Minus v Selth

1. Pursuant to s 206G of the Corporations Act 2001 (Cth) the applicant, Derek Michael Minus, be granted leave to manage ABCD Corporation Pty Ltd ACN 133 338 682, APLUS Pty Ltd ACN 003 190 190, Dispute Resolution Associates Pty Ltd ACN 090 594 451, and Mediation & Arbitration Centre Pty Ltd ACN 608 133 768.
2. The grant of leave in order 1 is subject to ABCD Corporation Pty Ltd ACN 133 338 682 not engaging in any trading activity in any capacity other than as trustee of the Minasian Superannuation Fund.
3. No order as to costs. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

JAGOT J: 1 This is an application made under s 206G(1) of the Corporations Act 2001 (Cth) (the Act) for an order granting leave to the plaintiff, Mr Minus, to manage four named proprietary companies: APLUS Pty Ltd (APLUS), Dispute Resolution Associates Pty Ltd (DRA), ABCD Corporation Pty Ltd (ABCD), and Mediation & Arbitration Centre Pty Ltd (MEDARB). 2 The Australian Securities and Investments Commission (ASIC) intervened in the proceedings and filed submissions on 4 September 2019 setting out reasons why according to it, the plaintiff should only be granted leave to manage one of the specified companies, namely, ABCD, on condition that ABCD not engage in any trading activity in any capacity other than as trustee of the Minasian Superannuation Fund. 3 I have been considerably assisted by the submissions that ASIC has made in support of its position that the grant of leave should be limited to the company known as ABCD. Indeed, but for ASIC's involvement, I may have been left with a false impression about the status of some of the companies. The reason for this is that the application was supported by an affidavit from Mr Minus dated 22 July 2019 which, amongst other things, under the heading Mediation &Arbitration Centre Pty Ltd, stated that: This company was established to provide mediation and arbitration services for the resolution of small business disputes in Australia. 4 This part of the affidavit then continued by stating: As well as generating an income this service provided assistance to the franchising and other small business communities throughout Australia. 5 It was through the involvement of ASIC in this proceeding that it became apparent from Mr Minus' evidence that the company MEDARB, in fact, was not currently trading. Mr Minus explained in giving evidence that he had been using general language to describe the service that he intended to provide through the company, similar to the service which had been previously supplied by DRA in a contract with the Commonwealth Government to provide services connected with the Office of the Mediation Adviser for the Franchising Code of Conduct, the Office of the Mediation Adviser for the Horticulture Code of Conduct, and the Office of the Dispute Resolution Adviser for the Oil Code of Conduct (positions held by Mr Minus). 6 I make this point about the importance of ASIC's involvement because Mr Minus has been critical of what he sees as unnecessary delay by ASIC in advising him whether or not it proposed to intervene in the proceedings. The sequence of events shows that Mr Minus was subject to a bankruptcy order and, accordingly, automatic disqualification from being involved in the management of a company pursuant to s 206B(3) of the Act, which provides that: A person is disqualified from managing corporations if the person is an undischarged bankrupt under the law of Australia, its external territories or another country. 7 On 8 February 2019, as required, Mr Minus notified ASIC of his intention to make an application to this Court to manage a corporation. Mr Minus was notified by ASIC on 22 February 2019 that he was required to provide certain information to ASIC by 8 March 2019 so that it could consider his application. It took Mr Minus some time to get the relevant information together. 8 In the meantime he wrote to his Australian Financial Security Authority (AFSA) Case Manager on 19 March 2019 requesting a response from his trustee in bankruptcy as to whether or not the trustee had any objection to his foreshadowed application for leave to manage the companies. Thereafter, on 25 March 2019, Mr Minus sent another email to his AFSA Case Manager attaching documents and responses to each of the requests she had made in relation to obtaining a letter from the trustee in bankruptcy as to the trustee's position. 9 On 8 April 2019 his trustee in bankruptcy notified ASIC and Mr Minus that the trustee had been notified by Mr Minus of his application to Court to manage the four corporations. The trustee said: At the time of writing, the trustee neither objects nor supports the bankrupt's application. 10 In the event, it took Mr Minus until 17 May 2019 to provide ASIC with the information that ASIC had requested. Thereafter, on 21 June 2019, Mr Minus requested a response from ASIC as to whether or not it would be intervening in the proceedings, on the basis that he proposed to lodge the application in the Federal Court in the following week. On 28 June 2019, ASIC informed Mr Minus that ASIC was still in the process of reviewing the information but aimed to provide a letter setting out its position with respect to Mr Minus's application for leave to manage corporations shortly. 11 By 26 July 2019, Mr Minus had still not heard from ASIC and he sent another letter notifying ASIC that he had lodged the application with the Federal Court. The application, according to the Court's records, was filed on 26 July 2019. 12 Mr Minus sent another follow-up request to ASIC on 9 August 2019, noting that a directions hearing had been set down in respect of his application on 22 August 2019. He again asked whether ASIC would provide him with an indication of its position before the date of the directions hearing, and whether it would be appearing. 13 On 20 August 2019, ASIC informed Mr Minus to the effect that it did not oppose him managing ABCD on the basis that ABCD does not engage in any trading activity in any capacity other than as trustee of the Minasian Superannuation Fund, but said in relation to the remainder of the application, that it was ASIC's position that Mr Minus had not provided sufficient information to the Court to justify the grant of leave. 14 On 29 August 2019, Mr Minus sent to ASIC a copy of the orders of the Court, and sought urgent advice as to ASIC's position and, in addition, asked what information ASIC considered to be insufficient to allow the Court to grant leave. 15 The matter was initially listed for hearing on 1 October 2019, but the hearing date was moved to today, 5 September 2019 at the request of Mr Minus, in circumstances where there are orders in place by Collier J dated 14 March 2019, which provides (in part) that: