Federal Court of Australia

PF1 Solutions Pty Ltd (in liq) v Doshi, in the matter of PF1 Solutions Pty Ltd (in liq) (No 4) [2026] FCA 1011

ORDERS

THE COURT ORDERS THAT:

Plaintiff’s interlocutory process filed on 23 June 2026

1.    The plaintiff have leave to file and serve, within seven (7) days of the date of these orders:

(a)    an amended originating process in the form of the amended originating process attached to the plaintiff’s interlocutory process filed on 23 June 2026; and

(b)    a further amended statement of claim in the form of the document marked as MFI-1 at the hearing on 22 July 2026.

2.    The plaintiff pay the defendants’ costs thrown away by reason of the amendments.

3.    Otherwise, the costs of the plaintiff’s interlocutory process filed on 23 June 2026 be costs in the cause.

Defendants’ interlocutory application filed on 3 March 2026

4.    The plaintiff provide, within 14 days of the date of these orders, further security for the defendants’ costs in the sum of $75,000.00.

5.    The proceeding be stayed until such security is provided.

6.    The plaintiff provide, within 28 days of the date of these orders, discovery of the documents in the Schedule to this order.

7.    The defendants’ interlocutory application otherwise be dismissed.

8.    The costs of the defendants’ interlocutory application be costs in the cause.

Generally

9.    The defendants file and serve a defence to the further amended statement of claim within 28 days of the date of compliance with order 4.

10.    The plaintiff file and serve a reply within 14 days of service of any defence to the further amended statement of claim.

11.    The proceeding be listed for further case management at 9:30am on 13 October 2026.

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

SCHEDULE

1.    All documents evidencing investigations undertaken by the liquidator of the plaintiff of and concerning the plaintiff and its former officers, from the date of the liquidator’s appointment until the date of the first public examination conducted with respect to the plaintiff.

REASONS FOR JUDGMENT

GOODMAN J:

A.    Introduction

1    These reasons for judgment address: (1) an application by the plaintiff Company for leave to file an amended originating process and a further amended statement of claim; and (2) an application by the defendants for orders that the Company provide: (a) further security for costs; and (b) discovery of several categories of documents.

B.    The application for leave to FILE AN AMENDED ORIGINATING PROCESS AND A FURTHER AMENDED statement of claim

B.1    Background

2    The current pleadings are the originating process and the amended statement of claim.

3    At the risk of over-simplification, the case as presently pleaded in the amended statement of claim may be summarised as follows:

(1)    the Company was incorporated in May 2012, with the first defendant (Mr Doshi) as its sole director;

(2)    from 1 January 2015, Mr Doshi was replaced as the sole director of the Company by Mr Kamlesh Joshi;

(3)    at all material times:

(a)    Mr Doshi and his wife Ms Ting (the second defendant) were employees of the Company;

(b)    Mr Doshi was the sole signatory on the Company’s bank accounts and had the requisite access and control to pay monies from those accounts;

(4)    between about July 2012 and about September 2018 (when a liquidator was appointed to the Company) a series of payments, defined as the Payments, was made from the Company’s bank account to:

(a)    Mr Doshi;

(b)    Ms Ting;

(c)    a self-managed superannuation fund (SMSF) in respect of which Mr Doshi and Ms Ting were trustees and beneficiaries (Mr Doshi and Ms Ting are the third defendant qua trustees of the SMSF);

(5)    the Payments were made for nil consideration and were not for the benefit of the Company;

(6)    the Payments were applied to purchase and maintain real property in the name of Mr Doshi and Ms Ting in both their individual capacities and qua trustees of the SMSF;

(7)    the Payments were made in breach of:

(a)    Mr Doshi’s employment agreement and his statutory and fiduciary duties as a director and as an employee of the Company;

(b)    Ms Ting’s employment agreement and her statutory and fiduciary duties as an employee of the Company;

(8)    Mr Doshi engaged in a fraudulent and dishonest design and Ms Ting knowingly assisted Mr Doshi in that design;

(9)    each of Mr Doshi and Ms Ting knowingly received funds procured in breach of trust; and

(10)    the Company is entitled to a range of remedies with respect to the above conduct.

4    The Payments are identified in paragraph 36 of the amended statement of claim (and the proposed further amended statement of claim) as the payments set out in Annexure A thereto.

5    The defendants have filed a defence to the amended statement of claim. That defence includes, of relevance to the discovery application, a plea of laches and acquiescence:

Further or in the alternative, if [the Company] is found to be entitled to equitable relief, which is denied, then by delaying until 9 April 2024 to commence this proceeding in respect of a claim alleged to have arisen in 2012, being a delay of more than 12 years, [the Company] has unduly delayed in bringing this proceeding, and is guilty of laches and acquiescence, and such delay shall cause prejudice to the defendants and/or is otherwise excessively onerous on the defendants to defend, and in the premises [the Company] is thereby precluded from obtaining that equitable relief.

6    The parties have also joined issue on aspects of the proceeding via a document titled “ANNEXURE A – SCHEDULE OF THE PAYMENTS WITHDRAWN FROM ACCOUNTS 1 AND 2 – PARTIES CONSOLIDATED RESPONSE” (Consolidated Response).

7    The Consolidated Response uses Annexure A as a starting point and records the position of the parties with respect to each of the Payments listed in Annexure A. It is in the form of a table which includes:

(1)    209 rows concerning individual Payments;

(2)    nine columns, with the headings: “No.”, “Date”, “Amount ($) Withdrawn”, “Account”, “Transaction detail”, “Recipient”, “Plaintiff’s Position”, “Defendants Response” and “Admit/Deny receipt”;

(3)    the following definitions which are deployed in the column headed “Plaintiff’s Position”:

(a)    “Wages” means: “The wages earned by either Doshi or Ting pursuant to their employment contracts. To the extent the total of the wages exceed Doshi and Ting’s contractual entitlements, that excess is recoverable by the Company as alleged in the ASOC”;

(b)    “Super” means: “Payments made into a superannuation account. This includes the superannuation to which either Doshi or Ting were entitled to be paid arising from their employment. To the extent the total sum of these payments exceed Doshi and Ting’s entitlements that excess is recoverable by the Company as alleged in the ASOC”;

(c)    “Payment without authority/breach of duty” means: “A payment made by the Company to Doshi or Ting or both of them which was unauthorised or was otherwise made or received in breach of trust or of their duties or obligations as alleged in the ASOC”;

(4)    in the column headed “Plaintiff’s Position”:

(a)    a statement on behalf of the Company as to whether each Payment is pressed or not pressed; and

(b)    for the Payments which are indicated as pressed, a further statement which classifies the transaction as “Wages”, “Super” or “Payment without authority/breach of duty”.

B.2    The proposed amendments

8    The focus of the application was upon the proposed amendments to the amended statement of claim, rather than the proposed amendments to the originating process.

9    The Company originally sought leave with respect to a pleading attached to its interlocutory process.

10    Subsequently, the legal representatives of the parties, commendably, engaged in a dialogue concerning the defendants’ objections to that pleading.

11    At the commencement of the hearing, counsel for the Company provided a further draft of the pleading in respect of which the Company sought leave. That version contained some recent amendments aimed at addressing some of the defendants’ objections. Although there was at least one prior version of the pleading proffered by the Company, I will refer herein to the version relied upon at the hearing (and upon which the application was ultimately fought) as the proposed further amended statement of claim.

12    The proposed amendments start with a shift away from the proposition that from 1 January 2015, Mr Doshi was replaced as the sole director of the Company by Mr Joshi (see [3(2)] above) and instead assert that – despite the records maintained by the Australian Securities and Investments Commission indicating such a change – the true position is that: (1) Mr Doshi continued to act as a director of the Company; or (2) Mr Joshi was accustomed to acting in accordance with the instructions or wishes of Mr Doshi; and that as a result Mr Doshi was a director of the Company within the meaning of s 9 of the Corporations Act 2001 (Cth) from the date of the incorporation of the Company in 2012 until the date of the appointment of the liquidator in 2018.

13    The proposed amendments, again at the risk of over-simplification, then include allegations to the following effect:

(1)    Mr Doshi made the Payments or authorised, facilitated or permitted the Payments being made by Mr Joshi and did so:

(a)    in contravention of ss 180 to 182 of the Act;

(b)    in breach of fiduciary duties he owed to the Company;

(2)    Ms Ting and the SMSF are accessorily liable for: (a) Mr Doshi’s contraventions of ss 180 to 182 of the Act; and (b) his breaches of fiduciary duty;

(3)    Mr Joshi made the Payments or authorised, facilitated or permitted the Payments being made by Mr Doshi and did so:

(a)    in contravention of ss 181 and 182 of the Act;

(b)    in breach of fiduciary duties he owed to the Company;

(4)    Mr Doshi, Ms Ting and the SMSF are accessorily liable for: (a) Mr Joshi’s contraventions of ss 181 and 182 of the Act; and (b) his breaches of fiduciary duty; and

(5)    the Company is entitled to a range of remedies with respect to the above conduct.

14    Subsequently, the legal representatives of the parties, commendably, engaged in a dialogue concerning the defendants’ objections to the proposed amendments.

B.3    The defendants’ objections to the proposed amendments

15    Following that dialogue the defendants take issue with the following aspects of the proposed amendments.

16    The defendants’ first objection concerns paragraphs 139, 147 and 154 of the proposed further amended statement of claim. Paragraphs 139 and 147 each state: “The Payments were received by Doshi, Ting and/or the SMSF”. Paragraph 154 states: “Each of Doshi, Ting and/or the SMSF stood by and allowed each other to receive the Payments for no consideration and for no benefit to [the Company]”.

17    The defendants complain that there is an inconsistency between: (1) paragraphs 139, 147 and 154 of the proposed further amended statement of claim which allege that the Payments were received solely by Mr Doshi, Ms Ting and/or the SMSF, on the one hand; and (2) Annexure A which records some payments allegedly made to persons other than Mr Doshi, Ms Ting and the SMSF, on the other. They submit that this creates an irreconcilable contradiction within the proposed amended statement of claim and places the defendants in an invidious position.

18    In response, the Company relies upon the following particular included (recently) in the proposed further amended statement of claim:

Doshi, Ting and the SMSF received the Payments from the Bank Accounts (paragraphs 36 and 37 of the FASOC and the Consolidated Response).

19    The Consolidated Response is described at [6] to [7] above.

20    It is clear from the definitions of “Wages” and “Payment without authority/breach of duty” in that document that the Company alleges that the Payments identified as falling within those categories were made to Mr Doshi, Ms Ting or the SMSF.

21    The definition of “Super” is less clear. It leaves open the possibility that some of the Payments falling within this category were paid to a party other than Mr Doshi, Ms Ting or the SMSF. For example, superannuation paid to another employee of the Company.

22    Nevertheless, I do not regard this potential ambiguity as a reason not to grant leave to file the proposed further amended statement of claim. It is sufficiently clear (from at least paragraphs 139, 147 and 154 of the proposed further amended statement of claim) that the Company alleges that all Payments, including those Payments which fall within the “Super” category, are payments received by Mr Doshi, Ms Ting or the SMSF. The defendants are in a position to plead to the relevant allegations in the proposed further amended statement of claim. In this regard, I note that the Consolidated Response records, in the “Admit/Deny receipt” column, the defendants’ answers to the assertion that particular Payments were received by them. Further, I am not satisfied that the defendants will not be in a position fairly to prepare their affidavit evidence in response to the affidavit and documentary evidence served by the Company.

23    The defendants’ second objection concerns paragraphs 118, 126, 140(d), 148(d) and 153(d) of the proposed further amended statement of claim and the particularisation of the allegations of actual knowledge made in those paragraphs.

24    Paragraphs 118 and 126 are in the following form:

118.    At all material times, each of Doshi, Ting and the SMSF had actual knowledge of the matters pleaded above in paragraphs 36 to 37 and 42 to 44.

126.    At all material times, each of Ting and the SMSF had actual knowledge of the matters pleaded above in paragraphs 36 to 37 and 42 to 44.

25    Each is supported by the following particulars:

This is to be inferred from the following matters:

i.    Doshi, Ting and the SMSF received the Payments from the Bank Accounts (paragraphs 36 and 37 of the FASOC and the Consolidated Response);

ii.    in respect of certain of the Payments received by Doshi and Ting, both Doshi and Ting had knowledge of the receipt of the Payments because they were received into a joint account in the name of Doshi and Ting;

iii.    in respect of the Payments received by the SMSF, both Doshi and Ting had knowledge of the receipt of the Payments because they were received into a bank account in the name of the SMSF and Doshi and Ting were, at all material times, the joint and several trustees of the SMSF;

iv.    Doshi, Ting and the SMSF did not provide any benefit to [the Company] for the Payments and [the Company] did not otherwise receive any benefit from the Payments; and

v.    Doshi, Ting and the SMSF did not provide any consideration to [the Company] for the Payments and [the Company] did not otherwise receive any consideration for the Payments.

26    Paragraph 140(d) of the proposed further amended statement of claim contains an allegation that Ms Ting and the SMSF had knowledge of facts which to an honest and reasonable person would indicate that the Payments were made in breach of the fiduciary duties owed by Mr Doshi to the Company. Paragraph 148(d) contains a similar allegation with respect to knowledge of Mr Doshi, Ms Ting and the SMSF concerning breaches of the fiduciary duties owed by Mr Joshi to the Company. Paragraph 153(d) contains a similar allegation with respect to knowledge of Mr Doshi, Ms Ting and the SMSF concerning breaches of the fiduciary duties owed by each of Mr Doshi and Mr Joshi to the Company. Each of these three paragraphs include an extensive list of matters from which it is alleged that knowledge of the relevant persons is to be inferred.

27    Again, the submissions made on behalf of the defendants focused upon the particularisation of knowledge of Mr Doshi, Ms Ting and the SMSF with respect to Payments identified in Annexure A which may have been made to other parties. It was submitted that there has not been proper particularisation in accordance with r 16.43 of the Federal Court Rules 2011 (Cth). I do not accept this submission.

28    As noted above, it is sufficiently clear that the Company alleges that all of the Payments were made to Mr Doshi, Ms Ting or the SMSF. It is not part of the Company’s case that any of the Payments were made to other parties. Thus, there is no deficiency in the particularisation of knowledge concerning Payments made to other parties.

29    The defendants’ third objection concerns paragraphs 119 and 127 of the proposed further amended statement of claim.

30    These paragraphs are contingent upon paragraphs 118 and 126 of the proposed amended statement of claim respectively. The objection was built on the objection to paragraphs 118 and 126 and fails for the same reasons as the objection to those paragraphs.

31    The defendants’ fourth objection is based upon their contention that most, if not all, of the Payments are statute barred in circumstances where the first of the Payments were made between 2012 and September 2018 and the proceeding was not commenced until April 2024. I do not regard this as a sufficient reason to deny leave to file the proposed further amended statement of claim, particularly as: (1) this would effectively amount to a summary determination of the limitation issue in circumstances where there has not been full argument and it may be that the argument needs to take into account particular evidence; and (2) this argument has been available to the defendants since the commencement of the proceeding and the defendants have pleaded the limitation defence in their defence, without seeking a summary determination of the issue.

32    The defendants’ final objection concerns the delay on the part of the Company in seeking to advance the new claims in circumstances where there appears to be no reason why such claims could not have been advanced in the original statement of claim. The Company’s explanation is that it has recently changed its legal representation and as a result it wishes to advance the new claims. As counsel for the defendants fairly acknowledged, this explanation does have some force. This is particularly so when dates for the hearing are yet to be set and the defendants are yet to file and serve any evidence upon which they propose to rely at the hearing.

33    For all of the above reasons, there should be a grant of leave to the Company to file the proposed further amended statement of claim. It follows that there should also be a grant of leave with respect to the proposed amended originating process. The Company should pay the defendants’ costs thrown away by reason of the amendments. The costs of the application for leave to amend should be costs in the cause.

C.    the application for further security for costs

34    I turn now to the application for further security for costs.

35    On 17 April 2025, I made an order that the Company provide security for the defendants’ costs in the sum of $200,000.00: see PF1 Solutions Pty Ltd (in liq) v Doshi, in the matter of PF1 Solutions Pty Ltd (in liq) (No 3) [2025] FCA 373 (PF1 (No 3)).

36    Such security was provided on 30 April 2025.

37    On 3 March 2026, the defendants filed an application for further security for costs. That application is supported by an affidavit of the defendants’ solicitor in which he provides a revised estimate of the defendants’ total costs of $498,130.00.

38    During the course of the present application, the Company provided a further $50,000.00 by way of security.

39    Hence, the defendants seek further security in the sum of $248,130.00 ($498,130.00 less ($200,000.00 + $50,000.00)).

40    As with the earlier application for security, the only issue is as to the quantum of the security to be ordered. The Court’s discretion with respect to the quantum of security to be ordered must be exercised judicially but is a discretion of some breadth. As I noted in PF1 (No 3) at [8], it is appropriate to take a “broad-brush” approach to the setting of an amount to be provided by way of security for costs. Although the purpose of such an order is to provide some protection to the defendants such that any costs order in their favour is not pyrrhic, it is not part of the purpose of such an order to provide a complete indemnity for the costs of a successful party.

41    The following matters are relevant to the determination of an appropriate amount of security.

42    First, the revised estimate of the defendants’ costs provided by the defendants’ solicitor.

43    That estimate of costs may be summarised as follows:

44    The following matters may be noted with respect to this estimate:

(1)    the estimated future costs comprise costs for senior counsel ($118,800.00), junior counsel ($67,501.19) and solicitor ($52,745.00). In this regard:

(a)    the costs for senior counsel are calculated at a daily rate of $12,000.00 (plus GST), when the National Guide to Counsel Fees provides a guideline daily rate of $2,100.00 to $7,650.00 for senior counsel. If the top of that range were to be used, then the total figure would be $75,735.00, a reduction of $43,065.00;

(b)    the solicitor’s costs are included on a solicitor and client basis and without any discount to reflect likely recovery on a party and party basis. If the estimate of solicitor’s costs were to be multiplied by 0.7 to reflect a more realistic recovery rate, then the total figure would be $36,921.50, a reduction of $15,823.50;

(2)    the solicitors’ costs already incurred and the costs of the present application are also included on a solicitor and client basis and without any discount to reflect likely recovery on a party and party basis. If the same multiplier were used, then the total figure would be $48,548.50, a reduction of $20,806.50;

(3)    no overall discount for the vagaries of litigation has been applied;

(4)    the nature of the expert evidence to be adduced has not been described with any precision, although I understand it to be an expert who can opine on matters relevant to defences to contraventions of ss 180 to 182 of the Act. No expert was identified nor has evidence of an estimate of costs provided by such an expert been adduced; and

(5)    the defendants have been the subject of several costs orders. It follows that the defendants will not recover their own costs of events the subject of those adverse costs orders.

45    Secondly, since that estimate was made, the Company has brought the amendment application discussed above, with the result that the defendants have incurred costs with respect to that application and will incur further costs in filing a defence to the further amended statement of claim; and in addressing the new claims made in that pleading. As to the last of these matters, it appears from the proposed amended statement of claim that the factual substratum will remain largely (but not entirely) the same; however the various different ways in which the new claims are expressed will require additional work.

46    Finally, as previously noted, the Company has already provided $250,000.00 by way of security for the defendants’ costs.

47    Taking all of the above matters into account, and applying a necessarily broad-brush approach, an appropriate amount of further security is $75,000.00 (taking the total amount of security provided to $325,000.00) and I will make an order for the provision of further security in that amount.

D.    the discovery application

48    Discovery was originally sought with respect to six categories of documents. As a result of constructive discussions between the legal representatives of the parties, it has become unnecessary to address most of these categories. I note that, as part of those constructive discussions, the Company has agreed to provide a list of the documents upon which it proposes to rely at the hearing of this proceeding (subject of course to the reservation of a right to supplement that list in appropriate circumstances).

49    The remaining categories of documents are:

50    In summary, the defendants’ position is that such discovery should be ordered because:

(1)    the defendants have pleaded the defence of laches and acquiescence set out at [5] above;

(2)    the Company has served an affidavit made by its liquidator in which he has deposed that:

(a)    his investigations into the affairs of the Company were impeded by a lack of assistance from the current and former directors of the Company and as a consequence he needed to carry out a series of public examinations;

(b)    between 3 October 2018 and 4 December 2018, the liquidator sent correspondence to the first defendant seeking information from the first defendant and Mr Joshi;

(c)    the public examinations were carried out in November 2022, June 2023 and September 2023;

(3)    an exhibit to that affidavit includes remuneration approval request reports which refer to hours spent by the liquidator and his employees during the liquidation and that some “investigations” were conducted; and

(4)    the defendants wish to obtain evidence to test, as part of their defence of laches and acquiescence, what the liquidator was doing during the period from December 2018 to November 2022 with respect to the claims that the Company now brings against the defendants.

51    Counsel for the Company submitted that categories 1 and 2 are overly broad and would catch many documents not relevant to the purpose of the discovery request as explained above. I agree.

52    In my view the defendants are entitled to some discovery for the purpose that has been identified. The discovery to be provided should be limited to discovery in accordance with categories 1.3 and 1.4, modified as follows:

All documents evidencing investigations undertaken by the liquidator of the plaintiff of and concerning the plaintiff and its former officers, from the date of the liquidator’s appointment until the date of the first public examination conducted with respect to the plaintiff.

E.    Conclusion

53    For the foregoing reasons: (1) there should be a grant of leave to file the proposed amended originating process and the proposed further amended statement of claim; (2) the Company should provide further security for costs in the amount of $75,000.00; and (3) the application for discovery with respect to categories 1 and 2 should be dismissed save with respect to categories 1.3 and 1.4 (as modified). I will make orders accordingly.

Associate:

Dated:    30 July 2026