Compliance & regulatory advice lawyers Sydney
Staying compliant with the latest laws and regulations can be a challenging task, especially for businesses operating in highly regulated industries. But with Heathfield Grosvenor, you can have peace of mind knowing that you have a team of experts on your side.
Our services include but are not limited to:
- Advising on the latest compliance and regulatory requirements and best practices
- Reviewing and updating company policies and procedures to ensure compliance
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- Providing training and education on compliance and regulatory matters
- Assisting with the development and implementation of internal controls and compliance programs
At Heathfield Grosvenor, we understand the importance of being proactive when it comes to compliance and regulatory issues. Our team of experts will work closely with you to understand your unique business needs and provide tailored solutions that meet your specific requirements.
Don’t let compliance and regulatory issues slow down your business. Contact us today to schedule a consultation with one of our experienced lawyers. We are here to help you navigate the complexities of this area of law and ensure that your business stays compliant and protected.
Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017
The Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017 (Bill) was introduced by the House of Representatives on 1 March 2017. A report of the Senate Education and Employment Legislation Committee is presently due by 9 May 2017. It is anticipated that the Bill (in its current form or otherwise with amendments) will receive Royal Assent later this year. The Bill addresses the findings of various well publicised reports regarding the exploitation of workers (including migrant workers under temporary work visas). Briefly, the measures to be introduced include: Higher penalties[1] for “serious contraventions[2]” of various workplace laws[3] (to act as a deterrent); Prohibitions against employers unreasonably requiring their employees to make payments (e.g. requiring their wages to be paid back in cash); Making franchisors and holding companies[4] potentially liable for underpayments by their franchisees or subsidiaries where they “knew or could reasonably be expected to have known” that the contraventions, or similar contraventions, would at least be likely to occur and failed to take reasonable steps[5] to prevent them; Higher penalties for record keeping failures; and Increased evidence gathering / investigatory powers of the Fair Work Ombudsman. The following activities are examples of some reasonable steps which could be taken by franchisors and holding companies (who have a significant degree of influence or control over their franchisees or subsidiaries) to try to avoid a contravention of the Bill (if and when enacted), depending on the size and influence of the relevant franchisor or holding company: ensuring that the franchise agreement or other business arrangements require franchisees to comply with workplace laws. Consider appropriate amendments to your franchise manual for example; providing franchisees or subsidiaries with a copy of the FWO’s free Fair Work Handbook and information notices / circulars; encouraging franchisees or subsidiaries to cooperate with any audits by the FWO; establishing a contact or phone number for employees to report any potential underpayment to the business; and auditing of companies in the network. ……………………… [1] Up to $108,000 for individuals and $540,000 for corporations [2] Where the conduct constituting the contravention was deliberate (i.e. expressly, tacitly, or impliedly authorised) and part of a systematic pattern of conduct bearing in mind the number of contraventions, the period of time during which the contraventions occurred, the effect of the contraventions, and any other relevant considerations [3] e.g. contravening the National Employment Standards, a modern award, enterprise agreement, workplace determination, national minimum wage order, equal remuneration order, certain payment related provisions and record provisions [4] Who have a significant degree of influence or control over the affairs of their franchisee or subsidiary [5] The court will take into account factors such as the size and resources of the franchisor or holding company, their ability to influence or control, any action taken to ensure that the franchisee or subsidiary knew about their obligations under the specific workplace laws, any arrangements in place for assessing compliance with the specific workplace laws, whether there are any complaints related arrangements in place, and the extent to which compliance with the specific workplace laws is encouraged or required by the franchisor or holding company
Exclusion, information restriction and exit frustration: A case study in minority shareholder oppression – Jolan Pty Ltd v Essential Investments Pty Ltd (No 2) [2021] FCA 1533
Home The Federal Court’s decision in Jolan Pty Ltd v Essential Investments Pty Ltd (No 2) [2021] FCA 1533 (Jolan) is a significant reminder that shareholder oppression claims are assessed by reference to the overall commercial fairness of the conduct in question, rather than whether individual acts are technically lawful. The case demonstrates how a series of decisions, each potentially defensible in isolation, may collectively amount to oppressive conduct under sections 232 and 233 of the Corporations Act 2001 (Cth). Background The plaintiff, Jolan, sought orders under section 233 of the Corporations Act 2001 (Cth) (the Act) to remedy the oppression, unfair prejudice, and unfair discrimination against it as a minority shareholder of the first defendant, Essential Investments Pty Ltd (Company), pursuant to section 232(e) of the Act.[1] The Company was the holding company of three subsidiaries, Essential Coffee Pty Ltd (Essential Coffee), Essential Coffee (NZ) Limited (Essential Coffee NZ) and Essential Brands Group Pty Ltd (Essential Brands) (together the Group).[2] Its primary business was the supply of coffee machines and consumables, particularly coffee beans.[3] Mr Todd Hiscock, who was employed in the business and a trusted friend of Mr James McWilliam, had approached Mr McWilliam to invest in the business. Mr Hiscock had told Mr McWilliam various things prior to June 2016, including that:[4] Mr McWilliam should invest $1 million towards the $5 million purchase price of the business; the investment would be “short term” with an Exit Event within two (2) years that would double Mr McWilliam’s investment; Mr McWilliam would get a paid executive position within the business paying $150,000 per annum; and Mr McWilliam would be entitled to a board seat, as one of the top five shareholders. On 16 June 2016, Jolan was incorporated and used by Mr McWilliam and his wife, Mrs Nikola McWilliam, as the vehicle to invest $1 million in the Company and Jolan became one of its top five shareholders. In July 2016, Jolan entered into a shareholders’ agreement which required all shareholders to exercise their powers to achieve an “Exit Event” within two years. Further, under the agreement, Jolan had certain contractual rights to appoint a director to the board of the Company.[5] Subsequently, Mr McWilliam was appointed as a director of the Company pursuant to a nomination by Jolan and commenced his role as a paid executive director of Essential Coffee in July 2016.[6] However, there had only been one active campaign to sell the Company during June 2019 to September 2019. When it became obvious that an Exit Event would not be achieved in the short term, Jolan took steps to attempt to sell its shares in the Company.[7] In parallel with this process, Mrs McWilliam, who was a practising solicitor, replaced Mr McWilliam as Jolan’s nominated director on the board of the Company in March 2020. Mrs McWilliam had raised some concerns about corporate governance issues with the board’s processes, which ultimately led to her resignation in November 2020, following a notice being issued to shareholders with a resolution proposing that she be removed as a director of the Company.[8] Jolan appointed Mr McWilliam in her place.[9] However, Mr McWilliam was removed as a director of the Company in February 2021 after the Company’s solicitors wrote to him making various allegations concerning events which had occurred years earlier, many of which were incorrect.[10] Mr McWilliam was also removed as a director of Essential Coffee.[11] These events led to a breakdown in the McWilliams’ relationship with the Company and its directors and shareholders, and resulted in the McWilliams being excluded from participating in the management of the Company and their proposed sale of Jolan’s shares to a third party being impeded. Jolan had not had its nominated director on the board of the Company since June 2021.[12] Legal principles The grounds for court order are found in section 232 of the Act, which provides that the Court may make an order under section 233 of the Act if the conduct of the company’s affairs, or an actual or proposed act or omission by or on behalf of the company, or a resolution or proposed resolution of the members of a class of members of the company, is “oppressive to, unfairly prejudicial to, or unfairly discriminatory against, a member or members whether in that capacity or in any other capacity”.[13] For the purpose of sections 232 and 233 of the Act, the “affairs” of a body corporate are described broadly under section 53 of the Act, which includes the formation, membership, business, transactions and dealings, property, profits and liabilities of the company; the internal management of the body; the ownership of shares in the body; the powers of persons to exercise voting rights; and the circumstances of the acquisition or disposal of shares in the body.[14] The expression “oppressive to, unfairly prejudicial to, or unfairly discriminatory against” under section 232(e) of the Act is concerned with conduct that involves “commercial unfairness” or “a departure from the standards of fair dealing, or where a decision has been made so as to impose a disadvantage, disability or burden on the plaintiff that, according to ordinary standards of reasonableness and fair dealing, is unfair”.[15] It is a compound expression that “does not involve separate tests for the elements within it”.[16] The test of unfairness requires an objective assessment.[17] The question is “whether objectively in the eyes of the commercial bystander there has been unfairness, namely conduct that is so unfair that reasonable directors who consider the matter would not have thought the conduct or decision fair”.[18] As such, “whether or not the conduct is oppressive will not depend upon the motives for what was done. It is the effect of the act that is material”.[19] Furthermore, the Court stated that the “conduct can contravene section 232 of the Act even if it is lawful, in good faith or compliant with the company’s constitution”.[20] The “failure to comply with reasonable requests for information to which a party is entitled is capable of
Damages for Republication of Defamatory Statement by Third Party
Home Milne v Ell [2017] NSWSC 555 Home This case serves as a reminder of how liability for defamatory statements can extend to the republication of the statement by third parties, even where the republication has not been expressly authorised (but impliedly authorised). In summary, an original publisher will be liable for the repetition of his or her original defamatory publication, including in altered form where the republication adheres to the sense and substance of the original publication and: he or she expressly or impliedly requested or authorised the repetition of the original publication; he or she intended that the repetition should take place; the repetition is the natural and probable consequence of the original publication; or there is a duty or obligation on the recipient of the original publication to repeat the original publication. The defendant, Mr Ell, originally brought an action for defamation against the plaintiff, Ms Milne and Mr Ell was awarded $15,000 in damages plus costs in 2014. Shortly after the 2014 judgement, Mr Ell was contacted by a journalist to whom Mr Ell said (referring to Ms Milne) “She’s not a fit and proper person to be a councillor…” (Statement). This and other statements were subsequently published by the journalist in a printed article appearing in NSW and QLD as well as online. Ms Milne succeeded in obtaining an award of damages for defamation against Mr Ell arising from the Statement, and its subsequent republication by the journalist. In summary, it was held: Requirement of specificity of pleading imputations: The words “She’s not a fit and proper person to be a councillor…” referring to Ms Milne were sufficient by themselves to give rise to a defamatory imputation (i.e. they constituted an act or condition asserted of or attributed to a person). It was unnecessary for the pleading in the statement of claim to be more specific in the circumstances. Defence of honest opinion / fair comment: The imputation was one which related to a matter of public interest (because it related to whether or not a public officer was a fit and proper person to hold the position). On the question of whether or not the Statement was an expression of opinion rather than fact, the Court is required to examine the context, including whether the imputation is a “bare comment”, denuded of the facts upon which it is based or notorious facts presumed to be known by the reader, or without any of the other elements necessary to substantiate the defence. In the circumstances a reasonable recipient would understand the Statement as a statement of fact and not the offering of an opinion based upon stated facts. Accordingly, because the Statement was not an opinion and was not based upon stated facts, the defence of honest opinion / fair comment did not apply. Republication: The republication of the Statement made to the journalist was the natural and probable result of uttering the words in the Statement to the person (who was known to Mr Ell to be a journalist) and Mr Ell was therefore liable for its republication. In the circumstances of a press conference, or interview by the press, express authority or a request to publish is not necessary. Damages: In determining the amount of damages to be awarded in any defamation proceedings, the court is to ensure that there is an appropriate and rational relationship between the harm sustained by the plaintiff and the amount of damages awarded. The purposes of an award of damages have been described as including: the consolation to the personal distress and hurt caused by the publication; reparation for the harm done to the personal and business reputation of the person defamed; and vindication of the reputation of the person defamed. If there had been no republication in this case then the damages would have been nominal (if any). In terms of the republication, the relevant publication issue had sales of approximately 36,000 newspapers and a readership of approximately 135,000. The online publication also caused additional damage and, in some respects, notwithstanding its withdrawal from the website, it may still be causing damage. The judge also accepted the “grapevine” effect of the publication of the article in print and the broadcasting of the website so that the damage was not confined to those that read the article or opened and/or downloaded the website article. Taking into account the fact that a public apology had been published by the publishers of the article (thereby vindicating Ms Milne to an extent), damages of $45,000 were awarded to Ms Milne plus costs.
Interlocutory Injunctions in Australia: When Waiting for Trial Is Not an Option
A business owner discovers that a recently departed sales director has taken the client list and is already calling customers on behalf of a competitor. A minority shareholder learns that the director in control of the company is quietly moving its funds into a related entity. A founder realises that by the time a final hearing is reached, the commercial damage will already be done. These are the situations interlocutory relief exists for. Final judgment in a commercial dispute can be one to two years away. If confidential information will be exploited, assets dissipated or evidence destroyed in the meantime, a win at trial may be worth very little. An interlocutory injunction is a temporary court order made before final judgment, designed to hold the position so that the eventual judgment still means something. It is not, however, relief for the asking. The court’s discretion is real, the evidentiary burden is significant, and the applicant must almost always accept a financial exposure of its own — the undertaking as to damages — as the price of the order. This article explains how the remedy works in Australia, the legal test the courts apply, and the practical questions a business should answer before pressing the button on an urgent application. The main types of urgent orders “Interlocutory relief” covers a family of temporary orders. Each serves a different purpose, but they share one unifying idea: preserving the court’s ability to grant effective final relief. Order Purpose Typical scenario Interlocutory injunction Restrain conduct (or compel a limited step) until trial Misuse of confidential information, breach of a post-employment restraint, threatened publication Freezing order (Mareva order) Prevent assets being dissipated or moved beyond reach A real danger that any judgment would be unenforceable Search order (Anton Piller order) Permit a supervised search of premises to preserve evidence A real possibility that critical documents or data will be destroyed Preservation order Protect specific property or material in dispute Safekeeping of identified property, records or evidence Freezing orders and search orders are governed by harmonised rules and dedicated practice notes in the Federal Court — see the Freezing Orders Practice Note (GPN-FRZG) and the Search Orders Practice Note (GPN-SRCH) — with equivalent provisions in the Uniform Civil Procedure Rules 2005 (NSW). Both are treated as exceptional remedies. A search order in particular is among the most intrusive orders a civil court can make, and the court expects precision, complete candour and a tightly controlled execution plan, including supervision by an independent solicitor. The legal test: what the High Court actually requires The governing principles come from Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618, as restated by the High Court in Australian Broadcasting Corporation v O’Neill (2006) 227 CLR 57. An applicant must establish three things. 1. A prima facie case The applicant must show a serious question to be tried in the sense the High Court explained in O’Neill: a sufficient likelihood of success at trial to justify preserving the status quo in the meantime. That does not mean proving the case is more likely than not to succeed — the court will not conduct a mini-trial. But it means more than an arguable assertion, and the required strength of the case varies with what is at stake. The more drastic the order sought, the more the court will want to see of the underlying merits. Affidavit evidence should identify the relevant contract, restraint, intellectual property right, debt or fiduciary duty with enough precision for the court to see a genuine controversy requiring protection. 2. Damages would not be an adequate remedy Equity does not intervene where money at trial would fix the problem. The applicant must show it is likely to suffer harm for which damages will not adequately compensate — lost market position that cannot realistically be rebuilt, confidential information that cannot be made secret again, or a judgment that would be worthless because the assets are gone. 3. The balance of convenience favours the order Many applications are won or lost here. The court weighs the injustice to the applicant if relief is refused and it later wins at trial, against the injustice to the respondent if relief is granted and the applicant later loses. If the respondent can comfortably accommodate a short, narrow restraint while the applicant faces irreversible loss without one, the balance will often favour intervention. The breadth of the order sought matters: courts respond better to orders that preserve value than to orders that look like final relief in disguise. The undertaking as to damages: the price of the order Before granting an interlocutory injunction, the court will almost always require the applicant to give the “usual undertaking as to damages” — a promise to compensate anyone affected by the order, including third parties, if the court later decides the order should not have been made. The Federal Court’s Usual Undertaking as to Damages Practice Note (GPN-UNDR) sets out the standard form. This is where many applications meet commercial reality. The undertaking is not a formality: courts scrutinise whether the applicant can actually meet the exposure it creates, and an undertaking that is plainly worthless, with no security offered in its place, can weigh heavily against relief. It is not an absolute bar — the court retains a discretion, may accept security or a payment into court, and may still act where refusing relief would destroy the very subject matter of the dispute — but an applicant that has not thought about its capacity to stand behind the undertaking has not finished its risk analysis. For a small or medium-sized business, the undertaking can represent an exposure larger than the dispute itself, and it should be assessed at board level before the application is filed. Procedure: fast, but unforgiving Urgent applications move quickly. In the Supreme Court of New South Wales, genuinely urgent matters can be brought before the duty judge on the same or the next day; the Federal Court operates
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