ASIC v Australian Property Custodian Holdings Limited (No 3) [2013] FCA 1342

Corporations
Law
ASIC V AUSTRALIAN PROPERTY CUSTODIAN
HOLDINGS LIMITED (NO 3) [2013] FCA 1342

Introduction
 The ASIC v Australian Property Custodian
Holdings Limited (No 3) is a recent case in
which issues regarding breach of director duties
were raised.
 The case highlighted the importance of
compliance with duties for the responsible
entities (REs) operating in Australia.
 The case also emphasis on the importance of
director duties.

Introduction
 The legal issues in this case raised due to
amendments in the Constitution of the
company which were made without prior
approval of members.
 Directors misused their position and acted
unfair to gain personal benefits.
 The facts, duties breached and decision of this
case will be evaluated along with its relevance
on corporations operating in Australia.

Case Background
 In July 2006, the directors of the RE made
changes in the Constitution of the company.
 These amendments introduced two new fees
which include listing and removal fees.
 The calculations of these fees were conducted
by determining 2.5 percent the gross assets
value of the company whereas previously it was
calculated by evaluating the price of the units
(Austlii, 2013).

Case Background
 The directors did not made asked for prior
approval of the members while making these
changes.
 The lawyer of the company provided that
changes can be made without approval in case
the rights of members are not affected.
 However, the directors did not take the prior
permission of the members.

Case Background
 The deed in which the amendments were
introduced were not dated until August 2006.
 This decision was taken so that the amended
constitution and supplementary PDS could be
lodged to the ASIC (Jade, 2013).
 A listing fee was paid by the directors in 2007
regarding the changes which are made in the
constitution.