Australia, March 26 -- New South Wales Land and Environment Court issued text of the following judgement on Feb. 26:

1. The plaintiff, Platypus Impact Housing Australia Limited, brings these proceedings against the first defendant, Mr Jack Elsegood, and his associated company, Elsegood Holdings Pty Ltd. The proceedings were commenced on 1 July 2024.

2. In its Commercial List Statement, Platypus summarises the "Nature of the Dispute" as follows:

"1. The First Defendant (Mr Elsegood) is a former director of [Platypus]. [Platypus's] business includes pursuing and undertaking property developments opportunities for housing in New South Wales and Queensland.

2. During the course of his directorship of [Platypus], Mr Elsegood was introduced to a development opportunity which [Platypus] had identified and was pursuing in Queensland. Mr Elsegood undertook work in his capacity as a director of [Platypus] in respect of investigating and seeking to advance and secure [Platypus's] interest in that development.

3. Mr Elsegood resigned [as] a director of [Platypus]. [Platypus] then lost the development opportunity following termination by the vendor of the relevant agreements that were in place with [Platypus]. The development was then taken up and purchased by an unrelated special purpose entity controlled by persons with whom Mr Elsegood had previously developed a business relationship when working for [Platypus] and in connection with the pursuit of the development for [Platypus]. Mr Elsegood was thereafter provided with benefits from that entity as a reward for his previous work in respect of the development (that is, his work for [Platypus]) and for introducing the development opportunity to the persons in control of the entity while he was a director of [Platypus]. The benefits which Mr Elsegood obtained included (at least) shares acquired by the Second Defendant (Elsegood Holdings, a company of which he is the sole shareholder and director), cash, and an agency agreement. The total value of the benefits which Mr Elsegood obtained in this way is not presently known to [Platypus], but is estimated to be not less than $400,000 (the amount of at least one cash payment received by Mr Elsegood) plus the value of the shares obtained by the Second Defendant, which may be valued in excess of $670,000.

4. [Platypus] contends that Mr Elsegood obtained these benefits in breach of his fiduciary and directors' duties owed to [Platypus], namely the 'no profit' rule and section 183 of the Corporations Act 2001 (Cth). [Platypus] seeks relief to disgorge from Mr Elsegood these unlawful gains, including a declaration of trust and alternative orders for an account or equitable compensation, and compensation pursuant to section 1317H of the Corporations Act 2001. Mr Elsegood's conduct is analogous to that of a rogue fiduciary or director who obtains a secret commission in connection with the work done for his principal; the fact that he resigned as a director of [Platypus] prior to taking the benefits in question does not absolve him from liability." (Italicised and bolded emphasis in original.)

*Rest of the document and Footnotes can be viewed at: (https://www.caselaw.nsw.gov.au/decision/19540d0a38f74a5915525db8)

Disclaimer: Curated by HT Syndication.