entities until being taken to a search of the Australian Securities and Investments Commission (ASIC) database as a reminder.
6. Whilst the entities had different de jure directors, the plaintiffs allege that those individuals were directors in name only, as Mr Cassaniti was the true and controlling mind of each company. This has previously been the subject of judicial consideration at [75] to [81] of Krejci No 1, where Cheeseman J referred to evidence that Mr Cassaniti was the true controlling mind of Marginata, Reliance, CAP Accounting and Accolade.
7. Secondly, that the affairs have been carried on casually and in neglect of various statutory obligations.
8. The plaintiffs assert that the controllers of Accolade and the Richmond Liq Group, being Mr Cassaniti and / or the listed director, failed to comply or caused the company to fail to comply with its statutory obligations to:

(a) keep written financial records pursuant to s 286 of the Corporations Act;

(b) lodge income tax returns from time to time in accordance with part IV of the Income Tax Assessment Act 1997 (Cth); and

(c) lodge GST returns from time to time in accordance with Part 2-7, Div 31 of the A New Tax System (Goods and Services Tax) Act 1999 (Cth).

1. Thirdly, that the affairs of the relevant companies have not been carried out in accordance with the accepted standards of corporate management. The plaintiffs point to evidence suggesting (1) that persons registered as directors of relevant companies do not know anything about the business of those companies; (2) that Mr Cassaniti appears to be the controlling mind of various relevant companies; (3) the failure of the listed directors and / or Mr Cassaniti to keep proper financial records and assist the plaintiffs and provisional liquidators in carrying out their investigations; (4) the unusual manner in which money is circulated between the Companies; and (5) that Mr Cassaniti appears to be a beneficiary of the working of the various schemes.
2. Fourthly, that there have only been limited books and records made available which has caused difficulties for the investigators in verifying the various unusual transactions associated with the companies.
3. Of course, all of the matters outlined above are merely allegations at this stage. It is sufficient for present purposes to note that the present case is not one which is, in substance, a case of winding up in insolvency with a just and equitable ground claim thrown in for additional colour. In the present case, the just and equitable ground will undoubtedly be a significant focus of the winding up proceedings. Further, as alleged, the asserted facts are serious and, if established, raise a serious case for relief, including winding up.
4. In relation to the management of relevant entities, it is relevant that the application to appoint replacement provisional liquidators was initially brought by the de jure directors of the provisional liquidation group, being:

(a) Mr Carmello Duardo, in his capacity as director of Accolade;

(b) Ms Thi Linh Trinh, in her capacity as director of Marginata; and

(c) Mr Andrew Bruce Miller, in his capacity as director of Reliance.

At that time, Mr Cassaniti was not a registered director. However, at the hearing the application the subject of Krejci No 3 (Replacement Application), the Court was belatedly informed that Mr Cassaniti now admitted that he was a director within the extended meaning in s 9AC(1)(b) of the Corporations Act of Marginata and Reliance. An ASIC Form 484 was lodged with effect from 7 May 2025 formally recording Mr Cassaniti as the director of each of Marginata and Reliance. It was also revealed that Mr Miller had retired as a director of Reliance with effect from 7 February 2025 and should never have been named as an applicant on the Replacement Application. The Replacement Application was subsequently amended to add Mr Cassaniti as an applicant and to remove Mr Miller. These matters tended to suggest an inappropriately casual approach to corporate administration of relevant entities.

1. On 25 November 2025, Mr Robert David Webb of Watson Webb, solicitors for the Cassaniti Parties, swore an affidavit (Webb November Affidavit) on information and belief, based on Mr Cassaniti's instructions, which seeks to explain the monies transferred between the companies. The Webb November Affidavit deals with payments to relevant defendant entities alleged in the proposed amended statement of claims to be loans or payments made without consideration. In this affidavit, Mr Webb says that the basis for Mr Cassaniti's instructions include:

(a) that Mr Cassaniti is someone who, since the commencement of the proceedings, has reviewed the books and records of CAP Accounting in respect of the subject matter of this proceeding; and

(b) that Mr Cassaniti is "a director of several of the Defendants, and otherwise as someone who has knowledge of those Defendants for whom Watson Webb acts of which he is not a director, due to them forming part of the corporate group that is primarily owned and operated by the Cassaniti family".

1. In some cases, the payments are said to be payments for various consultancy services provided by entities receiving payments from the plaintiffs, or by Mr Cassaniti on their behalf. For example, in relation to the $4,194,144.39 paid from Richmond to CAP Accounting, which is said to be for payment of professional fees, the affidavit provides some examples, such as Mr Cassaniti "assisting ULS with its loan review requirements with the National Australia Bank".
2. In some case, the payments are said to be repayments of loans. In some of those cases, those loans are tripartite - i.e. company A was unable to pay company B, so company C paid company B and recorded this payment as a loan to company A.
3. In some cases, the arrangement involves 4 parties. For example, at [47] of the Webb November Affidavit, it is stated that:

The payment from Eastrock to CAP Accounting, of $101,000, was a loan repayment by Mr Panella to Reliance.

1. The affidavit goes on to explain that (1) Reliance lent moneys to Mr Panella, (2) Mr Panella was owed directors fees by Eastrock, and (3) in discharge of that liability for fees, Mr Panella requested Eastrock to pay Reliance. The affidavit does not explain why the payment is made from Eastrock to CAP Accounting, rather than to Reliance.
2. The Cassaniti Parties say that the Webb November Affidavit demonstrates that there is a genuine dispute about the amounts said to be owing by the relevant defendants, and therefore a genuine dispute about whether the relevant plaintiffs are creditors of the companies sought to be wound up.
3. The evidence in the Webb November Affidavit is given by a solicitor on information and belief (essentially on instructions). It is at a high level of generality, and for the most part consists of conclusory assertions. It provides little documentary support for those assertions. It does not provide any proper evidence of the relationships between the various entities, the circumstances in which particular services or loans were supplied, the precise nature of those services or loans, or precisely why payments were made in the amount and at the time that they were.
4. Further, the plaintiffs make further submissions about this evidence, as follows:

(a) When Mr Cassaniti was examined in December 2024 about a number of the payments now the subject of the Webb November Affidavit, he was unable to provide any explanation for those payments. Likewise, other directors or relevant defendant entities were unable to provide any explanation for other payments. That suggests that the evidence about those payments in the Webb November Affidavit is not any genuine recollection by Mr Cassaniti, and does not support any finding that there is a genuine dispute.

(b) In paragraph 4 of the Webb November Affidavit, Mr Webb refers to Mr Cassaniti as someone who, since the commencement of the proceedings, "has reviewed the books and records of CAP Accounting in respect of the subject matter of [the] proceeding." However, as Mr Krejci explains in his affidavit of 2 December 2025 in response to the Webb November Affidavit, he and Mr Keenan, as provisional liquidators of CAP Accounting, had been seeking the books and records of CAP Accounting for most of 2025. The affidavit is therefore based on the examination of unspecified records which were unable to be provided to the provisional liquidators (and which have not been provided with the Webb November Affidavit), such that the assertions can neither be verified nor tested.

(c) Some reliance is placed on payments said to be made pursuant to an agreement referred to as the ULS Services Agreement. Mr Krejci and Mr Keenan had been seeking a copy of that agreement for some months, including in a notice to produce. The response to that notice to produce, in September 2025, had been that the document was "not in our clients' control and, to the best of our clients' knowledge, our clients do not know where the document is and/or in whose control it is." It was not until November 2025 that the document was produced, and when produced it was said that "[t]he circumstances in which these documents have been located will be addressed in our clients' evidence". It was not so addressed.

(d) There are significant discrepancies between the payments in respect of Accolade's services recorded in the Webb November Affidavit and the financial records of Accolade produced to Mr Krejci and Mr Keenan. Mr Krejci has set out details of various alleged discrepancies in his evidence.

(e) There are inconsistencies between statements in the Webb November Affidavit and statements in previous evidence.

(f) The assertion in the Webb November Affidavit at [16] is that amounts paid by Richmond to CAP Accounting were in fact payable by ULS, but Richmond paid them on behalf of ULS because ULS had cashflow issues. This is inconsistent with the fact that ULS was at that time making payments to Richmond which Richmond would use to pay wages and superannuation, with the balance paid to CAP Accounting. The bank account statements of Richmond shows large deposits from ULS on a given day, and then the payment out on the same day of wages, superannuation, and a transfer to CAP Accounting. The evidence thus shows that ULS was providing the monies for the payments to CAP Accounting, which is quite inconsistent with Mr Webb's evidence based on Mr Cassaniti's instructions.

1. There is some force to the plaintiffs' contentions. For example, the bank statements referred to in the last point cast real doubt on the proffered explanation. The Cassaniti Parties have not sought to respond to any of these points.
2. More generally, the Webb November Affidavit does not provide any proper explanation as to the commercial relationships between the various parties and the transactions in question. As an explanation for the events the subject of the proceeding, it is inadequate. For the purposes of the present application, I will proceed on the footing that the debt is the subject of dispute. However, given that this proceeding has been on foot for a year, if the debt was truly in dispute, one would expect something better than the modest effort in the Webb November Affidavit. In my view, the Webb November Affidavit provides only weak support for any contention that there is a genuine dispute.
3. I do not consider that the question of whether there is a genuine dispute is purely a binary assessment for present purposes. The character of the evidence adduced is relevant to my consideration of the correct approach to adopt in the circumstances.

Is there power to hear the winding up applications (existing and new)?

(a) the Court has no power to hear any of the applications for winding up, either the original applications or the new applications, because the plaintiffs' status as creditors is the subject of a genuine dispute; and

(b) as a consequence, the original orders for the appointment of provisional liquidators were beyond power, and likewise the expansion of the case to bring winding up proceedings against additional entities is also beyond power. In relation to the original orders, it is submitted that the plaintiffs are not entitled to apply for final winding up relief, and hence the mandatory statutory prerequisite to provisional liquidation is absent.

1. The Cassaniti Parties correctly observe that the only potential basis on which the plaintiffs have standing to seek the relevant winding up orders is as creditors of the relevant entities. In relation to the insolvency ground, s 459P(1)(b) of the Corporations Act provides that a creditor may apply to the Court for a company to be wound up in insolvency. Otherwise, s 462 of the Act identifies the classes of persons who may apply for an order to wind up a company, and the relevant class for present purposes is "a creditor (including a contingent or prospective creditor)": s 462(2)(b) of the Corporations Act.
2. The Cassaniti Parties do not seek to prove, on the present application, that the plaintiffs are not creditors of the relevant defendant entities. Rather, the Cassaniti Parties submit that it is sufficient that the Webb November Affidavit disputes that the amounts claimed to be debts are repayable. The Cassaniti Parties submit that the amounts claimed are the subject of a genuine dispute, such that the plaintiffs' status as creditors is disputed. In that regard, the Cassaniti Parties seek to rely upon authorities that address the use of winding up proceedings to collect disputed debts.
3. The Cassaniti Parties submit that the bar for establishing the existence of a disputed debt is low. The Cassaniti Parties also submit that the Court would be slow to conclude that the alleged debts in question were not the subject of a genuine dispute, because that could risk prejudging substantive questions in the proceeding. The Cassaniti Parties submit that if the Court, in order to avoid prejudgment, accepts that there is a genuine dispute, then the effect of this is that the plaintiffs have no standing and the Court lacks power to entertain the winding up application.
4. Thus the Cassaniti Parties contend, in effect, that on the basis of evidence consisting of a series of generalised and conclusory assertions on information and belief seeking to explain apparently anomalous payments, parties in the position of the plaintiffs who wish to bring an apparently serious claim for winding up on the just and equitable ground in connection with an alleged tax fraud could be prevented from even commencing such an application on the basis that the Court lacks power to entertain it.
5. The submission is unattractive. I do not accept it. In my view, it involves a misapprehension or misapplication of authorities that address a different kind of mischief.
6. It has long been recognised that winding up applications have the potential to be subject to abuse and that it is necessary to guard against such applications being used as a mechanism to bring improper pressure to extract the payment of disputed debts. That concern is allied with a concern that winding up proceedings, which are meant to be dealt with speedily, are not usually an appropriate vehicle for resolving complex disputes of fact or law. The provisions for the setting aside of a statutory demand if the debt is the subject of genuine dispute, now contained in s 459H of the Corporations Act, are not inconsistent with these concerns.
7. Prior to the 1993 amendments to Australian corporations law, the relevant principles were stated as follows, in McPherson The Law of Company Liquidation, 3rd ed., 1987 at pp 63-64:

Reference has been made to the rule that a disputed debt cannot be made the subject of a statutory demand so as to provide proof of the company's inability to pay its debts in the event of a failure to comply therewith. Independently of this, however, there is a broad general principle that a winding-up order will not, as a matter of discretion, be made on a debt which is bona fide disputed, provided that the dispute is based on some substantial ground. No doubt one reason for this rule is that an applicant whose debt is disputed may lack the qualification necessary to file an application for a winding-up order; he is not a creditor if it turns out that the company was justified in refusing to pay. But the principal reason is that a winding-up application is not to be used for the improper purpose of compelling a solvent company to pay a disputed debt which would certainly be discharged as soon as the company's liability was clearly shown to exist.

It follows that the principle has no application where the company is proved to be insolvent...

The general principle is, however, a discretionary one, and in exceptional circumstances winding-up orders have been made even though the existence of the debt was genuinely disputed...

1. I have referred to the 3rd edition, as it is the one identified by the High Court in Australian Securities and Investments Commission v Lanepoint Enterprises Pty Ltd (receivers and managers appointed) [2011] HCA 18; (2011) 244 CLR 1 (Lanepoint) as predating the changes effected by the 1993 amendments. Lanepoint is discussed below.
2. The above statement of principles from McPherson does not avail the Cassaniti Parties. The argument of the Cassaniti Parties requires a conclusion that the Court lacks power to entertain a winding up application, not that a Court might decline to make a winding up order as a matter of discretion. Further, as noted earlier, I am not presently dealing with the question of whether to make a winding up order.
3. The cases relied upon in support of the principle that a winding-up order will not be made on a bona fide disputed debt are, in the main, cases of winding up in insolvency (only), and most concern statutory demands. Such cases may raise the issue of whether the debt which is being used to support a presumption of insolvency is truly a debt due.
4. One case frequently cited for the proposition quoted above is In Re K. L. Tractors Ltd [1954] VicLawRp 70; [1954] V.L.R. 505 (O'Bryan J). In that case, the following observations were made at 512:

Apart from the question whether there has been a neglect to comply with a statutory demand, a winding-up order will not as a matter of discretion be made on a debt which is bona fide disputed, provided the dispute is based on a substantial ground... This principle, however, has no application here even if it extends beyond a dispute debt to a counter-claim, because I am convinced if it is applicable to a counter-claim, it will only avail if the counter-claim is based upon substantial ground, which this counter-claim has not been shown to be.

1. In the case of In Re Q.B.S Pty Ltd [1967] Qd. R. 218 (Re Q.B.S.) at 224 - 225 (Gibbs J), the following observations were made:

There is a clear rule that a winding up order will not be made on a debt which is bona fide disputed by the company...

Of course a debt is not bona fide disputed simply because the respondent company says that it is disputed. The court hearing the petition can go into evidence to consider whether or not the dispute is bona fide, i.e., whether the claim is disputed on some substantial ground... It seems to me that in every case it becomes necessary for the court to exercise its discretion as to how far it will allow the question whether or not the dispute is bona fide to be explored. In some cases it may be very easy to decide this question on the petition and affidavits in reply. In other cases however it may be difficult to determine whether or not the dispute is bona fide without determining the merits of the dispute itself. In some such cases convenience may require that the court decide the question whether or not a debt exists, but in other such cases it may appear better to allow that question to be determined in other proceedings before the petition for winding up is heard.

1. These observations were approved by the Privy Council in Brinds Ltd v Offshore N.L. (1985) 60 ALJR 185 (Brinds Ltd), where their Lordships said (at 188):

It is a matter for the discretion of the judge whether a winding up order should be made on a disputed debt, and it is also a matter of discretion whether he decides the substantive question of debt or no debt.

1. The well-recognised approach in Re Q.B.S. is inconsistent with any contention that the Court lacks power.
2. Re Q.B.S. concerned the Companies Act 1961 (Qld), s 221(1) of which provided that a company may be wound up on the petition of, inter alia, "any creditor, including a contingent or prospective creditor, of the company". Since that time, the relevant companies or corporations legislation has continued to make provision for standing to bring a winding up application such that it includes creditors as a class of applicants, including contingent and prospective creditors (e.g. s 363(1) of the Companies Act 1981 (Cth), i.e. the Companies Code). The current version of that provision is s 459P(1) of the Corporations Act.
3. The conventional approach was summarised in Re Horizon Pacific Ltd (1977) 2 ACLR 495 at 498 - 501 (Needham J) as follows:

Horizon's submission was based upon the principle applied [in] Re K L Tractors Ltd [1954] VicLawRp 70; [1954] VLR 505, which in itself was an application of Re London & Paris Banking Corporation (1874) LR 19 Eq 444.

That principle is that "a winding up order will not as a matter of discretion be made on a debt which is bona fide disputed, provided the dispute is based upon a substantial ground" - Re K L Tractors Ltd [1954] VicLawRp 70; [1954] VLR 505 at 512. I do not know whether O'Bryan J intended to predicate that the dispute must be both bona fide and based upon a substantial ground - in most statements of the rule the two requirements appear as one - that is, if the dispute is based on a substantial ground, the debt is bona fide disputed.

The rule is not necessarily applicable in all cases. For example, it is open to the court hearing the winding up petition to resolve the dispute if it is satisfied that it has before it all the evidence which could be brought before it in proceedings to establish the debt - Bateman Television Ltd (in liq) v Coleridge Finance Co Ltd [1969] NZLR 794 (Supreme Court)[1971] UKPC 8; , [1971] NZLR 929 at 932 (Privy Council). As Gibbs J said, in Re QBS Pty Ltd [1967] Qd R 218 at 225:

Of course a debt is not bona fide disputed simply because the respondent company says that it is disputed... [Needham J then set out the balance of the passage set out above]

1. Justice Needham then considered the debate between the parties and concluded that there was an issue to be tried between the parties on the question whether the relevant deed relied upon for the debt was effective as a contract binding Horizon. His Honour continued at 500 - 501:

It is not the normal function of the court in hearing a winding up petition to try complex issues in order to determine whether the petitioner is a creditor of the respondent. When the issue is one of law, it is a matter for the court to determine, in its discretion, whether it should decide the point in the petition or leave it to be decided in proceedings brought for that purpose. Where the question whether the petitioner is a creditor is dependent for its resolution upon issues of fact which are not conceded and need proof, prima facie, provided there is a dispute on substantial grounds as to the petitioner's status, the issues should be tried in the normal way.

...

In my opinion, for the reasons I have given, no order should be made on the petition at this stage. The evidence indicates that there is a doubt whether Horizon could pay the sum claimed by Lombard if it were found to be due and, therefore, I think it not the correct course to dismiss the petition; the proper course is to stay it pending the outcome of proceedings to establish the debt - cf, Re QBS Pty Ltd [1967] Qd R 218 at 226.

1. In a particular case, it may that the proceeding involves an abuse of process. In L & D Audio Acoustics Pty Ltd v Pioneer Electronic Australia Pty Ltd (1982) 7 ACLR 180 at 183 (McLelland J) (L & D Audio), it was observed that proceedings by a person as creditor for the winding up of a company on the insolvency ground will ordinarily be held to be an abuse of process:

(a) if the winding up proceeding is bound to fail, e.g. if it is clear that the applicant will not be able to prove that it is a creditor, or will not be able to prove that the company is unable to pay its debts; and

(b) if the application is made for some improper purpose, e.g. if the applicant is seeking to use the winding up proceeding to coerce a company in to paying an alleged debt without affording the company a reasonable opportunity to ascertain or have it established that the debt is properly payable.

1. His Honour added a category of case being one where issues will arise in the winding up proceeding of a kind inappropriate for determination in such a proceeding, e.g. a substantial contest as to the existence or enforceability of a debt relied on by the applicant, which should properly be resolved in separate proceedings brought for that purpose. However, such a case would ordinarily be described as one where the Court determines that it is not appropriate for the contested issue to be determined, and declines to make the winding up order.
2. Further, in L & D Audio, McLelland J went on to consider whether it was likely that the company was insolvent, such that although there was a dispute as to the particular debt relied upon (and in particular whether the plaintiff would be able to establish an offsetting amount), there would be other pathways to winding up, and ultimately concluded that the plaintiff had not shown that the institution by the defendant of the proceeding for the winding up of the plaintiff would be an abuse of process of the court.
3. In Ocean City Ltd (rec and mgr apptd) v Southern Oceanic Hotels Pty Ltd [1993] FCA 86; (1993) 10 ACSR 483 (French J) at 486, his Honour referred to Re Q.B.S. (being the approach of leaving open the possibility that the judge in winding up proceedings might, in an appropriate case, determine the merits of a disputed debt), and said:

I must say, with respect, that I find that approach more attractive and consistent with modern notions of seeking the most economic and efficient use of judicial time than a more rigid approach which would mandate in every case of disputed debt the splitting off of the dispute however easily determined and the stay or dismissal of winding up proceedings pending its determination.

1. His Honour also noted a similar approach was adopted by Needham J in Offshore Oil NL v Acron Pacific Ltd (1984) 2 ACLC 8. That case involved a winding up proceeding where the defendant disputed the debt on the grounds that it was not immediately payable. The following observations were made (at pp 8-9):

Although the defendant submitted that these proceedings should be dismissed, as there exists a bona fide dispute between the parties as to the liability of the defendant, and the proceedings to resolve that dispute have already been commenced, it seems to me that, the only issue between the parties in these proceedings being the proper construction of the deed of 25 November 1982, so far as it regulates the relationship between the plaintiff and the defendant, the question at issue can be resolved as easily in these proceedings as in those commenced by the defendant. The defendant has conceded that the only defence it has to offer against the claim of the plaintiff to wind it up is the assertion it makes as to the proper construction of the deed.

Justice Needham concluded that the debt was immediately payable.

1. The position prior to the 1993 amendments was altered somewhat by those reforms. As analysed by Gummow J (Brennan CJ, Dawson, Gaudron and McHugh JJ agreeing) in David Grant & Co Pty Ltd v Westpac Banking Corporation [1995] HCA 43; (1995) 184 CLR 265 at 270, the 1993 reforms responded to a concern expressed in the Harmer Report that companies often needed to bring injunction proceedings where a debt claimed in a demand was disputed, and constitute:

a legislative scheme for quick resolution of the issue of solvency and the determination of whether the company should be wound up without the interposition of disputes about debts, unless they are raised promptly.

1. That scheme of course includes the mechanisms in ss 459G and 459H of the Corporations Act for the setting aside of a statutory demand in circumstances where there is a "genuine dispute" or an "offsetting claim". Justice Gummow also observed at 279:

No doubt, in some circumstances, the new Pt 5.4 may appear to operate harshly. But that is a consequence of the legislative scheme which has been adopted to deal with perceived defects in the pre-existing procedure in relation to notices of demand. It may also transpire that a winding-up application in respect of a solvent company is threatened or made for an improper purpose which amounts to an abuse of process in the technical sense of that term, as explained in Williams v Spautz. However, in an appropriate case, injunctive relief may then be available to the company in a court of general equity jurisdiction.

(Footnotes omitted.)

1. The significance of the 1993 amendments was also discussed by the High Court in the more recent decision of Lanepoint, considered further below.
2. I then turn to the cases relied upon by the Cassaniti Parties. None of them involve situations analogous to the present case.
3. The first case is Treadtel International Pty Ltd v Cocco [2016] NSWCA 360; (2016) 117 ACSR 176, a decision of the New South Wales Court of Appeal (Barrett AJA, Gleeson and Leeming JJA agreeing). The first applicant, Treadtel International Pty Ltd (Treadtel), sought leave to appeal a decision granting the respondent, Mr Cocco, leave to amend his pleading to add, inter alia, a winding up claim. As recorded at [21], Mr Cocco adopted an inconsistent position throughout the proposed pleading, the first being that he was entitled to a share and therefore entitled to statutory relief as a stakeholder in Treadtel, and the second being that he had relinquished that share and was thereby entitled to receive an agreed consideration from the shareholder and also had a claim in damages against Treadtel for breach of contract. Thus, on Mr Cocco's case, Treadtel owed no quantifiable and current debt to Mr Cocco, and he had an untested claim for unliquidated damages. Even on his own case, he was not a current creditor. Barrett AJA reached the following conclusion:

[59] The present case is, to my mind, one of disputed or otherwise unclear legal rights and duties when it comes to the question whether Treadtel is, by reason of an action for unliquidated damages maintainable by Mr Cocco, subject to an obligation that makes Mr Cocco a contingent or prospective creditor (it is not, and cannot be, argued that he is a present creditor). The obligation of Treadtel upon which Mr Cocco relies as the foundation of his standing to seek winding up is, on his own case, a contractual obligation derived from the Milan agreement. Yet Mr Cocco himself disputes the making and existence of the Milan agreement and the contractual force of the buy-out terms alleged against him. In asserting his standing to seek remedies available to a shareholder, he relies on the absence of any contractual commitment to relinquish the trust share to Mr Crosher and denies the contractual force that his opponents ascribed to the Milan agreement. In mounting his winding up case, however, Mr Cocco advances the proposition that the Milan agreement is the source of a right for him to sue Treadtel for damages.

[60] On the face of his own pleading, Mr Cocco causes his status as a creditor to be questioned. That, coupled with the circumstance that proof of the Milan agreement will involve a trial of obviously controversial issues, is sufficient to warrant a conclusion that Mr Cocco's asserted status as a contingent or prospective creditor is based on disputed or otherwise unclear legal rights and duties destructive of any argument that he should, at this stage, be permitted to petition for winding up of Treadtel.

1. Those observations, pertaining to the particular circumstances of that case, including that Mr Cocco was not yet a creditor, are not determinative of the issue in the present case. However, in the course of his decision, Barrett AJA made some broader obiter comments. Those comments were in the section of the judgment dealing with whether a person with merely an untested claim for unliquidated damages can bring a winding up application. Again, that is not an issue in the present case. At [54], his Honour quoted, with apparent approval, a passage containing observations of Williams J in Re PMC Investments Pty Ltd (1991) 9 ACLC 1559 (Re PMC), which adopted the observations from the 3rd edition of McPherson (i.e. that a winding-up order will not, as a matter of discretion, be made on a debt which is bona fide disputed provided that the dispute is based on some substantial ground), and which then continued:

Given the argument that has taken place to date, it is sufficient for me to rule that the applicant has locus standi to seek the order for the winding up of the company. In those circumstances, it seems to me to be fair to give the company an opportunity of placing material before the Court which may call into play the principles in relation to disputed debts to which I have referred.

1. Those observations, quoted by Barrett AJA, expressly drew a distinction between a question of standing and the question of whether to make the winding up order. At [55], Barrett AJA observed:

Williams J thus recognised what was, in a sense, provisional standing - standing subject to the possibility that the initial favourable impression might be displaced.

1. With respect of Barrett AJA, a better way of describing the judgment of Williams J is one where his Honour distinguished between standing to bring an application and the Court's discretion to refuse to make a winding-up order.
2. Somewhat inconsistently with paragraph [54], and three paragraphs later, Barrett AJA said (at [57]):

It is a well-established rule of practice that a person who claims to be a creditor but whose debt is disputed on genuine grounds will not be permitted to initiate or pursue a winding-up application.

1. His Honour cited, as authority for that proposition, some 19th century English decisions stemming from Cadiz Waterworks Co v Barnett (1874-75) LR 19 Eq 182, in which the pursuit of winding up proceedings was enjoined:

on the ground that it is the object of the Court to restrain the assertion of doubtful rights in a manner productive of irreparable damage.

That appears to be a reference to the possibility of restraining the further conduct of a proceeding as an abuse of process.

1. At [57], Barrett AJA addressed the matter as a question of standing. However, to characterise the principle in that way is inconsistent with earlier authority, including Re Q.B.S. and the decision of the Privy Council in Brinds Ltd.
2. At [58], Barrett AJA observed:

The rationale of the several decisions I have mentioned concerning contingent and prospective creditors is, it seems to me, that such a creditor will not be permitted to apply for winding up unless there is an existing obligation of the company... which obligation can be viewed with a high degree of assurance as a source of financial liability. Thus, in a case such as Re PMC, a defaulting purchaser under a conveyancing transaction may be seen to be subject to a relevant obligation where the standard contractual position is uncontroversial and the value of the property is shown to be such that the default has occasioned loss to the vender, even though no proceedings have crystallised that liability. But the position is otherwise where, as in Mackay, the existence of the obligation, as well as the quantification of any damage, is dependent on the resolution of disputed or otherwise unclear legal rights and duties by means of proceedings for damages brought against the company.

1. It is clear that the entire discussion was taking place in the context of considering whether a person with an uncertain claim for unliquidated damages can pursue a winding up proceeding. Indeed, Barrett AJA, in citing Re PMC a second time, appeared to recognise the possibility that a person with a relatively uncontroversial claim for unliquidated damages could nevertheless qualify. His Honour was not considering the question I am considering. In light of that context, and in light of the inconsistency between [54] and [57] of the judgment, I would not give weight to the unqualified width of the obiter comment in [57] quoted above in determining the issue arising the present case. That would, in any event, be inconsistent with the observations of the Privy Council in Brinds Ltd, and the supervening obiter observations of the High Court in Lanepoint, discussed below.
2. The second case cited by the Cassaniti Parties is Tokich Holdings Pty Ltd v Sheraton Constructions (NSW) Pty Ltd (2004) 185 FLR 130 (White J). This was an application by a supporting creditor, Sheraton Constructions (NSW) Pty Ltd (in liq) (Sheraton), to be substituted as the plaintiff in the winding up proceeding. The company (Tokich) disputed the debt relied upon by Sheraton. His Honour concluded that the debt was subject to a genuine dispute. Sheraton submitted that, because there was a presumption of insolvency flowing from the failure to satisfy a statutory demand from a different creditor, it should be substituted notwithstanding its debt was disputed. Thus the question at issue was again different from the present case. Justice White made the following observations (from [67]):

[67] As a matter of power as distinct from discretion, the Court may order a company to be wound up in insolvency where the creditor's debt is disputed if the Court determines that the applicant has standing to bring the application. The Court has the power to determine the disputed question and if it determines that the applicant is a creditor it may make an order for winding up. (Re QBS Pty Ltd [1967] Qd R 218 at 225 per Gibbs J; Community Development Pty Ltd v Engwirda Construction Co [1969] HCA 47; (1969) 120 CLR 455; Brinds Ltd v Offshore Oil NL (1985) 60 ALJR 185 at 188).

[68] As a matter of discretion, where the debt and hence the applicant's standing is disputed, the Court will usually not entertain the application for winding up.

[72] The preponderance of authority is that a company may not be wound up on the application of a person claiming to be a creditor whose debt is disputed unless that dispute is resolved. Otherwise the applicant will not establish its standing to apply for the company's winding up. Because the winding up jurisdiction should not be used to resolve disputed questions of debt, it may be an abuse of process for an alleged creditor, whose debt is disputed, to apply to wind up the company. ...

1. That is a more nuanced analysis that differentiates between power and discretion, recognises the time at which a dispute as to the debt may fall to be determined, and recognises the potential role of a finding of abuse of process.
2. The third decision relied upon by the Cassaniti Parties is In the Matter of Bayfoyle Pty Ltd [2025] NSWSC 1373 (Black J). The case is primarily about the deficiencies of a statement of claim, which his Honour found to be seriously inadequate. This is another case concerning winding up in insolvency. At [56], Black J observed that the allegations brought by the putative creditors were "extraordinarily complex", and to the extent that they claimed to be contingent creditors, "those claims are plainly disputed and too complex to be relied on in a winding up application". At [57], Black J accepted a proposition that:

a winding up proceeding should be stayed or dismissed if the issues raised in it are inappropriate for determination in such a proceeding, where there is a substantial contest as to the existence or enforceability of a debt relied on by the applicant.

1. Justice Black concluded, at [58], that the complex claims advanced by the creditors were such that they could not properly be resolved in a winding up proceeding, including because the resolution of those matters could not conceivably occur within the six month time limit contemplated in s 459R of the Corporations Act.
2. It is then necessary to consider the decision of the High Court in Lanepoint. In Lanepoint:

(a) At [12], their Honours observed that the principle underpinning the decision of the majority in the Full Court was "that ordinarily a company would not be wound-up on the basis of a disputed debt", and that where a disputed debt was relied upon, "that dispute should be resolved outside of the winding-up process". Ultimately, their Honours concluded that this principle did not survive the 1993 amendments.

(b) At [13], their Honours observed that although the application for winding up was brought by ASIC, the reasoning of the Full Court necessitated "consideration of the position of creditors as applicants for winding up in insolvency in the current statutory scheme" (i.e. post the 1993 amendments). Their Honours noted that the Full Court considered that the current statutory scheme did not inhibit the application of principles which informed the exercise of the court's discretion in the past, which therefore directed attention to those principles and the statutory context in which they were applied. Thus the judgment is not just about the position of ASIC.

(c) Their Honours then turned to consider the principles that applied prior to the 1993 amendments, including by reference to the summary of those principles in the 3rd edition (1987) of McPherson's The Law of Company Liquidation. In that regard, at [16] their Honours noted that:

Where a creditor sought to prove a company's insolvency by relying upon a debt owed by it, but without resort to the procedure of statutory demand, the court, as a general principle, would not order winding up where a debt was bona fide disputed upon some substantial ground. The principle informed the court's discretion whether to dismiss the application. McPherson says that, although the principle may have some basis in the court's concerns as to the status of the applicant for winding up as a creditor where there was a genuine dispute about the debt, the principle reason for it was that the court would not permit an application for winding up to be used for the improper purpose of compelling a solvent company to pay a disputed debt. It followed that it had no application in the case of an insolvent company.

(Footnotes omitted.)

(d) Their Honours noted (at [17]) that the power given to the court to order a winding up was expressed in permissive terms, as it is now. They referred to the "practice" of the court to dismiss an application for winding up where a debt was the subject of a genuine dispute on substantial grounds, and that "[a]n order for dismissal would not be made in the case of an insolvent company".

(e) Their Honours noted (at [18]) that the power to adjourn or to stay was sometimes exercised in order to allow a debt to be proved, or not, in other proceedings. Their Honours then quoted from Re Q.B.S., which has been discussed above.

(f) The Court then turned to discuss the changes to the regime effected by the 1993 amendments. Their Honours noted (at [24]) that the extent of discretion to refuse a winding up order was put beyond doubt by the terms of s 467(1) of the Corporations Act, noting that the reference to "other order" was apt to include an order staying the proceedings.

(g) At [29]-[30], their Honours observed (emphasis added, footnote omitted):

1. More relevant to the reasons of the majority in the Full Court is the principle applied by the court in winding up proceedings brought under the former legislation, where the statutory demand process was not invoked. It will be recalled that the principle was based upon the potential abuse, by creditors, of the winding up process to compel a solvent company to pay a genuinely disputed debt. On that basis alone it would have no application to ASIC... More fundamentally, because the principle has no application in the case of an insolvent company, it cannot apply in the context of the current Pt 5.4, where the statutory presumption of insolvency operates.
2. The majority of the Full Court were therefore wrong to conclude that the general principle could apply to ASIC's application or that it continues to apply to creditors' proceedings, given the presumption provided by s 459C. The current statutory scheme provides no basis for an assumption in favour of a dismissal or stay of proceedings where a company disputes the existence or amount of a debt.

(h) At [32], the Court observed that ss 459A and 467(1)(c) make plain that the court retains a discretion to stay proceedings on an application to wind up a company in insolvency, and at [33], the Court observed that what was said by Gibbs J in Re Q.B.S. about practical considerations remains relevant in this regard.

1. In my view, the position can be summarised as follows:

(a) In order to bring a winding up application, a person must fall within one of the categories of person identified in s 459P(1). In the present case, the relevant category is that one or more of the plaintiffs must be a "creditor". The satisfaction of that requirement is a question of standing to bring the application. Like any question of standing, the company can challenge the standing of the applicant to bring an application for winding up.

(b) A challenge to standing is a substantive challenge which the Court could resolve as a separate issue, or as part of the determination of the winding up application.

(c) However, a creditor does not cease to be a person who can bring an application merely because the company asserts that the person is not a creditor because the debt is disputed. If a person's status as a creditor is challenged, the Court may need to deal with that challenge, and do so prior to making any order for winding up.

(d) I say "may", because the Court could also, in its discretion, determine that the question as to whether a debt is owing is unsuitable for determination in a winding up application. A Court may well do that if the issue involves factual or legal disputes that are not straightforward. That is, the Court may say that the dispute as to the alleged debt should be determined in separate proceedings, and refuse to further entertain the application for winding up.

(e) In a particular case, a refusal to further entertain an application could take the form of refusing to permit an application to be brought: e.g. the refusal of leave to amend to bring a winding up application, or a refusal to make an order for substitution in favour of a creditor with a disputed debt. However, that is an exercise of discretion. It is not because the Court lacks power to entertain the winding up application (at least prior to any determination by the Court that the asserted "creditor" is not in fact a creditor).

(f) The Court could also determine that the application involves an abuse of process. A proceeding may be an abuse if it is being used as an improper mechanism to coerce the payment of a genuinely contested debt. But the commencement of a winding up proceedings by a creditor, even if the company disputes the debt, is not automatically or necessarily an abuse of process.

(g) More generally, there is no assumption in favour of a dismissal or stay of proceedings where a company disputes the existence or amount of a debt (Lanepoint at [30]), and no presumption that a dispute as to a debt should be resolved separately and apart from the winding up process (Lanepoint at [31]-[33]). Rather, it is a matter for the Court dealing with the application.

1. When understood in light of the correct approach, the contention of the Cassaniti Parties that the Court lacks power to entertain the winding up application is not well founded.
2. That deals with the first basis on which the Cassaniti Parties submitted that they should be permitted to reagitate the appointment of provisional liquidators.

Has there otherwise been a change in circumstances?

1. The second basis on which the Cassaniti Parties submit that they should be permitted to reagitate the appointment of provisional liquidators was that there was a change of circumstances. In their written submissions, the Cassaniti Parties rely on three particulars of the alleged change in circumstances.
2. The first is a contention that, because the plaintiffs have now filed a statement of claim, which "fully exposes the flaw in their claim to have standing to wind up the relevant defendant companies", this is somehow a change in circumstances. I do not accept this is a relevant change in circumstances, including because there is no flaw as alleged, but also because any relevant point about standing could have been raised at the previous hearing as the relevant facts going to the grounds for the challenge now relied upon by the Cassaniti Parties (i.e. that the plaintiffs are not creditors) were known then.
3. The second change of circumstances relied upon is the impending expiry of the period for winding up in insolvency pursuant to s 459R of the Corporations Act (which was previously extended to 12 months by consent). I do not accept this is a relevant change of circumstances. The appointment of provisional liquidators was not made on the insolvency ground. The time limit for winding up in insolvency may be relevant to the conduct of the winding up proceeding but it is not a basis for reagitating the appointment of provisional liquidators appointed in conjunction with an application for winding up on the just and equitable ground.
4. The third change of circumstances relied upon is what is described as the prejudice being suffered by the Cassaniti Parties by reason of the existing regime. This is not a relevant change of circumstances. It is something that was able to be anticipated as a consequence of the original orders. The present case is not one like Waterproofing No 3, where the interlocutory orders operated in some unexpected way because the circumstances were not as originally anticipated.
5. In oral submissions, senior counsel for the Cassaniti Parties, Mr Sulan SC, engaged in a valiant effort to reframe the present situation as involving a change of circumstances. He submitted that when considered as a whole - the addition of the insolvency ground, the joinder of new parties, the fact that the insolvency ground is time limited such that there would be some sort of bifurcation of the winding up claims, the new pleadings, and the effect of the orders on the defendants - the time had come to consider what should be the interlocutory regime going forwards. However, none of those matters amount to a relevant change of circumstances, and simply combining them does not alter the position.
6. It follows that the Cassaniti Parties do not succeed on their application to set aside the appointment of provisional liquidators.

The joinder of new parties and the new winding up claims

1. The background to the new claims has been set out earlier. Again, I am not dealing with whether a winding up order should be made. Rather, I am dealing with whether an application can be brought in the first place. Having regard to the legal principles discussed above, the question for present purposes is whether:

(a) the bringing of the new claims amounts to an abuse of process; or

(b) I should decline to permit the new claims to be brought in the exercise of my discretion.

1. The Cassaniti Parties did not contend that the present circumstances involve any abuse of process, and I do not consider the bringing of the new claims to amount to an abuse of process. There is nothing to suggest that the plaintiffs are seeking to bring improper pressure on the defendants (actual or proposed) to compel the payment of a contested debt. Having regard to the nature of the allegations and the matters that have been pleaded, there is a serious question to be considered concerning the distributions of monies so as to avoid tax, and also a serious question as to the administration of various companies, that could potentially support a winding up application. Of course, it may be that many of the allegations ultimately will be contested, and I express no concluded views on any of them.
2. In relation to discretion:

(a) It is relevant that the commencement of winding up proceedings against the Further Recipient Companies has the potential to have a substantial detrimental effect on those entities, and I take that into consideration.

(b) It is not evident, and has not been established, that the question of whether the plaintiffs are creditors is unable to be determined within the confines of winding up proceedings. That is particularly so in circumstances where the defendants are yet to file their defences.

(c) The materials before me provide prima facie evidence of serious and irregular matters: schemes to avoid the payment of tax, payments of sums to third parties instead of to the Deputy Commissioner of Taxation, directors who are unable to explain the purpose of the payments, directors who appear to have no knowledge of the affairs of the companies of which they are directors, directors acting under the apparent direction of Mr Cassaniti when he is not a director of the relevant entity, and numerous payments dispersing the funds received from entities which failed to pay tax to a large number of recipient companies.

(d) Although the Cassaniti Parties have sought to dispute the debts claimed, this has been done in a way that lacks rigour and detail, such that there is only relatively weak support for the contention that the plaintiffs are not creditors.

(e) In oral submissions in reply, senior counsel for the Cassaniti Parties submitted that, as a matter of discretion, I ought not permit winding up applications to be brought where the plaintiffs allege they are creditors on the basis of a claim for unliquidated damages. However, that is not an accurate characterisation. As noted in the Background section above, the plaintiffs have a claim for moneys had and received and a loan repayment claim for specified amounts, being the specified amounts alleged to have received by the various recipient entities. The plaintiffs also have an unliquidated claim for loss and damage. The former claim is sufficient for their status as a creditor. Further, the winding up application is brought, inter alia, on the just and equitable ground. The present case is therefore not analogous to those cases involving an attempt to wind up in insolvency on the basis of a speculative and uncertain claim for unliquidated damages.

1. The present circumstances are not ones where I would, in the exercise of my discretion, restrain the plaintiffs from commencing winding up proceedings against the Further Recipient Companies. Nor would I restrain the continuation of the existing winding up proceedings.
2. Notwithstanding that there will be no immediate restraint, as a matter of case management going forwards, I will at some point (and after the defences have been filed) request the plaintiffs to address me on how the matter can sensibly proceed as a winding up proceedings and how the matter can be advanced in an efficient manner, particularly having regard to the large number of companies sought to be wound up and the likely scope of the issues. That will require an examination of the issues and how they will be litigated. Permitting the proceeding to be brought does not necessarily mean that I will continue to entertain the winding up application or make any order for winding up. However, it is premature to consider this further prior to defences being filed.
3. I conclude that it is appropriate to permit the plaintiffs to revise their originating process in the manner sought, but with the removal of Kerrigan Law as a defendant (given that the joinder of that entity was not pursued on this application).

The addition of Global Management as a plaintiff

1. The addition of Global Management is appropriate, having regard to the matters that are pleaded in respect of that entity and their relationship to the existing claims.

The Cassaniti Parties' attack on the amended pleading

1. The Cassaniti Parties also seek to have the Court disallow various amendments in the proposed amended statement of claim, or alternatively that those paragraphs be struck out. The ground for seeking this relief is the same as the ground for discharging the provisional liquidator: i.e. that the claims are unarguable because the plaintiffs lack standing. However, for the reasons set out above, the plaintiffs do not lack standing merely because the relevant debts are said to be contested, and the Cassaniti Parties have not (to date) established that the plaintiffs lack standing.

Alleged lack of standing of the Cassaniti Parties

1. In light of the conclusion I have reached, there is no need to deal with the plaintiffs' contention that the Cassaniti Parties lack standing to complain about the proposed amendments to the plaintiffs' originating process, including the bringing of new winding up claims. The response of the Cassaniti Parties to this argument has considerable force, but there is no need to express any final view on the question.

1. The Cassaniti Parties submit that the freezing orders should be reduced in quantum, on the basis that the order against each entity is for an amount greater than the money alleged to have been received by that entity. However, as analysed earlier in the Background section, the plaintiffs' claim against each defendant is not limited to the sum received by that defendant, but includes a larger claim for loss and damage suffered by the plaintiffs. In those circumstances, reducing the quantum of the freezing orders against each entity by reference to the amount alleged to have been received by that entity would not preserve against dissipation of the larger amount of loss and damage that is claimed.
2. The Cassaniti Parties make a further point that the quantum of the freezing order assumes that each defendant the subject of such order could be liable for the total loss to the plaintiff companies collectively, rather than the loss to the particular plaintiff company from which the relevant money received by the defendant entity was paid, and submit that no principled legal basis has been advanced for such a claim.
3. From the proposed amended statement of claim, it appears that the plaintiffs' case is that each of Mr Panella and Mr Cassaniti breached their directors duties to each of the plaintiff entities, and are liable for the losses incurred by those entities. In other words, the liability alleged is a liability for the collective loss. It is then pleaded that each of the relevant recipient entities:

(a) had knowledge of the relevant matters constituting the breach of directors duties; and

(b) was involved in the contraventions, including because they received payments pursuant to the various schemes.

1. As explained by the plaintiffs, their case is that because each recipient entity was under the control of, at least, Mr Cassaniti, each entity participated in the overall conduct.
2. I do not accept that no principled legal basis has been put forward for the claim. Whether the plaintiffs can establish their claims is another matter entirely. It is not immediately apparent, for example, how it will be proved that each of the recipient companies was involved in the overall conduct affecting all of the payments. But that is a matter for proof in due course.
3. It follows that the ground advanced by the Cassaniti Parties for variation of the freezing orders does not support the amendment sought.
4. The Cassaniti Parties also advanced the possibility of amending the freezing orders to accommodate an offer of security. The plaintiffs complained that they had not had a proper opportunity to consider the offer. I will not consider this issue at present, but it may be recognised that the Cassaniti Parties are not prevented from seeking a subsequent variation to the freezing orders on this basis.
5. I am otherwise persuaded that the freezing orders made by Moshinsky J on 9 October 2025 should be continued. The evidence before the Court raises a prima facie case for relief and amply supports a conclusion that there is a significant risk of dissipation. The evidence suggests, at a prima facie level, that funds have been moved about through a large number of entities at will, that proper records have not been kept, and that the affairs of associated corporations have been conducted in an informal and unsatisfactory manner. Of course, there may be good explanations provided in due course, but the freezing orders should be continued in the meantime.

1. Having regard to the outcome, the Cassaniti Parties should pay the plaintiffs' costs of the aspects of the interlocutory applications the subject of these reasons, with the exception of the application to join Kerrigan Law, which is the subject of separate orders (including an order as to costs). However, given that the plaintiffs' interlocutory process included orders that were not the subject of this hearing, including orders that the Cassaniti Parties have not contested, I will ask the parties to bring in short minutes with an appropriate form of cost order or orders.

I certify that the preceding one hundred and twenty-four (124) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Moore.

UNITED LIFT TECHNOLOGIES PTY LTD (ACN 659 501 532) (IN LIQUIDATION)

FINANCIAL ADVISORY AUSTRALIA PTY LTD (ACN 669 266 228) (IN LIQUIDATION)

CAPITAL FINANCIAL ADVISORY PTY LTD (FORMERLY KNOWN AS ACCOLADE ADVISORY PTY LTD) (ACN 604 214 100)

RELIANCE FINANCIAL SERVICES PTY LTD (ACN 146 317 919)

70 BATHURST STREET PTY. LIMITED (ACN 082 390 976)

WENTWORTH WILLIAMS AUDITORS PTY LTD (ACN 099 391 189)

FRASER HOLDINGS NSW PTY LTD (ACN 640 331 791) (IN LIQUIDATION)