Federal Court of Australia

Palmer v Shipton [2026] FCAFC 90

ORDERS

THE COURT ORDERS THAT:

1.    Leave to appeal be granted.

2.    The appeal be dismissed.

3.    The applicant/appellant pay the respondent’s costs of and incidental to the application for leave to appeal and the appeal.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

ORDERS

THE COURT ORDERS THAT:

1.    Leave to appeal be granted.

2.    The appeal be dismissed.

3.    The applicant/appellant pay the respondent’s costs of and incidental to the application for leave to appeal and the appeal.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

BEACH AND ABRAHAM JJ:

1    Mr Clive Palmer and Palmer Leisure Coolum Pty Ltd (PLC) have each pursued separate but related proceedings against a former chairman of the Australian Securities and Investments Commission, Mr James Shipton, for the alleged tort of misfeasance in public office. Mr Palmer and PLC, who we will collectively refer to as the Palmer parties, have made various attempts to properly plead their case against Mr Shipton but have been singularly unsuccessful.

2    The Palmer parties have applied for leave to appeal in each proceeding against decisions of the primary judge in which his Honour made orders striking out various parts of the Palmer parties’ amended statements of claim and refusing leave to file their proposed further amended statements of claim; it is convenient to refer to these proposed amended pleadings as the SOCs or separately as the Palmer SOC or the PLC SOC where necessary to distinguish between them.

3    His Honour struck out various paragraphs of the earlier pleadings pursuant to r 16.21(1)(c), (d) and (e) of the Federal Court Rules 2011 (Cth). His Honour then refused to grant leave to the Palmer parties to replead in terms of the SOCs and as a consequence then made orders for summary dismissal pursuant to r 26.01(1)(a) and (c) of the Rules. His Honour did not utilise s 31A of the Federal Court of Australia Act 1976 (Cth) as this provision had not been invoked by Mr Shipton.

4    The Palmer parties in seeking leave to appeal assert in their proposed appeal grounds in each case that his Honour made the following errors.

5    First, it is said that his Honour erred in holding that the SOCs did not plead specific conduct of Mr Shipton capable of constituting the tort of misfeasance in public office. We should note here that the Palmer parties only put submissions concerning the SOCs. They did not seek to revive the earlier amended pleadings which had partially been struck out by his Honour.

6    Second, it is said that his Honour erred in holding that it was insufficient in seeking to establish the tort for the putative tortfeasor to cause, supervise or direct the relevant impugned conduct of others, and that in any event the SOCs did not plead sufficient material facts concerning such conduct.

7    Third, it is said that his Honour erred in holding that the Palmer parties failed to plead material facts establishing that Mr Shipton held the state of mind necessary to establish the tort.

8    Fourth, it is said that his Honour erred in refusing leave to replead in circumstances where the refusal of such leave effectively operated as a permanent stay of the proceedings.

9    Fifth, it is said that his Honour erred in ordering the summary dismissal of the proceedings in the absence of an affidavit complying with r 26.01(2).

10    The Palmer parties assert that important issues are raised by their proposed appeals. It is said that of the points that we have just outlined, the first to third points go to the legal elements required to establish the tort, which it is said are unsettled in some respects. Further, the Palmer parties say that the consequences of non-compliance with r 26.01(2) is a matter of general significance. And they say that in this respect none of the pleaded material facts were controverted by Mr Shipton’s affidavit evidence in support of the application for summary dismissal, which it was said the Rules required Mr Shipton to do.

11    More generally, the Palmer parties say with reference to GLJ v Trustees of the Roman Catholic Church for the Diocese of Lismore (2023) 280 CLR 442 that the correctness standard is the applicable standard of appellate review in respect of each of their proposed grounds of appeal.

12    In summary, in our view there was no error in the primary judge’s determinations. His Honour correctly determined, after careful consideration of the pleadings and in the exercise of his discretion, that the SOCs did not disclose a reasonable cause of action for the tort of misfeasance in public office.

13    Moreover, as the Palmer parties had made various attempts to plead their cases but fundamental flaws remained, it was well open to the primary judge to determine that there was no utility in granting yet another opportunity to replead, and as a consequence to summarily dismiss the two proceedings.

14    In our view, his Honour applied orthodox principles concerning the questions of strike out, the refusal of leave to replead and summary dismissal in coming to those conclusions. None of the proposed grounds of appeal in each case demonstrate error by the primary judge.

15    Now as we have said, the Palmer parties assert that the correctness standard applies to the consideration of the proposed grounds of appeal. Of course, some interlocutory decisions must be determined on a correctness standard. But that is not this case. The primary judge was making a broad, discretionary assessment of whether the relevant paragraphs of the amended statements of claim ought to be struck out on the basis of the insufficiency of the facts pleaded, rather than on a contestable point of law, and whether the Palmer parties ought be granted leave to replead in terms of the SOCs given that they had already had several opportunities to amend their cases. The discretionary nature of that assessment means that an error of the type identified in House v The King (1936) 55 CLR 499 must be established. A similar point can be made concerning the question of summary dismissal.

16    Contrastingly, the observations in DHI22 v Qatar Airways Group QCSC (No 1) (2025) 310 FCR 361 at [25] and [27] to [31] per Stewart J, Mortimer CJ and Stellios J agreeing, are distinguishable. Stewart J applied the correctness standard to an appeal from a decision for strike out and summary dismissal where the relevant error was the primary judge’s assessment of the merits of various legal arguments. In that scenario, it was not the discretion that miscarried. Rather, the primary judge had been incorrect to order summary dismissal at that stage of the proceedings given the reasonably arguable legal issues concerning the interpretation and application of various articles of the Montreal Convention.

17    But the case before the primary judge in these proceedings did not turn on reasonably arguable and difficult legal questions. Further, the Palmer parties had already made various attempts to plead against Mr Shipton the tort of misfeasance in public office, but were unable to articulate a coherent case against Mr Shipton, such that the primary judge exercised his discretion to strike out the relevant paragraphs of the amended statements of claim and to refuse leave to replead in terms of the SOCs. Further, as the actual or proposed pleadings did not disclose a reasonably arguable cause of action, and no leave to replead was granted, summary dismissal followed.

18    But in any event, even if the correctness standard applies, the primary judge’s decision was correct for the reasons given below. But before proceeding further we should address the question of leave to appeal.

19    The question of whether leave to appeal ought be granted is usually to be decided by the application of the two-pronged test in Décor Corporation Pty Ltd v Dart Industries Inc (1991) 33 FCR 397 at 398 and 399. But if an interlocutory order has the practical operation of finally determining the rights of the parties seeking leave to appeal, then a prima facie case exists for granting leave; see Johnson Tiles Pty Ltd v Esso Australia Pty Ltd (2000) 104 FCR 564 at [43] per French J.

20    In our view the applications for leave to appeal do not raise questions of general importance. Further, the proposed grounds of appeal do not provide a suitable vehicle to clarify the elements of the tort of misfeasance in public office. Indeed, whilst the outer limits of the tort of misfeasance in public office may perhaps be said to remain unsettled, the Palmer parties failed below because they had not properly pleaded essential and non-contentious elements of the tort.

21    But nevertheless we would grant leave to appeal if only because the effect of his Honour’s determinations is effectively to bring these proceedings to an end. But we would dismiss each appeal for the reasons that we will now turn to.

The key elements of the Palmer parties’ complaint

22    Before directly addressing the Palmer parties’ deficient pleadings and the appeal grounds, it is useful to set out the key elements of the Palmer parties’ complaint as can be gleaned from the material before us.

23    The Palmer parties wrote to Mr Shipton on 30 September 2019 making a complaint about alleged connections between ASIC and The President’s Club Limited, which is referred to in that letter as “TPC”. The 30 September 2019 complaint was annexed to the affidavit of Mr Sameh Iskander, the solicitor for the Palmer parties, dated 11 February 2025, which was before the primary judge and before us.

24    The text of the letter contained the following extracts:

I am writing to you directly to bring to your personal attention what I believe is a serious crime or abuse which has been committed by senior ASIC employees. It requires your immediate personal attention and investigation in accordance with the public duty you hold by virtue of your office.

…

In these circumstances, we require that within 21 days you advise:

1.     Is there any relationship between any current or former ASIC staff member, including in particular any person involved in the decision to not investigate the TPC Parties (an “ASIC Person”) and any TPC Parties. For this purpose, we note that there are a large number of owners of time share interests in the scheme, many of whom are wealthy, many of whom are well connected in political, business and government circles and many of whom have been vocal and critical of Mr Palmer and his actions in respect of the TPC scheme;

2.     If so:

a.     what is that relationship;

b.     what communications occurred between ASIC Persons and TPC Parties and what is the content of those communications;

c.     Please provide a copy of those communications;

3.     Did any TPC Party seek to influence an ASIC Person in relation to the decision not to investigate;

4.     Was any ASIC person influenced by a TPC Party in relation to the decision not to investigate;

5.     Are there any conflicts of interest held by an ASIC Person in relation to the investigation. If so, what is the conflict and how did ASIC manage the conflict.

…

I would request you as the current responsible officer of ASIC to investigate these matters in the public interest. If it will assist, the writer would be agreeable to meet you to provide a further explanation. I realise your appointment was after the initial matter set out in this letter so you personally could not be the ASIC executive authorising such payments against the Public Interest.

Could you please respond to this letter within 21 days.

25    In summary, it was said by the Palmer parties that the 30 September 2019 complaint brought to Mr Shipton’s attention a complaint that a serious crime or abuse had been committed by senior ASIC employees, and required his immediate personal attention and investigation. It was said that the complaint raised questions about the influence that TPC had exerted over ASIC officers and questions of conflict of interest.

26    It was said that in respect of some further matters contained in the 30 September 2019 complaint there was a sufficiently particularised complaint that in February 2016, Mr Palmer was personally threatened by a director of TPC that unless he offered a substantial amount of money to purchase interests in an unregistered time share scheme that ASIC would charge Mr Palmer in relation to TPC. It was said that the TPC director confirmed he had spoken to ASIC and had a mate working at a senior level in ASIC’s head office.

27    It was said that TPC operated a time share scheme at the property previously known as the Hyatt Regency Coolum but re-named the Palmer Coolum Resort. It was said that ASIC, using taxpayer funds, paid the full costs order that had been made jointly against ASIC and TPC following this case.

28    It was said that on 4 February 2016, ASIC informed Coeur De Lion Investments Pty Ltd that ASIC had decided not to investigate a complaint of contravention by TPC and its directors pursuant to s 601ED(5) of the Corporations Act 2001 (Cth).

29    It was said that it could be inferred that the 30 September 2019 complaint was received by Mr Shipton. It was said that Mr Shipton’s public duty included investigating the matters in the 30 September 2019 complaint, consistent with his statutory functions. It was said that the questions contained in the 30 September 2019 complaint concerning the relationship between ASIC staff and TPC called for substantive, affirmative answers.

30    There was a response of Ms Rashpal Hartmann, ASIC’s counsel, dated 1 November 2019 annexed to the Iskander affidavit that contained the following extracts:

I refer to your letter dated 30 September 2019 addressed to James Shipton, Chair of the Australian Securities and Investment Commission (ASIC).

I have been asked to consider the matters raised in your letter and provide a response.

In summary, I understand your letter to be:

•    Asking why ASIC paid the legal costs awarded by the Federal Court against The President's Club Limited (PCL) and ASIC on 4 September 2015 in the matters of Queensland North Australia Pty Ltd & Ors v Takeovers Panel & Ors [2014] FCA 591 and Queensland North Australia Pty Ltd & Ors v Takeovers Panel & Ors [2015] FCAFC 128 (together the Judicial Review Proceedings);

•    Querying ASIC's decision to not investigate a complaint submitted by your lawyer and Coeur De Lion Investments Pty Ltd (CDLI), that PCL was operating an unregistered time share scheme (PCL Complaint) and alleging it was made "hastily and without proper consideration";

•    Querying whether any current or former ASIC staff member in particular any individuals involved assessing the PCL Complaint had a "relationship" with any PLC Parties which may have influenced ASIC’s decision to not investigate the PCL Complaint; and

•    Alleging the criminal proceedings commenced by ASIC against you and Palmer Leisure Coolum Pty Limited (Palmer Leisure) have "no basis in law", "breaches both ASIC and DPP guidelines" and have not been "brought for a proper purpose".

I have made enquiries in respect of the above matters and provide the response below.

…

Assessment of PCL Complaint

I note that on 15 February 2016, CDLI wrote to ASIC expressing disagreement with ASIC's assessment of the PCL Complaint. This correspondence was treated as a request to review ASIC's initial decision to take no further action in relation to PCL. On 13 April 2016, ASIC wrote to CDLI reporting on the outcome of its review and affirming ASIC's original decision to take no further action in respect of the PCL Complaint.

I have caused a review to be undertaken of ASIC's assessment of the PCL Complaint and the subsequent review, I am satisfied the PCL Complaint was given due consideration and the decision to not take further action was taken in accordance with ASIC's policies and procedures.

Conflicts of Interest

My enquiries have not found any evidence that officers of PCL were involved in or improperly influenced ASIC's assessment of the PCL complaint or that the relevant ASIC staff held any conflicts of interests relating to PCL.

If you have further details regarding the ASIC staff which you claim to have been improperly influenced in their decision-making or hold undisclosed conflicts of interest, please provide this information to ASIC's Professional Standards Unit at professional.standards.unit@asic.gov.au

Criminal Prosecution

As you are aware, on 22 February 2018, ASIC commenced criminal proceedings in the Magistrates Court of Queensland against you and Palmer Leisure (Criminal Prosecution). The CDPP is the prosecuting authority and responsible for the conduct of the criminal prosecution.

The complaints particularise that on 12 April 2012, Palmer Leisure publicly proposed to make a takeover bid for securities in a company but subsequently did not make an offer for those securities within two months, as required under section 631(1) of the Corporations Act.

In September 2018, you and Palmer Leisure commenced proceedings in the Queensland Supreme Court, seeking a stay of the criminal prosecution (Stay Proceedings).

The allegations you make in your letter of 30 September 2019, have also been raised in the Stay Proceedings. As these matters are currently before the Court and the subject of litigation, it is not appropriate for ASIC to make any further comment at this stage.

31    It was said that it is apparent from the tenor of the communication that Mr Shipton acted on the 30 September 2019 complaint by causing or directing an investigation of the matters contained therein.

32    It was said that ASIC asserted that an investigation was carried out. And it was said that at the time of the investigation, ASIC was in possession of critical evidence, which would have been revealed had it conducted a basic inquiry or sincere investigation.

33    It was said that the inference is arguable that Mr Shipton must have known that: (a) ASIC was engaged in the conduct pleaded in the SOCs at [5], [5A] and [5B]; and (b) the concerns contained in the 30 September 2019 complaint would be found by the most basic investigation.

34    It was said that the findings from the investigation were reported to Mr Shipton. It was said that that is a fair reading according to the tenor of the 1 November 2019 communication.

35    It was said that the inference is arguable, on the strength of the contemporaneous documentation and his statutory duties, that Mr Shipton must have known that the investigation was demonstrably deficient, or alternatively that the matters complained of were established and the statement in the 1 November 2019 communication was false, or alternatively that no investigation occurred and the statement in the communication was false.

36    It was said that the inference is arguable that, despite the matters set out above, Mr Shipton caused and/or directed an outcome that no further action was to be taken in relation to the 30 September 2019 complaint. It was said that the 1 November 2019 communication, on the state of the evidence before the primary judge, was difficult to explain in any other way.

37    It was said that the outcome of the investigation was communicated to Mr Palmer and PLC, on behalf of Mr Shipton and ASIC, by way of the 1 November 2019 communication.

38    In essence, the Palmer parties’ case against Mr Shipton appears to be principally based on the 30 September 2019 complaint, the 1 November 2019 communication of Ms Hartmann and inferences to be drawn from that thin material and other events.

39    This is all pleaded in elaborate terms in the SOCs.

The pleadings – the Palmer SOC

40    It is appropriate to set out relevant extracts of the Palmer SOC; for the most part we have not included particulars. We have also changed some of the format of the pleading to reduce length and we have also deleted strike out notations and underlining. The PLC SOC is in similar terms and we do not need to set this out.

41    It is alleged in [3] that Mr Shipton as well as being employed by ASIC as Chairman and based in its Melbourne office:

…

(ba)    at all material times, as Chairman of ASIC had the following powers and duties:

(i)    ultimately responsible for the duties of the Accountable Authority contained in the Public Governance, Performance and Accountability Act 2013 (Cth) (PGPA Act), including: (1) to govern ASIC in a way that promoted the achievement of the purposes of ASIC (s15(1) PGPA Act); (2) to establish and maintain appropriate systems of risk oversight and management and of internal control of ASIC (s16 PGPA Act);

(ii)    to determine the ASIC Code of Conduct (s126B of the Australian Securities and Investments Commission Act 2001 (Cth) (ASIC Act);

(iii)    to determine, uphold and promote the ASIC Values (s126C(1) and (2) ASIC Act);

(c) to (ha)

was responsible for the oversight of subordinate employees of ASIC, including … Jennifer Mary Forbes who was a subordinate employee of ASIC who laid the Complaint in the Resort Prosecution, … Heather Alice Gibson, Justice of the Peace, who was a subordinate employee of ASIC who witnessed the Complaint in the Resort Prosecution; … Rashpal Hartmann [responsible for the response to Mr Palmer’s letter dated 30 September 2019] … Dimitrios Kotsovolos, being the ASIC officer with carriage of the investigation regarding PLC and Mr Palmer and who was based in the Melbourne office of ASIC; … John Price, being an ASIC Commissioner with oversight of the investigation regarding PLC and Mr Palmer and who was based in the Melbourne office of ASIC; and … Greg Tanzer, being an ASIC Commissioner …;

(i)    is and was at all material times “an official of a Commonwealth entity” within the meaning of s 13 the PGPA Act with ASIC as a “Commonwealth entity” within the meaning of s 10 of the PGPA Act.

42    It is alleged in [5], [5A] and [5B] in section B titled “ASIC’s involvement with TPC” as follows:

5.     Since May 2012, and through to at least 2018, ASIC was involved in extensive communications and interactions with, and made representations to, TPC, concerning PLC and Mr Palmer, as follows …

(a) to (o)    [A listing of emails and letters spanning the period 2012 to 2015, not involving Mr Shipton]

(p)     [Deleted]

(q) to (v)    [4 September 2015 costs orders and subsequent communications concerning costs]

…

each of the matters pleaded in sub-paragraphs (a) to (v): (aa) were recorded in writing; (ab) at all material times were in the possession of ASIC; (ac) were brought into existence before the 30 September 2019 Complaint (defined below); (ad) subsequent to the 30 September 2019 Complaint, were recorded in documents disclosed by ASIC to Mr Palmer and PLC in the Resort Prosecution as constituting documents relevant to that criminal proceeding; (ae) in the context of the matters pleaded in (aa) to (ad) above, were matters the existence of which would have been revealed by the most basic investigation in relation to the 30 September 2019 Complaint and any such investigation could not have failed to learn of the existence at least some of them.

5A (a)     In February 2016, a meeting in Sydney in the State of New South Wales, occurred between representatives of TPC and of PLC and Mr Palmer;

(b)     The attendees at the meeting were: (i) for TPC: Ian Lewis and Wayne Owen; (ii) the attendees in addition to Mr Palmer for or on behalf of PLC and Lion Investments: Simon Stodart, Michael Palmer, Emily Palmer, Kane Jones.

(c)     A representative of TPC stated to the effect that TPC had a mate in ASIC and if PLC did not pay, action would be taken against PLC and its directors.

[(d)]     It may be inferred from the matters pleaded in paragraphs 5 above and 5B below at least that ASIC was aware that such meetings were occurring, and representations of that kind were being made by TPC, shortly after this time.

5B     (a)     The TPC Timeshare Scheme:

(i)     was flawed and unprofitable and required constant further contributions from members when expenses exceeded income, including; (1) the further contributions included owners being obliged to contribute additional funds to fund expenses not covered by letting pool income; (2) Lion Holdings and after that, Lendlease, funded Lion Investments to also meet the shortfall whilst they each successively endeavoured to sell the Unsold Lots over the subsequent approximately 24 year period, as pleaded in paragraph 4A above; and (3) as a consequence of (2) above, owners were not required to meet the shortfall and knew that the TPC Timeshare Scheme was unsustainable and would ultimately cease operating,

(ii)     was largely loss-making and the total outgoings were punitive reflecting a flawed ownership/management model that was destined to be inefficient from the outset because of its multiple layers;

…

(b)    As early as 2000, ASIC knew TPC was asserting that: (i) without the Resort Administration Agreement (the RAA), (which was the means by which facilities at the Resort were made available to timeshare owners and the costs of which was causing the timeshare scheme to run at a loss) an owner’s investment in TPC was almost valueless; (ii) owners of interests in TPC made marginal profits; (iii) there was a delicate balance between all parties interested in the Resort; (iv) if TPC was required to transition to a managed investment scheme arrangement, it would be required to renegotiate the RAA and if it failed to do so, TPC would be wound up.

(c)    The directors of TPC were aware at least by 2003: (i) that the original developer of the Resort, and Lendlease, had been unable to sell the Unsold Lots; (ii) that if Lendlease had sought to alienate the Unsold Lots, there would only have been a narrow market of purchasers for those lots; (iii) if someone with the sophistication and experience of Lendlease in marketing real property could not sell the Unsold Lots, they were virtually impossible to sell; and (iv) for so long as there was Unsold Lots, villa owners were always at risk that a new owner would eventually want to realise the unsold investment and would not have the same desire for allowing losses to keep being incurred, and continue to meet the shortfall when not obliged to do so.

(d)    TPC always faced a risk that Lion Investments, when controlled by Lion Holdings and subsequently by Lendlease, would no longer meet the trading shortfall of TPC, and the unprofitable TPC Timeshare Scheme would fail.

(e)    It may be inferred from the matters pleaded in paragraph 5B(a) and 5B(c) above, that by no later than the beginning of 2011, TPC knew that any incoming purchaser from Lendlease would not continue to meet the shortfall.

(f)    By 2011, TPC was aware that it needed a strategy to procure a buy-out of all interests because the TPC Timeshare Scheme had commercially failed.

(g)    By reason of: (i) the dealings that the directors of TPC had with ASIC at least since 2000 as pleaded in paragraph 5B(b) above; (ii) the knowledge of the directors of TPC pleaded in paragraph 5B(c) above regarding why the timeshare scheme had failed commercially; and (iii) the dealings the directors subsequently had with ASIC, and the relationship it reflected, pleaded in paragraph 5 above, it may be inferred that, by the time Lion Investments was acquired from Lendlease, ASIC was aware the TPC Timeshare Scheme had failed commercially and of the matters alleged in paragraphs 5B(a) to (f) above.

(h)    By reason of the matters pleaded in 4A and 5B(a)-(f) above, by 2011 TPC: (i) was always destined to fail; (ii) had in fact failed commercially; (iii) was insolvent or close to insolvent; (iv) had and was continuing to survive only because it was not, and had generally for the previous 24 years not, met significant of its debts when due or at all, which debts were mounting; (v) TPC and the Villa Interests were valueless or near valueless (TPC’s True Financial Position).

(i)    In July 2011, PLC (then known as QNA) acquired 98% of the shares in Lion Holdings from Lendlease.

(j)    The remaining 2% of shares were acquired by Closeridge as pleaded in paragraph 4A above.

(k)    On or about 6 July 2011, TPC was first notified by Lendlease of its intention to sell its shares in Lion Investments to entities associated with Mr Palmer and PLC, as pleaded in paragraph 4A above.

(l)    By 15 September 2011, after Lion Investments gave notice of its revocation of the Exemption Deed dated 31 January 2005, ASIC was aware that: (i) the consequences of TPC having to comply with legislative requirements regarding managed investments schemes identified in the letter dated 10 October 2000 would materialise; (ii) accordingly, an owner’s investment in TPC was ‘almost valueless’; (iii) and it may be inferred, the owners of interests in TPC would require an incoming purchaser to buy out all interests in TPC because it had commercially failed.

(m)    The revocation took effect on or about 13 March 2012, following expiry of the 180 day notice period required by cl 4.2 of the deed poll.

(n)    From 13 March 2012, the ASIC exemption ceased to apply.

(o)    To ASIC’s knowledge, TPC was thereafter conducting an unregistered timeshare scheme.

(p)    By 2012, on the basis of documents lodged with it and previous correspondence pleaded above, ASIC must have known of TPC’s True Financial Position.

(q)    At a time prior to 10 April 2012, the directors of TPC resolved to suspend payments of a refurbishment levy and to use sums from a refurbishment fund for purposes other than refurbishment, including for the purposes of paying legal fees in respect of disputes between TPC and entities associated with PLC and Mr Palmer.

(r)    On 12 April 2012, PLC lodged with ASIC a document entitled “bidders statement” proposing a bid for all shares in TPC and the corresponding Villa Interests. Before that time and until around 10 June 2012, PLC and Mr Palmer were not aware of: (i) the conduct of the directors of TPC in sub-paragraph (q) above; and (ii) the full extent of TPC’s True Financial Position.

(s)    In the circumstances, there was no proper basis for ASIC, consistent with its functions, to participate or assist in TPC’s attempts to procure an offer from PLC and/or Mr Palmer to purchase the shares in TPC and the Villa Interests for a material value when ASIC knew TPC and the Villa Interests were valueless or near valueless.

(t)    At the time of the commencement of the Resort Prosecution on 22 February 2018, ASIC must have known that:

(i)     PLC and/or Mr Palmer would have available to them a defence under s670F of the Corporations Act 2001 (Cth) on the basis that PLC could not reasonably have been expected to comply with s631 of the Corporations Act 2001 (Cth) by reason of the matters pleaded in subparagraph (r) above, of which PLC and Mr Palmer did not know and could not reasonably be expected to know;

(ii)    the frequency and duration of the period of contact, and the tenor of the contact, between TPC and ASIC, evinced TPC’s influence over ASIC, as pleaded in paragraph 5 and 5A above and sub-paragraph 5B(b) and (k), above;

(iii)     ASIC paid TPC’s costs in a Federal Court Proceeding, and did not seek a contribution, as pleaded in paragraph 5(q) to (v) above;

(iv)     Mr Wallis of TPC was a golfing acquaintance of Mr Tanzer of ASIC, as stated in the communication pleaded in paragraph 5(i) above, and sought to use that relationship to obtain special treatment from ASIC;

(v)     to ASIC’s knowledge, as at 2012, TPC’s True Financial Position meant it was inappropriate for ASIC to participate in TPC’s attempts to procure an offer from PLC and/or Mr Palmer to purchase the shares in TPC and the Villa Interests when ASIC knew TPC and the Villa Interests were valueless or near valueless;

(vi)     ASIC’s officers and employees would be material witnesses in the Resort Prosecution on the topic of TPC’s True Financial Position and in PLC and/or Mr Palmer’s defence under s670F of the Corporations Act 2001 (Cth);

(vii)     TPC’s directors who were urging ASIC to charge PLC and/or Mr Palmer were in a position to benefit from ASIC establishing a contravention under s631 of the Corporations Act 2001 (Cth) as they may be parties that suffered loss or damage resulting from the contravention and entitled to recover the amount of the loss and damage from PLC and/or Mr Palmer under s670E of the Corporations Act 2001 (Cth).

43    It is alleged in [6] and [7] in section C titled “ASIC commences resort prosecution” as follows:

6.     On 22 February 2018, ASIC (by Mr Shipton and his subordinate employees) (nearly 6 years after the alleged events) filed complaints and summonses against Mr Palmer and PLC (the Resort Prosecution).

7.     The complaint in the Resort Prosecution is that on or about 12 June 2012: (a) PLC breached s 631(1) of the Corporations Act 2001 (Cth) in that, after publicly proposing to make a takeover bid for securities in a company, PLC did not in fact make an offer for securities in that company within the two month time limit fixed by that section; and (b) by virtue of s 11.2 of the Criminal Code (Cth) Mr Palmer aided, abetted, counselled or procured that offence by PLC.

44    It is alleged in [8] to [12] in section D titled “Mr Shipton fails to perform the functions of the public office” as follows:

8.     By letter dated 30 September 2019 (30 September 2019 Complaint) Mr Palmer for himself and on behalf of PLC wrote to Mr Shipton to the following effect:

(a)     bringing to his attention “a serious crime or abuse which has been committed by senior ASIC employees”;

(b)     stating that the matter “requires your immediate personal attention and investigation in accordance with the public duty you hold by virtue of your office”;

(c)     referring to a meeting in February 2016 in the presence of Mr Palmer’s solicitor in which Mr Palmer was “personally threatened by the director of The President’s Club limited that unless I offered substantial amount of money to purchase interests in an unregistered time share scheme that ASIC would charge me in relation to The President’s Club. He confirmed he had spoken to ASIC and had a mate working at a senior level in ASIC head office”;

(d)     noting that ASIC using taxpayer funds paid the full costs order that had been made jointly against ASIC and TPC following the resolution by the Full Court of the Federal Court of Australia that TPC “operates a time share scheme”: Queensland North Australia Pty Ltd v Takeovers Panel [2015] FCAFC 68;

(e)     referring to the fact that on 4 February 2016, [ASIC] informed Coeur De Lion Investments Pty Ltd that ASIC had decided not to investigate a complaint of contravention by TPC and its directors of s601ED(5);

(f)     presenting a list of questions concerning any relationship between ASIC staff and TPC, asking: (i) for what communications “occurred between ASIC Persons and TPC Parties and what is the content of those communications” (questions 1 and 2); (ii) whether any representative of TPC sought to influence ASIC (question 3); and (iii) whether any ASIC person was influenced by TPC in relation to the decision not to investigate a complaint by Lion Investments (question 4); and (iv) whether there were any conflicts of interest held by ASIC in relation to the investigation and if so, what was the conflict and how did ASIC manage the conflict (question 5).

8A.     As is now known, at least the matters pleaded at paragraph 8(a), (c) to (e) above were factually true, and the questions set out at 8(f) called for substantive, affirmative answers, in that:

(a)     the matters pleaded in 8(a) above were true by reason of any or any combination of the circumstances pleaded in paragraphs 5, 5A and 5B above;

(b)     the matters pleaded in 8(c) above were true in that Mr Wallis of TPC was a golfing acquaintance of Mr Tanzer of ASIC, as stated in the communication pleaded in paragraph 5(i) above;

(c)     the matters pleaded in 8(d) above were true in that ASIC paid TPC’s share of a costs order and did not seek a contribution as pleaded in paragraph 5(q) to (v) above;

(d)     the matters pleaded in 8(e) above were true in that the refusal was recorded in writing by letters dated 4 February 2016 and 13 April 2016 from ASIC employees;

(e)     questions 1 and 2 should have been answered in the affirmative and at least the correspondence pleaded at paragraphs 5 and 5B(b) above should have been identified;

(f)     question 3 should have been answered in the affirmative because it may be inferred that TPC sought to influence ASIC from:

(i) to (vi) [Various matters were listed to justify the inference]

(g)     question 4 should have been answered in the affirmative because of:

(i) to (vii) [Various matters were listed to justify the inference]

…

ASIC’s decision not to investigate TPC’s conduct of an unregistered timeshare scheme is explicable only by the circumstance of ASIC being influenced by representatives of TPC as alleged;

(h)     question 5 should have been answered in the affirmative because by reason of the matters pleaded in 8A(f) and (g) above, representatives of ASIC were in a position of conflict of interest in that:

(i) to (iv) [Various matters were listed to justify this position]

8B.     Between about 30 September 2019 and about 1 November 2019, Mr Shipton caused and/or directed an investigation of the matters set out in and requested by the 30 September 2019 Complaint (Investigation), as may be inferred by the matters pleaded in paragraph 9 below.

8C.     Between about 30 September 2019 and about 1 November 2019, [Ms] Rashpal Hartmann on behalf of Mr Shipton and ASIC, conducted the Investigation or alternatively purported to conduct the Investigation, as may be inferred by the matters pleaded in paragraph 9 below.

8D.     Between about 30 September 2019 and about 1 November 2019, [Ms] Hartmann reported [her] findings in relation to the Investigation to Mr Shipton as may be inferred by the matters pleaded in paragraph 9 below.

8E.     By conduct, Mr Shipton accepted that it was, or was connected to, his public duty, to investigate the matters stated in the 30 September 2019 Complaint as may be inferred by the matters pleaded in paragraph 9 below.

8F.     In the premises of: (a) paragraphs 5(aa) to (ae) above; (b) ASIC’s knowledge pleaded in paragraph 5A(b) above; (c) ASIC's knowledge pleaded in paragraph 5B(b), (g), (o), (p), (s) and (t), Mr Shipton must have known that the concerns stated in paragraphs 8(a) and (f) above would be found by the most basic investigation.

8G.     In the premises of the matters pleaded in paragraphs 5, 5A, 5B and 8A, Mr Shipton must have known that ASIC was engaged in the conduct pleaded in paragraphs 5, 5A and 5B by reason of its position and powers as a regulator, and the only rational explanation for the Communication in paragraph 9 below is:

(a)     the investigation was demonstrably deficient because it did not establish the matters complained of in the 30 September 2019 Complaint despite the matters pleaded in paragraphs 5, 5A, 5B and 8A above;

(b)    alternatively, there was an investigation which established the matters complained of in the 30 September 2019 Complaint and paragraph 8A above and the statement in the Communication in paragraph 9(b) below was false;

(c)     alternatively, no investigation occurred and the statement in the Communication in paragraph 9 below was false.

9.     On or about 1 November 2019 [Ms] Rashpal Hartmann on behalf of Mr Shipton and ASIC wrote to Mr Palmer and PLC to the following effect (the Communication):

(a)     stating that [Ms] Hartmann had “been asked to consider the matters raised in your letter and provide a response”;

(aa)     stating that in relation to PCL’s complaint regarding TPC conducting an unregistered timeshare scheme, [she] had caused a review to be undertaken and was satisfied that the complaint was given due consideration and the decision not to take further action was in accordance with ASIC’s policies and procedures;

(ab)     stating that the decision to pay TPC’s legal costs was given due consideration and appropriately authorised;

(b)     stating, in respect of the conflict of interests, that “My enquiries have not found any evidence that officers of PCL were involved in or improperly influenced ASIC’s assessment of the PCL complaint or that the relevant ASIC staff held any conflicts of interest relation to PCL”. This statement was not true, for the reasons pleaded in paragraphs 5, 5B(s) and 8A above and 20 below.

9AA.     Despite the matters pleaded at [8C] to [8G] above, Mr Shipton caused and/or directed an outcome that no further action was to be taken in relation to the 30 September 2019 Complaint (together with the matters set out in [9](b) above, the Outcome).

9A     Mr Palmer became aware of the matters pleaded in paragraph 5 above in or around March 2023 when disclosure was provided to his solicitors in Resort Prosecution.

9B     The Investigation, Communication and Outcome were:

(a)     an investigation or part of an investigation pursuant to s13(1) of the ASIC Act, in relation to suspected contraventions of the corporations legislation and/or a contravention of a law of the Commonwealth concerning the management or affairs of a body corporate or managed investment scheme;

(ab)     conduct to which Mr Shipton’s duties:

(i)     to govern ASIC in a way that promoted the achievement of the purposes of ASIC (s15(1) PGPA Act);

(ii)     to establish and maintain appropriate systems of risk oversight and management and of internal control of ASIC (s16 PGPA Act);

(iii)     to exercise his powers, perform his functions and discharge his duties honestly, in good faith and for a proper purpose (s26 PGPA Act);

(iv)     to exercise:

(1)     powers of ASIC for the public good;

(2)     ASIC’s discretionary public powers reasonably.

(v)     to determine the ASIC Code of Conduct (s126B ASIC Act);

(vi)     to determine, uphold and promote the ASIC Values (s126C(1) and (2) ASIC Act), including to demonstrate professionalism by always being honest and fair in dealings with others;

attached;

(b)     further or alternatively, ASIC’s general administration of the ASIC Act.

10.     By the matters pleaded in paragraphs 5, 5A and 5B above, officers of TPC were involved in and improperly influenced ASIC’s assessment of the PLC complaint and/or that the relevant ASIC staff held conflicts of interests relating to TPC.

11.     The facts, matters and circumstances pleaded in paragraph 5, 5A, 5B and 8A above were known to ASIC at the time of the purported Investigation, Communication and Outcome, in that:

(a)     the communications involved ASIC officers as pleaded herein;

(b)     Mr Shipton had responsibility for subordinate ASIC officers;

(c)     Mr Shipton caused or directed the Investigation, Communication and Outcome;

(d)     the matters had the characteristics, and were disclosed by ASIC in the Resort Prosecution, in the circumstances pleaded in paragraph 5(aa to ae) above.

12.     The purported Investigation, Communication and Outcome failed and/or omitted to identify, properly consider or properly investigate the facts, matters and circumstances pleaded in paragraph 5, 5A and 5B above and draw the conclusions pleaded in paragraph 8A above.

45    It is alleged in [16] to [26] in section F titled “Misfeasance in public office” as follows:

16.     At all material times, in his capacity as Chairman of ASIC, Mr Shipton held a public office.

17.     In causing and/or supervising and/or directing: (a) the purported Investigation, including those who carried it out; and/or (aa) the Outcome; and/or (b) the Communication, including those who sent the Communication; and/or (c) the filing of complaints in the Resort Prosecution, including those who filed laid the complaints in the Resort Prosecution, Mr Shipton was exercising public power or was connected to a power or function he had by virtue, or as an incident, of his public office.

18.     In exercising his public functions pleaded in paragraph 17 above, Mr Shipton was obliged to exercise those functions in the public interest.

18A.     At all relevant times, Mr Shipton was under a duty to exercise:

(a)     powers of ASIC for the public good;

(b)     ASIC’s discretionary public powers reasonably.

Particulars

(a)     The powers of ASIC are conferred by sections 1, 11, 12A(6) and 13 of the ASIC Act.

18B.     At all relevant times: (a) Mr Shipton was required to uphold and promote the ASIC Values (s126C(2) ASIC Act); (b) an ASIC Value was to demonstrate professionalism by always being honest and fair in dealings with others.

18C.     By reason of the failures and/or omissions pleaded at paragraphs 8B to 9AA, 9B, 12, 17, 18 above in respect of the:

(a)     Investigation; and/or

(aa)     Outcome; and/or

(b)     Communication,

Mr Shipton failed to:

(c)     exercise the powers of ASIC for the public good;

(d)     exercise ASIC’s discretionary public powers reasonably;

(e)     be honest and fair in dealings with PLC and Mr Palmer.

18D.     Mr Shipton’s failures pleaded in paragraph 18C above were a breach of:

(a)     the duty in paragraph 18A above;

(b)     the ASIC Values and s126C(2) ASIC Act.

18E.     At all relevant times, the PGPA Act imposed (inter alia) the following duties on Mr Shipton:

(a)     the duty to exercise his powers, perform his functions and discharge his duties with the degree of care and diligence that a reasonable person would exercise if the person: (i) were an official of a Commonwealth entity in the Commonwealth entity's circumstances; and (ii) occupied the position held by, and had the same responsibilities within the Commonwealth entity as, Mr Shipton (s25 PGPA Act); and

(b)     the duty to exercise his powers, perform his functions and discharge his duties honestly, in good faith and for a proper purpose (s26 PGPA Act),

(c)     being ultimately responsible for the duties of the Accountable Authority contained in the PGPA Act, including: (i) to govern ASIC in a way that promoted the achievement of the purposes of ASIC (s15(1) PGPA Act); (ii) to establish and maintain appropriate systems of risk oversight and management and of internal control of ASIC (s16 PGPA Act);

(collectively, the PGPA Duties).

18F.     On its proper construction, the PGPA confers on an individual a private civil cause of action in respect of a breach of the PGPA Duties.

18G.     PLC and Mr Palmer are members of a class of persons for whose benefit the PGPA Duties were imposed.

18H.     By reason of the failures and/or omissions pleaded at paragraphs 8B to 9AA, 9B, 12, 17, 18 above in respect of the:

(a)     Investigation; and/or

(aa)     Outcome; and/or

(b)     Communication,

Mr Shipton failed to:

(c)     exercise his powers, perform his functions and discharge his duties with the degree of care and diligence that a reasonable person would exercise if the person occupied Mr Shipton’s position;

(d)     failed to exercise his powers, perform his functions and discharge his duties in good faith.

18I.     Mr Shipton’s failures pleaded in paragraph 18H above were a breach of the PGPA Duties.

18II     At the time of making the decision, and acting in causing and/or supervising and/or directing the purported Investigation, the Outcome, the Communication and Resort Prosecution, Mr Shipton knew that his powers to do so were limited in that: (a) he could not make the decision and/or undertake those actions in a manner that did not comply with the duty in paragraph 18A above; (b) he could not make the decision and/or undertake those actions in a manner that did not adhere to the ASIC Values and s126C(2) ASIC Act; and (c) he could not make the decision and/or undertake those actions in a manner that did not comply with the PGPA Duties.

18J.     In the premises of paragraphs 8B to 9AA, 9B, 12, 17 and 18 above and paragraph 20 below, Mr Shipton’s causing and/or supervising and/or directing of the purported Investigation was an invalid and/or unauthorised act in that:

(a)     it breached the duty in paragraph 18A above in that Mr Shipton failed to: (i) exercise the powers of ASIC for the public good; (ii) exercise ASIC’s discretionary public powers reasonably;

(b)     it breached the ASIC Values and s126C(2) ASIC Act in that Mr Shipton failed to be honest and fair in dealings with PLC and Mr Palmer;

(c)     it breached the PGPA Duties in that Mr Shipton failed to: (i) exercise his powers, perform his functions and discharge his duties with the degree of care and diligence that a reasonable person would exercise if the person occupied Mr Shipton’s position; (ii) failed to exercise his powers, perform his functions and discharge his duties in good faith; (iii) failed to govern ASIC in a way that promoted the achievement of the purposes of ASIC; (iv) to establish and maintain appropriate systems of risk oversight and management and of internal control of ASIC;

(d)     it was an improper exercise of the power conferred by the ASIC Act in pursuance of which it was purported to be exercised, and thereby was an improper exercise of a power within the meaning of that expression on the combined reading of ss5(1)(e) and 5(2)(a), 5(2)(c), 5(2)(e) and 5(2)(j) of the Administrative Decisions (Judicial Review) Act 1977 (Cth).

18K.     In the premises of paragraphs 8B to 9AA, 9B, 12, 17 and 18 and 18II above and paragraph 20 below, Mr Shipton’s causing and/or supervising and/or directing of the Outcome and/or the Communication was an invalid and/or unauthorised act in that:

(a)     it breached the duty in paragraph 18A above in that Mr Shipton failed to: (i) exercise the powers of ASIC for the public good; (ii) exercise ASIC’s discretionary public powers reasonably;

(b)     it breached the ASIC Values and s126C(2) ASIC Act in that Mr Shipton failed to be honest and fair in dealings with PLC and Mr Palmer;

(c)     it breached the PGPA Duties in that Mr Shipton failed to: (i) exercise his powers, perform his functions and discharge his duties with the degree of care and diligence that a reasonable person would exercise if the person occupied Mr Shipton’s position; (ii) failed to exercise his powers, perform his functions and discharge his duties in good faith; (iii) failed to govern ASIC in a way that promoted the achievement of the purposes of ASIC; (iv) to establish and maintain appropriate systems of risk oversight and management and of internal control of ASIC;

(d)     it was an improper exercise of the power conferred by the ASIC Act in pursuance of which it was purported to be exercised, and thereby was an improper exercise of a power within the meaning of that expression on the combined reading of ss5(1)(e) and 5(2)(a), 5(2)(b), 5(2)(c), 5(2)(e) and 5(2)(j) of the Administrative Decisions (Judicial Review) Act 1977 (Cth).

19.     In the premises of paragraphs 5B(s), 8B to 9AA, 9B, 12, 17, 18 and 18II above and paragraphs 20 and 21(i) – (iv) below, by causing and/or supervising and/or directing the purported Investigation, the Outcome, the Communication and the Resort Prosecution, Mr Shipton knowingly acted in excess of his power in that he knew: (a) the conduct breached the duty in paragraph 18A above; (b) the conduct breached the ASIC Values and s126C(2) ASIC Act; (c) the conduct breached the PGPA Duties.

19A.     In the premises of paragraphs 5B(s), 8G, 9AA, 12, 18D and 18I above and paragraphs 20 and 21(i) – (iv) below, by causing and/or supervising and/or directing the purported Investigation, the Outcome, the Communication and the Resort Prosecution, Mr Shipton intended to cause Mr Palmer harm.

20.     By reason of the matters stated in paragraph 5, 5A, 5B, 8 to 12, 15 to 19 above, the purported Investigation, Outcome, and the Communication and the laying of the complaints commencing the Resort Prosecution, were not an honest attempt to perform the functions of the public office held by Mr Shipton in that:

(a)     the allegations in the 30 September 2019 Complaint were established by the facts, matters and circumstances pleaded in paragraph 5, 5A and 5B above;

(b)     if the facts, matters and circumstances pleaded in paragraph 5, 5A, 5B and 8A above were identified, properly considered or properly investigated during the Investigation, Mr Shipton would not have caused the Communication to be sent and the Outcome would not have been reached;

(c)     further or alternatively, the contention in the Communication relevantly that there was no evidence that “officers of [TPC] were involved in or improperly influenced ASIC’s assessment of the [TPC] complaint or that the relevant ASIC staff held any conflicts of interest relation to [TPC]” was false by reason of the facts, matters and circumstances pleaded in paragraph 5, 5A, 5B and 8A above;

(d)     further or alternatively, the facts, matters and circumstances pleaded in paragraph 5, 5A, 5B and 8A above were identified, properly considered or properly investigated, but were knowingly concealed by the Outcome and the sending of the Communication;

(da)     he failed and/or omitted to identify, properly consider or properly investigate the facts, matters and circumstances in paragraph 5, 5A, 5B and 8A above, in particular: (i) the frequency and duration of the period of contact between TPC and ASIC; (ii) the relationship between Mr Bruce Wallis a director of TPC and Mr Greg Tanzer, Commissioner at ASIC; (iii) the fact that ASIC was in possession of correspondence between Mr Wallis and Mr Tanzer in which Mr Wallis asked ASIC to take enforcement action against Mr Palmer; (iv) the fact that ASIC was in possession of correspondence in which Mr Tanzer had forwarded the email from Mr Willis to others in ASIC including Kate O’Rourke and Amanda Zeller;

21.     Mr Shipton’s malice towards Mr Palmer (each of the kinds pleaded in paragraphs 19 and 19A above and paragraphs 23A, 23B and 24 below) can be inferred from his engaging in the acts and omissions pleaded at paragraphs 6, 8B to 9AA, 9, 9B, 12, 13 17 and 18 and 20 in the circumstances pleaded at paragraph 16 to 19 above, in that:

(i)     Mr Shipton was the Chairman of ASIC and aware of its powers and obligations;

(ii)     Mr Shipton requested that his subordinate … investigate the matters in Mr Palmer’s communication, in the knowledge that the investigation and any [ensuing] communication would be bound by the duties and obligations pleaded in paragraphs 18A to 18K above;

(ii)     Mr Shipton was aware of the matters in paragraph 5, 5A and 5B

[sic]     as part 52 of the indivisible legal entity of ASIC;

(iii)     Mr Shipton was aware or recklessly indifferent that the Investigation, Outcome and Communication were beyond power and breached the duties and obligations pleaded in paragraphs 18A to 18K;

(iv)     Mr Shipton was aware or recklessly indifferent that the Investigation, Outcome and Communication were deficient;

(v)     alternatively, Mr Shipton was aware or recklessly indifferent that:

(1)     the investigation was demonstrably deficient because it did not establish the matters complained of in the 30 September 2019 Complaint despite the matters pleaded in paragraphs 5, 5A, 5B and 8A above;

(2)     there was an investigation which established the matters complained of in the 30 September 2019 Complaint and paragraph 8A above and the statement in the Communication in paragraph 9 above was false;

(3)     no investigation occurred and the statement in the Communication in paragraph 9 above was false;

(vi)     Mr Shipton was aware or recklessly indifferent that the most basic investigation would have found the matters in paragraph 5B(t) and 8A above but the Investigation did not.

22.     In the premises of the facts pleaded in paragraphs 20 and 21 above, Mr Shipton’s malice towards Mr Palmer was the actuating motive for the acts and omissions referred to in the sub-paragraphs to paragraph 19 and 20 above.

23.     Had Mr Shipton discharged his duties and exercised his public function for the public interest Mr Shipton would have:

(a)     caused the purported Investigation to review the facts, matters and circumstances paragraph 5, 5A and 5B above;

(b)     instructed ASIC officers to investigate TPC;

(c)     instructed ASIC officers to withdraw the complaint and the Resort Prosecution;

(d)     ensured that the CDPP was provided with the complete and accurate material in order to decide whether to continue the Resort Prosecution;.

(e)     not acted in a manner which: (i) breached the duty in paragraph 18A 15A above; (ii) breached the ASIC Values and s126C(2) ASIC Act; (iii) breached the PGPA Duties; (iv) was an improper exercise of power under the ASIC Act.

23A     Mr Shipton acted unlawfully in that he had no power under the ASIC Act to engage in the Investigation, Outcome and the Communication in the manner he did in the circumstances of paragraphs 8 to 12 and 18J to 22 above.

23B     Further or alternatively, Mr Shipton had knowledge or acted with reckless indifference as to whether his conduct was unlawful in the circumstances of paragraphs 8 to 12 and 18J to 22 above.

24.     Mr Shipton knew, or acted with reckless indifference to the fact, that the consequence of the circumstances pleaded at paragraphs 19 to 23B above would probably be the suffering of economic loss by Mr Palmer, in that:

(a)    It may be inferred that Mr Shipton, as Chairman of ASIC, before the Investigation, Outcome and Communication, considered: (i) the duty in paragraph 18A above; (ii) the ASIC Values and s126C(2) ASIC Act; (iii) the PGPA Duties; (iv) the manner of the exercise of his powers;

(b)     It may be inferred that Mr Shipton considered the risk that the Investigation, Outcome and Communication were beyond power, by reason of: (i) the matters known to him and to ASIC in paragraph 5 above; (ii) the duties and obligations in paragraph (a)(i) to (iii) above; (iii) the Investigation not considering the matters in paragraphs 5, 5A, 5B, 8A and 20(da) above; [iv] the Outcome and Communication not addressing the matters in paragraphs 5, 5A, 5B, 8A and 20(da) above; [v] the matters in paragraphs 18J and 18K; and

(c)     despite the matters in paragraphs (a) and (b) above, Mr Shipton proceeded with the Investigation, Outcome and the Communication.

25.     In the premises of paragraphs 17 to 24 above, Mr Shipton’s conduct made a material contribution to the commencement and continuation of: the Resort Prosecution.

26.     In the premises of paragraph 25 above, Mr Shipton is liable in damages to Mr Palmer for the tort of misfeasance in public office.

46    It is alleged in [27] that:

27.     By reason of Mr Shipton’s conduct, including the omission or decision to take no further action as pleaded at [9AA] above, Mr Palmer has suffered loss and damage, namely economic loss, presently calculated to exceed $3.5 million.

47    In our view the SOCs are little more than houses of cards.

48    The only objective primary facts pleaded against Mr Shipton were, first, his position as a chairperson, second, that the 30 September 2019 complaint was sent to him and, third, that this complaint was responded to by the 1 November 2019 communication sent by Ms Hartmann.

49    Taking the Palmer SOC as an example, the entire edifice of the Palmer parties’ case has at its foundation only these objective primary facts.

50    Now true it is that [3] of the Palmer SOC pleads various powers, duties, and responsibilities for other employees and staff of ASIC. But that is not a plea of specific conduct. Moreover, being responsible for the conduct of others does not without more make their conduct Mr Shipton’s conduct for the purposes of the tort.

51    Then there are extensive pleas of historic facts and conduct that pre-date Mr Shipton’s appointment as the chairperson. It is said, for example, that material relating thereto was in the possession of ASIC and were matters that “the most basic investigation” of the 30 September 2019 complaint would have revealed (see [5](ae) for example). Similar themes are raised in [5A] and [5B], including language used such as “ASIC must have known” ([5B](t)).

52    Then the 30 September 2019 complaint is pleaded at [8], with subsequent assertions in [8A] that various elements of the complaint were “factually true” and that the questions posed in the complaint “called for substantive, affirmative answers”.

53    Building upon that problematic edifice to say the least, various matters are pleaded at [8B] to [8G], which we have set out.

54    Now put to one side for the moment [8B] to [8D], the culmination of this part of the pleading then is found in [8F] and [8G] which descend into language such as “Mr Shipton must have known …”. Not only does that not meet the requisite state of mind plea for the tort, but the assertions or inferences themselves are based on the earlier flimsy and speculative foundations of the pleader. It is worth setting out again [8F] and [8G]:

8F     In the premises of:

(a)    paragraphs 5(aa) to (ae) above;

(b)    ASIC’s knowledge pleaded in paragraph 5A(b) above;

(c)    ASIC's knowledge pleaded in paragraph 5B(b), (g), (o), (p), (s) and (t),

Mr Shipton must have known that the concerns stated in paragraphs 8(a) and (f) above would be found by the most basic investigation.

8G.     In the premises of the matters pleaded in paragraphs 5, 5A, 5B and 8A, Mr Shipton must have known that ASIC was engaged in the conduct pleaded in paragraphs 5, 5A and 5B by reason of its position and powers as a regulator, and the only rational explanation for the Communication in paragraph 9 below is:

(a)    the investigation was demonstrably deficient because it did not establish the matters complained of in the 30 September 2019 Complaint despite the matters pleaded in paragraphs 5, 5A, 5B and 8A above;

(b)    alternatively, there was an investigation which established the matters complained of in the 30 September 2019 Complaint and paragraph 8A above and the statement in the Communication in paragraph 9(b) below was false;

(c)    alternatively, no investigation occurred and the statement in the Communication in paragraph 9 below was false.

55    Then [9] to [9B] set out the 1 November 2019 communication and various consequences, and state the following in [9AA] and [9B]:

9AA.    Despite the matters pleaded at [8C] to [8G] above, Mr Shipton caused and/or directed an outcome that no further action was to be taken in relation to the 30 September 2019 Complaint (together with the matters set out in [9](b) above, the Outcome).

9A    …

9B    The Investigation, Communication and Outcome were:

(a)    an investigation or part of an investigation pursuant to s13(1) of the ASIC Act, in relation to suspected contraventions of the corporations legislation and/or a contravention of a law of the Commonwealth concerning the management or affairs of a body corporate or managed investment scheme;

(ab)    conduct to which Mr Shipton’s duties:

[(i) – (vi)] attached;

(b)     further or alternatively, ASIC’s general administration of the ASIC Act.

56    This all culminates in [10] to [12] which state:

10.    By the matters pleaded in paragraphs 5, 5A and 5B above, officers of TPC were involved in and improperly influenced ASIC’s assessment of the PLC complaint and/or that the relevant ASIC staff held conflicts of interests relating to TPC.

11.    The facts, matters and circumstances pleaded in paragraph 5, 5A, 5B and 8A above were known to ASIC at the time of the purported Investigation, Communication and Outcome in that:

(a)    the communications involved ASIC officers as pleaded herein;

(b)    Mr Shipton had responsibility for subordinate ASIC officers;

(c)    Mr Shipton caused or directed the Investigation, Communication and Outcome;

(d)    the matters had the characteristics, and were disclosed by ASIC in the Resort Prosecution, in the circumstances pleaded in paragraph 5(aa to ae) above.

12.    The purported Investigation, Communication and Outcome failed and/or omitted to identify, properly consider or properly investigate the facts, matters and circumstances pleaded in paragraph 5, 5A and 5B above and draw the conclusions pleaded in paragraph 8A above.

57    So it is said that Mr Shipton “caused or directed the Investigation, Communication and Outcome”, and that the same “failed and/or omitted to identify, properly consider or properly investigate the facts, matters and circumstances pleaded …”

58    Now there is no objective primary fact pleaded that Mr Shipton caused or directed anything other than that he received the 30 September 2019 complaint and, it may be inferred, passed it on to be followed up and actioned if necessary. The assertion that he directed the investigation and its outcome is pure speculation, let alone with a state of mind that is required to establish the tort of misfeasance in public office. None of that has been properly pleaded or particularised.

59    Then what follows in the Palmer SOC in the section headed “F. Misfeasance in Public Office” at [16] to [26] is a very elaborate edifice of allegations, which we have previously set out and won’t repeat, asserting that Mr Shipton caused or did things or failed to do things and acted in breach of various duties. But all of this has at its heart the flimsy set of factual allegations that we have just referred to.

60    But all of this is the pleader’s construct based upon speculative inferences compounded upon other speculative inferences and even goes so far as to say that “Mr Shipton knowingly acted in excess of his power” [19], that “Mr Shipton intended to cause Mr Palmer harm” [19A], that “the purported Investigation, Outcome and the Communication … were not an honest attempt to perform the functions of the public office held by Mr Shipton” [20], that “Mr Shipton’s malice towards Mr Palmer … can be inferred from his engaging in the acts and omissions …” [21], that “Mr Shipton’s malice towards Mr Palmer was the actuating motive for the acts and omissions …” [22], that “Mr Shipton acted unlawfully in that he had no power under the ASIC Act to engage in the Investigation, Outcome and the Communication” [23A], that “Mr Shipton had knowledge or acted with reckless indifference as to whether his conduct was unlawful” [23B] and that “Mr Shipton knew, or acted with reckless indifference to the fact, that the consequence of the circumstances pleaded at paragraphs 19 to 23B above would probably be the suffering of economic loss by Mr Palmer” [24].

61    It is convenient to make a number of points here.

62    First, as to this edifice, the only objective primary facts pleaded are that Mr Shipton received the 30 September 2019 complaint, passed it on to be actioned and it was actioned, manifesting in the 1 November 2019 communication.

63    Second, as to the pleas of knowledge, intention or malice, these all seem to be based on earlier assertions, which earlier assertions themselves lack any properly pleaded factual foundation.

64    Third, it is said that Mr Shipton acted unlawfully or without power concerning “the Investigation, Outcome and Communication”. Now it cannot seriously be said that Mr Shipton receiving the 30 September 2019 complaint, passing it on to be actioned, its actioning and the 1 November 2019 communication were unlawful acts or acts without power in and of themselves. So it seems to be said that what was unlawful or without power was the carrying out of a deficient investigation. That is a problematic conclusion. But in any event, no objective primary fact is pleaded demonstrating that Mr Shipton intended or knew this to be so or was recklessly indifferent as to this.

65    Fourth, various duties and responsibilities of Mr Shipton are pleaded including at [18E] being “ultimately responsible for the duties of the Accountable Authority contained” in the Public Governance, Performance and Accountability Act 2013 (Cth); see ss 15, 16 and 17; and as to officials, see ss 25 to 27. But to establish such duties and responsibilities does not take the matter far in terms of the tort. One needs to plead conduct of Mr Shipton which conduct may include a direction to another employee or officer.

66    Fifth, the Palmer SOC refers to s 126C of the ASIC Act and “the ASIC Values”. As a consequence of questioning from a member of the Court, after the hearing we were provided with a one page document headed “ASIC’s Values”, which set out a few vague dot points under the headings of “Accountability”, “Professionalism” and “Teamwork”. It did not take the matter anywhere; we were told that this was the subject of a determination under s 126C(1), but it is not entirely clear to us as to when and by whom precisely.

67    So, in summary, the SOC constructs a very elaborate pleading edifice around the 30 September 2019 complaint, the 1 November 2019 communication and very little else concerning Mr Shipton’s conduct or his actual knowledge. It is not an unfair description to say that there is an inverse relationship between the length, elaborateness and wordiness of the SOC on the one hand, and the detail of the direct conduct and knowledge of Mr Shipton as identified in the SOC on the other hand.

68    Having set out the sought to be pleaded allegations, it is appropriate to turn to the grounds of appeal. It is convenient here to group grounds 1 and 2 together. Further, we will address ground 5 before we address ground 4.

The pleading of Mr Shipton’s conduct (grounds 1 and 2)

69    The Palmer parties say that the primary judge erred in holding that the SOCs do not plead any specific conduct of Mr Shipton that is capable of constituting the tort of misfeasance in public office.

70    His Honour’s reasoning was twofold (at [35]). First, he said that “…the applicants are not in a position to plead what particular role the respondent actually played … the applicants seek to impugn the respondent’s “conduct”, largely by reference to his role as chairperson of ASIC”. Second, he said that “[t]o the extent the respondent’s conduct is specifically identified by the applicants, the applicants’ claim still seeks to attribute acts and knowledge of various ASIC officers in order to impugn the respondent’s conduct.”

71    As to the first observation of his Honour, the Palmer parties say that his conclusion is not supported by a fair reading of the SOCs. They say that it has been pleaded that an exercise of power by Mr Shipton caused or directed an outcome that no further action was to be taken in relation to the 30 September 2019 complaint. They say that the matters which are specifically alleged against Mr Shipton, rather than to other actors, and not merely by reference to his role as chairman, have been properly pleaded.

72    As to the second observation of his Honour, they say that his Honour’s finding misconceives the SOCs and the issues raised below. They say that their case was never put on the basis of the attribution of acts or knowledge of others, but rather depended on the acts and knowledge of Mr Shipton himself. They say that the question of attribution of knowledge did not fall for determination on the SOCs. They say that the question of attribution was not apt to arise as an issue unless Mr Shipton, by pleading or evidence, asserted that he had no knowledge of the 30 September 2019 complaint or the 1 November 2019 communication, despite the tenor of those documents.

73    Further, they say that the matters that they allege are not denied by Mr Shipton, and comprise facts peculiarly within his knowledge. They say that where the facts are peculiarly within Mr Shipton’s knowledge, a cause of action should not be dismissed because of gaps in an applicant’s case if the evidence might be obtained as a result of discovery or other processes. In that context they referred to Classic Gourmet Sausages Pty Ltd v Leda Commercial Properties Pty Ltd (2000) 97 FCR 313 at [39] per Gallop J and Eggerth v EPI International Pty. Ltd [2017] FCA 1547 at [4] and [5] per Derrington J. But those cases are readily distinguishable considering the facts and causes of action involved. None dealt with the tort in question or dealt with a pleading that was as manifestly deficient as those we are dealing with.

74    More generally, they say that discovery and other interlocutory processes have an important role in illuminating pleas such as they have made and that the fact that the evidence will develop following discovery and other interlocutory processes is a matter of importance.

75    Further, the Palmer parties say that the primary judge erred in holding (at [42]) that the terms “cause”, “supervise” and “direct” and their conjunctive “and/or” form in which they were pleaded did not result in the identification of what Mr Shipton himself had actually done.

76    They accept that the primary judge correctly observed (at [45]) that “[Obeid v Lockley (2018) 98 NSWLR 258] provides that directing or causing someone to do something can constitute an exercise of public power generally.”

77    His Honour went on at [45] and [46] to distinguish Obeid, because in Obeid, the “causing or directing” was specifically pleaded as an instruction, whereas the SOCs do not plead “how the respondent is said to have “caused and/or directed” the Investigation, the Communication, or the Outcome.”

78    But the Palmer parties say that they did plead, with sufficient particularity, facts resulting in the identification of what Mr Shipton himself actually did.

79    Generally, the Palmer parties contend that the primary judge erred in holding (at [42] to [46] and [48]) that it was insufficient for the tort of misfeasance in public office for the Palmer parties to allege that Mr Shipton had “caused” and/or “supervised” and/or “directed” the conduct of others, and that the Palmer parties had not pleaded sufficient material facts for such conduct in the SOCs.

Analysis

80    A claim for the tort of misfeasance in public office involves serious allegations concerning both conduct and state of mind that must be pleaded clearly and with specificity. We agree with the point put by Mr Shipton that the need for specificity demands a clear articulation of what precisely Mr Shipton is said to have done.

81    In Federal Commissioner of Taxation v Futuris Corporation Limited (2008) 237 CLR 146 it was said by Gummow, Hayne, Heydon and Crennan JJ at [60] albeit in a different context that:

Allegations that statutory powers have been exercised corruptly or with deliberate disregard to the scope of those powers are not lightly to be made or upheld.

82    Further, in Lock v Australian Securities and Investments Commission (2016) 248 FCR 547 Gleeson J said (at [124] and [126]):

Allegations that statutory powers have been exercised corruptly or with deliberate disregard to the scope of those powers are not lightly to be made or upheld: Federal Commissioner of Taxation v Futuris Corporation Ltd (2008) 237 CLR 146 at [60].

…

As for fraud or dishonesty, the tort of misfeasance in public office must be distinctly alleged and sufficiently particularised, and it is not sufficiently particularised if the facts pleaded are consistent with innocence or honest incompetence: Three Rivers District Council v Bank of England (No 3) [2003] 2 AC 1 (Three Rivers) at 291-292 (Lord Millett); Danthanarayana v Commonwealth [2014] FCA 552 at [97] (Foster J); Streeter v Western Areas Exploration Pty Ltd (No 2) (2011) 278 ALR 291 at [605]. It is not sufficient to allege unlawful conduct: it is necessary to plead the primary facts that will be relied upon to justify any inference of unlawfulness: Three Rivers at 292; NRMA Insurance Ltd v Flanagan [1982] 1 NSWLR 585 at 603.

83    The tort of misfeasance in public office is a tort of personal liability. It cannot be established by aggregating the acts and knowledge of various officers; see Grass v Slattery (2018) 162 ALD 276 at [155] per Bromwich J; Farah Custodians Pty Ltd v Commissioner of Taxation [2018] FCA 1185 at [108] per Wigney J. And nor can it “be built upon a foundation that is a composite of the conduct of a number of individual officers”; see Moder v Commonwealth of Australia (2012) 261 FLR 396 at [73] per Margaret Wilson AJA, Muir and Fraser JJA agreeing; MJL v State of Western Australia [2015] WASC 348 at [87] per Allanson J.

84    Clearly it would seem from the description of the alleged conduct, and from the SOCs themselves, that the Palmer parties are unable to plead what role Mr Shipton himself played in any of the conduct that they allege, other than that he received the 30 September 2019 complaint and caused it to be acted on by someone else within ASIC, which ultimately resulted in the 1 November 2019 communication.

85    We are not in doubt that the factual foundation pleaded falls far short of what is required to support the scaffold of inferences propping up the Palmer parties’ cases.

86    In our view it was well open to the primary judge to conclude that the Palmer parties’ claims fell at the first hurdle, for failing to adequately identify the relevant acts or omissions by Mr Shipton that were said to sustain the allegation of the tort of misfeasance against him. This is also reflected in the sprawling pleading that Mr Shipton was involved in causing and/or supervising and/or directing others to act.

87    Now clearly the Palmer parties had hoped to discern a viable case for misfeasance against Mr Shipton, through discovery or other interlocutory processes. But we agree with Mr Shipton that a pleading of misfeasance that is embarrassing or does not disclose a cause of action cannot be maintained by an aspiration that discovery might assist the Palmer parties to confirm whether they have a case. That is nothing more than an impermissible fishing exercise. And it does not matter that there are facts in the present case which might be within the peculiar knowledge of Mr Shipton.

88    Further, in our view there was no error in the primary judge’s approach concerning the question of Mr Shipton causing, supervising or directing others to perform actions.

89    Now we accept that Obeid does provide some authority for the proposition that a public officer can commit the tort of misfeasance by causing or directing another to act beyond power (at [194] per Bathurst CJ). But the scenario dealt with in that case is not our context.

90    In Obeid, a claim for the tort of misfeasance in public office was brought against two employees of ICAC who had participated in the execution of a search warrant, and in particular by impermissibly causing the contents of certain documents at the relevant premises to be recorded on video. Those employees had directed a third person to do the recording.

91    It was in that context that Bathurst CJ said (at [194] and [195]):

Both Mr Lockley and Mr Grainger contended that causing Mr Curd to record the contents of the documents on video was not an exercise of public power. This argument has no merit to the extent that it is based on the proposition that directing Mr Curd to record the material on video, as distinct from doing it themselves, meant there was no exercise of public power. If, as I have concluded at [118] above, the respondents were public officers, then the fact that they exercised a power by directing or causing someone else to exercise the power, particularly when it is clear that they could have exercised the power themselves, does not mean that they did not exercise the power.

In addition, Mr Grainger contended that no express request was made to Mr Curd to record the whole of the contents of the Heads of Agreement on video. In relation to the Solicitor General’s Advice, the transcript of the Video Recording makes it clear that there was an express direction to record the whole of the contents of the document. So far as the Heads of Agreement were concerned, the position is not quite as clear. The transcript of the Video Recording shows that Mr Grainger stated Video in response to Mr Lockley’s question “What do you want to do with that?”, and that Mr Lockley then said “Video that front page, these pages”. However, whatever the precise terms of what was said, Mr Curd apparently took these comments as a direction to record the whole of the contents of the Heads of Agreement on video and neither of the respondents suggested that he should not do so. In the relevant sense, both Mr Lockley and Mr Grainger caused Mr Curd to record the contents of the documents. This ground of the amended notices of contention has not been made out.

92    But contrastingly, in the context before us the SOCs did not contain material facts identifying precisely what Mr Shipton was said to have “caused”, “supervised” or “directed”, when or how he did so, or through whom.

93    Instead, the pleadings use these verb forms in an ambulatory and aggregate “and/or” form, unsupported by any particularisation. That mode of pleading left it uncertain whether the allegation was of personal participation or responsibility for others or even more generally mere oversight arising from Mr Shipton’s position as the then chairman of ASIC.

94    As the primary judge correctly held, such a pleading is evasive and ambiguous and so falls foul of r 16.02(2)(c) and fails to give fair notice of the case to be met as is required under r 16.02(1)(d).

95    In summary, appeal grounds 1 and 2 are not made out.

State of mind pleas (ground 3)

96    The Palmer parties say that the primary judge erred in holding (at [56]) that they failed to plead material facts establishing that Mr Shipton held the requisite state of mind to found the tort of misfeasance in public office. The primary judge’s reasoning at [56] is three-fold.

97    First, his Honour observed that “the allegation as to mental state is supported only by inferences, drawn in turn from further inferences (including as to ASIC’s knowledge rather than any personal knowledge of [Mr Shipton]), assertions and speculation”.

98    Second, his Honour observed that the “facts as pleaded … do not support an allegation of dishonesty.”

99    Third, his Honour said that the “inferences upon which the applicants rely to support an allegation of dishonesty are based on a generalised allegation of wrongdoing untethered from any pleaded act, omission or conduct of the respondent and are not particularised in any way which would allow the applicant to prove [the tort]”.

100    As to the first observation, the Palmer parties say that the primary judge’s finding to the effect that the requisite mental state cannot be inferred is wrong in law. They say that proof of knowledge will often be a matter of inference. They say that they have pleaded with particularity the factual bases on which the mental elements can be inferred.

101    The Palmer parties referred to A v New South Wales (2007) 230 CLR 500 at [93] albeit a case concerning the tort of malicious prosecution. We would note here that the plurality at [93] said that as to the proof of malice “its proof will often be a matter of inference. But it is proof that is required, not conjecture or suspicion”.

102    As to the second observation by the primary judge, the Palmer parties say that his Honour’s conclusion is wrong in law. They say that the test is not confined to dishonesty. And they say that it appears that the primary judge adopted the observations in Plaintiff M83A/2019 v Morrison (No 2) [2020] FCA 1198 at [115] of Mortimer J (as her Honour then was) that misfeasance will not be established where there is an alternate hypothesis consistent with an honest exercise of power. But they say that reliance on this passage is inapposite.

103    They say that a majority of the House of Lords in Three Rivers District Council v Governor and Company of the Bank of England (No 3) [2003] 2 AC 1 held that pleadings of misfeasance in public office will survive a strike out application if fraud, dishonesty or bad faith is pleaded with sufficient particularity, even if the facts support an innocent explanation. They point out that as Lord Hope observed at [55] and [56] the pleadings stage is concerned with “what must be alleged” and “[t]he question whether the evidence points to negligence rather than to misfeasance in public office is a matter which must be judged in this case not on the pleadings but on the evidence”. And they say that at [122] Lord Hutton observed, by reference to the reasoning of Thesiger LJ in Davy v Garrett (1878) 7 ChD 473 at 489 and the reasoning of Buckley LJ in Belmont Finance Corporation Ltd v Williams Furniture Ltd [1979] 1 Ch 250 at 268, that an explanation consistent with innocence is only fatal to a pleading if fraud, dishonesty or bad faith has not been pleaded with sufficient clarity.

104    Contrastingly, the Palmer parties contend that the principles expressed by Lord Millett in Three Rivers (and picked up by Mortimer J in Plaintiff M83A/2019 at [115]) do not reflect the Australian position. They say that malice or another state of mind can be inferred from facts that are consistent with honest motivation. They say that Lord Millett’s proposition is analogous with the criminal burden placed on the Crown, which must exclude all reasonable hypotheses consistent with innocence in cases based on circumstantial evidence. But they say that such reasoning does not have a place in civil litigation, even where the allegations are serious, because it disturbs the onus of proof that the law dictates. And they say that in any event if such a rule exists within the confines of the tort, it should only have application following a hearing and evidence, and an evaluative process about which inference should be drawn on the evidence. They say that to import such a requirement at the pleadings stage limits a party’s capacity to sue on the tort.

105    Generally, the Palmer parties say that they have sufficiently pleaded the requisite state of mind to make out the tort. Further, they say that dishonesty is sufficiently pleaded as referenced in the SOCs. They say that the question of dishonesty is one which should be tested at trial, and after the Court has heard and considered the evidence. They say that intention to cause the plaintiff harm was pleaded. Further, they say that knowledge that conduct was beyond power and would probably cause harm was pleaded. Further, they say that subjective recklessness was pleaded.

106    Further, the Palmer parties say that they have pleaded with particularity the factual bases on which it may be inferred that Mr Shipton had actual knowledge. And they pray in aid what was observed in Plaintiff M83A/2019 by Mortimer J at [115] that “there is no difficulty in framing a case in misfeasance by reference to inferences, provided a sufficient factual basis for the inferences is pleaded”.

107    As to the third observation by the primary judge (at [56]), the Palmer parties say that it is erroneous to characterise Mr Shipton’s role as “untethered” and a “generalised allegation of wrongdoing” for the reasons advanced by them in relation to their appeal grounds one and two.

Analysis

108    It is not in doubt that misfeasance is an intentional tort and that a knowing abuse of public power is the gravamen of the cause of action; see Northern Territory of Australia v Mengel (1995) 185 CLR 307 at 345; see further Sanders v Snell (1998) 196 CLR 329 at [42].

109    A plaintiff must plead material facts which are capable of demonstrating either that the defendant intended to cause the plaintiff harm or that the defendant knew that his conduct was beyond power and would probably cause harm or was subjectively reckless as to such invalidity and likely injury.

110    As to this latter way of establishing the mental element, there seems to be a debate about whether it extends to showing only a foreseeable risk of harm arising from the knowing excess of power or whether knowledge or reckless indifference of the likelihood of harm must be shown. We prefer the latter position on the current state of the authorities, but for present purposes we do not need to resolve that debate.

111    We would note that notwithstanding what was said in Mengel in the joint reasons (at 347), in Sanders v Snell it was said by the majority (at [38]):

For present purposes it may be accepted that the tort of misfeasance in public office extends to acts by public officers that are beyond power, including acts that are invalid for want of procedural fairness. But to establish that tort, it is not enough to show the knowing commission of an act beyond power and resulting damage. As the majority said in Mengel:

“The cases do not establish that misfeasance in public office is constituted simply by an act of a public officer which he or she knows is beyond power and which results in damage. Nor is that required by policy or by principle. Policy and principle both suggest that liability should be more closely confined. So far as policy is concerned, it is to be borne in mind that, although the tort is the tort of a public officer, he or she is liable personally and, unless there is de facto authority, there will ordinarily only be personal liability. And principle suggests that misfeasance in public office is a counterpart to, and should be confined in the same way as, those torts which impose liability on private individuals for the intentional infliction of harm. For present purposes, we include in that concept acts which are calculated in the ordinary course to cause harm, as in Wilkinson v Downton, or which are done with reckless indifference to the harm that is likely to ensue, as is the case where a person, having recklessly ignored the means of ascertaining the existence of a contract, acts in a way that procures its breach.”

For the purposes of deciding Mengel, the majority considered it sufficient to proceed on the basis that the tort requires an act which the public official knows is beyond power and which involves a foreseeable risk of harm but noted also that there seems much to be said for the view that misfeasance extends to the situation of a public official recklessly disregarding the means of ascertaining the extent of his or her power.

112    And as Bathurst CJ said at [156] in Obeid (with Leeming JA making similar observations at [229] to [240]):

The judgment of the majority in Sanders v Snell did not say that Mengel had decided that reasonable foreseeability of a risk of harm was sufficient for the tort of misfeasance in public office. The majority at [38] set out the passage from Mengel which I have cited at [123] above, and then commented that, for the purpose of deciding Mengel, the majority had been prepared to consider it sufficient to proceed on the basis that the tort requires an act which the public official knows is beyond power and which involves a foreseeable risk of harm, but the majority in Sanders v Snell noted that the majority in Mengel also said that there was much to be said for the view that misfeasance extends to the situation of a public official recklessly disregarding the means of ascertaining the extent of his or her power. The High Court in Sanders v Snell also acknowledged at [42] that the precise limits of the tort of misfeasance in public office remained undefined.

113    But whichever element is pleaded, there must be specific facts pleaded to support it. In our view, the Palmer parties did not adequately plead those facts.

114    Further, contrary to what the Palmer parties have asserted, the primary judge did not hold that the mental state could never be inferred. Indeed, in most cases it will likely be inferred from primary facts. But an inference of malice or knowledge can only be drawn where there is a sufficient factual basis pleaded to support it.

115    In the present case, the pleadings contained assertions that Mr Shipton “must have known” or “was recklessly indifferent”, which were conclusory and circular. The Palmer parties have sought to infer the requisite state of mind solely from the fact that the alleged conduct, which again has not been pleaded with specificity, was said to be unlawful.

116    Further, the primary judge’s remarks were not importing some additional need to plead dishonesty as an element of the tort. Rather, the point was that an inference of malice or other state of mind cannot be inferred from facts that are consistent with honest motivations. We agree with Mr Shipton that there is nothing particularly controversial in that reasoning.

117    The primary judge’s reference to that reasoning was another way of expressing his Honour’s ultimate conclusion that neither the facts pleaded, nor the inferences said to be drawn from those facts, were capable of supporting a case for misfeasance.

118    Further, the Palmer parties appear to suggest that the primary judge was wrong to follow the reasoning of Mortimer J in Plaintiff M83A/2019 (at [115]) where she said:

Finally, in terms of flaws in the applicants’ case on the critical state of mind element in misfeasance, the authorities are clear that misfeasance will not be established where there is an alternate hypothesis consistent with an honest exercise of power. As the extract at [57] above indicates, and as might be expected for a tort dependent on establishing a deliberate state of mind in a respondent, there is no difficulty in framing a case in misfeasance by reference to inferences, provided a sufficient factual basis for the inferences is pleaded. While in Three Rivers Lord Millett described what is necessary for the tort to be proved at trial, he also made the point that the pleading must identify the primary facts to be proved. This basic level of symmetry between pleading and proof is fundamental. Without it, there is nothing but baseless speculation.

119    The Palmer parties say that Lord Millett’s approach is not the correct approach as a matter of pleading, as distinct from what must be shown on the evidence at trial.

120    Now it is not in dispute that in terms of the evidence led at trial that is said to provide a foundation for an inference as to the state of mind required to establish the tort, if there are equally open alternative inferences as to state of mind, viz, one consistent with establishing the tort and one not, alternatively if the latter inference is more likely than the former inference, then the tort will not be established. And as to the anterior question of whether there is a properly pleaded case, in our view not only do the necessary foundational facts need to be pleaded with precision from which the necessary inference as to state of mind is sought to be drawn, but such facts must reasonably arguably support the drawing of the inference required to establish the state of mind required for the tort; see also r 16.43.

121    As to the passage that we have set out from Mortimer J’s decision, in terms of what Lord Millett said concerning pleading the tort, which appeared to go beyond what Lord Hope and Lord Hutton said on the pleading aspect, what Mortimer J referred to (at [115]) in terms of what Lord Millett had said was only that “the pleading must identify the primary facts to be proved”. And earlier in [115] she had said that “a sufficient factual basis for the inferences” needed to be pleaded. We agree with those observations. But even if, in citing Lord Millett, Mortimer J went too far (see also in this context [57] of her reasons), none of this avails the Palmer parties. Their pleading of state of mind is substantially untethered and lacks a proper factual foundation in any event.

122    Further, in our view the primary judge did not err in his concluding statements at [56] as to the issues with the Palmer parties’ pleadings of state of mind being based on inferences drawn from further inferences. And we agree with Mr Shipton that the SOCs proceeded on a flimsy foundation of inferences.

123    Finally, Mortimer J observed in Plaintiff M83A/2019 (at [125]) that plaintiffs alleging misfeasance will often face an information asymmetry where they cannot plead facts that they do not know, referring to Webster (Trustee) v Murray Goulburn Co-Operative Co Limited (No 2) [2017] FCA 1260.

124    In Webster, Beach J said (at [6]):

Of more specific relevance to the present context, leave to replead a cause of action ought not to be given if there is an absence of proper particulars to support any necessary plea of a condition of mind such as knowledge or belief. Moreover, if it is necessary to plead that a party ought to have known some matter, then particulars of the facts and circumstances from which it is said that party ought to have known that matter must be given. Of course, particularising the knowledge of another person has its difficulties. One does not know what is in the mind of that other person. But there may be an admission or communication that establishes or manifests such a state of mind. Further, such knowledge may also be able to be inferred from other facts and circumstances. In that scenario, particulars identifying the inferences and the facts and circumstances from which such inferences arise may be sufficient, providing that the inferences are reasonably arguable. Now such particulars may shade into evidence that is not usually required to be pleaded or particularised. But the fact that particulars of that type may have that duality is no excuse for not providing them where knowledge is sought to be established inferentially. I would make one other point. Given information asymmetry as between the parties concerning the state of mind of one of them, where the pleadings are at an early stage and before discovery, so long as some particulars of knowledge are given so as to demonstrate that the plea of knowledge is not wholly speculative, it may be appropriate to allow a plea of knowledge to go forward on the basis that full particulars of knowledge will be provided after discovery, reserving to the other party the right to seek a strike out or summary dismissal of the pleaded cause of action relying upon that knowledge at that later stage if that turns out not to be the case.

125    But Webster had distinguishing features in relation to the nature of the causes of action alleged, as Mortimer J recognised when she said (at [126]):

The difficulty in applying such an argument to the FASOC as it stands lies in the seriousness of an allegation of misfeasance in public office, and in the elements which must be proven (and therefore alleged) to establish the tort. As I have attempted to explain, the absence of any information capable of providing a probative basis for alleging the requisite state(s) of mind for misfeasance in each of the individual respondents is a flaw which cannot be answered by the aspirational contention that something may emerge during discovery.

126    So, whilst any information asymmetry might excuse gaps in a statement of claim for a different cause of action such as negligence, it cannot excuse gaps in pleadings in cases for misfeasance in public office, because of the serious nature of the allegations involved.

127    The third ground of appeal does not disclose any material error. It is convenient at this point to now deal with ground 5 before returning to ground 4.

The refusal of leave to replead (ground 5)

128    The Palmer parties say that the primary judge also erred in refusing leave to replead. They say that in so refusing leave, the primary judge failed to consider and determine two material matters.

129    First, they say that the refusal of leave to replead effectively amounted to the grant of a permanent stay of the proceedings.

130    Second, they say that in determining the issue of leave to replead, the primary judge ought to have considered and determined the significance of Mr Shipton’s failure to file an affidavit in support of his summary dismissal application. They say that by such an affidavit, Mr Shipton could have deposed to various matters, including denying the factual matters put against him and addressing matters peculiarly within his knowledge. They say that this failure is significant.

131    Further, they say that in the present context, the question must be approached on the basis of the assumed truth of the pleaded facts. The Palmer parties say that there is a clear factual case to be answered at trial. They say that the Court cannot conclude otherwise, in the light of Mr Shipton’s failure to deny the allegations put against him. They say that the evidence will develop following discovery and other interlocutory processes and that this warrants particular caution in considering whether there should be summary determination. They say that these matters weigh heavily against summary dismissal at this early stage of the litigation.

132    The Palmer parties say that their rights have been permanently sterilised.

133    And they say that leave to replead ought only to have been refused if continuation of the proceedings was irreconcilable with the administration of justice. They say that such a conclusion could not have been reached in the circumstances of this case.

Analysis

134    We accept that in most cases concerning an application to strike out the pleadings, the appropriate course is usually to grant leave to replead. But this was not the usual case, and particularly given the nature of the allegations.

135    The Palmer parties had had brought to their attention the fundamental flaws in their pleadings since at least 16 August 2024 and had since made two attempts to replead their causes of action. But such issues remained. Moreover, this was not for lack of opportunity or resources. Clearly, the Palmer parties were not in a position to properly plead out the tort of misfeasance in public office against Mr Shipton.

136    In those circumstances, the primary judge was correct to consider that this was a clear case where there would be no utility in granting the Palmer parties a further and fourth opportunity to replead. There was no error in that conclusion.

137    Now the Palmer parties say that the primary judge’s refusal to grant leave to replead amounted to a permanent stay of the proceedings, such that leave could only be refused if that course would be irreconcilable within the administration of justice. They prayed in aid the reasoning in GLJ.

138    But the analogy to a permanent stay is inapposite. And in any event, the administration of justice did not require that the Palmer parties be given a fourth opportunity to attempt to articulate a viable cause of action.

139    Further, the Palmer parties say that the primary judge should nevertheless have permitted a further amendment because Mr Shipton had not filed an affidavit denying the pleaded facts. But we agree with Mr Shipton that there is no basis to say that it was somehow incumbent upon Mr Shipton to put on evidence, actively dispelling the possibility of a case of misfeasance in public office against him, in order to seek to strike out the pleadings that were manifestly embarrassing and did not disclose a cause of action or as the price to oppose the grant of any further leave to replead.

140    Unremarkably, an application to strike out the pleadings is considered on the basis of the pleadings. It is for the Palmer parties to adequately plead their case.

141    The discretion to refuse leave to replead was exercised after three failed attempts to articulate a viable cause of action, and after a finding that the defects were fundamental and incapable of cure. The result was orthodox. No error is disclosed by the fifth ground of appeal.

142    Finally we should return to and say something about ground 4.

The supporting affidavit under r 26.01(2) (ground 4)

143    The Palmer parties say that there are two separate affidavit issues. One issue is what is said to be the formal failure to comply with r 26.01(2) of the Rules. The other issue stresses the significance of Mr Shipton’s failure to deny the matters put against him for the purposes of the summary judgment application, particularly given the important matters peculiarly within Mr Shipton’s knowledge.

144    The Palmer parties contend that the primary judge erred in granting summary dismissal of the proceedings in circumstances where it was said that the supporting affidavit did not comply with r 26.01(2), being the affidavit of Ms Kimberley MacKay sworn on 16 October 2024.

145    They say that the supporting affidavit failed to address the criteria as to grounds, facts and circumstances set out in r 26.01(2). And they made reference to what was said in Australian Steel Co (Operations) Pty Ltd v Steel Foundations Ltd (2003) 58 IPR 69 by Kenny J at [34] to [40] and the cases she there cited, although we would note here that Kenny J was considering the then Order 20 r 1(1)(a), which differed from the present form of r 26.01(2).

146    The Palmer parties say that at no stage did Mr Shipton ever contend that the MacKay affidavit was compliant with the Rules, or seek that compliance with the Rules be dispensed with.

147    Now Mr Shipton contends that summary judgment was sought only as ancillary or consequential relief under r 26.01 if, once the impugned paragraphs were struck out, no cause of action remained. But the Palmer parties say that summary judgment is a creature of the Rules, which do not contemplate ancillary or consequential summary judgment applications requiring a less exacting standard of proof.

148    The Palmer parties say that the question of the adequacy of a pleading, which is dealt with by a strike out application, and a summary dismissal application require different and independent considerations. They say that a strike out application focuses on whether the pleadings are properly formulated, whereas a summary judgment application usually involves limited consideration of the relative strength or merits of the parties’ cases. Moreover, a summary judgment application involves consideration of the evidentiary foundation, whereas a strike out application does not. They say that this is the reason why the terms of r 26.01(2) are prescriptive, and why an application for summary judgment must be supported by affidavit.

149    They say that there were important matters before the primary judge which were relevant only to the summary judgment application, which the primary judge failed to consider. First, they say that there were matters peculiarly within Mr Shipton’s knowledge. Second, they say that Mr Shipton’s failure to deny the matters put against him by way of affidavit is significant. Third, they say that there was a clear factual investigation to be undertaken by way of discovery and other interlocutory processes. Fourth, they say that there was a real issue of fact to be tried.

150    More generally, they say that all of these circumstances were compounded by the fact that the primary judge was invited to fortify the outcome of summary dismissal by hypotheses that were unproven.

151    Generally, the Palmer parties say that they were prejudiced by the non-compliant affidavit, and that the primary judge wrongly made orders for summary judgment in the absence of the necessary evidentiary foundation.

152    Further, the Palmer parties raise another point concerning summary dismissal. They say that it is wrong for Mr Shipton to assert that it does not matter that there are facts which might be peculiarly within his knowledge. They say that the primary judge was required to consider additional matters in determining whether to grant summary dismissal. In this regard, the Palmer parties refer to the following observations of Handley and Cripps JJA in Wickstead v Browne (1992) 30 NSWLR 1 at 11 concerning applications for summary dismissal:

By launching such an application a defendant undertakes the burden of establishing that there is no triable issue. On such an application the defendant bears the onus of proof and where the facts are peculiarly within the defendant’s knowledge the plaintiff’s action should not be dismissed because of gaps in the case if the necessary evidence might be obtained as a result of discovery or interrogatories.

153    But again, in our view such observations must be read in their context and do not assist the Palmer parties. Wickstead, which involved a claim in negligence brought by four quadriplegics, is readily distinguishable.

Analysis

154    The principal application made by Mr Shipton was a strike out application seeking to invoke r 16.21(1)(c), (d) and (e). Summary judgment was sought only as ancillary or consequential relief under r 26.01 if, once the impugned paragraphs were struck out, no cause of action remained with no leave to replead being granted.

155    That was how the interlocutory applications were formulated, and how Mr Shipton put his case in written and oral submissions. The primary judge clearly treated the application in that fashion.

156    Further, even if r 26.01(2) did apply, there was no substantial error made by the primary judge. The affidavit accompanying the strike out application identified the grounds and pointed to the pleadings as the factual matrix. That satisfied the rule’s purpose, which was to notify the opposing party of the basis for the order sought.

157    Further, the Palmer parties suffered no real prejudice from the absence of an affidavit directly couched in the language of r 26.01(2). The Palmer parties had been on notice since at least 16 August 2024 of the strike out case and its factual foundation in their own pleadings. They filed extensive submissions addressing it. On any view, they were fully apprised of the grounds of the application and the facts and circumstances relied on to support those grounds. As to the MacKay affidavit, it did not recite the usual formulations, but the correspondence annexed to the affidavit made it abundantly clear as to the vices in the pleaded claims and that in the absence of rectification, dismissal of both proceedings would be sought. The deficiencies justifying dismissal arose solely from the Palmer parties’ pleadings.

158    But even if some defect were assumed, it would be immaterial. The summary dismissal followed as a matter of inevitability once the strike-out orders were made and leave to replead was refused. The Palmer parties do not identify any different forensic course that they would or could have taken had a further affidavit been filed.

159    Further, any technical non-compliance did not deprive the Court of power to make the order for summary judgment in this case. Whilst the ordinary practice is to insist on a compliant affidavit for summary judgment, any explicit (or in the present case perhaps implicit) dispensation with any technical requirement either wholly or partly is permissible; see for example Vrkic as liquidator of V Health Plus Corporation Pty. Ltd. (in liquidation) v Singh [2020] FCA 385 at [78] and [79] per Gleeson J and Fazeldean on behalf of the Thalanyji People (No 2) v Western Australia [2012] FCA 1163 at [12] and [13] per Barker J.

160    Finally, we accept that a power to summarily terminate proceedings “must always be attended with caution”. As was said by French CJ and Gummow J in Spencer v Commonwealth of Australia (2010) 241 CLR 118 at [24], albeit a case concerning s 31A of the FCA Act:

The exercise of powers to summarily terminate proceedings must always be attended with caution. That is so whether such disposition is sought on the basis that the pleadings fail to disclose a reasonable cause of action or on the basis that the action is frivolous or vexatious or an abuse of process. The same applies where such a disposition is sought in a summary judgment application supported by evidence. As to the latter, this Court in Fancourt v Mercantile Credits Ltd said:

“The power to order summary or final judgment is one that should be exercised with great care and should never be exercised unless it is clear that there is no real question to be tried.”

More recently, in Batistatos v Roads and Traffic Authority (NSW) Gleeson CJ, Gummow, Hayne and Crennan JJ repeated a statement by Gaudron, McHugh, Gummow and Hayne JJ in Agar v Hyde which included the following:

“Ordinarily, a party is not to be denied the opportunity to place his or her case before the court in the ordinary way, and after taking advantage of the usual interlocutory processes. The test to be applied has been expressed in various ways, but all of the verbal formulae which have been used are intended to describe a high degree of certainty about the ultimate outcome of the proceeding if it were allowed to go to trial in the ordinary way.”

There would seem to be little distinction between those approaches and the requirement of a “real” as distinct from “fanciful” prospect of success contemplated by s 31A. That proposition, however, is not inconsistent with the proposition that the criterion in s 31A may be satisfied upon grounds wider than those contained in pre-existing Rules of Court authorising summary dispositions.

161    Of course we are not dealing with s 31A and so their last observation may be put to one side for present purposes. But there is little doubt that his Honour in the case before him exercised or displayed the necessary caution.

162    Finally, we accept that caution should be exercised in summarily disposing of a proceeding which raises a debatable question of legal principle concerning the tort of misfeasance in public office or one of its elements. But we are not dealing with the type of legal debate as to the scope of the concept of public power or its exercise as was discussed in EA v Diaconu (2020) 102 NSWLR 351 at [56] and [57] per Payne JA, at [73], [74] and [127] to [129] per White JA, and [147] and [163] per Simpson AJA.

163    In summary, we reject appeal ground 4.

Conclusion

164    For the foregoing reasons, in each case we will grant leave to appeal but dismiss each appeal.

165    There is no good reason why the Palmer parties should not pay Mr Shipton’s costs of and incidental to the applications for leave to appeal and the appeals.

Associate:

Dated:    8 July 2026

REASONS FOR JUDGMENT

MCDONALD J:

166    I have read the judgment of Beach and Abraham JJ. I agree that, in each case, leave to appeal should be granted and the appeals by Mr Palmer and PLC should be dismissed with costs. Subject to a reservation in relation to one question, I also agree generally with the reasons given by Beach and Abraham JJ for those conclusions.

167    The reservation relates to the standard of appellate review that is relevant to the various issues raised by the grounds of appeal advanced by Mr Palmer and PLC. Mr Palmer and PLC contended that each of the questions raised by their five grounds of appeal admits of only one correct answer, so that the “correctness” standard of appellate review is applicable. That is, Mr Palmer and PLC submit that their appeals should be allowed if the Full Court would reach a different conclusion from the primary judge on any of those questions, and that it is not necessary for them to demonstrate error of the kind associated with House v The King (1936) 55 CLR 499 (House v The King).

168    The distinction between issues that attract the “correctness” standard of appellate review and those to which the principles in House v The King apply has been discussed by the High Court in Minister for Immigration and Border Protection v SZVFW (2018) 264 CLR 541; [2018] HCA 30 (SZVFW), GLJ v Trustees of the Roman Catholic Church for the Diocese of Lismore (2023) 280 CLR 442; [2023] HCA 32 (GLJ), and Moore (a pseudonym) v The King (2024) 282 CLR 460; [2024] HCA 30. As Gageler J said in SZVFW (at 563 [49]):

… The line is drawn by reference to whether the legal criterion applied or purportedly applied by the primary judge to reach the conclusion demands a unique outcome, in which case the correctness standard applies, or tolerates a range of outcomes, in which case the House v The King standard applies. The resultant line is not bright; but it is tolerably clear and workable.

169    Grounds 4 and 5 in each appeal challenge the outcome of an exercise of a true discretion by the primary judge – in the case of ground 4, the discretion to grant summary dismissal where that is otherwise appropriate, but where no affidavit fulfilling all the requirements in r 26.01(2) of the Federal Court Rules 2011 (Cth) has been filed; and in the case of ground 5, the discretion to grant or refuse leave to replead.

170    In DHI22 v Qatar Airways Group QCSC (No 1) (2025) 310 FCR 361; [2025] FCAFC 91 at 369 [25], the decision whether to grant leave to replead was held to involve an exercise of discretion, and the standard of appellate review associated with House v The King. Such a decision is no less discretionary because the effect of a decision not to allow an applicant to replead might be said to be, in some sense, practically equivalent to a stay of proceedings. This conclusion is not inconsistent with the decision in GLJ. The holding in GLJ was that the question of whether proceedings “are or are not capable of being the subject of a fair trial” or “are or are not so unfairly and unjustifiably oppressive as to constitute an abuse of process”, and so should be stayed, is one to which there can be only one correct answer. The High Court in GLJ did not hold that the “correctness” standard necessarily applies to appellate review of any decision that results in a permanent stay of proceedings; that depends on whether the question raised by the relevant ground of appeal is one that admits of only one correct answer or one that involves a challenge to an exercise of discretion.

171    To the extent that Mr Palmer and PLC advance, in connection with ground 4, a contention that the Court is legally required not to grant summary dismissal in the absence of an affidavit complying with r 26.01(2) of the Federal Court Rules, I would accept that that is a question which admits of only a single correct answer. But the correct answer to that question is that there is no such absolute prohibition. The affidavit contemplated by r 26.01(2) is facultative; it provides a convenient means of ensuring that the party facing summary dismissal is fairly on notice of the basis on which such an order might be made. The filing of such an affidavit is not a legal precondition to the exercise of the power to summarily dismiss a proceeding. The decision whether to require that there be an affidavit that complies with r 26.01(2), where the Court otherwise considers that it is appropriate to order that a proceeding be summarily dismissed, must be discretionary. In this case, the ground for summary dismissal and the relevant facts and circumstances were apparent; including, in particular, the circumstance that Mr Palmer and PLC had had several opportunities to attempt to plead their case against Mr Shipton in a manner that was unambiguous and gave adequate notice of the case to be met, but had been unable to do so. The basis for the application for summary dismissal in this case did not require Mr Shipton to file an affidavit negating factual assertions made in the statements of claim that were to be struck out or in the proposed further statements of claim. To require him to do so would have defeated the purpose of the application to strike out the pleadings, by effectively requiring Mr Shipton to answer, on oath, a case that had not been properly pleaded.

172    For the reasons given by Beach and Abraham JJ, the primary judge’s exercise of the discretion in respect of the questions raised by grounds 4 and 5 has not been shown to have miscarried.

173    The questions raised by each of grounds 1, 2 and 3 direct attention to the legal elements of the tort of misfeasance in public office, but also involve an evaluative judgement as to the level of specificity required in the pleading of particular conduct on the part of Mr Shipton which is alleged to constitute those elements, assessed in the context of the requirements of pleadings which are expressed in general terms in rr 16.01 and 16.02 of the Federal Court Rules.

174    Whether composite evaluative questions of that kind, arising in the context of an application to strike out a statement of claim or for leave to file an amended or substituted statement of claim, should be regarded as involving a true discretion or as questions that permit of only one correct answer is, in my view, a more difficult question. It is possible to find statements in High Court authorities which appear to support both views: cf, Favell v Queensland Newspapers Pty Ltd (2005) 79 ALJR 1716; [2005] HCA 52 at 1719 [6] (Gleeson CJ, McHugh, Gummow and Heydon JJ); Coe v Commonwealth (1979) 53 ALJR 403 at 407 (Gibbs J; Aickin J agreeing), 409, 411 (Jacobs J), 412 (Murphy J). It may be that, while the ultimate decisions of whether to strike out a pleading or to grant leave for the filing of a further pleading are discretionary, the anterior determination as to whether a pleading discloses a cause of action and otherwise complies with the Federal Court Rules, which informs the exercise of those discretions, should be reviewed according to the “correctness” standard.

175    It is unnecessary to finally decide this issue, and I would prefer not to decide it, in circumstances where I would hold, essentially for the reasons given by Beach and Abraham JJ, that not only was the decision of the primary judge open, his Honour was correct to reach the conclusions that he did.

Associate:

Dated:    8 July 2026