case_outcome: cited

case_text: new site was to be the first economically efficient green power project promoted by GPEL and thus GPEL's foundation positive cash flows. The use by Alfred Wong of the capital subscribed by JFCP to retire debt to entities related to him in the face of the representations made to JFCP is said by ASIC to demonstrate that the undertaking of GPEL 'cannot be carried on consistently with candid and straightforward dealings with the public, from whom further capital must be obtained if its existence is to be prolonged' ( Re Producer's Real Estate & Finance Co Ltd [1936] VLR 235 of 246) and to reflect a willingness on the part of Alfred Wong to prefer the interests of Richland (and thus his own interests) to that of the members and creditors of GPEL. GPEL contends that capital subscribed by a shareholder can properly be used for the commercial purposes of GPEL and the application of the funds subscribed by JFCP to reduce debt and eliminate interest was both orthodox and prudential . A second contention which is said by ASIC to lead to a conclusion that the court ought to be satisfied that it is just and equitable that GPEL be wound up is that notwithstanding a decision on the part of the Board of GPEL on 11 May 2005 to place 'a freeze' upon raising money from the public by the issue of promissory notes, Alfred Wong caused a 'Second Information Memorandum' to be developed and published pursuant to which further promissory notes were issued by GPEC and monies raised from the public without the authority of the Board of Directors.


case_title: Loch v John Blackwood Ltd [1924] AC 783

case_text: 461(1) of the Act empowers the Court to make an order for the winding up of a company on enumerated grounds including that the Court is of the opinion that it is just and equitable that the company be wound up (s 461(1)(k)) and on the ground that directors have acted in the affairs of the company in their own interests rather than in the interests of members as a whole or in any other manner whatsoever that appears to be unfair or unjust to other members. Section 462(2) of the Act confers standing on ASIC to apply for an order to wind up a company on a ground provided for by s 461, in the circumstances contemplated by s 464. Section 464 provides that where ASIC is investigating or has investigated for the purposes of Division 1 of Part 3 of the Australian Securities & Investments Commission Act 2001 (Cth) ('the ASIC Act') matters connected with the affairs of a company, ASIC may apply for a winding up order. ASIC contends that as a matter of public interest with a view to protecting the investing public whose funds have been solicited by way of the JFCP subscription and conduct in relation to the promissory notes, it is just and equitable that GPEL and GPEC be wound up as, upon a proper examination of the conduct of both companies, the Court ought to be satisfied of 'a justifiable lack of confidence in the conduct and management of the affairs' of each company ( Loch v John Blackwood Ltd [1924] AC 783 at 788 per Lord Shaw).


case_title: Australian Securities Commission v A S Nominees Limited (1995 1996) 62 FCR 504

case_text: the usual applicant for an order on such a ground is a contributory , it is clear that ASIC has standing to apply for an order on the just and equitable ground in the pursuit of public interest and the Court will examine those public interest considerations to determine where the actual public interest lies ( Australian Securities Commission v A S Nominees Limited ( ASC v A S Nominees ) (1995 1996) 62 FCR 504 at 531C, per Finn J). See also Australian Securities & Investments Commission v Pegasus Leveraged Options Group Pty Ltd 41 ACSR 561 per Davies AJ at [95]-[97]; Australian Securities & Investments Commission v ABC Fund Managers & Ors 39 ACSR 443 at [116] [129], per Warren J; and Australian Securities & Investments Commission v Chase Capital Management Pty Ltd & Ors 36 ACSR 778 at [75] per Owen J.


case_text: this respect, the ground has 'a proper role to serve as an instrument of investor protection' ASC v A S Nominees at 531 and one expression of that protection is whether the affairs of the company can be carried on 'consistently with candid and straightforward dealing with the public, from whom further capital must be obtained if its existence is to be prolonged' ( Re Producers' Real Estate & Finance Co Ltd (1936) VLR 235 at 246 per Mann CJ). Another is whether creditors or members can continue to have confidence in the conduct of the affairs of the company ( Re Chemical Plastics Ltd [1951] VLR 136 at 142 per Hudson A-J; ASC v A S Nominees Ltd at 531). Where the order is sought by a Regulator such as ASIC in vindication of the public interest, the Court must itself evaluate the factual matrix in order to form a view as to whether 'a sufficient reason' for making the order is demonstrated ( Re Walter L Jacob & Co Ltd (1988) 5 BCC 244 at 251). In other words, what is the quality of the conduct or the burden of the misconduct. Accordingly, I have examined in some considerable detail the background circumstances concerning the subscription of the JFCP funds and their use; the events surrounding the prohibition by the Board upon the issue of any further promissory notes and the circumstances which led Alfred Wong and Andris Lielkajis to arrange for presentations of the GPEL product at various seminars by Lielkajis. I have found that the conduct in relation to those matters is misconduct for all the reasons indicated previously. I will not repeat them here. However, the assessment of that conduct and the conclusions I have reached concerning it reflects a lack of confidence in Alfred Wong and the directors in the conduct and management of GPEL and GPEC.