Federal Court of Australia

Morcom Holdings Pty Ltd v Mountain Asset Partners Pty Ltd (in liquidation) (No 6) [2026] FCA 690

ORDERS

THE COURT ORDERS THAT:

1.    The plaintiff be granted leave to file an amended statement of claim in the form of the document marked as MFI-3 on the application, amended so as to provide the plaintiff’s best particulars of the knowledge pleaded in paragraphs [23B] and [23C] thereof.

2.    The amended statement of claim is to be filed as:

(a)    a version which is marked up in accordance with rule 16.59 of the Federal Court Rules 2011 (Cth); and

(b)    a clean version which is not marked up.

3.    The plaintiff pay the second to sixth defendants’ costs thrown away by reason of the amendments to its statement of claim, excluding the costs of the plaintiff’s interlocutory application filed on 20 October 2025.

4.    The third to sixth defendants pay the plaintiff’s costs of and incidental to the plaintiff’s interlocutory application filed on 20 October 2025.

5.    The second to sixth defendants file and serve any defence to the amended statement of claim by 25 June 2026.

6.    The proceeding be listed for case management at 9:30am on 2 July 2026.

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

REASONS FOR JUDGMENT

GOODMAN J:

A.    Introduction

1    These reasons for judgment address an application by the plaintiff to amend its statement of claim. The only active defendants are the second to sixth defendants. The second defendant consents to the filing of the proposed amended statement of claim, being the document marked MFI-3 on the application (PASOC). The third to sixth defendants (objecting defendants) object to particular paragraphs of that draft pleading.

2    The plaintiff’s complaint as pleaded in the PASOC as against the active defendants concerns investments that it made in convertible notes issued by ALAMMC 4 Pty Ltd (receivers and managers now appointed) and SDA 3 Pty Ltd (now in liquidation). Each investment was of $1,000,000. I will refer to those investments as the ALAMMC 4 Investment and the SDA 3 Investment.

3    The plaintiff contends, in broad terms, that:

(1)    the second defendant (Mr Ross), an employee of Mountain Asset Partners Pty Ltd (now in liquidation) engaged in conduct that contravened one or more of ss 18, 20 and 21 of the Australian Consumer Law, being Schedule 2 to the Competition and Consumer Act 2010 (Cth); ss 12CA, 12CB and 12DA of the Australian Securities and Investments Commission Act 2001 (Cth); and ss 1041E, 1041F and 1041H of the Corporations Act 2001 (Cth) (together, the statutory provisions);

(2)    the third defendant (Mr Lenton), another employee of Mountain Asset:

(a)    engaged in conduct that contravened one or more of the statutory provisions; and

(b)    was involved in contraventions of the statutory provisions by Mr Ross;

(3)    each of the fourth defendant (Mr Gardner), the fifth defendant (Mr Newman) and the sixth defendant (Mr Tanveer) – being the directors and members of Mountain Asset – was involved in contraventions of the statutory provisions by Mountain Asset and Mr Ross; and

(4)    the plaintiff is entitled to recover its loss caused by the contraventions from those alleged to have contravened the statutory provisions, and from those alleged to have been involved in such contraventions.

4    The allegations against Mr Lenton concern the ALAMMC 4 Investment, but not the SDA 3 Investment. The allegations against the remaining active defendants concern both investments.

5    The proposed amendments are broad-ranging and include some deletions from the statement of claim. The analysis below addresses the proposed amendments to which objections have been taken.

B.    The case against Mr Ross

B.1    Introduction

6    I start with the case pleaded against Mr Ross.

7    The objecting defendants contend that the PASOC does not properly plead a case in which the alleged conduct of Mr Ross is conduct of Mr Ross in a personal capacity, as distinct from conduct of Mountain Asset. It follows, in their submission, that they could not have been involved in contraventions by Mr Ross of any of the statutory provisions.

8    Thus it is necessary to consider the case pleaded against Mr Ross and then whether it has the deficiencies suggested by the objecting defendants.

B.2    The case pleaded against Mr Ross

9    The plaintiff pleads cases against Mr Ross with respect to the ALAMMC 4 Investment and the SDA 3 Investment.

10    The case with respect to the ALAMMC 4 Investment is as follows.

11    First, Mr Ross is identified at PASOC [3] in the following manner:

The Second Defendant (Ross):

(a)    is a natural person capable of suing and being sued;

(b)    was, at all material times, engaged by Mountain Asset as a “Client Manager”;

(b1)    was for the purposes of promoting, distributing and marketing investments in ALAMMC Developments 4 and SDA 3 (defined below) one of the living persons through whom Mountain Asset acted and therefore the conduct of Ross, and in particular the Ross ALAMMC Representations and Ross SDA 3 Representations, was also conduct of Mountain Asset;

Particulars

…

(b2)    further, or in the alternative, Ross was appointed and acted as agent of Mountain Asset to promote, distribute and market on behalf Mountain Asset the ALAMMC Developments 4 and SDA 3 and therefore the conduct of Ross, and in particular the Ross ALAMMC Representations and Ross SDA 3 Representations, is deemed to also be conduct engaged in by Mountain Asset.

Particulars

…

(b3)     further, or in the alternative, Ross was appointed and acted as an agent of Mountain Asset to promote, distribute and market investments in ALAMMC Developments 4 and SDA 3 and therefore the conduct of Ross, and in particular the Ross ALAMMC Representations and Ross SDA 3 Representations, was also conduct of Mountain Asset.

(c)    is and was at all material times a person for the purposes of:

(i)    sections 18, 20, 21 and 29 of the ACL;

(ii)    sections 12CA, 12CB, 12DA and 12DB of the ASIC Act; and

(iii)    sections 1041E, 1041F and 1041H of the Corporations Act.

(bold and italic emphasis in original)

12    Secondly, “[Mr] Ross and Mountain Asset” (emphasis added) are alleged to have made representations to the plaintiff:

(1)    on 6 May 2022, in an email that attached a document titled “Information Memorandum – Specialist Disability Housing Midland, Western Australia” dated 15 April 2022 (ALAMMC 4 IM) which related to a project titled the ALAMMC 4 Project, that:

(a)    Mountain Asset was one of Australia’s leading ethical wealth management firms;

(b)    Mountain Asset had been involved in the successful completion of 17 National Disability Insurance Scheme Property Projects (PASOC [14]);

(2)    via the provision to the plaintiff of the ALAMMC 4 IM that:

(a)    the funds raised in respect of the ALAMMC 4 Project would be utilised:

(i)    firstly, for “payment of issue costs in relation to [the ALAMMC 4 IM] (e.g. solicitor and accountant fees)” (ALAMMC Issue Costs); and

(ii)    secondly, “to fund land acquisition costs for the Project Site and working capital towards construction of the Project”,

with the consequence that the balance of the funds available after payment of the ALAMMC Issue Costs would be “allocated” and thereby be available only to the ALAMMC 4 Project;

(b)    ALAMMC Developments 4 Pty Ltd (Receivers and Managers Appointed) (ALAMMC Developments 4) had available working capital from completed developments, including to fund interest payments to noteholders;

(c)    there was no 16.5 per cent commission or fee (or 15 per cent excluding GST) charged to the investor or taken from investor or project funds and payable to Mountain Asset or Armada Assets (PASOC [15]);

(3)    on 9 May 2022, in response to a question from the plaintiff as to the security that was available to noteholders in the ALAMMC 4 Project, that:

(a)    the land the subject of the ALAMMC 4 Project would form part of the security available to noteholders;

(b)    ALAMMC Developments 4 owned the land the subject of the ALAMMC 4 Project (PASOC [16]);

(4)    on 10 May 2022, at a meeting in North Sydney (10 May 2022 meeting), that:

(a)    Mountain Asset was a finance broker that maintained an Australian Financial Services License;

(b)    Mountain Asset had operated as a wealth management and financial brokerage firm for a period of 10 years;

(c)    there were no brokerage fees or commissions borne by an investor in the ALAMMC 4 Project and to the extent there were any costs in respect of fundraising for the ALAMMC 4 Project, those costs were contained in the ALAMMC 4 IM (Second Fee Representation);

(d)    Mr Ross had verified that:

(i)    ALAMMC Developments 4 had partnered with a provider of NDIS accommodation for the property to be constructed by ALAMMC Developments 4 to be rented to participants in the NDIS;

(ii)    ALAMMC Developments 4 had working capital available to it to complete the ALAMMC 4 Project;

(iii)    the feasibility studies contained in the ALAMMC 4 IM were accurate and correct and had been checked;

(e)    the funds raised for the ALAMMC 4 Project would be held in a trust account (Second ALAMMC Trust Account Representation);

(f)    ALAMMC 4 would maintain an account solely for the purpose of payments of costs relating to the ALAMMC 4 Project (Second Allocation of Funds Representation);

(g)    the release of funds from the account for payment of, inter alia, construction costs would occur following independent certification that such works had been completed (Second Utilisation of Funds Representation);

(h)    Mountain Asset had facilitated investments in at least 17 successfully completed projects similar to the proposed ALAMMC 4 Project across Australia, which had resulted in investors being repaid their principal investment and interest, together with bonus payments upon completion of those developments; and

(i)    the land the subject of the ALAMMC 4 Project would form part of the security available to investors in ALAMMC Developments 4 (PASOC [17]),

(collectively, the 10 May 2022 Representations).

13    The representations described in paragraph [12] are defined collectively as the Ross ALAMMC Representations (PASOC [19]).

14    Thirdly, some of the Ross ALAMMC Representations were as to future matters (PASOC [16A] and [19A]).

15    Fourthly, the representations as to future matters were misleading because of the absence of reasonable grounds (PASOC [19B] to [19D]); and the remaining representations were “incorrect, false, untrue, misleading or deceptive, or were likely to mislead or deceive, and otherwise capable of leading [the plaintiff] into error” (PASOC [20]).

16    Fifthly by making the Ross ALAMMC Representations in circumstances where those representations had the character alleged in the previous paragraph, Mr Ross contravened the statutory provisions (PASOC [37]).

17    Sixthly, by reason of the contravening conduct, the plaintiff suffered loss. This is pleaded as follows at PASOC [34], [35] and [36]:

34.    Because of each or all of the:

(a)    Ross ALAMMC Representations;

…

Morcom:

(e)    completed the ALAMMC Application Form; and

(f)    caused Morcom Holdings to advance the sum of $1,000,000 to ALAMMC Developments 4 (ALAMMC 4 Advance).

35.    On 12 May 2022, Morcom Holdings was issued 1,000,000 convertible notes in ALAMMC Developments 4 ...

Particulars

…

36.    Because of each of the components of the ALAMMC 4 Representations (and the ALAMMC 4 Representations as a whole), Morcom caused Morcom Holdings to advance the sum of $1,000,000 to ALAMMC Developments 4, and instead:

(a)    would have retained the sum of $1,000,000 in an interest-bearing account.

(bold emphasis in original)

18    I note that the ALAMMC 4 Representations referred to in PASOC [36] include the Ross ALAMMC Representations.

19    Finally, the plaintiff claims that it is entitled to recover the loss caused to it by reason of the abovementioned conduct (PASOC [92] and [93]).

20    The plaintiff’s pleading with respect to the SDA 3 Investment follows a similar pattern to that set out above with respect to the ALAMMC 4 Investment (with some differences as to the representations made and their falsity).

B.3    The challenge by the objecting defendants

21    I turn now to the contention of the objecting defendants that the PASOC does not properly plead a case against Mr Ross in his personal capacity and only pleads a case based upon Mr Ross being an agent of Mountain Asset. They point in particular to allegations that Mr Ross: (1) was engaged by Mountain Asset as a “Client Manager” (PASOC [3(b)]); (2) was “one of the living persons through whom Mountain Asset acted and therefore the conduct of Ross … was also conduct of Mountain Asset” (PASOC [3(b1)]); and (3) was acting as an agent of Mountain Asset (PASOC [3(b2) and (b3)]). The objecting defendants contend that no case is pleaded against Mr Ross in his personal capacity.

22    It follows, in their submission, that there is no basis for any allegation that the objecting defendants were accessorily liable for any conduct of Mr Ross.

23    I disagree. The case as pleaded clearly includes and identifies a case against Mr Ross in his personal capacity. In particular:

(1)    Mr Ross is identified as a person capable of being sued (PASOC [3(a)]);

(2)    particular representations are identified as conduct of both Mr Ross and Mountain Asset (PASOC [3(b1), (b2) and (b3)], [14], [15], [16], [17] and [23A(b)]);

(3)    Mr Ross is identified as a “person” for the purposes of the statutory provisions (PASOC [3(c)]). That is, a person subject to the statutory prohibitions in those provisions; and

(4)    it is alleged that by reason of his conduct Mr Ross engaged in conduct in contravention of the statutory provisions (PASOC [37]).

24    It may be that the objecting defendants will plead and prove that Mr Ross’s conduct was conduct only attributable to Mountain Asset and he was not acting in a personal capacity. However, that is not a question that arises for determination on the present application.

25    As noted above, the pleading of the case against Mr Ross with respect to the SDA 3 Investment is in similar terms. It follows that the challenge made by the objecting defendants with respect to that case fails for the same reasons.

26    The challenge to this aspect of the PASOC fails.

C.    The case against Mr Lenton

C.1    Introduction

27    I turn next to the challenge to the case pleaded against Mr Lenton.

28    The plaintiff alleges that Mr Lenton contravened one or more of the statutory provisions.

29    Mr Lenton challenges several aspects of the manner in which the case against him has been pleaded. Before addressing those challenges, it is convenient first to set out how that case has been pleaded.

C.2    The case pleaded against Mr Lenton

30    That case is as follows.

31    First, Mr Lenton is identified at PASOC [4] in the following manner:

The Third Defendant (Lenton):

(a)    is a natural person capable of suing and being sued; and

(b)    was, at all material times, engaged by Mountain Asset as a “Client Manager”; and is and was at all material times a person for the purposes of:

(i)    sections 18, 20, 21 and 29 of the ACL;

(ii)    sections 12CA, 12CB, 12DA and 12DB of the ASIC Act; and

(iii)    sections 1041E, 1041F and 1041H of the Corporations Act.

(bold and italic emphasis in original)

32    Secondly, Mr Lenton attended the 10 May 2022 meeting (PASOC [21]).

33    Thirdly, at that meeting Mr Ross made the 10 May 2022 Representations.

34    Fourthly, as to Mr Lenton’s alleged contravening conduct:

23A    In circumstances where:

(a)    Lenton attended the 10 May 2022 meeting in his capacity as a “Client Manager” of Mountain Asset;

(b)    Lenton knew that any or all of the Second Fee Representation, the Second ALAMMC Trust Account Representation, the Second Allocation of Funds Representation and the Second Utilisation of Funds Representation, being made to Morcom by Ross and Mountain Asset in his presence were false, untrue, misleading or deceptive, or made without reasonable grounds;

(c)    so as to not contravene section 18 of the ACL, section 12DA(1) of the ASIC Act, section 1041H of the Corporations Act, section 1041F of the Corporations Act and section 21 of the ACL at the meeting, and in Morcom’s presence, Lenton should not have remained silent, failed to correct, failed to disclaim and/or failed to indicate he did not adopt the Second ALAMMC Trust Account Representation, the Second Allocation of Funds Representation and the Second Utilisation of Funds Representation, or so many of them that he knew were false, untrue, misleading or deceptive, or made without reasonable grounds; and

(d)    further, or in the alternative, so as to not contravene section 18 of the ACL, section 12DA(1) of the ASIC Act, section 1041H of the Corporations Act, section 1041F of the Corporations Act and section 21 of the ACL at the meeting, and in Morcom’s presence, Lenton should have spoken and corrected, disclaimed or indicated that he did not adopt the Second ALAMMC Trust Account Representation, the Second Allocation of Funds Representation and the Second Utilisation of Funds Representation or so many of them that he knew were false, untrue, misleading or deceptive, or made without reasonable grounds.

23B    Lenton knew the Second Fee Representation was false, untrue, misleading or deceptive, or made without reasonable grounds in circumstances where a commission of 16.5% (or 15% excluding GST) was payable on all funds raised by Mountain Asset from investor funds whom it caused to invest in entities under the control of McWilliams, including ALAMMC Developments 4, such a commission being payable on those amounts by ALAMMC Developments 4.

Particulars

a.    Agency Agreement between Mountain Asset Partners Pty Ltd and Ben Ross.

b.    The Agency Agreement with Ross appears to be a standard form agreement with Client Managers such that it can be inferred that Lenton was party to a similar agreement on materially similar terms, including the payment of commission on funds raised by Mountain Asset from investor funds.

c.    Promoter Agreement executed by Gardner and McWilliams on 2 March 2021.

d.    Service Agreement executed by Gardner, Garrison and McKellar on 11 June 2020

e.    Further particulars to be provided following discovery and/or the issuance of subpoenas.

23C    Lenton knew the Second ALAMMC Trust Account Representation, the Second Allocation of Funds Representation and the Second Utilisation of Funds Representation was false, untrue, misleading or deceptive, or made without reasonable grounds.

Particulars

a.    The representations were made in Mr Lenton’s presence in circumstances where at the time of the representations Ross, and it can be inferred Lenton, were parties to an agency agreement with Mountain Asset which provided for him to be paid 5% commission on “all amounts received for all Products sold to customers”.

b.    Further, in the absence of the funds being held on trust as represented by the Second ALAMMC Trust Account Representation and utilised only for the purposes represented by the Second Allocation of Funds Representation and the Second Utilisation of Funds Representation, it can be inferred there were no reasonable grounds for the making of those representations.

c.    Further particulars to be provided following discovery and/or the issuance of subpoenas.

24.    In the circumstances of paragraphs 21 to 23C, by way of his:

(a)    silence;

(b)    failure to correct;

(c)    failure to disclaim the correctness; and/or

(d)    failure to indicate he did not adopt,

the Second Fee Representation, Second ALAMMC Trust Account Representation, the Second Allocation of Funds Representation and the Second Utilisation of Funds Representation made by Ross in his presence during the 10 May 2022 Meeting, Lenton engaged in conduct that was incorrect, false, untrue, misleading or deceptive, or was likely to mislead or deceive, and otherwise capable of leading Morcom into error (Lenton ALAMMC Conduct).

24A    Further, the falsity, untrue nature, misleading or deceptive nature, or absence of reasonable grounds of the Second ALAMMC Trust Account Representation, the Second Allocation of Funds Representation and the Second Utilisation of Funds Representation were each a material fact within the meaning of section 1041F of the Corporations Act.

Particulars

a.     Had the true position in respect of any of those matters been disclosed, Morcom would not have invested in ALAMMC Developments 4.

(bold and italic emphasis in original)

35    Fifthly, by reason of his engagement in such conduct, Mr Lenton contravened one or more of the statutory provisions (PASOC [38]).

36    Sixthly, by reason of that contravening conduct, the plaintiff suffered loss. This is pleaded as follows at PASOC [34], [35] and [36]:

34.    Because of each or all of the:

    …

(b)    Lenton ALAMMC Conduct;

…

Morcom:

(e)    completed the ALAMMC Application Form; and

(f)    caused Morcom Holdings to advance the sum of $1,000,000 to ALAMMC Developments 4 (ALAMMC 4 Advance).

35.    On 12 May 2022, Morcom Holdings was issued 1,000,000 convertible notes in ALAMMC Developments 4 ...

…

36.    Because of each of the components of the ALAMMC 4 Representations (and the ALAMMC 4 Representations as a whole), Morcom caused Morcom Holdings to advance the sum of $1,000,000 to ALAMMC Developments 4, and instead:

(a)    would have retained the sum of $1,000,000 in an interest-bearing account.

(bold emphasis in original)

37    I note that the ALAMMC 4 Representations are defined so as to include the Lenton ALAMMC Conduct (PASOC [34(b)]).

38    Finally, the plaintiff claims that it is entitled to recover the loss caused to it by reason of the abovementioned conduct (PASOC [92] and [93]).

C.3    Mr Lenton’s challenges to the case pleaded against him

39    I turn now to the challenges brought by Mr Lenton.

40    First, Mr Lenton contends that, as with Mr Ross, there are no pleaded material facts from which it may be deduced that the plaintiff has a claim against him in a personal capacity.

41    Again, I disagree. In particular, the PASOC contains allegations that:

(1)    Mr Lenton was at all material times a “person” for the purposes of the statutory provisions (PASOC [4(b)]);

(2)    Mr Lenton attended the 10 May 2022 meeting and, in broad terms, failed to correct the 10 May 2022 Representations made by Mr Ross which Mr Lenton knew to be false (PASOC [21], [23], [23A], [23B], [23C]);

(3)    by such omission, Mr Lenton engaged in misleading or deceptive conduct (PASOC [24]);

(4)    Mr Lenton thereby engaged in conduct in contravention of one or more of the statutory provisions (PASOC [38]); and

(5)    such conduct caused loss to the plaintiff (PASOC [34] to [36]) which it is entitled to recover (PASOC [92] and [93]).

42    Again, it may be that Mr Lenton will plead and prove that his conduct was conduct only attributable to Mountain Asset and he was not acting in a personal capacity, but that is not a question that arises for determination on the present application.

43    Secondly, Mr Lenton contends that there are no particulars that support the allegation in PASOC [23A(b)] that he had actual knowledge of the falsity of: (1) the Second Fee Representation; (2) the Second ALAMMC Trust Account Representation; (3) the Second Allocation of Funds Representation; or (4) the Second Utilisation of Funds Representation.

44    Mr Lenton’s submission that there are no particulars to PASOC [23A(b)] may be accepted. However, the plaintiff has expressly pleaded at PASOC [23B] and [23C] that Mr Lenton knew that each of these representations was false and has provided particulars to those paragraphs.

45    Rule 16.43 of the Federal Court Rules 2011 (Cth) requires a party who pleads knowledge to state in the pleading particulars of the facts upon which that party relies.

46    During the course of argument as to the adequacy of the particulars to PASOC [23B] and [23C] (and in a context in which the objection to the adequacy of the particulars to PASOC [23B] was raised in oral but not in written submissions) it became apparent that the plaintiff proposed to rely upon matters not yet particularised (or not particularised in sufficient detail) in order to establish Mr Lenton’s knowledge of the matters pleaded in those paragraphs.

47    In those circumstances, there is little utility in determining the adequacy of the particularisation of PASOC [23B] and [23C] and the more efficient course is to provide the plaintiff with an opportunity to provide full particulars.

48    Thirdly, Mr Lenton contends that the particulars to PASOC [24A], which he contends concern causation, should be pleaded as material facts and not as particulars.

49    I do not accept this submission. Construed in the context of the PASOC as a whole, it is clear that the plaintiff does not rely upon these particulars to establish causation. Instead, PASOC [34(b)], [35] and [36], which are set out at [36] above, and which are unchallenged (and the subject of a response in the defence filed on behalf of Mr Lenton (and the other objecting defendants) to the existing statement of claim), provide the requisite material facts concerning causation.

50    Further, the plaintiff’s unchallenged submission is that the particulars to PASOC [24A] concern a different topic, namely why the representations pleaded in that paragraph were “material facts” within the meaning of s 1041F of the Corporations Act.

51    For the above reasons, the objections to the PASOC in so far as it concerns the case against Mr Lenton fail.

D.    The case against Mr Gardner, Mr Newman and Mr Tanveer

D.1    Introduction

52    I turn now to the challenges to the pleading of the case as against Mr Gardner, Mr Newman and Mr Tanveer. As noted above, the plaintiff alleges that each of them is accessorily liable because he was involved in contraventions of the statutory provisions by Mountain Asset and Mr Ross.

53    Mr Gardner, Mr Newman and Mr Tanveer challenge several aspects of the manner in which those cases have been pleaded. Before addressing those challenges, it is convenient first to set out how those cases have been pleaded.

D.2    Pleading of the accessorial liability claims

54    The accessorial liability case is pleaded in effect six times – as against each of Mr Gardner, Mr Newman and Mr Tanveer and by reference to each of the ALAMMC 4 and SDA 3 Investments.

55    The analysis below addresses the accessorial liability case against Mr Gardner with respect to the ALAMMC 4 Investment (being the case that was the focus of submissions on the present application).

56    That case is pleaded by reference to the ALAMMC 4 Representations, a term which is defined at PASOC [34] as comprising, relevantly:

(1)    the Ross ALAMMC Representations (see [12] to [13] above);

(2)    the MA Website Representations, being representations by Mountain Asset, via its website as at 5 May 2022, that it:

(a)    had operated since 2013 and was one of Australia’s leading ethical wealth management firms; and

(b)    aimed to offer “high returns…ongoing income…[and] strong security” (PASOC [31]).

57    The pleading is relevantly as follows:

41.    At the time of the ALAMMC 4 Representations and the ALAMMC 4 Advance Gardner had actual knowledge that:

(a)    Mountain Asset had not commenced trading in July 2013;

Particulars

…

(b)    Mountain Asset did not operate a bank account with any Australian financial institution;

Particulars

…

(c)    Mountain Asset was not a wealth management and brokerage firm;

…

(e)    Mountain Asset’s functions were limited to:

(i)    generating “leads” for potential investors via the MA Website (such website being its sole asset), with the conversion of such leads resulting in commissions being payable to Armada Assets on all funds raised, including funds raised pursuant to the ALAMMC 4 IM;

(ii)    the preparation of ALAMMC 4 IM;

…

(iv)    the dissemination of the information contained within, the:

(A)    MA Website; and

(B)    ALAMMC 4 IM,

to persons such as Morcom; and

(f)    Mountain Asset was not receiving compensation or remuneration for converted “leads” generated by Mountain Asset to McWilliams and his related entities, including ALAMMC Developments 4.

Particulars for (c) to (f)

…

(g)    The funds raised in respect of the ALAMMC 4 Project would not be utilised only for:

(i)    “payment of issue costs in relation to [the ALAMMC 4 IM] (e.g. solicitor and accountant fees)”; and

(ii)    “to fund land acquisition costs for the Project Site and working capital towards construction of the Project”,

with the consequence that the balance of the funds available after payment of the ALAMMC Issue Costs would be “allocated” and, thereby be available only to the ALAMMC 4 Project.

(h)    a 16.5% commission or fee (or 15% excluding GST) was taken from investor or project funds and payable to Mountain Asset or Armada Assets.

(i)    Not all costs in respect of fundraising for the ALAMMC 4 Project were disclosed in the ALAMMC 4 IM.

Particulars for (g) to (i)

a.    Gardner was a director of both Armada Assets and Mountain Asset and it should be inferred in the performance of those roles he had actual knowledge that a 16.5% (or 15% excluding GST) commission was paid to Armada Assets from funds raised from investors by Mountain Asset.

b.    Service Agreement between Armada Asset and SDA Aust Pty Ltd dated 11 June 2020 bearing Gardner’s signature.

c.    Service Agreement between Armada Asset and MMF Pty Ltd dated 26 February 2021 bearing Gardner’s signature.

d.    Agency Agreement between Armada Assets Pty Ltd, Mountain Asset Pty Ltd and Ben Ross bearing Gardner’s signature.

e.    Agency Agreement between Mountain Asset Partners Pty Ltd and Ben Ross.

f.    Affidavit of James Gardner affirmed on 19 June 2025, paragraphs 29 and 55.

g.    Further particulars to be provided following discovery and/or the issuance of subpoenas

41A    At the time of the ALAMMC 4 Representations and the ALAMMC 4 Advance Gardner:

(a)    had actual knowledge of the contents of the ALAMMC 4 IM, including that the ALAMMC 4 IM contained the First Utilisation Representation, the First Allocation of Funds Representation and/or the First Fee Representation.

Particulars

a.    All marketing material, including the ALAMMC 4 IM was provided by Mountain Asset to its agents, including Ross.

b.    Armada Asset charged commission for marketing investment opportunities, including this opportunity to Morcom (as evidenced by Armada Assets’ invoice to ALAMMC Developments 4 dated 13 May 2022). It can therefore be inferred that Gardner, being the sole director, secretary and shareholder of Armada Assets, was familiar with the marketing material and that such marketing material, including the principal document, being the ALAMMC 4 IM was being disseminated by agents of Mountain Asset.

c.    Armada Asset received and paid invoices from each of:

i.    The Careers Guy Pty Ltd (being an entity whom Mr Newman was, and remains, the sole director, secretary and shareholder of) dated 1 June 2022;

ii.    Aussie Managing Partners Pty Ltd (being an entity whom Mr Tanveer was, and remains, the sole director of) dated 2 June 2022; and

iii.    Mr Ross dated 17 May 2022,

such invoices having been issued in connection with the marketing of the opportunity to Morcom.

d.    As a director it can be inferred he had actual knowledge of the contents of the Information Memorandums submitted by Mountain Asset, being some of the principal information given to investors or potential investors.

e.    Further particulars to be provided following discovery and/or the issuance of subpoenas

(b)    had actual knowledge that Ross, on behalf of Mountain Asset, provided the ALAMMC 4 IM to Morcom;

Particulars

a.    Service Agreement between Armada Asset and MMF Pty Ltd dated 26 February 2021 bearing Gardner’s signature.

b.    Affidavit of James Gardner affirmed on 19 June 2025, paragraph 29.

c.    Agency Agreement between Mountain Asset Partners Pty Ltd and Ben Ross bearing Mr Newman’s signature.

d.    Agency Agreement between Armada Assets Pty Ltd, Mountain Asset Pty Ltd and Ben Ross.

e.    The Plaintiff repeats particulars b-c to paragraph 41A(a) above.

f.    Further particulars to be provided following discovery and/or the issuance of subpoenas.

(c)    in the alternative, had actual knowledge that Mountain Asset provided the ALAMMC 4 IM to potential investors;

Particulars

a.    Service Agreement between Armada Asset and MMF Pty Ltd dated 26 February 2021 bearing Gardner’s signature.

b.    Affidavit of James Gardner affirmed on 19 June 2025, paragraph 29.

c.    Agency Agreement between Mountain Asset Partners Pty Ltd and Ben Ross bearing Mr Newman’s signature.

d.    Agency Agreement between Armada Assets Pty Ltd, Mountain Asset Pty Ltd and Ben Ross.

e.    The Plaintiff repeats particular b-c to paragraph 41A(a) above.

f.    Further particulars to be provided following discovery and/or the issuance of subpoenas.

(d)    had actual knowledge of the entirety of the substantive content of the 6 May Email and 9 May Email, including the First Going Concern Representation, the Second Going Concern Representation and the First Security Representation;

Particulars

a.    The substantive content of all communications sent by Ross to potential investors was provided to Ross by Gardner, Newman and Tanveer on behalf of Mountain Asset.

b.    Further particulars to be provided following discovery and/or the issuance of subpoenas.

(e)    had actual knowledge that Mr Ross, and other agents of Mountain Asset, were making representations to potential investors to the effect of the First and Second Allocation of Funds, the First and Second Utilisation of Funds, and the First and Second Fee Representations.

Particulars

a.    Actual knowledge should be inferred in circumstances where Gardner and the other directors authorised client managers to meet with potential investors and those client managers were provided marketing material and other information by Gardner and the other directors which made representations to the effect of the First and Second Allocation of Funds, First and Second Utilisation of Funds and First and Second Fee Representations.

b.    Further particulars to be provided following discovery and/or the issuance of subpoenas.

41B    In the circumstances of paragraphs 41 and 41A above, Gardner had actual knowledge that:

(a)    representations to the effect of the First Going Concern Representation, the Second Going Concern Representation, the First and Second Allocation of Funds, the First and Second Utilisation of Funds, the First and Second Fee Representations, and the First Security Representation were being made by, or on behalf of, Mountain Asset; and

(b)    those representations were incorrect, false, untrue, misleading or deceptive, and were likely to mislead or deceive, and otherwise capable of leading Morcom, or an investor in the position of Morcom into error.

…

43.    In the premise of paragraph 41B Gardner was involved in the contraventions by Mountain Asset and Ross in that he:

(a)    aided, abetted, counselled or procured;

(b)    induced, whether by promises or otherwise; or

(c)    was, by act or omission, directly or indirectly, knowingly concerned in, or a party to,

the contraventions by those persons in circumstances where he:

(d)    caused, or acquiesced in, the ALAMMC 4 IM being sent to potential investors, including Morcom, in circumstances where he had actual knowledge that representations in the ALAMMC 4 IM were incorrect, false, untrue, misleading or deceptive, and were likely to mislead or deceive, and otherwise capable of leading Morcom, or an investor in the position of Morcom, into error;

(e)    provided the substantive content of all communications sent by Ross to potential investors, including Morcom, and in particular the content of the 6 May and 9 May Emails in circumstances where he had actual knowledge that representations in the emails were incorrect, false, untrue, misleading or deceptive, and were likely to mislead or deceive, and otherwise capable of leading Morcom, or an investor in the position of Morcom, into error; and/or

(f)    caused, authorised, or acquiesced in client managers meeting with potential investors including Morcom in circumstances where those client managers were provided marketing material and other information by Gardner and the other directors (Newman and Tanveer) which made representations to the effect of the First and Second Allocation of Funds, the First and Second Utilisation of Funds, and the First and Second Fee Representations which were incorrect, false, untrue, misleading or deceptive, and were likely to mislead or deceive, and otherwise capable of leading Morcom, or an investor in the position of Morcom, into error.

43A    In the circumstances above, Gardner was involved in the contraventions by Mountain Asset and Ross within the meaning of:

(a)    section 79 of the Corporations Act;

(b)    section 5 of the ASIC Act; and/or

(c)    section 2 of the ACL,

to such an extent that, but for his involvement, those contraventions would not have occurred.

44.     In the premise of paragraphs 41 to 43A above … Morcom Holdings suffered loss because of the Gardner ALAMMC Involvement.

(bold and italic emphasis in original)

D.3    The challenges by Mr Gardner, Mr Newman and Mr Tanveer

58    I turn now to the challenges brought by Mr Gardner, Mr Newman and Mr Tanveer.

59    First, Mr Gardner, Mr Newman and Mr Tanveer submit that several subparagraphs of the PASOC in which it is alleged that Mr Gardner had knowledge of:

(1)    the falsity of particular representations ([41(g) and (i)]); or

(2)    the making of other representations ([41A(a), (b) and (d)]),

are not supported by the particulars of knowledge pleaded.

60    The submissions that the particulars do not support the allegation of knowledge in those paragraphs are cast in broad and sweeping terms. It is not the Court’s role at this point in the proceeding to assess whether the evidence identified in the particulars makes good the assertions of knowledge. Although there may be cases where it can be established that facts set out in the particulars provided are simply incapable, if proven, of establishing an allegation of knowledge, the plaintiff’s submissions fall well short of doing so in the present case. Thus, I am not satisfied that the particularisation of the allegations of knowledge in these paragraphs provides any reason not to grant leave to file the PASOC.

61    Secondly, Mr Gardner, Mr Newman and Mr Tanveer submit that the first particular to PASOC [41A(a)] is a material fact that ought be pleaded. I disagree – that paragraph provides particularisation of the allegation that Mr Gardner had knowledge of the representations referred to in PASOC [41A(a)]. The material fact is knowledge, in respect of which particulars are to be provided in accordance with r 16.43 of the Rules.

62    Thirdly, Mr Gardner, Mr Newman and Mr Tanveer submit that PASOC [41A(c)] is irrelevant and cannot establish causation.

63    The submission of irrelevance was not developed during oral submissions – I take it to be in effect a submission that the paragraph is embarrassing because it contains facts unnecessary for a cause of action (cf. rr 16.02(1)(b) and (d), (2)(d) and 16.21 of the Rules). The plaintiff submits that PASOC [41A(c)] is relevant because an inference might be drawn from Mr Gardner’s knowledge that the ALAMMC 4 IM was provided to potential investors and that he had knowledge of the alleged contraventions. It is far from plain that this paragraph is irrelevant.

64    Further, PASOC [41A(c)] does not purport to establish causation. As noted above, causation is the subject of PASOC [34(b)], [35] and [36].

65    Fourthly, Mr Gardner, Mr Newman and Mr Tanveer submit that PASOC [41A(e)] is embarrassing because it alleges that Mr Gardner had actual knowledge that Mr Ross and other agents of Mountain Asset were making representations “to the effect of” the representations there pleaded. In this regard, the objecting defendants rely upon the observations of Justice Dowsett in Australian Competition & Consumer Commission v Michigan Group Pty Ltd [2002] FCA 1439 at [303]:

It is quite possible that the act of a natural person respondent on behalf of a corporation will constitute a contravention of the Act by that corporation, and yet the natural person respondent will be found not to have been knowingly concerned in that contravention. In the case of representations as to existing facts, this is because it is not necessary to show that the respondent corporation knew of the misleading nature of the statement in question, but knowing involvement predicates such knowledge on the part of the relevant natural person. The matter is even more complex in the case of representations as to future matters. A representation on behalf of a corporation will constitute a contravention if the corporation fails to show reasonable grounds for it. However a natural person respondent bears no onus of proof. It will be necessary for ACCC to demonstrate that such a person:

•    knew that the representation was made; and either:

•    knew that it was misleading; or

•    knew that the corporation had no reasonable grounds for it.

66    Mr Gardner, Mr Newman and Mr Tanveer rely upon this paragraph for the proposition that it is necessary to prove that the accessory knew the actual representation was made, not a different representation that is “to the effect of” the original representation. I do not accept this submission. Although his Honour referred to the need to prove the alleged accessory’s knowledge of the representation made, he did not address the use of the words “to the effect of”. Similarly, the other authorities cited by the objecting defendants, namely Australian Competition and Consumer Commission v Original Mama's Pizza and Ribs Pty Ltd [2008] FCA 370; (2008) ATPR 42-236 at [149] (Madgwick J) and Quinlivan v Australian Competition & Consumer Commission [2004] FCAFC 175; (2004) 160 FCR 1 at 6 [15] (Dowsett, Heerey and Sundberg JJ).

67    There may be an issue at the hearing as to the specificity or scope of the knowledge held by Mr Gardner, Mr Newman and Mr Tanveer concerning particular pleaded representations, but I do not regard this as a reason not to allow this aspect of the case to proceed.

68    Fifthly, Mr Gardner, Mr Newman and Mr Tanveer submit that PASOC [43(d) and (e)] contain conclusionary allegations that Mr Gardner caused or provided documents or communications when such allegations have not been pleaded. I do not accept this submission. The short answer is that such allegations are pleaded in PASOC [43(d) and (e)]. The plaintiff might have pleaded these allegations earlier, but there is no prejudice to Mr Gardner, Mr Newman and Mr Tanveer in having to address them as part of PASOC [43].

69    Sixthly, Mr Gardner, Mr Newman and Mr Tanveer submit that PASOC [43] does not set out how Mr Gardner was knowingly concerned in or a party to the contraventions by Mountain Asset and Mr Ross with respect to the MA Website Representations, which it will be recalled, form part of the ALAMMC 4 Representations (see [56] above).

70    As counsel for the plaintiff acknowledged, that is a point well made but it is not a reason to refuse leave to file the PASOC or any part of it.

71    Finally, Mr Gardner, Mr Newman and Mr Tanveer – who submitted that “[t]he claims against Mr Newman and Mr Tanveer are in almost identical form and suffer from the same issues” – referred specifically to several paragraphs of those parts of the PASOC. I have considered those paragraphs and have come to the same conclusion as I did for the corresponding paragraphs of the proposed pleading against Mr Gardner. Similarly, the cases pleaded with respect to the SDA 3 Investment, in respect of which Mr Gardner, Mr Newman and Mr Tanveer make substantially the same complaints.

E.    Conclusion

72    For the reasons set out above, the plaintiff will be granted leave to file the PASOC. The third to sixth defendants, who unsuccessfully opposed the application, should bear the costs of the application. The plaintiff accepts that it should bear the costs of the active defendants thrown away by reason of the amendments. I will make orders accordingly.

Associate:

Dated:    4 June 2026

SCHEDULE OF PARTIES