Federal Court of Australia

WIJOAV Services Pty Ltd v Goldstone Private Equity Pty Ltd, in the matter of Goldstone Private Equity Pty Ltd [2025] FCA 174

ORDERS

THE COURT ORDERS THAT:

1.    The interlocutory application dated 6 March 2025 be returnable instanter.

2.    Leave be granted to the plaintiffs to amend the originating process such that the name of the second plaintiff be changed to “Alexandra Victoria Commins”.

3.    By 5:00 pm on 7 March 2025, the plaintiffs serve copies of the following documents (the Documents):

(a)    the originating process as filed on 6 March 2025;

(b)    the affidavit of Alexandra Victoria Commins dated 6 March 2025 and exhibit AC1;

(c)    the consents to act as liquidator of David Sampson and Maxwell Prentice of PBS Recovery;

(d)    the interlocutory application dated 6 March 2025; and

(e)    a stamped copy of these orders dated 7 March 2025.

4.    Service of the Documents referred to in Order 2 above be effected by taking the following steps by 5.00 pm on 7 March 2025:

(a)    emailing a copy of the Documents to the following email addresses:

(i)    jim_angelis@goldstonepe.com.au;

(ii)    info@goldstonepe.com.au; and

(iii)    jim_angelis@angelholdco.com;

(b)    for the first and second defendants, posting a copy of the Documents by way of express post to Level 43, 50 Bridge Street, Sydney, NSW 2000; and

(c)    for the third and fourth defendants, posting a copy of the Documents by way of express post to 2A Gilliver Avenue, Vaucluse, NSW 2030.

5.    Upon the Plaintiffs, by their counsel, giving the usual undertaking as to damages, until 4:15 pm on 11 March 2025 or further order of the Court, the defendants be restrained from taking any step to remove or replace the second plaintiff as a director of the first defendant and/or the second defendant or to act upon or give effect to the second plaintiff’s purported removal from, or purported vacation of, the position of a director of the first or second defendant.

6.    The interlocutory application otherwise be stood over to 10:15 am on 11 March 2025 before the Corporations and Commercial Law Duty Judge.

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

REASONS FOR JUDGMENT

MOORE J:

1    The present proceeding concerns a dispute in the management and control of a private equity business, administering a number of funds, known as Goldstone Private Equity. The business is operated, inter alia, through two entities, being the first and second defendants. The first defendant, Goldstone Private Equity Pty Limited, is referred to in the relevant shareholders deed as the “Manager”. The second defendant, Goldstone Fund Management Pty Limited, is referred to in the shareholders deed as the “General Partner”. I will refer to the first and second defendants collectively as the “Goldstone Companies”.

2    The principals of the business are the second plaintiff, Ms Alexandra Commins, and the third defendant, Mr James (“Jim”) Angelis. The evidence filed on the present application for interlocutory relief is an affidavit from Ms Commins. Because the application has been brought ex parte, there is no evidence from Mr Angelis, and I bear in mind that there is likely to be a rival version of events in due course.

3    Ms Commins gives evidence of the decision by her and by Mr Angelis to go into business together to establish and administer private equity funds, and of the negotiation of constituent agreements establishing the relevant business structure. The first plaintiff is an entity owned by Ms Commins. The fourth defendant is an entity owned by Mr Angelis.

4    All six parties to this proceeding are parties to a Shareholders Deed, dated 2 November 2023, which regulates the ownership and management of the Goldstone Companies. In very broad terms, the ownership and management of the Goldstone Companies is split evenly between Ms Commins and Mr Angelis, although the Shareholders Deed contains additional provisions about voting, including provisions for a casting vote in certain limited circumstances.

5    The evidence suggests that as of February 2025, Goldstone Private Equity has received funding commitments totalling at least $111 million, including $100 million from Mr Angelis or his entities, and that in the period from November 2023 to January 2025 the funds produced a return on investment of approximately $20 million. More detailed financial information is not readily apparent in the current evidence.

6    Ms Commins and Mr Angelis have had a falling out. The immediate impetus for the present application is the purported termination by Mr Angelis of Ms Commins’ employment by the Manager (i.e. the first defendant) for alleged (but unspecified) “serious misconduct”, which Mr Angelis asserts terminates Ms Commins’ position as a director of each of the Goldstone Companies. Ms Commins denies these allegations, and denies that Mr Angelis has any entitlement to remove her as a director of the Goldstone Companies or that she has been so removed. If Ms Commins is entitled to remain as a director of the Goldstone Companies, then it appears likely that there will be a deadlock in the management of the Goldstone Companies.

7    The plaintiffs have brought proceedings seeking, inter alia:

(a)    declaratory relief that Ms Commins was not validly removed as a director of the Goldstone Companies;

(b)    a declaration that the third and fourth defendants have conducted the affairs of the Goldstone Companies in an oppressive/unfair/discriminatory manner, and in a manner contrary to the interests of members as a whole; and

(c)    an order for the transfer of shares in the Goldstone Companies, or alternatively that those companies be wound up.

8    The plaintiffs have also sought interlocutory relief, including an order for the appointment of provisional liquidators to the Goldstone Companies, an order restraining the defendants from taking any steps to remove Ms Commins as a director of the Goldstone Companies and certain associated companies, and an order reinstating Ms Commins’ access to her company emails and the records of the Goldstone Companies.

9    Only a subset of that interlocutory relief was pressed on an interim, ex parte basis last Friday, 7 March 2025, being orders for short service, mode of service, and an order until the matter is next before the Court restraining the defendants from taking any step to remove or replace Ms Commins as a director of the Goldstone Companies or to act upon or give effect to Ms Commins’ purported removal from, or purported vacation of, the position of a director of the Goldstone Companies. After hearing from counsel for the plaintiffs, I indicated that I was prepared to grant the limited relief sought at that appearance. I subsequently made orders in chambers later that day, i.e. 7 March 2025.

10    These are the reasons for the making of those orders.

11    Clause 4.3 of the Shareholders Deed relevantly provides as follows:

4.3    Vacation of office

(a)    Subject to clause 4.3(b), the office of a Director of each Goldstone Company becomes vacant if:

(i)    in respect of any executive Director, that person is no longer employed or engaged by the Manager;

…

12    There was also in evidence an Executive Employment Agreement between the Manager and Ms Commins dated 1 November 2023, pursuant to which Ms Commins was employed as “Executive”. Clause 18 of that agreement relevantly provides as follows:

18.3    Termination without notice

(a)    The Company may only terminate the Executive’s Employment if:

(i)    in the Company’s opinion, the Executive’s conduct (whether by act or omission) amounts to serious misconduct, including, without limitation:

(A)    wilful or deliberate behaviour by the Executive that is inconsistent with the continuation of the contract of employment;

(B)    conduct that causes imminent or serious risk to:

1.    the health or safety of a person; or

2.    the reputation or viability of the Company;

(C)    engaging in dishonesty, theft, fraud or assault in the course of the Executive’s Employment;

…

13    The relevant requirement is “serious misconduct” (not just misconduct), and some examples are provided.

14    The plaintiffs refer to some emails by which Mr Angelis purported to terminate Ms Commins’ employment, and asserted that this vacated Ms Commins’ position as a director of the Goldstone Companies and required Ms Commins to cease to be a director of the investee entities. On 27 February 2025, Mr Angelis relevantly wrote in the following terms:

Dear Alexandra

I confirm that your employment ended, effective immediately.

As discussed your employment ended due to your serious misconduct.

…

The termination of your employment for serious misconduct is a default event under the Goldstone shareholders’ deed. As a result, your position as a director of the Goldstone companies has become vacant, you are no longer entitled to be a director of an investee entity, and you will be required to divest your shares in the Goldstone companies in accordance with the shareholders’ deed. I will correspond separately with you in relation to these matters shortly.

15    Ms Commins responded by email that Mr Angelis’ actions had “no factual or legal basis and accordingly are ineffective”.

16    Mr Angelis relevantly responded as follows, by email dated 28 February 2025.

The termination of your employment was due to your serious misconduct.

The ending of your employment was necessary to protect the reputation and viability of the business and the health and safety of the employees.

The consequences of your termination flow from the shareholders arrangements, corporate structure and company rules.

17    These communications are unhelpfully vague. They do not shed light on the basis for the purported termination of Ms Commins’ employment. For example, they do not identify the alleged misconduct, or indicate how it constitutes “serious misconduct” falling within the terms of clause 18.3 of the Employment Agreement.

18    Nor do the communications from Mr Angelis indicate how this is an action of the Manager (i.e. of Goldstone Private Equity Pty Limited, of which Mr Angelis and Ms Commins are co-directors), rather than the unilateral act of Mr Angelis. For example, Mr Angelis’ email does not identify any corporate act of the Manager (such as the passage of a resolution), or the basis on which any such resolution could be passed. It is uninformative in this respect.

19    It is not necessary to consider these matters in any significant detail. They are likely to be subject to extensive dispute. Mr Angelis may have a different version of events. At this very early stage, it is sufficient to observe that there is at least a serious question to be tried that the purported notice of termination of employment is not a proper and valid act by the Manager removing Ms Commins as the Executive of the Manager pursuant to the Employment Agreement, and therefore that there is no basis for asserting that Ms Commins is no longer a director of the two Goldstone Companies or for removing Ms Commins as a director. There is a sufficiently serious question to support a modest form of interlocutory relief to preserve the status quo, being Ms Commins’ position as a director of the Goldstone Companies, for a short period to enable the issue to be ventilated more fully. I was informed that, on the latest search, ASIC’s records indicated that Ms Commins remained registered as a director of the Goldstone Companies.

20    The balance of convenience favours the grant of some limited relief. In circumstances where the Shareholders Agreement contemplates joint decision making and joint control, it is undesirable for one of two directors to be removed from the board pending the Court hearing further about that dispute. By contrast, there is nothing in the materials to suggest that the preservation of the status quo by the limited order which the plaintiffs seek would cause irremediable prejudice to any person. The plaintiffs do, of course, only obtain relief on the provision of the usual undertaking as to damages.

21    I am also prepared to make the orders sought in relation to service. The matter should be brought back on Tuesday, 11 March 2025 at 10.15 am before the Commercial and Corporations Duty Judge for further consideration, which may or may not involve further timetabling orders for the progress of the matter. There is evidence that one of the email addresses used for service is under active recent use by Mr Angelis and it appears that the proposed service regime should be effective to bring the matter to the attention of the defendants.

22    It is for these reasons that I made the orders I made on 7 March 2025.

Associate:

Dated:    10 March 2025