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[2026] QSC 15
General information, not legal advice.
Supreme Court of Queensland
2026-02-17
Treston J
Original judgment source is linked above.
CORPORATIONS - MANAGED INVESTMENT SCHEMES - WINDING UP - where company operates as trustee of one discretionary and one unit trust - where trustee carried on an unregistered managed investment scheme and scheme administrator appointed - where scheme administrator applies for directions in relation to distribution of realised funds in accordance with s 601EE Corporations Act 2001 (Cth) and as to the operation of the 'clear accounts rule' - where beneficiaries suffered loss arising out of the operation of the unregistered managed investment scheme - whether directions ought to be made as to the mechanisms for distributing realised funds and adjudicating claims by the scheme administrator.
COURTS AND JUDGES - COURTS - OTHER MATTERS - OTHER PARTICULAR MATTERS - where respondents as litigants appeared in person - where artificial intelligence used in submissions resulted in hallucinated and irrelevant case references - where final orders previously made in relation to matters agitated by respondents - where opposition to application hopeless and misconceived - whether indemnity costs should be ordered.
Corporations Act 2001 (Cth), s 601EE
Trusts Act 1973 (Qld), s 94
Australian Securities and Investment Commission v Letten (No 17) [2011] FCA 1420; (2011) 286 ALR 346
Carter Holt Harvey Wood Products Australia Pty Ltd v Commonwealth [2019] HCA 20; (2019) 268 CLR 524
Lane v The Deputy Commissioner of Taxation [2017] FCA 953; (2017) 253 FCR 46
Mier v FN Management Pty Ltd [2005] QCA 408; [2006] 1 Qd R 339
Park v Whyte (No 3) [2017] QSC 230; [2018] 2 Qd R 475
Moore (Scheme Administrator) v Ochkit Pty Ltd [2025] QSC 249
[1] On 19 October 2020 an originating application was filed seeking the appointment of an administrator to a scheme, some of the details of the scheme to which I will set out below. On 17 November 2020 the application to wind up the scheme came on for hearing before Applegarth J. Ultimately, orders were made by Applegarth J on 27 November 2020 appointing Mr Moore to wind up the scheme.
[2] On 14 November 2024 Mr Moore filed an amended application, which was part heard before me on 21 November 2024.
[3] After a series of reviews, applications and related judgments, the matter came before me for determination of the 14 November 2024 application on 2 December 2025. On that day, I made orders as set out below:
"1. Pursuant to Section 601 EE of the Corporations Act 2001 (Cth) ("the Act") and/or pursuant to section 94 of the Trusts Act 1973 the Applicant is justified in applying the property of the Belbrooke Mortgage Trust ("the Trust") being that property held by Belbrooke Pty Ltd ("Belbrooke") pursuant to the Trust Deed dated 8 February 2017 ("the Trust Deed") in the following manner:
a. firstly, to the payment of remuneration expenses and outlays of the Applicant as a person appointed in terms of Section 601EE of the Act and as Trustee by Order dated 27 November 2020 as the case may be;
b. secondly, after giving effect to Order 1(a) herein, otherwise give effect to the Trust Deed in terms of Clause 92 therein save that the property of the Trust not be applied to the payment of debts and liabilities of the Trust in terms of clause 92 of the Trust Deed except as provided for by this Order;
c. thirdly, after giving effect to Orders 1(a) and 1(b) herein, to apply any remaining property of the Trust in terms of Order 2 herein.
a. firstly, priority payments as prescribed by Section 556 of the Act as if that Section applied to the Scheme;
b. secondly, all non-priority claims in terms of Section 553 of the Act as if that Section applied to the Scheme.
a. adjudicating claims against the Scheme (by unit holders and creditors) using the process set out by Division 6 of Part 5.6 of the Act;
b. otherwise acting in terms of the process set out by Regulation 5.6.47 of the Corporations Regulations 2001 (Cth);
c. not paying dividends where any creditor cannot be located or whose bank account cannot be identified, and such funds as would otherwise be distributed be retained within the dividend fund pending further order of the Court;
d. otherwise applying process set out Division 6, Part 5.6 and the Corporations Regulations 2001 (Cth).
[4] On the day that I made those orders, I said I would publish reasons in due course. These are those reasons.
[5] Mr and Mrs Houwing were directors of one of the companies, Belbrooke Pty Ltd (Belbrooke), which company is a trustee of the Belbrooke Mortgage Trust (the Mortgage Trust) which is a unit trust, and the Belbrooke Administration Trust (the Administration Trust), which is a discretionary trust, the primary beneficiaries of which are also Mr and Mrs Houwing.
[6] Mr Houwing was a director and authorised representative of a company, Financial Options Pty Ltd (Financial Options). Financial Options held an Australian Financial Services Licence, and Mr Houwing provided financial advisory services through that business.
[7] Mr Houwing's business model was that he would arrange for his investor clients to lend money to his related entities in circumstances where there was no independent advice. As a consequence of his conduct, Mr Houwing was permanently banned from providing financial services and the licence which the company held was cancelled in February 2020.
[8] In particular, Mr Houwing recommended to his clients that they lend monies to either the Mortgage Trust or the Administration Trust. The trustee of each such trust was Belbrooke Pty Ltd. The company would then lend monies to Mr and Mrs Houwing themselves, or companies controlled by them.
[9] Whilst both the Houwings and the company they controlled, Ochkit Pty Ltd (the first respondent) (Ochkit) purchased real property, the assets of the scheme were not the real property, but rather registered first mortgages over the real property, securing the advances from Belbrooke.
[10] By way of example, Mr Moore demonstrated the transactions by reference to the dealings of Tabruby Pty Ltd as Trustee for the Campbell Superannuation Fund (Tabruby) (in relation to the Mortgage Trust) and the Dahm Superannuation Fund (in relation to the Administration Trust).
[11] In the Tabruby matter, under a loan agreement, Tabruby lent Belbrooke, as trustee for the Mortgage Trust, a sum of $828,000. Tabruby was then issued 828,000 units in the Mortgage Trust to provide Tabruby with an equitable interest in that trust. The Mortgage Trust was then to hold a first mortgage over land owned by the Houwing's company, Ochkit.
[12] The loan agreement provided that in the event of further advances, or in the event that the loan interest was not paid, then Tabruby would consent to Belbrooke creating additional further units, and issuing those units equal to the dollar amount of the loan outstanding. This had the effect that, on default under the loan, the remedy was to issue more units, notwithstanding that the underlying asset base against which security was provided was not itself increasing.
[13] In relation to the Administration Trust, the circumstances of the Dahm Superannuation Fund are demonstrative of how the scheme worked. In that case, Mr and Mrs Dahm, the fourth respondents, as trustees for their superannuation fund, lent $165,000 to the Administration Trust with the agreement provided that the borrower agreed that the lender was entitled to an equitable interest in a trust which had a first mortgage over certain land. Whilst the trust was not identified, it was the Mortgage Trust that held the relevant first mortgage over the real property. Again, units in the Mortgage Trust were issued to the investor.
[14] Counsel for Mr Moore suggested the summary of the investors as identified by Mr Houwing's affidavits and submissions was as follows (although internally the affidavit material was in some respects inconsistent):
Steven George Blades and Valerie Dawn Blades ATF Catch 22 Super Fund
Christine Lesley Houwing as trustee for the Rosevale Discretionary Trust
Barry Calder Dahm and Joan Dahm ATF Dahm Super Fund
Michael Lawrence Masters and Debra Anne Masters ATF Super Holiday Fund
Barry Calder Dahm and Joan Dahm ATF Dahm Super Fund
Christine Lesley Howing as trustee for the Rosevale Discretionary Trust
Tabruby Pty Ltd (A.C.N. 010 371 061) ATF The Campbell Super Fund
Gregory Ian and Vicki Joyce Brown as trustee for the Greg and Vicki Brown Super Fund
[15] By the order of 27 November 2020, the scheme is defined as including the dealings of both the Mortgage Trust and the Administration Trust. The Houwings continued to challenge the order in relation to the scheme. Their complaints are easily dismissed. The order is final, there was no appeal. I dealt with their complaints previously[1] and there was no appeal against that decision.
[16] Only the Mortgage Trust has assets; the Administration Trust has none. I refer to the asset position in more detail below.
[17] In February 2017, Belbrooke, as trustee for the Mortgage Trust, entered into a loan agreement with Ochkit in respect of what was described as an "advance" of $2,267,260. No money was actually ever so advanced. The "advance", also referred throughout as the Ochkit loan, is not repayable until February 2037.
[18] The Administrator has deposed to the realisation of Scheme assets of $2,145,782.72.
[19] Interest on the Ochkit loan of $2,267,260 would have accrued but according to Mr Moore there was no evidence that it had ever been paid. Mr Moore deposes that as at April 2024, unpaid interest was $1,218,652.68. Similarly, unpaid interest on investor loans was calculated at approximately $389,000 at the same date.
[20] As at November 2024, the funds held by the Administrator were approximately $1.8 million. Accordingly, there will be no surplus amount for distribution outside the Scheme.
[21] The applicant sought directions regarding the general administration of the scheme. Those directions flowed from the earlier order of Brown J (as her Honour then was) on 30 April 2024 for the Administrator to advertise for claims to establish the contributor's rights to scheme funds. Various claims were received in response to that advertising. The Administrator sought before me to put in place a regime for the assessment of those claims.
[22] A critical part of the ongoing administration of the scheme, is that the Administrator sought direction with respect to effect of the clear accounts rule so far as it applies to the property of the scheme, otherwise held on trust for beneficiaries who were unitholders under the scheme.
[23] The application fell to be dealt with within s 601EE(2) of the Corporations Act 2001 (Cth) which provides:
(1) If a person operates a managed investment scheme in contravention of subsection 601ED(5), the following may apply to the Court to have the scheme wound up:
(2) The Court may make any orders it considers appropriate for the winding up of the scheme."
" [15] Section 610EE (2) of the Act states only that a court "may make any orders it considers appropriate for the winding up of the scheme". The concept of "winding up", which is synonymous with that of liquidation, has long been central to the law of companies. The precise way in which this process may be undertaken is usually a matter for the legislature. As Lord Diplock said in Ayerst v. C & K (Construction) Ltd, "the making of a winding up order brings into operation a statutory scheme for dealing with the assets of the company that is ordered to be wound up". His Lordship went on to point out, however, that the essential characteristics of the winding up process have remained the same since the passage of the Companies Act 1862 (U.K.). In Joye v. Beach Petroleum N.L., the Full Court of the Federal Court approved the statement of McPherson S.P.J. in Re Crust 'N' Crumb Bakers (Wholesale) Pty Ltd that:
"Winding up is a process that consists of collecting the assets, realising and reducing them to money, dealing with proofs of creditors by admitting or rejecting them, and distributing the net proceeds, after providing for costs and expenses, to the persons entitled."
[16] It follows, in my view, that where a statute makes reference, without more, to the "winding up" of an entity, it is referring to the application of a procedure containing these essential characteristics. It follows that s.601EE(2) must be read as empowering a court to make such orders as it considers appropriate in order to apply such a procedure to an unregistered managed investment scheme. It may also be accepted that the terms of the section allow for further orders to be made as needed so long as they are required for the "due conduct and completion of the winding up". The necessary corollary is that an order that could not reasonably be seen as advancing this procedure would not be authorised by s.601EE (2). The comprehensive survey of authority undertaken by White J. in Re Stacks Managed Investments Ltd shows that courts have used the power granted by s.601EE to appoint persons to act as receivers, managers or liquidators with powers commensurate with those that would be possessed by persons fulfilling similar roles in the winding up of a company. Whatever the precise details of the procedure that may be fixed by a court to wind up an unregistered scheme, the understanding of "winding up" adopted above means that a necessary first step must be to determine what should be properly considered to be the property of the scheme.
[17] No different view as to what is involved in the winding up of a scheme is suggested by the observations of Barret J. in Australian Securities and Investments Commission v. Commercial Nominees of Australia Ltd to which the learned primary judge referred, and upon which his Honour relied as indicating the breadth of the power conferred by s. 601EE(2) of the Act. Barret J. said:
"In relation to s 601EE(2) of the Corporations Act, I accept that the powers conferred upon the court are very broad. The concept of winding up, as it is applied by s 601EE to an unregistered managed investment scheme, is not the subject of any explanation or elaboration in the statute. It seems to me, as a matter of general principle, however, that what is contemplated is the realisation of assets of the scheme, discharge of liabilities and distribution of any surplus among beneficiaries or members in an appropriate way. So much is clearly implied by the expression 'winding up', the general meaning of which may be gathered from the approaches taken to that general subject under statutes dealing not only with companies but also with partnerships. Those statutory approaches were built on foundations which pre-dated legislation in either area. Given that s 601EE(2) enables the court to make 'any orders it considers appropriate for the winding up of the scheme' (emphasis added), it must be accepted that the court has jurisdiction to settle or prescribe any aspect or element of the basis for winding up or the winding up process which it is necessary to supply because that element cannot be obtained from any other source. In this respect, it is noteworthy that the statute itself does not attempt to lay down the basis for or method of winding up. That is, to my mind, an indicator of intention that the court should be able to act in the comprehensive way I have outlined."
[18] I would add only one caveat. While it is true that the Act does not explicitly lay down a method for the winding up of an unregistered scheme it must be assumed that, in general, a court would be guided by analogies with the law relating to the winding up of companies, partnerships and trusts when deciding on the appropriate procedure for the winding up of a scheme. The best analogy would suggest the procedure to be followed. In my opinion, good reason should be shown before a court would make an order in the winding up of a scheme that did not have a precedent or parallel in the Act, partnership legislation or the law relating to the winding up of trusts. Of course, the best analogy might be thought to be the winding up procedure applicable to a registered scheme. Unfortunately for present purposes, the Act, beyond directing that a registered scheme be wound up in accordance with its constitution, also leaves the detail of the winding up of a registered scheme in the hands of the Court, which may make such orders as it "thinks necessary to do so."
[25] As such, the orders sought for both the application of the clear accounts rule and generally regarding the administration of the scheme all fall within the court's broad powers under s 601EE(2), which provides that the Court may make any orders it considers appropriate for the winding up of the Scheme.
[26] The clear accounts rule has been expressed in a number of ways, all of which are similar.
[27] Gordon J, in Australian Securities and Investment Commission v Letten (No 17)[3] said that a trustee's right of indemnification is subject to a condition precedent being that the trustee must make good any loss it caused to the estate (the clear accounts rule). Gordon J described the clear accounts rule as "... essentially a mathematical exercise setting off the trustee's right to indemnity against its liability with respect to previous breaches of trust ...".
[28] In Carter Holt Harvey Wood Products Australia Pty Ltd v Commonwealth[4] Kiefel CJ, Keane and Edelman JJ described the application of the rule as follows:
"31 The trustee's power to be reimbursed from the trust fund for the entirety of a payment that has been made by the trustee personally, sometimes also described as "recoupment", is not in issue in this appeal. This appeal is concerned with the trustee's power of exoneration, which is a power to use trust funds to discharge debts that were properly incurred by the trustee in the course of the trust business. By the exercise of the power of exoneration, equity ensures that the trustee "need not pay and perhaps ruin himself before seeking relief". However, the value of the power of exoneration, like the value of the power of reimbursement, may decrease by "netting-off reciprocal monetary obligations" to the extent to which the trustee has incurred a duty to increase the trust funds or, more loosely, a "liability which the trustee owes to the trust estate".
34 Trust creditors take the insolvent trustee's power of exoneration as they find it. They can enforce the power of exoneration by subrogation to the trustee's rights but the creditor "can be no better off than the trustee".
[29] In Park v Whyte (No 3)[5] Jackson J said of the clear accounts rule:
"[138] In some quarters, the clear accounts rule is seen as derived from the rule in Cherry v Boultbee. A reasonable argument exists that it is either separable from a sub-set of the principles for which Cherry v Boultbee is often cited. The Court of Appeal in Re Dacre, without considering Cherry v Boultbee, acted on the footing that there was a long series of authorities that "a defaulting trustee cannot claim a share in the estate unless and until he has, made good his default" and that the rule is based on the theory "that the [c]ourt treats the trustee as having received his share by anticipation", meaning that the trustee is treated as already having received its share to the extent of the default. Modern statements do not gainsay those propositions.
[139] In RWG Management, Brooking J considered and rejected an argument that a trustee was prevented from making a claim for indemnity for expenses against the estate until it has made good the loss to the estate from default, in the sense of payment of the amount of the default. Instead, he accepted that the counter-liabilities were to be applied (as if set off) against each other on the principle set out above, so that the trustee is entitled to any excess in its favour.
[140] To the extent that the reasons of Gordon J in Australian Securities Investment Commission v Letten (No 17) suggest that the trustee's obligation to make good the default is a condition precedent to the right to an indemnity, in my view, they should not be taken as requiring anything more than the process of reducing the amount of the right by the amount of the counter-liabilities in accordance with the principle stated by Brooking J, as already mentioned."
[30] A description of the clear accounts rule can also be taken from Lane v The Deputy Commissioner of Taxation[6] at [59]:
"This side excursion into the scope of the clear accounts rule has a particular relevance in the context of the insolvency administration of a trustee. The foregoing brief discussion discloses that the ascertainment of the scope of an insolvent trustee's right of exoneration or recoupment may be no simple matter. It will often require a consideration and understanding of the state of the accounts of the trust and of the personal accounts of the trustee as well as an examination of the stewardship of the trust by the trustee. These actions will necessitate expense and effort and, where the insolvent trustee's accounts are not well maintained, that may be a lengthy and expensive exercise. This is a pertinent consideration when a court is asked to give directions about the extent to which an insolvency administrator might be entitled to receive benefits from any fund generated by them for the purposes of utilising the right of exoneration to meet the claims of creditors."
[31] Put simply, the rule suggests that while trustees are personally liable for trust debts, equity can assist by conferring on trustees a right of indemnity out of the trust property which can be exercised in two ways, namely the right of reimbursement and the right of exoneration. The clear accounts rule therefore provides that the value of an indemnity that the trustee may recover from the trust fund is subject to any liability that the trustee has incurred to increase the trust fund either by making good a loss or by disgorging an unauthorised profit or gain.
[32] The rule does not, as the Houwings' suggested, relate to the production of trustee accounts before the administrator can seek remuneration.
[33] There was no application before the court as to the calculation of the distributions and dividends, but rather only an application as to the basis of such calculations. The general directions about the regime to be put in place for the assessment of the claims were affected by how the clear accounts rule applies to this particular scheme.
[34] The question was of some importance because according to the evidence offered by Mr Houwing, approximately $2.2 million was advanced by investors to either the Mortgage Trust or the Administration Trust and each of the investors were issued with units in the Mortgage Trust commensurate with their investment. There was also however, a group of unsecured creditors, who did not have the benefit of holdings of units. Those creditors include the Australian Taxation Office, banking institutions and a law firm. The total of the unsecured creditors amounted to approximately $291,660.
Belbrooke's liability to compensate the trust fund
[35] The clear accounts rule can apply therefore if I am satisfied that Belbrooke has a liability to compensate the trust fund by making good a loss in the way described by Gordon J in ASIC v Lettern above.
[36] Part 5C.1 of the Act deals with the registration of managed investment schemes.
[37] The Houwings maintained that the scheme here was not a managed investment scheme. I have already dealt with this issue.[7] In doing so I observed that when Justice Applegarth had made the order appointing Mr Moore as the Scheme Administrator on 27 November 2020 his Honour said:
"So I am persuaded on the material before me that this was a managed investment scheme that should have been registered in accordance with s 601ED of the Corporations Act ... I proceed on the basis that this was a managed investment scheme that was unregistered when it should have been."
[38] Although his Honour declined to make a declaration to that effect, given the potential exposure of the directors of the company, his Honour plainly proceeded on that factual basis. When the matter came on for hearing before me in September 2025, I concluded[8] that the order his Honour made was a final order and I would not re-open the question as to whether the scheme was a managed investment scheme which should have been registered. It follows that when the Houwings' submission set out at some length before me as to why the scheme was not a managed investment scheme which should have been registered, I declined to hear oral submissions in relation to that issue.
[39] The scheme, as I have described, was therefore always conducted in contravention of Part 5C of the Act. Mr Houwing as the promoter of the scheme, and Belbrooke as the vehicle of the scheme, engaged in conduct which was misleading or deceptive in respect to a financial product or financial services within the meaning of those terms as they are contained in the Act.
[40] Accordingly, the Act allows for recovery by a person who suffers loss or damage by the conduct of another who has engaged in contraventions of the Act.
[41] The Administrator identified numerous ways in which those rights may arise, including:
(a) pursuant to s 1325(2) of the Act, the court may, on the application of a person who has suffered, or is likely to suffer, loss or damage because of the conduct of another person that was engaged in a contravention of a s 1325 order, make such order or orders as the court thinks appropriate against the person who engaged in the conduct or a person who is involved in the contravention if the court considers that the order or orders concerned will compensate the person who made the application, in whole or in part for the loss or damage, or will prevent or reduce the loss or damage suffered, or likely to be suffered, by such a person; and
(b) rights for recovery arise under s 1041I of the Act for persons who suffer loss or damage by the conduct of another person who has engaged in a contravention of ss 1041E, 1041F, 1041G and 1041H. Each of the investors would therefore have a right of action against Belbrooke as trustee and respect of the contraventions of Part 7.10 of the Act.
[42] There are, no doubt, other ways in which individual investors can establish claims against Belbrooke as trustee as the entity conducting the scheme, such as the Ochkit loan itself being a breach of trust, or a breach of the trustee's fiduciary duty. It is unnecessary to list them all.
[43] Accordingly, the Administrator submitted, and I accepted, that Belbrooke was liable to compensate the trust for the losses caused by it and the clear accounts rule was therefore engaged. It follows that it was appropriate to make orders as sought by the Administrator to give effect to the clear accounts rule, that is, that after payment of the remuneration and expenses of the Administrator, then payment to the unitholders. Those orders are set out above.
[44] As a matter of completeness, I should however address the Houwings' submission that cl 92 of the Mortgage Trust Deed mandates a pari passu distribution, not the application of the clear accounts rule.
[45] Clause 92 of the Mortgage Trust Deed which is in the following terms:
92 On termination of the trust, the trustee must realise all the assets of the trust, pay all of its liabilities and distribute the remainder (after deducting any amount the trustee is entitled to and any amount the trustee decides is appropriate to cover actual contingent and future liabilities) to the unit holders in accordance with their entitlements, in proportion to the number of units in respect to which they are registered."
[46] The clear accounts rule is not inconsistent with this clause as the clause carries the proviso that the trustee may only deduct an amount that the trustee is entitled to before distributing the remainder. If the clear accounts rule applies, then the trustee will not be so entitled.
[47] The second issue which the Houwings raised was in relation to the Rosevale transaction.
[48] The evidence in relation to this transaction was difficult to follow but it seems that Mrs Houwing alleged that after her mother died, a sum of money was paid into a bank account in Rosevale's name. The amount involved was approximately $266,000. Apparently in about 2010, Mrs Houwing in her capacity as trustee extended unsecured loans to Ochkit for rates of interest that cannot presently be determined but arguably somewhere between 14 per cent and 17.25 per cent. The effect of the convoluted series of transactions appeared to be that Mrs Houwing, as trustee, then caused the Rosevale Discretionary Trust to loan money to Ochkit in its capacity as trustee for the Houwing Family Trust.
[49] But at some point, it was contended that the Belbrook Mortgage Trust (as part of a described "debt restructure") assumed Ochkit's liability to Rosevale. There's no evidence of any consideration for the transaction and the loan agreement is not a deed.
[50] It is not entirely clear to me either the factual or legal basis for the detail of this transaction, and it did not here fall to me to decide any issues in relation to it. The best that can be said in respect of it is that the application of the clear accounts rule does not mean that the arrangement cannot be properly considered by the Scheme Administrator in due course as part of the adjudicative process whatever the details of this arrangement may ultimately transpire to be. Put another way, the application of the clear accounts rule does not affect any entitlement, if there is one, in relation to this loan agreement.
[51] I should, however, say something about the balance of the submissions that were made by Mr and Mrs Houwing.
[52] The court understands how difficult it is for self-represented people to properly present their argument in cases of this complexity. The court has made numerous accommodations to the Houwings to facilitate their fair and just representation.
[53] But their defence of the proceedings has not been helped by a number of features.
[54] First, the lengthy written submissions which were filed in this application were plainly AI generated. They were infected by reference to cases which either did not exist, or if they existed were not relevant to the matters in issue before me, and were therefore cited incorrectly or were in support of principles which are not made out on the cases. That makes the consideration of the submissions a difficult and time-consuming exercise because the court can have no confidence whatsoever regarding the matters that contained therein.
[55] Second, the submissions repeatedly challenged the notion that the scheme was an unregistered scheme, and continued to assert that that issue remained open for determination. That issue does not remain open for determination. Justice Applegarth made an order on 27 November 2020 in which his Honour found that the scheme was an unregistered scheme. The Houwings sought to re-agitate that issue in an application before me on 23 September 2025 and for the reasons which I gave that day,[9] I concluded that his Honour's orders constituted final orders and there had been no appeal in relation to them. Further, for discretionary reasons, I would not in any event have allowed an application to effectively reopen consideration of his Honour's orders on grounds of procedural fairness. I will not repeat the reasons.
[56] It follows however that to the extent that the respondents' submissions continued to assert that the scheme was not an unregistered scheme and that the issue remains open for determination, that that has already been conclusively determined.
[57] The Houwings' submissions did not otherwise address the relevant question as to the application of the clear accounts rule in a way that was helpful because they proceeded on the basis of an incorrect assumption, that is, that the scheme was not an unregistered scheme. Accordingly, it is unnecessary to set out the balance of their arguments here.
[58] Mr Moore sought an order for indemnity costs against the Houwings. In my view he had a good basis to do so.
[59] First, after my decision of 22 September 2025, Mr Moore's solicitors wrote to the Houwings requesting their consent to the orders, effectively being the orders which I made on 2 December 2025. Mr Moore explained the basis for the order identifying, to allay any concerns which the Houwings might have had, that if they were to consent to the order it would:
"a. Allow for the expedient administration of the scheme;
[60] The Houwings refused to provide their consent.
[61] Second, as I have already identified, when the Houwings filed their lengthy written submissions, those submissions were substantially AI generated containing references which were incorrect, and cases which did not exist. That caused considerable time and cost to be incurred in the preparation of the application. Whilst it is understandable that self-represented people find complex legal matters difficult to litigate in superior courts, self-represented litigants must nevertheless comply with the same rules and practises as other litigants in this court. Here, there was not compliance with Practice Direction No 5 of 2025, and the non-compliance caused significant difficulty in understanding the genuine issues which the Houwings wished to agitate.
[62] Third, the Houwings continued to agitate that Justice Applegarth had not concluded that the scheme was a managed investment scheme which should have been registered. That is incorrect. His Honour did not make a declaration to that effect, but found as I have already set out above, that he was persuaded on the material that the scheme was a managed investment scheme that should have been registered and his Honour proceeded on that basis.
[63] However even if the Houwings had misunderstood what had happened before Justice Applegarth in November 2020, it is difficult to conclude that they did not understand when I came to a similar conclusion in September 2025 and published reasons to that effect.[10] In this way, the Houwings sought to agitate a question which had already been decided, expanding the breadth of the matters to be faced by the applicant and the court in a way which was entirely unnecessary.
[64] Fourth, it cannot be supposed that the Houwings' defence of these proceedings was other than protecting their own personal interests. Their interests are not reflective of the balance of the investors; to the contrary the balance of the investors have an interest in having the scheme wound up and whatever proceeds are available for distribution then distributed. As such the Houwings seek to do no more than protect their own personal interests.
[65] In circumstances where the Houwings' defence of the proceedings was so hopeless, their submissions were driven by a reconsideration of the decision made by Justice Applegarth in November 2020, and again by me in September 2025, coupled with the time and cost incurred by the inaccuracies caused by AI generated submissions, I was prepared to accede to the submission that the Houwings should in the circumstances be ordered to pay the costs of the amended application on an indemnity basis.
[1] Moore (Scheme Administrator) v Ochkit Pty Ltd [2025] QSC 249.
[4] [2019] HCA 20; (2019) 268 CLR 524 at [31], [34].
[5] [2017] QSC 230; [2018] 2 Qd R 475 at [138] - [140].
[7] Moore (Scheme Administrator) v Ochkit Pty Ltd [2025] QSC 249.
[8] Moore (Scheme Administrator) v Ochkit Pty Ltd [2025] QSC 249.
[9] Moore (Scheme Administrator) v Ochkit Pty Ltd [2025] QSC 249.
[10] Moore (Scheme Administrator) v Ochkit Pty Ltd [2025] QSC 249.
Moore (Scheme Administrator)
Ochkit Pty Ltd
(2011) 286 ALR 346
(2019) 268 CLR 524
(2017) 253 FCR 46