Monthly Archives: December 2016

On 15 March 2016, District Court Judge Elkaim in the State of New South Wales v Wenham [2016] NSWDC 25 found that a party who seeks to rely on the indemnity provisions under section 151Z of the Workers Compensation Act 1987 (NSW) (section 151Z) cannot rely upon the blameless accident provisions¹.

His Honour succinctly summarised his views at [23] of his Judgment in this matter as follows:

The cause of action relied upon by the plaintiff is provided by section 151Z. That cause of action required there to be a wrongdoer. The deeming provision concerning fault in section 7B of the MACA² is a deeming provision only for the purposes of a claim for damages. It is there to assist the victim of a blameless accident. It does not extend, absent specific reference, to the cause of action provided by section 151Z.

Leading independent law firm, Hall & Wilcox, has further bolstered one of its strongest practice areas by appointing a new partner and senior associate to its Sydney insurance team.

David Short, partner, was previously Sydney litigation group practice head with Meridian Lawyers. Prior to this, David was a partner at Ebsworth and Ebsworth (as it then was) and has previously worked as a senior claims specialist and general counsel at Chubb Insurance.

David’s career brings with him significant experience in many areas of insurance. This experience covers public and product liability, life insurance, professional indemnity (health care) and disciplinary work, association liability/directors and officers liability and defamation. He has acted nationally for several insurers, ASX listed major corporate clients, allied health professionals and their member associations.

Mitch Stein, was previously a senior associate at Barry Nilsson and Meridian Lawyers, where he specialised in insurance law and personal injury claims in the retail and health sectors.

Rhett Slocombe, partner and national insurance practice head at Hall & Wilcox, said the appointments cap off a strong year for the firm’s insurance practice. “We’ve continued to consolidate our practice as one of Australia’s largest national insurance teams, and the strength and breadth of the team is welcomed by our clients.

The recent Federal Court decision in BCI Finances Pty Ltd (In Liq) v Binetter (No 4) [2016] FCA 1351 (Binetter) is a timely reminder of company directors’ common law duties to act with care, skill and diligence in the discharge of their responsibilities (in addition to the statutory duties imposed under the Corporations Act 2001) – not least in the context of tax risk management.

The Binetter decision

The liquidators of four companies succeeded in a Federal Court action claiming that among other things, several directors of those companies breached their duty to act with care, skill and diligence as a result of certain arrangements involving offshore banking deposits, and as a result of their conduct in the context of an Australian Taxation Office (ATO) audit into the arrangements.

The impugned arrangement comprised of ‘back to back’ arrangements involving the use of funds held by directors and associated entities (in Switzerland and Israel) as security for advances from the Israeli banks to the four companies. The advances were equivalent to the offshore deposits.

The liabilities in the revised assessment arose as a result of the disallowance of deductions for the interest expenses claimed to be paid to the Israeli banks and the inclusion of other related amounts in the companies’ assessable income.

The Court held that the four directors breached their duties by agreeing to participate in a scheme between the companies and the Israeli banks. The Court found that:

• the directors intentionally concealed the existence of the offshore deposits and any income earned from the deposits