Mayfair 101 has moved to strike out the case brought by the Australian Securities and Investments Commission (ASIC) against the firm’s managing director, James Mawhinney, and parts of the regulator’s case that led to the issuance of a $30 million penalty.
The private equity investment group stated its lawyers made an application last week to strike out more than 50 paragraphs from the statement of claim.
“ASIC’s claim seeks to hold Mr Mawhinney personally liable for various alleged contraventions which are yet to be determined, including the penultimate paragraph in which ASIC seeks injunctive relief against Mr Mawhinney for dealing in financial products pursuant to section 1101B(1) of the Corporations Act,” it stated.
The application is also aiming to strike out three of the four representations relied upon by ASIC in its misleading or deceptive conduct case in 2020, in which Mayfair’s entities were found liable and issued with a $30 million penalty.
“Mayfair was not legally represented at the trial of the misleading or deceptive conduct matter, as a consequence of orders obtained by ASIC, meaning ASIC succeeded in its case in 2021 at trial against an undefended opponent. For the first time in a court the representations are now being properly legally contested,” Mayfair stated.
The hearing for the strike-out application took place today in the Federal Court in Melbourne where ASIC sought to drop its reliance on key evidence and witnesses in a pending trial related to the corporate regulator’s attempts to ban Mawhinney from dealing in financial products.
Following ASIC-initiated proceedings in 2020, Mawhinney was banned for 20 years, but that decision was overturned on appeal in October 2022 by the full court, which also ordered the case be remitted to a new Federal Court judge, with that case set to be heard in October.
During today’s hearing, ASIC argued it should not have to include in evidence at the October retrial an expert report from Deloitte insolvency practitioner Jason Tracy or the affidavits of ASIC legal officers Hugh Copley and Dayle Buckley.
However, Michael Pearce SC, acting for Mawhinney, told the court the report from Tracy was commissioned by ASIC and used in more than one legal proceeding against Mawhinney and Mayfair 101 and the affidavits of Copley and Buckley were used in the original banning hearings and should be made available for the remitted case in October.
“ASIC’s claim seeks to hold Mr Mawhinney personally liable for various alleged contraventions which are yet to be determined,” Mayfair 101 stated.
“The Tracy report had provided ASIC with substantive material in its original prosecution, as well as at the hearing that resulted in a $30 million fine against Mayfair 101 entities, and it should be addressed in ASIC’s re-running of the case.”
