Federal Court of Australia

Australian Securities and Investments Commission v Wiluna Mining Corporation Ltd [2026] FCA 824

ORDERS

THE COURT ORDERS THAT:

1.    The plaintiff's case against the first defendant be heard separately from, and subsequent to, the plaintiff's case against the second and third defendant as to liability for alleged contraventions of the Corporations Act 2001 (Cth).

2.    After the determination of the question whether the second and third defendants have contravened the Corporations Act in the respects alleged by the plaintiff, any party may request that the proceedings be listed for case management. The request may be made by email to the associate to the case managing judge.

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

REASONS FOR JUDGMENT

COLVIN J:

1    In June 2022, Wiluna Mining Corporation Limited published an announcement to the market as to the outcome of a capital raising by prospectus. The Australian Securities and Investments Commission (ASIC) claims that the announcement omitted information which made the announcement misleading in a material respect. ASIC also claims that, from a subsequent date not long after the announcement was published, Wiluna was aware of the omitted information but did not disclose it to the Australian Stock Exchange. ASIC claims that by such conduct Wiluna breached the continuous disclosure obligations as expressed in s 674A of the Corporations Act 2001 (Cth) and engaged in misleading or deceptive conduct contrary to s 1041H(1) of that Act.

2    ASIC also says that Mr Milan Jerkovic was a director of Wiluna at the time of the events relating to the announcement and that Mr James Malone was a senior manager employed by Wiluna at that time. It alleges that Mr Jerkovic authorised or permitted the release of the announcement and did not take reasonable steps to ensure that the announcement was not false or misleading. It further alleges that Mr Jerkovic did not take reasonable steps to cause Wiluna to qualify or correct the announcement or otherwise disclose the omitted information after the announcement was made by Wiluna. It alleges that Mr Malone participated in the drafting of the announcement for release at a time when he knew of matters which meant the announcement omitted information and he did not take reasonable steps to ensure that the announcement was not false or misleading.

3    ASIC alleges that by reason of Mr Jerkovic's conduct he contravened s 180 of the Corporations Act by failing to exercise his powers and discharge his duties as a director with the required degree of care and diligence and that his contravention was serious. He is also alleged to have contravened s 1309 of the Corporations Act by authorising or permitting the announcement to be given to the operator of a financial market when it omitted information that rendered to the announcement false or misleading in a material particular, to his knowledge. Mr Malone's conduct is also alleged to have contravened s 1309 of the Corporations Act.

4    ASIC seeks declarations of contravention and costs against Wiluna. As against each of Mr Jerkovic and Mr Malone, ASIC seeks declarations of contravention, an order requiring them to pay a pecuniary penalty, an order disqualifying them from managing a corporation for a period and costs. As to key aspects of the case brought by ASIC, Mr Jerkovic has invoked the privilege against exposure to a civil penalty, sometimes referred to as penalty privilege (as to which, see Rich v Australian Securities and Investments Commission [2004] HCA 42; 220 CLR 129 at [23]-[29] (Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ). As matters presently stand, Mr Malone has indicated that he will abide by the outcome in the proceedings.

5    Wiluna does not contest ASIC's case against it and has made formal admissions to that effect. Wiluna seeks to have ASIC's case against Wiluna heard and determined separately and before the final hearing of the case against Mr Jerkovic and Mr Malone. ASIC submits that it is open for the Court to proceed as Wiluna proposes. Mr Jerkovic seeks orders that ASIC's case against Wiluna be heard separately from, and subsequent to, its liability case against Mr Jerkovic and Mr Malone.

6    Subsequent to the events the subject of the claims made by ASIC, Wiluna was placed into administration. The administrators of the deed of company arrangement in respect of Wiluna have proposed a capital raising, the payment of an amount into a trust account for creditors and the relisting of Wiluna. For a time, the position of Wiluna was to the effect that relisting was unlikely while the case brought by ASIC against Wiluna was unresolved. However, by the time of the interlocutory hearing to consider whether ASIC's case against Wiluna should be heard and determined first, it was tolerably clear that the relisting of Wiluna would not be affected if ASIC's case against Wiluna was still pending. Rather, the issue in relation to relisting was the need to ensure there was adequate disclosure of the current state of these proceedings. In circumstances where agreement had been reached as between ASIC and Wiluna (and no pecuniary penalty was sought against Wiluna), disclosure of those matters did not give rise to any complexity. Accordingly, as was accepted by senior counsel for Wiluna, that aspect was no longer likely to have any material bearing upon the decision to be made concerning the order in which the claims ought to be determined.

Outcome

7    For the following reasons there should be orders substantially in the terms proposed by Mr Jerkovic.

Relevant principles

8    'Generally speaking…there is a public policy in the prompt making of final orders where parties have agreed on the outcome of the case…[but] that public policy consideration must be balanced against any impingement on the rights and interests of the contesting respondent': Australian Competition and Consumer Commission v Edison Mission Operations and Maintenance Loy Yang Pty Ltd [2006] FCA 853 at [3]-[4] (Young J).

9    The risk of inconsistent findings in respect of the same allegations made against different defendants may be a reason that counts against making orders on an agreed basis against one defendant before determining a contested case as against another. Inconsistent findings have the tendency to reflect adversely on the institutional integrity of the Court. Further, where proceedings are brought against a number of defendants, the making of findings as against one defendant before the hearing of the case against another defendant may have consequences for the fairness of the conduct of a subsequent trial in which the same issue falls for consideration. Even though earlier findings are not binding on other defendants, a conclusion reached as to an aspect of the case that a continuing defendant does not accept may leave the continuing defendant in a position where there is a need to persuade the Court that the earlier conclusion was wrong. These matters assume particular significance where the relevant proceedings seek civil penalties against some or all of the defendants or the proceedings otherwise involve the making of serious allegations against defendants.

10    In cases where it was alleged that there were parties to a contract, arrangement or understanding that contravened competition laws, the Court has declined to make declarations of contravention as against some parties where the proceedings were being defended by others. In such instances, the approach has been to consider whether to make the declarations after the case as against the other parties had been determined and depending upon the outcome as against those other parties: at Australian Competition and Consumer Commission v Woolworths (South Australia) Pty Ltd (ACN 007 873 118) (Trading as Mac's Liquor) [2003] FCA 530; [27]-[31] (Mansfield J), and cases there referred to.

11    Such an approach has been adopted due to the requirement that declarations of contravention be based upon more than admissions. There must be a foundation in fact that leads the Court to the conclusion that there has been a contravention of the kind to be declared: see the analysis by Jackman J in Australian Securities and Investments Commission v Noumi (No 4) [2024] FCA 1192 at [91]-[95]. Consequently, where multiple defendants are alleged to have been involved in the same conduct, the making of a declaration of contravention as against one defendant is likely to require the Court to make findings of fact and law and to reach ultimate conclusions as to matters that will also bear upon whether there is a basis for relief being obtained against the other defendants. The potential for unfairness in such cases is keen.

12    There are instances where, despite such risks, the course proposed by Wiluna has been followed and declarations have been made against one defendant at a time when proceedings in respect of the same matters were still being pursued against other defendants. However, it appears that in those instances no objection to that course was raised by the contesting party. It appears that the decision by Jackman J in Australian Securities and Investments Commission v Noumi Limited (No 3) [2024] FCA 862 is an example. My decision in Australian Securities and Investments Commission v Australian Mines Ltd [2023] FCA 9 is another.

13    However, in Australian Securities and Investments Commission v TerraCom Limited [2025] FCA 726, Jackman J made orders for the case against the party who admitted the alleged contraventions to be heard and determined separately from and subsequent to the case against the other defending parties. His Honour then dealt with the case against the other defending parties without reading the statement of agreed facts and admissions that had been prepared as between ASIC and the admitting party. Plainly, such an approach was taken by reason of concerns as to fairness of the kind to which I have referred.

14    Likewise, the reasoning of Jackson J in Australian Securities and Investments Commission v R M Capital Pty Ltd [2024] FCA 151 in making a declaration against one defendant in that case in circumstances where the case proceeding against another was based on the conclusion that the making of the declaration would not give rise to inconsistent findings: at [12]-[15]. See also the reasoning of Bennett J in Australian Competition and Consumer Commission v April International Marketing Services Australia Pty Ltd (No 5) [2010] FCA 17 at [27]-[34] and White J in Australian Competition and Consumer Commission v Australian Egg Corporation Ltd [2016] FCA 69 at [23].

The prospect of inconsistent findings in this case

15    The position of Wiluna in the present case was that it was appropriate for ASIC's case against Wiluna to be dealt with now on the basis of Wiluna's admissions because there was no real prospect of inconsistent findings given the nature of the defence to be conducted by Mr Jerkovic. The submissions for Wiluna as to why there would be no inconsistency if the proposed declarations were made against Wiluna were put on the basis that the contents of the agreed facts and admissions as between Wiluna and ASIC were not before the Court. Wiluna's submissions were based on the terms of the concise response filed in answer to ASIC's concise statement.

16    In that regard, in his response to ASIC's concise statement, Mr Jerkovic has admitted certain of the matters alleged by ASIC. He admits matters relating to the capital raising and the publication of the prospectus. He also admits the publication of the relevant announcement as well as key aspects of the basis for ASIC's case as to the matters that are alleged to have been omitted from the announcement. However, Mr Jerkovic claims penalty privilege in respect of the claims by ASIC as to the matters that were communicated by the announcement. He also claims penalty privilege as to ASIC's case as to information that was said to have been omitted from the announcement.

17    In addition, Mr Jerkovic claims penalty privilege as to those aspects of ASIC's case that allege that Mr Jerkovic authorised or permitted the release of the announcement, including claims as to his knowledge and alleged failures by Mr Jerkovic to take reasonable steps to qualify or correct the announcement by disclosing the omitted information.

18    Wiluna's contention was to the effect that Mr Jerkovic did not contest the underlying or primary facts on which the case against Wiluna depended. Rather, his case concerned the legal conclusions to be drawn from facts that were admitted and a denial of additional facts that were only in issue on ASIC's case against Mr Jerkovic (and Mr Malone). It was submitted that in those circumstances, there could be no inconsistences in those findings and the Court's legal conclusions as to matters bearing on Wiluna's liability would not affect the defence that was to be conducted by Mr Jerkovic as disclosed by his concise response.

19    It may be accepted that the terms of the declaratory relief that is sought as against Mr Jerkovic and Mr Malone are different to that to which Wiluna proposes to submit. The differences reflect what I might loosely refer to as the accessorial nature of the claims against Mr Jerkovic and Mr Malone. In order to establish liability on their part, ASIC must not only demonstrate the publication of the announcement, the omission of material information from that statement and the consequential misleading nature of the announcement. It must also demonstrate involvement by Mr Jerkovic (and Mr Malone) of a kind that is alleged to give rise to their individual culpability.

20    As matters presently stand, in order for the Court to be persuaded that the declaration sought against Wiluna should be made, the Court must accept ASIC's case as to what was communicated by the announcement and that the omitted information rendered the announcement misleading. In my view, that will require the Court to make findings as to a mixed question of fact and law concerning the nature and contents of what was communicated by the announcement. In that regard, I note that at least part of ASIC's case concerns matters that were said to have been impliedly communicated to the market by the announcement and a claim that, without the inclusion of the omitted information, the announcement was misleading in a material respect. The claim against Mr Jerkovic (and Mr Malone) also depends upon establishing these matters as well as additional matters as to their involvement in the relevant events.

21    As I have explained, Mr Jerkovic has invoked penalty privilege as to the claims by ASIC concerning what was actually communicated by the announcement and the alleged significance of the omitted information.

22    Consequently, if the Court was to make the declarations sought as against Wiluna at this stage, then as matters presently stand, Mr Jerkovic's defence will include, at least, a denial of matters that will have been found as the basis for the making of declaratory orders against Wiluna. In short, his defence will require him to persuade the Court to make findings that are inconsistent with the findings on which declaratory relief against Wiluna would have been based. That is to give rise to the very concerns identified in the authorities to which I have referred.

23    Even if, contrary to the view I have expressed, the only findings as to matters disputed by Mr Jerkovic that need to be made as the basis for the declaratory relief against Wiluna are findings of law then those concerns will still arise. In determining ASIC's case against Wiluna and granting the declaratory relief sought, the Court will have reached conclusions as to what was communicated by the announcement in the admitted circumstances as to what was omitted. Mr Jerkovic will then be in the position where part of his defence will be to dispute the correctness of those legal conclusions. Indeed, he may be within the ambit of those authorities concerned with those instances where the Court may depart from previous decisions as to the law. In my view, that too is a consequence of a kind that gives rise to the concerns identified in the authorities.

The significance of no penalty being sought against Wiluna

24    Submissions were advanced as to the significance or otherwise of no penalty being sought against Wiluna by ASIC. In cases where a penalty is sought as well as a declaration that may provide an additional reason as to why it is appropriate for the Court to bring the proceedings to an end as soon as possible. However, the fact that a penalty is not sought in the present case does not count in any significant way in favour of the orders sought by Mr Jerkovic. The significant point is the possibility of inconsistency.

Apprehended bias

25    Mr Jerkovic advanced submissions to the effect that a determination by a judge, based on admitted facts, that the declaration sought by ASIC should be granted as against Wiluna would mean the judge would be disqualified from hearing and determining ASIC's case against Mr Jerkovic. He submitted that it was in the interests of justice for the course that he proposed to be followed so as to enable the whole of the proceedings to be determined by the same judge. However, it seems to me that the issue of apprehended bias would only arise if there was the possibility of inconsistent findings. That is to say, it is a further reason why possible inconsistency in findings supports the approach urged by Mr Jerkovic. However, if I had concluded that there is no prospect of inconsistency I would not have been persuaded that an apprehension of bias would arise if the same judge was to make a declaration of contravention against one defendant and then deal with the balance of the case against remaining defendants.

Conclusion and orders

26    For the above reasons, there will be orders for ASIC's case against Wiluna to be heard separately from, and subsequent to, the determination of ASIC's case against Mr Jerkovic and Mr Malone as to liability. There will be provision for a case management hearing as to the determination of ASIC's case against Wiluna thereafter.

Associate:

Dated:    26 June 2026