WIJOAV Services Pty Ltd v Goldstone Private Equity Pty Ltd

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

Delivered ex tempore, revised from transcript

1. I gave judgment in this matter on 13 June 2025: WIJOAV Services Pty Ltd v Goldstone Private Equity Pty Ltd [2025] FCA 622 (the Principal Judgment). The defined terms in this judgment bear the same meaning as in the Principal Judgment. The Principal Judgment was on all issues, except:

(a) the price of any buy-out order under s 233 of the Corporations Act 2001 (Cth); and

(b) the quantification of any pecuniary remedies to which the plaintiffs may be entitled.

1. The order for separate questions was made by consent on 14 April 2025 (see order 11). That order contemplated that I would hear both stages of the proceedings, as is reflected in the transcript of that day (see T4.21-40). At that stage, a total of nine affidavits by Ms Commins and Mr Angelis, collectively, had been served, indicating that there would clearly be a credit contest between those witnesses at the first stage of the hearing.
2. By interlocutory application dated 22 October 2025, the Angelis Defendants seek orders that the proceedings be reallocated to another judge on the ground that I should disqualify myself by reason of apprehended bias. The contention of the Angelis Defendants is based on the credit findings which I made in favour of Ms Commins and adversely to Mr Angelis, especially at [51] and [54] of the Principal Judgment. The plaintiffs have served an affidavit of Ms Commins for the hearing on the remaining issues and intend to call her at that hearing, and the Angelis Defendants say that they intend to serve an affidavit of Mr Angelis and call him at the hearing.
3. It appears to be common ground that the fundamental test is whether a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the issues involving that witness: Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337 at [6]-[8].
4. The issue arises here in the context of bifurcated proceedings where certain questions as to the quantification of pecuniary remedies have been ordered to be heard separately from other questions pursuant to r 30.01 of the Federal Court Rules 2011 (Cth). In Australian Securities and Investments Commission v SunshineLoans Pty Ltd [2025] FCAFC 32; (2025) 308 FCR 514 (ASIC v SunshineLoans), the Full Federal Court dealt with the question whether the primary judge in that case should have disqualified himself from deciding the question whether and in what amount to award a civil penalty by reason of adverse credibility findings against a witness in the liability judgment.
5. Justice Bromwich referred to a category of cases where the judge is permitted or required to have regard to and apply findings made at an earlier stage of the proceedings, saying the following at [101]:

[101] In this category of cases, having decided earlier a fact in issue is ordinarily not a case of pre-judgment at all; it is just judgment of a kind that must be carried forward to the next stage no matter who hears it. In those circumstances, a fair-minded lay observer could not find, on the basis only of an earlier credit finding or determination of a live factual issue, that a judge might not be able to bring an impartial mind to the later stage of the proceeding. That is because, in this class of case, the earlier findings and evidence remain relevant to the question before the judge at the next stage, and that is part of the circumstances of which the lay observer is taken to be aware. Not only will it not be impermissible to have regard to them, but any later determination may be required or may be permitted to have regard to them. Neither of the two bases on which previous findings might commonly be said to give rise to a failure to consider a question on its merits - a perception that a judge will be unable to move their mind and that they have been tainted by evidence to which regard should not be had - necessarily applies in these cases. Something more is needed for recusal on the basis of liability findings. The two (or perhaps, three) stage test in Ebner needs to be strictly adhered to, so as to ensure that the duty to exercise jurisdiction is not too readily departed from.

1. Justice Colvin referred to the circumstance where a bifurcated hearing is conducted on the basis that the findings of the first hearing will inform the second, and said the following:

[143] In addition, it is a decision-making practice that enables a judge to determine the appropriate penalty or the quantum of damages or other relief by taking into account all that occurs during the first hearing as well as any additional evidence and submissions presented at the second hearing.

[144] In such cases, the first and second hearings are not separate judicial adjudications. Rather, the first hearing is conducted on the basis that everything that occurs in that hearing that might also bear upon the form or quantum of relief may be brought to account in adjudicating the matters to be addressed at the second hearing (if required). This goes beyond evidence in the first hearing being able to be relied upon in the second. It concerns all aspects of the first hearing, including any views of a kind that quite properly might be formed in the course of adjudicating a trial conducted at a single hearing.

[145] Significantly for present purposes, inherent in the staged nature of the trial is the contemplation that the same judge would conduct both hearings. In my view, the fact that the two hearings are to be conducted by the same judge and the prospect that any aspect of what might occur at the first hearing might be brought to bear by the judge at the second hearing are matters that the fair-minded lay observer would be taken to know.

...

[152] Importantly, in cases like the present where the trial is split in the manner described, the parties know from the outset that the second hearing (if required) will proceed on the foundation of all that has occurred in the first hearing. The prospect that an adverse view may be formed in the first hearing as to the credibility of a witness or as to the significance of aspects of the evidence that will have a bearing upon matters to be determined in the second hearing (if required) or even as to matters that will be required to be found in the second hearing (provided the judge does not do anything that would cause a fair-minded lay observer to question whether the judge remains open to be persuaded by other evidence that may be adduced in the second hearing) will not give rise to a reasonable apprehension of bias. It will not do so because the fair-minded lay observer will be aware of the particular nature of the successive hearings.

The making of credibility findings as to the testimony of a witness, even if firmly expressed, is an example of the due performance of the judicial function. Indeed, given the nature of the procedure, where such findings may be expected to have significance for the second part of the hearing process, it would be appropriate for the terms in which they are expressed to reflect the conclusions that have been reached by the judge.

1. The statements of principle by Bromwich and Colvin JJ are supported by the reasoning in Charisteas v Charisteas [2021] HCA 29; (2021) 273 CLR 289 at [12] that the reasonableness of any suggested apprehension of bias is to be considered in the context of ordinary judicial practice. I have referred above to the consent orders of 14 April 2024, contemplating that I would hear both stages of the proceedings.
2. I note that the High Court granted special leave to appeal from the decision in ASIC v SunshineLoans on 7 August 2025, and the appeal was heard on 16 October 2025. Judgment stands reserved. Until judgment is given by the High Court, I am bound to apply the majority reasoning of the Full Court.
3. In light of the reasons of Bromwich and Colvin JJ, I am unable to see any reason why I should disqualify myself from hearing the balance of the issues in these proceedings. It is conventional in oppression cases, as with civil penalty proceedings, for questions of liability to be dealt with separately and prior to questions pertaining to the quantification of pecuniary remedies. In an oppression case, where there is an order for the compulsory purchase of shares or other securities, the question of valuation is generally approached on the assumption that no oppression has occurred. One must therefore identify the nature and extent of the relevant oppression from findings in the liability judgment in order to exclude it at the valuation stage. The question of valuation is thus dependent on findings in relation to oppression and cannot ordinarily be approached independently of those findings.
4. In the present case, my findings as to oppression in the Principal Judgment are inextricably connected with findings of credibility, especially in relation to Ms Commins and Mr Angelis. I accept that the valuation for a compulsory purchase arising from oppression would not ordinarily be likely to be affected by the gravity of the oppressive conduct as such, but I do not regard that element as taking the present case out of the scope of the principles articulated by Bromwich and Colvin JJ. In particular, as I have said, it is necessary at the next stage of the hearing to have regard to the nature and extent of the oppression which has been found. I regard the present case as falling within the principles extracted above as expressed by Bromwich and Colvin JJ.

I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Jackman.