Plaintiff v Defendants

For the first and second Defendants in S ECI 2026 01563

(a) Australian Academy of Higher Learning Pty Ltd (in liq) (Company) applies, by originating process dated 24 October 2025, to set aside a statutory demand (Demand) served on it by Devinder Mahey (Mr Mahey) (Statutory Demand Set Aside Application); and

(b) Mr Mahey, who claims to be a creditor of the Company, applies, by originating process dated 21 February 2026, for orders that 'the Court stay the liquidation process initiated by the Liquidator on 13 February 2026' and for orders with respect to costs (Winding Up Stay/Termination Application).

1. The defendant to the Statutory Demand Set Aside Application is Mr Mahey.
2. The defendants to the Winding Up Stay/Termination Application are John Maxwell Morgan, the liquidator of the Company (Liquidator), Kang Chai, the former director of the Company, and Agung Dwi Kusuma, the current director of the Company.

1. Mr Mahey has filed and relies upon the following:

(a) affidavit of Devinder Mahey, sworn 27 October 2025 (First Mahey Affidavit); and

(b) affidavit of Devinder Mahey, sworn 2 January 2026 (Second Mahey Affidavit).

1. Mr Mahey has filed and relies upon the following:

(a) affidavit of Devinder Mahey, sworn 21 February 2026;

(b) affidavit of Devinder Mahey, sworn 23 March 2026; and

(c) affidavit of Devinder Mahey, sworn 27 March 2026.

1. The Liquidator has filed and relies upon the affidavit of John Maxwell Morgan, affirmed 26 March 2026.
2. The parties agreed that evidence filed in the Statutory Demand Set Aside Application should be treated as evidence filed in the Winding Up Stay/Termination Application.

1. The Company was an educational services provider, trading under the name 'Technical Institute of Victoria'.
2. A dispute arose between the Company and Mr Mahey, who was employed by it, concerning the termination of his employment and in respect of employment entitlements.
3. On 8 June 2023, Mr Mahey commenced proceedings against the Company at the County Court of Victoria,[1] claiming that the Company owed him money (CCV Proceeding).
4. On 21 November 2023, Mr Mahey commenced proceedings against Gurvinder Singh (Mr Singh) in this Court,[2] the managing director of the Company at the time, Phillip Andrew Hyde and Jeffrey Gunadasa, seeking compensation and damages for alleged unfair termination (2023 SCV Proceeding).
5. On 28 February 2024, Mr Mahey obtained default judgment against the Company for the sum of $118,290.48, comprising the claim amount, interest and costs (Default Judgment, Judgment Debt).
6. Prior to 5 September 2024,[3] Mr Mahey applied to the Magistrates' Court of Victoria at Swan Hill for an intervention order against Mr Singh (IVO Proceeding). Mr Mahey alleged that Mr Singh had directed another person to make threats towards him, causing severe mental distress.
7. The material filed by Mr Mahey in support of his application for an intervention order included:

(a) a document comprising an account of his dealings with Mr Singh and the 'threat[s] to [his] life'. The document records Mr Mahey's discovery of 'suspicious and illegal activity' and 'education and migration fraud'. The document records his perception that he was unfairly dismissed after raising those matters with the Company. Mr Mahey claims that Mr Singh harassed him as a result of the 2023 SCV Proceeding, affecting his mental health;

(b) a document described by Mr Mahey as 'a copy of a bogus qualification issued by [the Company]';

(c) a 'GP Mental Health Treatment Plan - Review', dated 18 June 2024 and signed by Dr Nappally, a general practitioner. The plan records 'problem/diagnosis' of 'depression/anxiety' with a 'Follow-up Relapse Prevention Plan' of 'ongoing therapy' (Mental Health Treatment Plan); and

(d) a Centrelink medical certificate (SU415) signed by Dr Nappally, which records that Mr Mahey was incapacitated during the period 21 June 2025 to 21 September 2025. It records the specific diagnoses of 'depression, anxiety, insomnia', with onset date 1 August 2023. It records that the functional impact of the condition is 'panic, unable to focus or concentrate, suicidal thoughts' (Medical Certificate).

1. Mr Mahey has deposed that the Magistrates' Court forwarded copies of the material referred to above to GPZ Legal, solicitors for the Company.
2. On 10 October 2024, the Company and Mr Mahey entered into and executed a deed of settlement and release in relation to the Default Judgment (Deed). The Deed provided for the Company to pay to Mr Mahey the sum of $80,000 in full and final settlement of the Claim.
3. The terms of the Deed relevantly include:

...

1.1 The Defendant shall pay the Plaintiff the sum of $80,000.00 (the settlement sum) in full and final settlement of the Claim, inclusive of Claim, costs and interests ...

...

3.1 Failure by the Defendant to pay any instalment due pursuant to Clause 1.1 of this Deed shall constitute default under this Deed.

3.2 In the event of such default, the Plaintiff shall be at liberty to immediately reinstate the proceeding and thereupon enter judgement against the Defendant for:

1. The settlement sum less any amounts which have been paid by the Defendant;

2. The costs of entry of such judgment, payable on an ordinary basis;

3.3 The Defendant agrees that for the purpose of the Plaintiff seeking to reinstate the proceeding and applying for and obtaining judgment as contemplated by this Deed, production by the Plaintiff of a true copy of this Deed in support of any such application for judgment as referred to above, together with evidence from the Plaintiff or its solicitors as to the amount of the settlement sum which then remains owing, may be produced as conclusive evidence of all necessary consents on the part of the Defendant to the entry of judgment against it.

4.1 In consideration of this Settlement and payment of the settlement sum, the Plaintiff acknowledges that its claim against the Defendant in proceeding SEC 12023 05594 (sic) filed on 31 May 2024, and which names Gurvinder Singh, Phillip Andrew Hyde and Jeffrey Gunadasa as First to Third Defendants, respectively, will be dismissed by Consent Order. The Plaintiff acknowledges that its claim in that Proceeding is connected to the present Claim and his claim for loss and damage associated with losing his job with the Fourth Defendant, as he claims in that proceeding, is addressed and settled by settlement of this proceeding.

4.2 The parties to proceeding SEC I 2023 05594 (sic) will execute a Deed of proposed Consent Order contemporaneously with the Settlement Deed being signed by the Plaintiff and the Defendant to it or against the First to Third Defendants in proceeding S ECI 2023 05594.

...

5.1 Upon execution of this Deed the Plaintiff and the Defendants, both jointly and severally, mutually release and forever discharge each other absolutely from any and all suits, actions, proceedings, demands, causes of action and/or any claim or claims whatsoever which they may have, or, but for the execution of this Deed, might have had against each other with respect to any act, cause, matter or thing referred to in or connected with or against the First to Third Defendnats arising out of the claims in this proceeding or the matters disclosed in the pleadings in the proceedings or the matters the subject of [a related] proceeding S ECI 2023 035594.

...

10.2 This Deed may be pleaded by either party, and the defendants in proceeding S ECI 2023 035594 in bar to any proceeding now or hereafter commenced arising out of or in connection with the subject matter of the releases contained herein, except for a proceeding to enforce this Deed.

1. From October 2024 to September 2025, the Company paid Mr Mahey the sum of $80,000 (Settlement Sum) by monthly instalments, in accordance with the Deed.
2. On 29 October 2024, Mr Galatas, solicitor, GPZ Legal, sent an email to Mr Mahey referring to the mention of the IVO Proceeding listed for 31 October 2024 and the previous hearing on 5 September 2024 (29 October Email). The email sets out criticisms of the material in support of the claim for an intervention order. The email contains the following comment regarding the material concerning Mr Mahey's medical condition:

Your medical condition, as it was described in now dated medical material, is in no way connected to Mr Singh.

1. On 3 October 2025, Mr Mahey sent the Demand, and accompanying affidavit, to the Company's registered office, claiming the difference between the Judgment Debt and the Settlement Sum, being $42,264.62.
2. On 24 October 2025, the Company brought the Statutory Demand Set Aside Application.[4]
3. The 29 October Email invited Mr Mahey to withdraw his application and offered for Mr Singh to bear his own costs, failing which, and in the event the application was dismissed, Mr Singh would seek an order for payment of his costs.
4. Mr Mahey subsequently withdrew the application for an intervention order. He claims that he was forced to withdraw due to 'ongoing threats, [his] deteriorating mental health, and a lack of legal protection'.
5. On 3 November 2025, Mr Mahey commenced further proceedings in this Court[5] against the Company seeking to set aside the Deed on the ground that it had been executed under duress, undue influence or as a result of unconscionable conduct and/or that it includes provisions that may be void on public policy grounds (Deed Set Aside Application).
6. On 13 February 2026, creditors of the Company resolved that it be wound up and that the Liquidator be appointed.
7. On 16 February 2026, the Statutory Demand Set Aside Application came on for hearing before me. I made orders adjourning the proceeding for mention on 31 March 2026. The purpose of the adjournment was 'to give the liquidator time in which to investigate the merits of the proceeding and to determine what he seeks to do with it'.
8. On 31 March 2026, I heard:

(a) the mention of the Statutory Demand Set Aside Application; and

(b) the Winding Up Stay/Termination Application.

(1) At any time during the winding up of a company, the Court may, on application, make an order staying the winding up either indefinitely or for a limited time or terminating the winding up on a day specified in the order.

(1A) An application may be made by:

(a) in any case - the liquidator, or a creditor or contributory, of the company ...

(2) On such an application, the Court may, before making an order, direct the liquidator to give a report with respect to a relevant fact or matter.

(3) Where the Court has made an order terminating the winding up, the Court may give such directions as it thinks fit for the resumption of the management and control of the company by its officers, including directions for the convening of a general meeting of members of the company to elect directors of the company to take office upon the termination of the winding up.

(4) The costs of proceedings before the Court under this section and the costs incurred in convening a meeting of members of the company in accordance with an order of the Court under this section, if the Court so directs, forms part of the costs, charges and expenses of the winding up.

(5) Where an order is made under this section, the company must lodge an office copy of the order within 14 days after the making of the order.

1. In Re Warbler Pty Ltd,[6] Master Lee KC, of the Queensland Supreme Court, set out a non-exhaustive list of principles relevant to the discretion to stay or terminate a winding up. Those principles (sometimes referred to as the Warbler factors) are:

(1) The granting of a stay is a discretionary matter, and there is a clear onus on the applicant to make out a positive case for a stay ...

(2) There must be service of notice of the application for a stay on all creditors and contributories, and proof of this ...

(3) The nature and extent of the creditors must be shown, and whether or not all debts have been discharged ...

(4) The attitude of creditors, contributories and the liquidator is a relevant consideration ...

(5) The current trading position and general solvency of the company should be demonstrated. Solvency is of significance when a stay of proceedings in the winding up is sought ...

(6) If there has been non-compliance by directors with their statutory duties as to the giving of information or furnishing a statement of affairs, a full explanation of the reasons and circumstances should be given ...

(7) The general background and circumstances which led to the winding‑up order should be explained ...

(8) The nature of the business carried on by the company should be demonstrated, and whether or not the conduct of the company was in any way contrary to 'commercial morality' or the 'public interest'.[7]

1. In Von Risefer v Mainfreight International Pty Ltd,[8] Ashley JA and Beach AJA pointed out that the Warbler factors do not carry equal weight. Their Honours said that when the company was wound up in insolvency, solvency or otherwise 'will loom large'. They also highlighted the importance of the Court having regard to the public interest and the interrelated issue of commercial morality.

(a) the Deed was signed by him under duress after he had been threatened by directors of the Company;

(b) he had been taking tablets at the time of settlement and was 'forced' to sign the Deed. He relied on evidence in relation to psychological counselling and medical prescriptions in support of this contention;

(c) he faced threats from 'bogus' qualification holders;

(d) his own lawyer 'terminated' a Sheriff's warrant without his consent and forced him to settle for a 'low amount'. When I asked how these matters affected the Company and its reliance on the Deed, he said that there was a 'possibility' that his lawyer was 'in contact with the other side';

(e) Exhibit D of his first affidavit comprised text messages containing threats to bring proceedings against him for defamation by Devinder Ji, 'a former partner'. I note the threats were made around one year prior to the signing of the Deed;

(f) Exhibit E of his first affidavit comprised a personal statement filed in his application for an intervention order against Mr Singh. He claimed that in June 2024, GPZ Legal threatened him with a costs order if he did not withdraw that application;

(g) Exhibit E and G of his first affidavit comprised the Mental Health Treatment Plan which evidenced his deteriorated health and psychological distress; and

(h) Exhibit H of his first affidavit comprised a list of medications. He stated that he was undertaking counselling and taking antidepressant tablets prescribed to him.

(a) any dispute arising out of the Default Judgment was settled by Deed. Mr Mahey received the sum of $80,000 which was 'within the realm of a reasonable settlement'. As a matter of law, the issue is now resolved and Mr Mahey is not owed money by the Company in any event. In the absence of the Deed being set aside, Mr Mahey does not appear to be a creditor;

(b) as to other causes of action, economic duress appears to be Mr Mahey's main concern;

(c) the Court should not stay or terminate the winding up in circumstances where the Company 'has more than $500,000 worth of creditors', including a bank and the ATO; that is, the Company is 'clearly' not solvent;

(d) Mr Mahey has not proposed to deal with payment of creditors and has not put forward evidence that would satisfy the Court that the Company is solvent;

(e) the liquidation, being relatively new and only five to six weeks old, is continuing 'in the usual course';

(f) there is a 'complete lack of utility' in the liquidation being stayed or terminated;

(g) the allegations as raised by Mr Mahey go to commercial morality concerns, which are matters that the Liquidator is and will continue to investigate; and

(h) in the circumstances, there is no public interest in the winding up being stayed or terminated.

1. In circumstances where the Company is in liquidation, no purpose is served by the Statutory Demand Set Aside Application. The Company seeks orders that the application be dismissed and it is appropriate to make those orders.

1. Mr Mahey claims to be a creditor of the Company, which is the only ground upon which he would have standing to seek orders staying or terminating its winding up.[9]
2. The difficulty for Mr Mahey is that his standing as a creditor depends upon the Default Judgment, in circumstances where the amount owing under the Default Judgment was compromised by the Deed, and where the Settlement Sum under the Deed has been paid. Mr Mahey disputes this and claims that the Deed is liable to be set aside. That claim is subject to the Deed Set Aside Proceeding, which has not been resolved and which is stayed pursuant to s 471B of the Act.
3. Two questions are raised in relation to the issue of standing:

(a) first, how is the standing of a creditor under s 482(1A) of the Act determined in a case where the creditor's claim is disputed; and

(b) second, whether it would be necessary for Mr Mahey to set aside the Deed before his standing could be established, or whether the Court can resolve that question in the process of determining standing.

1. I have not been able to find a case concerning the proper approach to s 482(1A) of the Act in those circumstances. But that is unsurprising because typically an applicant for relief under s 482 is a member of the company, and occasionally an administrator or liquidator. Creditors generally have little commercial interest in terminating a winding up, even of a solvent company.
2. Pursuant to s 553 of the Act, all debts payable by, and all claims against, the company (present or future, certain or contingent, ascertained or sounding only in damages), being debts or claims the circumstances giving rise to which occurred before the relevant date, are admissible to proof against the company in a winding up. This suggests that the term 'creditor' in s 482(1A) of the Act includes a contingent creditor. In the post winding up context, the term 'creditor' usually refers to a person who has a debt that is provable in the winding up.[10]
3. Assuming that 'creditor' in s 482(1A) includes a contingent creditor, given that a transaction affected by undue influence, duress or unconscionable conduct is voidable,[11] a question arises whether the matters alleged by Mr Mahey, if proved, would be sufficient to establish his standing as a creditor. For reasons that I explain later, it is not necessary for me to resolve this question.
4. In the context of the standing of a creditor to apply to terminate a composition under Part X of the Bankruptcy Act 1966 (Cth), it has been held that it was for the court to determine, 'definitively if necessary', whether a person claiming to be a creditor is in fact a creditor.[12] In Beard, Lockhart J found it unnecessary to determine the standard that was required to be satisfied in order to establish standing as a creditor.[13]
5. As was the case in Beard, it is not necessary for me to determine the standard required to establish Mr Mahey's claim to standing as a creditor. Whether or not it is necessary for the Deed to be set aside before standing can be established, or whether the standard is expressed in terms of resolution of the claim on the balance of probabilities, or some lesser standard, such as serious question to be tried or prima facie case, I am not satisfied, on the evidence before me, that Mr Mahey has established his standing as a creditor, even to those lesser standards.
6. The starting point is that Mr Mahey's claim is the subject of the Deed, and there is no dispute that the Settlement Sum under the Deed has been paid. Mr Mahey's contention is that the Deed is liable to be set aside, or varied, on grounds of undue influence, duress or unconscionable conduct or illegality, or that he has an entitlement to damages for misleading and deceptive conduct. By avoiding the Deed, Mr Mahey seeks to reinstate his claim to the $42,264.62 sum, being the amount that would be owing under the Default Judgment but for the Deed.

Undue influence, duress, unconscionable conduct

1. In Commercial Bank of Australia Ltd v Amadio, Mason J explained the difference between the doctrines of unconscionable conduct (in the narrow sense) and undue influence:[14]

Historically, courts have exercised jurisdiction to set aside contracts and other dealings on a variety of equitable grounds. They include fraud, misrepresentation, breach of fiduciary duty, undue influence and unconscionable conduct. In one sense they all constitute species of unconscionable conduct on the part of a party who stands to receive a benefit under a transaction which, in the eye of equity, cannot be enforced because to do so would be inconsistent with equity and good conscience. But relief on the ground of 'unconscionable conduct' is usually taken to refer to the class of case in which a party makes unconscientious use of his superior position or bargaining power to the detriment of a party who suffers from some special disability or is placed in some special situation of disadvantage, eg, a catching bargain with an expectant heir or an unfair contract made by taking advantage of a person who is seriously affected by intoxicating drink. Although unconscionable conduct in this narrow sense bears some resemblance to the doctrine of undue influence, there is a difference between the two. In the latter the will of the innocent party is not independent and voluntary because it is overborne. In the former the will of the innocent party, even if independent and voluntary, is the result of the disadvantageous position in which he is placed and of the other party unconscientiously taking advantage of that position.

1. In Djordjevic v Mondino (Djordjevic), Rares J explained the doctrine of undue influence in the context of bankruptcy proceedings in these terms:[15]

Undue influence is concerned with whether, in entering into the impugned transaction, the plaintiff freely exercised their will: Thorne v Kennedy [2017] HCA 49; 263 CLR 85 at [31] per Kiefel CJ, Bell, Gageler, Keane and Edelman JJ. The enquiry is focussed on the party bringing the application. Their free will need not be subordinated to the extent that they are reduced to an automaton, or were a 'mere channel through which the will of the defendant operated': Thorne at [32], citing Tufton v Sperni [1952] 2 TLR 516 at 530 per Jenkins LJ. However, their judgmental capacity must at least be '"markedly sub-standard" as a result of the effect upon the person's mind of the will of another': Thorne at [32].

The existence of undue influence can be proved by showing that (1) the parties are in a recognised category of relationship or, even if their relationship does not fall within a recognised category, it involved one party occupying a 'position of ascendancy and influence and the other a corresponding position of dependency or trust'; and (2) the transaction was one 'commonly involving a "substantial benefit" to another, which cannot be explained by "ordinary motives", or "is not readily explicable by the relationship of the parties"': Thorne at [34] (Citations omitted). Certain relationships constitute recognised categories and carry a presumption in favour of the party claiming that a transaction is affected by undue influence: Watkins v Combes [1922] HCA 3; (1922) 30 CLR 180 at 193-4 per Isaacs J. The relationships between litigant and litigant, or between litigant and mediator, do not fall into recognised categories of relationship. Nor does the mediator in this case occupy a position of ascendancy and influence, or Mr Mondino a corresponding position of dependency or trust.

However, undue influence can be proved outside these presumptive relationships by adducing 'direct evidence of the circumstances of the particular transaction' that shows actual undue influence: Thorne at [34]. The transaction must have been 'the outcome of such an actual influence over the mind of the [weaker party] that it cannot be considered his free act': Johnson v Buttress [1936] HCA 41; (1936) 56 CLR 113 at 134 per Dixon J. It is relevant to consider the nature and terms of the agreement reached between the parties when determining if it was the result of undue influence, including whether the consideration under the agreement was adequate: Johnson at 136. Other relevant factors include the relation of the parties, the susceptibility of the transferor to the influence of the other, the opportunity of the other to exert undue influence and the extent to which the transferor acted on the basis of independent advice: Thorne at [59], quoting American Law Institute, Restatement of the Law Third, Restitution and Unjust Enrichment (2011), s15, comment c.

1. In Djordjevic, Rares J explained the doctrine of duress in these terms:[16]

Some ambiguity surrounds the law of duress. The New South Wales Court of Appeal has held that duress is 'limited to threatened or actual unlawful conduct': Australia & New Zealand Banking Group v Karam [2005] NSWCA 344; 64 NSWLR 149 at [66]. An alternative position regarding the test for illegitimate pressure, more consistent with English and American authority, is concerned with 'whether the pressure goes beyond what is reasonably necessary for the protection of legitimate interests': see Thorne at [71] (per Nettle J). The High Court has so far declined to address the arguments in favour or against the approach in Karam, and the suitability of alternative approaches: see Thorne at [29] per Kiefel CJ, Bell, Gageler, Keane and Edelman JJ; at [70]-[73] per Nettle J. In Thorne, the High Court held that it was not necessary to address the arguments in favour of or against the Karam position that duress requires proof of threatened or actual unlawful conduct: Thorne at [29], [73].

1. In Djordjevic, Rares J explained the doctrine of unconscionable conduct in these terms:[17]

Unconscionable conduct arises where 'a party makes unconscientious use of his superior position or bargaining power to the detriment of a party who suffers from some special disability or is placed in some special situation of disadvantage': Amadio at 461 per Mason J. A special disadvantage does not exist in every case where there is some difference in bargaining power; instead, it must be a condition or circumstance 'which seriously affects the ability of the innocent party to make a judgment as to his own best interests, and where the other party knows or ought to know of the existence of that condition or circumstance and its effect on the innocent party': Amadio at 462. The High Court in Kakavas v Crown Melbourne Ltd [2013] HCA 25; 250 CLR 392 held unconscionable conduct concerns the prevention of 'victimisation' not the consequences of foolishness (at [18]) or 'proof of a predatory state of mind', not mere '[h]eedlessness of, or indifference to, the best interests of the other party' (at [161]). In this regard, unconscionable conduct is focussed on the conduct of the party defending the application.

1. In support of the claims of undue influence, duress and unconscionability, Mr Mahey says that he was suffering from a 'mental health condition' at the time of entry into the Deed and 'was under severe psychological distress and medical treatment'.
2. Mr Mahey claims that the Company's lawyers, GPZ Legal, and hence the Company, was aware of his mental health condition because he applied for an intervention order against Mr Singh, the director of the Company, and that copies of the Mental Health Treatment Plan and Medical Certificate were forwarded to them in the course of that proceeding. Mr Mahey claims that the Company 'knowingly took advantage of [his] vulnerable situation and contributed significantly to [his] mental distress and financial hardship'.
3. Mr Mahey has annexed Medicare records showing dates of services provided by Dr Nappally under his Mental Health Treatment Plan during the period 18 June 2024 to 26 October 2024. He has also annexed records of medication prescribed to him to treat depression and anxiety in the period 1 November 2023 and 27 July 2024. It is not clear whether this material was provided to the Company or GPZ Legal prior to entry into the Deed.
4. The evidence that Mr Mahey relies on to support the claim that the Company overbore his will, or unconscientiously took advantage of his mental state, is far from persuasive. The Mental Health Treatment Plan and the Medical Certificate are both dated June 2024 and therefore predate the execution of the Deed by more than three months. The information provided in those documents is summary information that does not address the impact of his mental health conditions on his decision to execute the Deed.
5. Mr Mahey adduces evidence that he was attending appointments with his psychologist both before and after entry into the Deed, and had been prescribed medicine in mid July 2024. But there is no evidence from the psychologist as to his state of mental health as at the date of execution of the Deed. Further, he does not give detailed evidence about those matters, and appears to have assumed that reference to his medication and treatment was sufficient proof that his judgment was impaired at the time of entry into the Deed.
6. Mr Mahey has referred in correspondence to threats made by Mr Singh and another person made on 18 January 2024 and 9 July 2024, which he described as 'a threat to [his] life' because he 'raised questions' about the 'hundreds of unknown bogus qualification[s]' issued by the Company.[18] For instance, Exhibit D of the First Mahey Affidavit comprises text messages from a person identified as 'Devinder Ji' made around October 2023, which appears to contain an allegation that Mr Mahey's complaints constituted defamation and 'they [the Company] wanna send you the defamation notice with the claim'. Such alleged 'threats' were made significantly prior to entry into the Deed in October 2024, and it is difficult to see how they could be said to have overborne Mr Mahey's will at the time he executed the Deed.
7. I am not satisfied that Mr Mahey's claim that the Deed is liable to be set aside or varied on grounds that his claims to undue influence, duress or unconscionable conduct have been established by sufficiently cogent evidence. I do not consider the evidence relied upon rises to the level of an arguable or prima facie case. Even applying these lesser tests, Mr Mahey has not established standing to seek relief under s 482 of the Act.

1. Mr Mahey's claim that the Company had engaged in misleading conduct by falsely representing in negotiations that it did not have 'sufficient funds to pay [his] employment entitlements' is not supported by sufficient probative evidence. Mr Mahey claims that he was shown transaction records by a former employee showing that significant funds had been transferred to a relative of a person associated with the Company and disguised as ATO payments.[19] That evidence is hearsay, and of little or no weight. On the other hand, there is cogent evidence before me that the Company had significant creditors when it went into liquidation. I am not satisfied that Mr Mahey has established an arguable or prima facie case of an entitlement to damages for misleading and deceptive conduct.

1. Mr Mahey also claims that the Deed, or some of its provisions, are in contravention of public policy and that the Deed is void on the ground of illegality.
2. In A v Hayden [No 2],[20] the High Court held that a contractual term could not be construed as creating a qualified obligation of confidentiality and thereby preventing the Commonwealth from disclosing the plaintiffs' identities to the police. The majority held that the Court would not lend its aid to the enforcement of the term because it had the tendency to adversely affect the administration of criminal justice, and would make enforcement contrary to public policy.
3. Mason J stated:[21]

The foregoing discussion indicates that, subject to minor qualification only, Lord Lyndhurst was correct in Egerton v Brownlow [(1853) [1853] EngR 885; 4 HLC 1, 163; [1853] EngR 885; 10 ER 359, 424] when he said that any contract having a tendency, however slight, to affect the administration of justice is illegal. He was of course speaking of a contract or engagement which has a tendency to affect the administration of justice adversely ...

Sometimes it is said that a contract to which the principle applies is void; at other times it is said that the contract is unenforceable or ... that the court will not lend its aid to the enforcement of the contract. The true position, as I see it, is that some contracts are void whereas others are valid, though the court will decline to enforce the particular provision in a valid contract in particular circumstances when enforcement of that provision would have an adverse effect on the administration of justice. Thus, a simple agreement not to disclose the existence of a serious criminal offence, which has been, or is about to be, committed in consideration of the payment of a sum of money may well be void because it is illegal. However, it will be otherwise with a contract which is in all respects lawful but nevertheless contains a provision which, if enforced according to its terms, will result in an interference with the administration of justice. Take a contract which contains a minor or subsidiary provision which, though not directed to non-disclosure of criminal offences, imposes an obligation of confidentiality in sweeping terms. If those terms are not susceptible of being read down, the court will refuse to lend its aid to the enforcement of the provision if enforcement would result in the non-disclosure of a criminal offence adversely affecting the administration of justice.

1. Mr Mahey claims that cl 4.1 of the Deed 'was inserted without prior discussion and was designed to prevent [him] from providing evidence to the Supreme Court ... or to relevant authorities regarding the unlawful activities of [the Company]'.[22] He contends that such a clause is 'contrary to public policy and unenforceable according to Australian law'.[23] He further contends that 'the contract created by GPZ Legal is therefore illegal, void and unenforceable'.[24]
2. I do not consider that cll 4.1 and 4.2 of the Deed operate in the manner contended for by Mr Mahey. Clause 4.1 provides an acknowledgment that Mr Mahey's claim in the 2023 VSC Proceeding 'for loss and damage associated with losing his job with [the Company] ... is addressed and settled by settlement of this proceeding'. Clause 4.2 provides for the signing of a settlement deed contemporaneously with the Deed.
3. Clauses 4.1 and 4.2 do not purport to prevent Mr Mahey giving evidence in the Supreme Court, although by settlement of the 2023 VSC Proceeding, the occasion for him to do so in that proceeding is reduced. The clauses would not prevent that evidence being given in other proceedings (for example, these proceedings, where Mr Mahey has sought to give evidence on the matters the subject of the claimed prohibition) or to any of the 'relevant authorities'. I do not consider that the settlement of the 2023 VSC Proceedings, or cll 4.1 and 4.2 of the Deed, are illegal or contrary to public policy.
4. I am not satisfied that Mr Mahey has established an arguable or prima facie case that the Deed is liable to be set aside or varied on grounds of illegality and breach of public policy such as to establish his standing as a creditor (possibly a contingent creditor) in respect of the balance of the Default Judgment.

1. Even if Mr Mahey had established standing pursuant to s 482(1A) of the Act, the evidence before the Court points overwhelmingly against the discretion to stay or terminate the winding up of the Company:

(a) there is no evidence that the Company is solvent - minimal funds have been recovered in the liquidation and the Company has known creditors that are owed the sum of $569,018.97 (including significant amounts owing to a bank and the ATO);

(b) Mr Mahey's own evidence raises significant questions concerning whether the conduct of the Company was contrary to 'commercial morality' or the 'public interest'.[25] His evidence is that the Company was involved in 'unlawful activities', including by providing 'bogus' qualifications connected to 'education and migration fraud'. I can make no findings about those matters on the basis of the evidence before me, but they are matters to investigated by a Liquidator; and

(c) the Liquidator's attitude is that it is necessary for the liquidation to continue to allow for investigation of the Company's affairs, recovery of assets and distribution to creditors (if funds are available).

1. I consider that it is appropriate that the Liquidator investigate Mr Mahey's claims, including his claims that Company funds have been diverted and that there has been fraudulent activity. Ironically, Mr Mahey seeks to remove the person whose role is to investigate the financial affairs of the Company, and to have control of the Company put back into the hands of the directors whose conduct he criticises. I have no reason to doubt that the Liquidator will investigate the matters set out in Mr Mahey's affidavits, including the matters set out at [3] to [8] of his affidavit sworn 27 March 2026, and take whatever steps he considers are appropriate.
2. In the premises, Mr Mahey has neither established standing as a creditor, nor demonstrated that, as a matter of discretion, the Company's winding up ought to be stayed or terminated.

1. In the premises, both the Set Aside Application and the Winding Up Stay/Termination Application must be dismissed. I will list the proceeding for further hearing on the question of costs if either party seeks a costs order.

[3] There is a reference in an email dated 29 October 2024 from Nick Galatas to Mr Mahey to a hearing on 5 September 2024, First Mahey Affidavit, Exhibit F.

[6] (1982) 6 ACLR 526, 533.

[8] [2009] VSCA 179; (2009) 25 VR 366.

[10] Cf s 462(2)(b) of the Act - noting that there 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: Roy Morgan Research Centre Pty Ltd v Wilson Market Research Pty Ltd (1996) 39 NSWLR 311 (Santow J).

[11] Cf Thorne v Kennedy [2017] HCA 49; (2017) 263 CLR 85.

[12] Beard v Prestige Baking Industries Pty Ltd (1981) 52 FLR 384, 405 (Fox J) ('Beard').

[14] [1983] HCA 14; (1983) 151 CLR 447 (emphasis added).

[15] [2023] FCA 882, [28]-[30].

[18] First Mahey Affidavit, Annexure E.

[19] First Mahey Affidavit, [35]-[38].

[20] [1984] HCA 67; (1984) 156 CLR 532.

[22] First Mahey Affidavit, [29]; Second Mahey Affidavit, [2].