Finance & Guarantee Company Pty Ltd v Auswild

[2019] VSC 664

Supreme Court of Victoria

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Interrogate

Catchwords

1. Equity
2. › Limitation of actions in equity
3. › Application by analogy to statutory limitation periods
4. › Equitable exception
5. › Whether constructive knowledge of fraud sufficient to commence time running
6. › Whether statutory postponement provision applies to equitable exception
7. › Limitation of Actions Act 1958 (Vic), s 27(b)
1. Equity
2. › Limitation of actions in equity
3. › Application by analogy to statutory limitation periods
4. › Second limb Barnes v Addy claims
5. › Whether subject to statutory limitation period by analogy
6. › Limitation of Actions Act 1958 (Vic), s 5(1)(a)
1. Equity
2. › Laches
3. › Delay in commencing proceedings
4. › Knowledge of facts giving rise to claim
5. › Prejudice to defendants
6. › Whether traditional notions of equity and good conscience require refusal of relief
1. Equity
2. › Fiduciary duties
3. › Directors
4. › No conflict rule
5. › No profit rule
6. › Whether transactions in best interests of corporations
7. › Reluctance of court to substitute its own view for commercial decision-making of directors

Quick Take

Section 27(b) of the Limitation of Actions Act 1958 (Vic) requires proof of common law fraud (actual dishonesty or moral turpitude) to postpone limitation periods; equitable fraud is insufficient. The equitable exception to analogous limitation periods operates independently and requires only constructive knowledge of the facts giving rise to the claim to commence time running. Second limb Barnes v Addy claims (knowing assistance) are subject to analogous statutory limitation periods. An attenuation clause requiring a director to 'declare' the nature of an interest imposes a positive obligation of disclosure not satisfied by the other directors' pre-existing knowledge of the conflict.