Federal Court of Australia

Benjamin Hornigold Ltd v John Bridgeman Limited (Default Judgment) [2026] FCA 1127

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to r 5.23(2)(c) of the Federal Court Rules 2011 (Cth), there be judgment for the Plaintiff against the Fourth Defendant in the amount of $8,971,569.52.

2.    The Fourth Defendant pay the Plaintiff’s costs of the Plaintiff’s interlocutory application for default judgment dated 20 July 2026.

3.    The proceeding otherwise be dismissed.

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

REASONS FOR JUDGMENT

Delivered ex tempore, revised from transcript

NEEDHAM J:

1    By an interlocutory application accepted for filing on 21 July 2026, the plaintiff seeks default judgment against the fourth defendant, JB Markets Pty Ltd (ACN 123 876 291) (JBM), for amounts owing under three separate loans which are set out at paragraphs 1(a), (b) and (c) of the interlocutory application (default judgment application). The basis for the order is that the fourth defendant is in default by failing to attend hearings in the proceedings and failing to prosecute or defend the proceedings with due diligence: see rule 5.22(c) and (d) of the Federal Court Rules 2011 (Cth).

2    There is a complicated history in these proceedings which is not necessary to traverse in any detail, but suffice to say that the fourth defendant, as demonstrated by Exhibit A in this application (being a Current and Historical ASIC Extract of the fourth defendant extracted on 6 August 2026), has no current directors and has a registered office from which apparently documents are returned if mail is sent to it.

3    In support of the default judgment application, the plaintiff relies on an affidavit of Michael Russell Catchpoole of 20 July 2026, which sets out the procedural history of the fourth defendant’s defaults from paragraph 7 onwards, and sets out the current position in paragraphs 33 and 34. That position is that no lay evidence or defence to the Amended Statement of Claim (ASOC) have been filed for the fourth defendant by a person competent to act on its behalf – that is a reference to the fact that the next to last director of the fourth defendant, Mr Peter Aardoom, had been granted leave to carry on proceedings on behalf of the fourth defendant otherwise than by a solicitor, but that leave was withdrawn on 17 October 2025.

4    A non-party costs order was made against Mr Aardoom on 18 December 2025 on the basis that he had continued to act for the company after he was no longer a director and had no basis to carry on those proceedings – see Benjamin Hornigold Ltd v John Bridgeman Ltd (Non-party costs order) [2025] FCA 1682. Since then, Mr Stuart McAuliffe, who was a director of the first defendant, John Bridgeman Limited (JBL), was appointed a director of the fourth defendant, but Mr McAuliffe is now bankrupt and thus the fourth defendant is left without any directors.

5    Section 23 of the Federal Court of Australia Act 1976 (Cth) (FCA Act) provides that the Court has power in matters in which it has jurisdiction to make orders including interlocutory orders as the Court thinks appropriate. I am satisfied that, as this matter is one arising out of the Corporations Act 2001 (Cth), I have jurisdiction. I am further satisfied that, bearing in mind the defaults of the fourth defendant, rules 5.22(c) and (d) of the Rules are activated.

6    Rule 5.23(2)(c) of the Rules provides:

5.23  Orders on default

…

(2) If a respondent is in default, an applicant may apply to the Court for:

…

(c) if the proceeding was started by an originating application supported by a statement of claim or an alternative accompanying document referred to in rule 8.05, or if the Court has ordered that the proceeding continue on pleadings—an order giving judgment against the respondent for the relief claimed in the statement of claim or alternative accompanying document to which the Court is satisfied that the applicant is entitled; or

…

…

7    I am satisfied that this proceeding falls within rule 5.23(2)(c) because it was commenced by an originating application. Pleadings were then ordered and the proceeding has continued on pleadings, the relevant pleading before me being the ASOC. As I have said, there is no effective defence to the ASOC.

8    In order to be satisfied that the plaintiff is entitled to the relief sought in rule 5.23(2)(c) of the Rules, it must be demonstrated that the defendant has been served with the relevant documents: see Speedo Holdings BV v Evans (No 2) [2011] FCA 1227 at 18 per Flick J. Two employees working for Corrs Chambers Westgarth, Mr Catchpoole’s firm, have made affidavits as to attempts as to service. They are affidavits of Mr Thomas Ethan Nunn-Rutledge of 23 July 2026 and Mr Daniel Phillip Sobel of 24 July 2026.

9    Mr Nunn-Rutledge attempted to serve the interlocutory application in these proceedings on the registered office of the fourth defendant. As I have said, that address is problematic, as demonstrated by a note in Exhibit A that mail had been returned. The address refers to two numbers in a street in New Farm, Queensland. Those two numbers are apparently two separate buildings and the indication of where in those buildings the fourth defendant is registered is only noted as “L 8”. Mr Nunn-Rutledge was informed by a person exiting the ground floor lobby of one of the buildings that level 8 could not be accessed by non-residents, and “[t]hat a person named ‘Peter’ who was associated with JBM lived at Unit 84” at that address. Mr Nunn-Rutledge, acting on some information from Corrs to the effect that Mr Aardoom, whose first name is Peter, was a former director of JBM, then placed the service documents in letterbox number 84, and he has provided a photograph of that letterbox.

10    Mr Sobel indicated that he posted, by registered mail, the default judgment application and a letter for the attention of the proper officer of JBM. That mail had a tracking number, and Mr Sobel gives evidence that, according to information on the Australia Post webpage for the tracking number, delivery had been attempted but could not be made “because the address was incorrect, incomplete or unclear”. He has provided details of those notifications from Australia Post in his affidavit.

11    Also tendered in these proceedings are three emails as Exhibits B, C and D. These are emails which were sent respectively by Mr Aardoom, Mr McAuliffe and the Court Registry. Each of Mr Aardoom and Mr McAuliffe contacted my chambers. Mr Aardoom copied in Mr Catchpoole and other addressees and sought an adjournment of the default judgment application which was originally listed on 27 July 2026. Mr McAuliffe sent his email directly to my Associate and only to my Associate. It attached a letter and transcript of other proceedings, which, given that Mr McAuliffe is not, and has not been, a party to these proceedings, nor is he a current director of the fourth defendant, were not read.

12    My Associate wrote to Mr Aardoom, and the Registry wrote to Mr McAuliffe, noting that they were not parties to the proceedings nor did they have leave to carry on the proceedings on behalf of the fourth defendant, and that the matter would proceed today.

13    The matter was called outside court and there was no response, and neither Mr Aardoom nor Mr McAuliffe have sought to attend the proceedings by Webex.

14    Given Mr Aardoom – the former director of the fourth defendant who apparently lives at the registered address of the company – has been in contact with the court and has been notified of today’s hearing, I do not take the view that in light of the efforts that have been made and the responses by Mr Aardoom and Mr McAuliffe that there is any need for any substituted service order or any other orders making up any deficits in the service. I am satisfied that the default judgment application has been brought to the attention of the fourth defendant and the former directors.

15    I now turn to the need to be satisfied that the plaintiff would be entitled to the relief sought – see CNIP Pty Ltd v Chan & Naylor Norwest Pty Ltd (No 2) [2011] FCA 1170 at [18] to [19] per Perram J. Mr Hynes, who appears with Mr Zhu on this application, has provided submissions which set out the way in which the plaintiff would seek, were the matter to run, to plead and prove its case. I note that the way in which the case needs to be proved on default judgment is not to provide evidence of each and every pleaded claim, but to view the pleading on the face of the statement of claim, in the context that no defence has been filed, and determine whether in those circumstances the plaintiff has made out its case.

16    The submissions set out the case against the fourth defendant, being that it is an Australian Financial Services Licensee which was responsible and ultimately liable for the conduct of the first defendant as its authorised representative. Division 6 of Part 7.6 of the Corporations Act sets out the scheme by which a licensee is responsible for the conduct of its authorised representative. The pleaded losses are that the first defendant caused the plaintiff to enter into three related party loans which formed part of an investment portfolio managed by the fourth defendant. The ASOC pleads that the first defendant was responsible for those loans and that, in very brief terms, the plaintiff has suffered damage and the fourth defendant is responsible for the actions of the first defendant.

17    I am satisfied the plaintiff would be entitled to the relief sought and that the fourth defendant is in default of the orders of the Court, so that an order for default judgment would be appropriate. I have had regard to the factors relating to the exercise of my discretion to order default judgment, as set out in Professional Administration Service Centres Pty Ltd v Commissioner of Taxation [2012] FCAFC 180; 295 ALR 52 (Edmonds, McKerracher and Nicholas JJ) at [44]. In particular, I have had regard to the length of time the proceedings have been on foot, the extent of the defaults, the fact that the company is unlikely to be able to defend the proceedings given the lack of any company officers, and the lack of efforts by the fourth defendant to engage in a proper manner with these proceedings, and I note here what I said in the non-party costs order decision referred to earlier.

18    The overarching purpose of section 37M of the FCA Act requires that proceedings be conducted so as to facilitate the just resolution of disputes according to law as quickly, inexpensively and efficiently as possible. The disposition of these long running proceedings by way of default judgment, without the consequential need to prove each of the claims by way of the evidence which has been filed, is consistent with that purpose.

19    I have been provided with calculations of the loss, which need to be updated to reflect today’s date. But for the calculation of subparagraph (a), I am prepared to make those orders. The plaintiff should provide my chambers with reworked figures for the making of order 1, and short submissions if there is to be no change, and I will then make those orders in Chambers once those submissions have been considered.

20    The proceedings are otherwise dismissed, and the fourth defendant is to pay the plaintiff’s costs of this application.

Associate:

Dated:    12 August 2026