Federal Court of Australia

Hagakure Limited v Cassisi, in the matter of vbaZen International Pty Ltd [2026] FCA 1235

ORDERS

THE COURT ORDERS THAT:

1.    Within 21 days of the date of these orders, the parties provide to the Associate to Goodman J agreed orders (or failing agreement, competing orders) to give effect to these reasons for judgment.

2.    If the parties are unable to agree on the proposed orders referred to in order 1, then:

(a)    within 28 days of the date of these orders each party file and serve written submissions of no more than five (5) pages in support of the orders sought by that party; and

(b)    the proceeding be listed for further case management on a date and time to be agreed between the parties and the Associate to Goodman J.

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    At the heart of this proceeding is the third defendant, vbaZen International Pty Ltd (Company) and intellectual property relating to a software product described as an add-in for Microsoft Excel primarily aimed at enhancing the Visual Basic for Applications (VBA) programming language.

2    The Company has two members, each holding one-half of the issued shares in the Company, namely:

(1)    the first plaintiff, Hagakure Limited, a company of which the second plaintiff, Mr Aldo Coronelli, is the sole member and director. I will refer to Hagakure and Mr Coronelli collectively as the Coronelli Interests; and

(2)    the second defendant, Tovica Technology Pty Ltd, a company of which the first defendant, Mr Toni Cassisi, is the sole member and director. I will refer to Tovica Technology and Mr Cassisi collectively as the Cassisi Interests.

3    Mr Coronelli and Mr Cassisi are the only directors of the Company.

4    Mr Coronelli is an investment adviser and Mr Cassisi is a computer software programmer.

5    The Company was incorporated on 1 February 2023. As will be seen, the incorporation of the Company and another company (vbaZen Limited) which was incorporated in the United Kingdom, was a step taken by Mr Coronelli and Mr Cassisi as part of a project (Project), which had been ongoing for many years with the aim of developing and commercialising the software product. That product was referred to by the Coronelli Interests and the Cassisi Interests as “ATCXL” and later “vbaZen”. Mr Coronelli described that product as:

… an advanced software add-in for Microsoft Excel that transforms the spreadsheet into a powerful analytics and automation platform. It extends Excel’s core capabilities with a rich set of statistical functions (offering dozens of built-in probability distributions), data structures, and optimization algorithms. The product integrates seamlessly with external computation engines like R, mapping Excel/VBA data types to R equivalents to leverage additional computational and graphical power. Its broad purpose is to enable complex data analysis, modelling, and workflow automation directly within the familiar Excel environment – effectively turning Excel into a robust tool for both high-end analytics and streamlined business productivity. Advanced regression models, linear algebra solvers, and non-linear optimizers (including support for 18 different algorithms, similar to MATLAB’s fmincon solver) are built in, allowing users to tackle complex calculations and optimizations without leaving Excel. In summary, vbaZen evolves Excel into a comprehensive analytical toolkit, combining ease-of-use with the capabilities of a scripting language and statistical software in one package. Potential users of vbaZen are financial analysts, data scientists, excel power users and business analysts and software developers and technical users of Excel.

6    In about March 2024 the Coronelli Interests and the Cassisi Interests fell out, in a context in which the effect of the above-mentioned memberships and directorships is that unanimity of votes is required for decisions to be made by the members and by the directors of the Company. That falling out is considered in detail below.

7    The principal relief sought by the Coronelli Interests is an order pursuant to s 233 of the Corporations Act 2001 (Cth) requiring the Cassisi Interests to purchase Hagakure’s 50 per cent interest in the Company, on the basis of alleged conduct of the Cassisi Interests in denying the Coronelli Interests access to the intellectual property.

8    Such relief is sought upon the premise that the Court finds that the Company owns the intellectual property.

9    If the Court were to find that that the Company does not own the intellectual property then the Coronelli Interests seek: (1) an order for damages pursuant to s 236 of the Australian Consumer Law (being Schedule 2 to the Competition and Consumer Act 2010 (Cth)) for alleged misleading or deceptive conduct by the Cassisi Interests in contravention of s 18 of the Australian Consumer Law; and (2) orders for specific performance of an alleged agreement concerning the transfer of the intellectual property.

10    For the reasons developed below: (1) the Company owns the intellectual property; (2) the order sought under s 233 of the Corporations Act should not be made; and (3) the misleading or deceptive case and the contract case do not arise for consideration.

B.    Findings of fact

11    The Coronelli Interests relied upon affidavits of Mr Coronelli sworn on 30 September 2024, 7 April 2025 and 30 June 2025; and an affidavit of Ms Naomi Griffin (the solicitor for the Coronelli Interests) sworn on 6 February 2025.

12    The Cassisi Interests relied upon affidavits of Mr Gregory McKenzie (Chief Information Officer and Patent Attorney with RISKflo) sworn 14 July 2025 and Mr Cassisi sworn on 12 November 2024, 19 May 2025 and 18 July 2025..

13    Only Mr Cassisi was cross-examined.

14    There are several thousands of pages of contemporaneous documentary evidence. This evidence, for the most part, reveals what has happened, and given its inherent reliability, has been the primary resource from which I have made the findings of fact set out below. The evidence contained in various emails has been reproduced at length in order to allow an appreciation of the nature of the relationship between the Coronelli Interests and the Cassisi Interests and its subsequent deterioration.

15    Relatedly, much of the affidavit evidence (and in particular the affidavit evidence of Mr Coronelli and Mr Cassisi) is tendentious and thus of limited value in the ascertainment of the facts, save perhaps as a demonstration of the considerable animus that has developed between Mr Coronelli and Mr Cassisi.

16    Mr Coronelli and Mr Cassisi met in around 2007 or 2008. Mr Coronelli asked Mr Cassisi to teach him programming and at the same time to help develop some specific prototype solutions to problems he was encountering developing an analytical platform. Mr Coronelli regarded Mr Cassisi as the right person to help him develop, fine tune and realise his vision of developing an enhanced VBA product.

17    Mr Coronelli’s evidence was that:

(1)    the Project emerged from his professional experience as a finance practitioner, including as an asset allocator, operational consultant and hedge fund manager, which suggested to him that Excel remained a central tool in the workflow of a wide range of professionals and that this would not change any time soon given how ingrained the application had become in most institutions; and

(2)    he had experienced first-hand though how inadequate and inflexible the programming environment was in VBA and how a lot of the existing applications available to users, complementing Excel, were aimed at very specific user cases and did not provide an ability to directly interact with VBA.

18    From around 2012, Mr Cassisi and Mr Coronelli were in frequent contact regarding the Project.

19    Since 2013, the source code for the software product has been in the Cloud.

20    During the period 2013 to 2024, Mr Coronelli monitored and contributed to the development of the software product on a regular basis. He regularly used, tested and provided feedback on the product and stress-tested it in real life applications. Each time there was a new version of the software, he checked its functionalities and user experience.

21    Between November 2015 and January 2016, Mr Cassisi and Mr Coronelli exchanged the following emails with the subject line “Budget info”. As part of that exchange, there were discussions concerning the software product and the establishment of a joint venture company to commercialise that product. The exchanges included the following.

22    On 6 November 2015, Mr Cassisi wrote:

…

For example, we could try to split the funding 50/50 through the company structure I proposed in a previous email. That is, you loan our new joint company something and that company contracts out to mine for the work, therefore, mine ends up paying all my taxes, super, etc as usual (and we avoid tax problems with the joint company). If things did well in a few years and we wanted to take some profits, then the company would repay you that loan without any tax either here in Australia or personally in the UK. However, for me to receive matching profits at the same time we would have to use an inter-company charge. Once there are no loans outstanding, then we can both take dividends, however, you will then pay tax on that whereas you don’t on the loan repayment.

23    On 28 November 2015, Mr Cassisi wrote:

I have been thinking further on “moving forward”, and I would suggest we could divide the plans into two separate phases.

Phase 1. We continue as now – i.e. we aim to develop enough to get a product together to move into the second Phase and we joint fund this based on minimum cost.

Phase 2. We start a new joint company and find a way to fund that. For that, we prepare business plans including advertising and a plan for growth including hiring staff.

My reasoning is that there are expenses and complications associated with the company in Australia and there’s no need to start incurring them until we have to. Moreover, we need to take our time to get the business plan right and to decide what precisely the product we are selling should look like.

So I’m thinking we split the funding for Phase 1 as per below: but I can open an EUR account for my existing Tovica company, or it can just be a personal one in my name – will check with the accountant if it makes any difference.

My ideal would be to start this at the end of January, which gives time to find a cheap room to rent in a shared office somewhere (I have one in mind, but there might be more possibilities).

The initial outlay would be the rent deposit and the need to buy a computer system to go in the office for development.

I definitely need to wind down developing at home – too many pressures on the family….

Your thoughts appreciated,

24    On 30 November 2015, Mr Coronelli responded:

I would be fine with the solution outlined below provided that:

•    we seriously work on bringing it to market – they need to be ‘productive’ months for both of us in different areas. A lot should be on me in this phase too…

•    we strengthen a bit the more informal relationship we currently have, since I first of all believe in it and in second place ( touching wood) many things could happen.

•    we define a window within which we will need to make a decision on commercialisation.

In particular:-

•    I would like to be sure that, if something happened to me, a reasonable part (we can define it) of eventual profits for a certain period of time could go to my family. I would take it on me to make sure the opposite happens too (for a bigger share given your kids are much younger and for a longer period). I know it is maybe stupid to think about it this way but I see saw many things happening

•    Repository of code and instructions on how to assemble/operate. I operate on trust but, if something happened, I wouldn’t know what to do. I know it is online but I have never tried to use it…

•    Exclusivity on commercial development – We operate on a right of first refusal ,unless we come to a mutually agreeable solution involving a third party.

•    ….

These are just initial thoughts but I would see no harm in putting something we both share on paper.

Let me know what you think

25    On 27 January 2016, Mr Cassisi wrote:

An email to digest before our call tomorrow – one to print for bedtime reading:)

Two Phases:

Phase 1 – a shared funding agreement as outlined below. We add to that our intent to move into phase 2 using a company etc (see below).

Phase 2 – a joint company which licenses the software off Tovica to exclusively sell it; usual source code escrow and right of first refusal on 3rd parties (see below).

Phase 1: Two Stages:

I would suggest we have a two-stage plan for this initial phase. We aim to perform the tasks below within the Feb-Dec timeframe, with a checkpoint in Nov. At that checkpoint, we look holistically at where we are and decide if we want an additional, say, two months, and what we will do in those. We then continue in a similar fashion (i.e. tight two month checkpoints with highly defined goals) as needed, constantly reviewing to be sure there is no “mission creep”.

That is, I definitely agree our aim should be to be ready product-wise to sell it at the end of 2016. However, we’re going to need outside assistance for the website design phase (and maybe more) and probably support or marketing. That will require a different funding arrangement – i.e. what I’m calling “phase 2”. It is at that point we will need a new company.

So I feel the natural “break point” between these phases is when we are confident our product, website and marketing documentation/strategy is ready and the code base totally reflects what we are selling. And, also important, that we ensure our code base can be supported with minimum overhead including licencing issues, software updates and billing etc.

I would also consider it aspirational if we could have the website logic in place, even if there is no “design” yet. E.g. we might decide later on the priority should be writing some new module for the add-in, but I’d like to include the website logic if possible within the first phase at this early stage.

Tasks

Our tasks need to be clear – my suggestions would be:

1) We flesh out a “product document” based on the list of features/things I outlined in my rather rambling ATCXL doc. i.e. decide what “modules” we want, what exists now, what might need more work, what to remove or hold back for now. We prioritise this as the first thing to do and tweak it if we find it takes longer to do something than anticipated.

Some kind of competitor analysis is needed. Also, talking to contacts you have, maybe preparing demo’s, whatever is needed to guide what will sell and for the highest amount.

Pricing. What can we get in a recurring fashion.

I see you taking the lead on these aspects: I can assist with “features” and my understanding of the “benefits” but you’re your own “target market” so can provide invaluable inputs here, use your contacts in the Hedge Fund industry, ask relevant people for input, give demos, etc.

2) We flesh out a “website document” based on competitors/peers out there. We need to know what resources in addition to myself will be needed to complete it – e.g. I would prefer to have the basic functionality working and leave the final “pretty design” to others. But we need to define those lines as soon as possible.

3) We need a more detailed set of programming tasks that I will undertake – these come out of 1) and 2) above. We will need approximate milestones/checkpoints for these to ensure I’m on track etc.

I already have a number of items in the system: these will have to be summarised and prioritised/dropped etc.

It is certainly the case that new items will arise out of existing ones as code is written. We need to be flexible with this and reshuffle priorities as needed.

Relationship

For phase 1, I’m happy to discuss taking care of our respective families should something untoward happen. Let me know what period/share-fractions you had in mind. I presume this applies should one of us not be around to start phase 2 – and the other one ends up going ahead on their own.

For the code repository, the access (which is assigned to your Microsoft Account) is all that is needed. At that point, another C++ developer can simply point Visual Studio at it and continue. I would really stress that the source should remain online and not be unprotected on any PC elsewhere: my nightmare is someone stealing a laptop with it on or some Trojan somehow scraping it up… For phase 1, we can make this explicit by putting it as part of the family disbursements clause.

I would suggest that as part of this agreement we agree our intent to go into phase 2 when we feel we are ready to do so and indicate our desire for a new company with funding to be determined at that time.

To avoid issues, once we enter phase 2 as described, our initial agreement no longer applies (see below).

For phase 2, we will have a new company and that structure will handle this “family disbursements” situation (well, at least I assume our wills would handle that: in my case, since I’m not married, I must get on with writing one but for you I suspect you’re covered? You’d have to take advise in England on what happens to existing share holdings.)

For the code repository, this will be covered via the usual inter-company escrow concept. That is, Tovica owns the code but the new company has an exclusivity on selling it – i.e. as you said, “a right of first refusal unless we come to a mutually agreeable solution involving a third party” applies to the source code and any commercialisation thereof.

Financials:

I’ve rechecked the figures and spoken to two different places that provide a desk in a shared office – availability in one is an issue but the costs are pretty similar.

The figures are okay so my original comments apply (edited to remove GBP):

“In net terms, I think a year including office expenses could be done in 120K AUD with a bit of careful budgeting on my side. So taking ½ of that and grossing up for just the immediate tax on that (I’d cover the higher tax rates that actually apply due to the overlap with the now defunct CIBC job), that’s 90K AUD.

But because I have funds already, the annual big outlays can be covered, so I only need to worry about the recurring components - i.e. so that could really be an “invoice payment for work done” of 7.5K AUD monthly (see end of email).

My thinking is that we could do the above for a year with the main focus being getting the add-in in shape for sale, and developing the all-important website (in terms of functionality, not design per sei).

We still need to prepare a plan/budget for advertising and probably a website designer (which may extend to actual html/css content work). But we have the choice of either using our share split to put in capital jointly or the loan approach to cover that. i.e. this waits until Phase 2.

This delays the bigger problem of the significant funding needed to hire additional staff, primarily sales, but also support and ultimately development. However, that’s an order of magnitude bigger so we need to find other ways I think and all those really involve having a more “complete” product and associated marketing vision for it.”

Note that I have setup an EUR denominated account to complement the existing GBP and AUD ones. The formalisation is standard: Tovica is undertaking work for you for a project of fixed duration Feb-Dec (11M so AUD 90K / 12 * 11 paid, say, monthly) – there are possible extensions of 2M with fixed deliverables (i.e. AUD 90K / 12 * 2 per extension) that may occur depending on need.

It only takes a month to setup a company here, a week or so if no GST needed. However, we need to also think about how we will jointly fund that company, something we’ll know more about once we have a better handle on the potential market etc.

I think the above is our best way to finally take the add-in to the next level and look forward to your thoughts,

(bold and underline emphasis in original)

26    Mr Coronelli did not respond to this email.

27    On 11 July 2016, Mr Cassisi sent an email to Mr Coronelli attaching an invoice from Tovica Technology and addressed to Mr Coronelli. It was numbered “#200” and contained the following under “Details”:

In respect for services provided to date by Tovica Technology Pty Ltd under our Phase 1 agreement for development of ATCXL:

Services to 7th July 2016    $8166.67    5     $40,833.35 AUD

                            ___________

(bold emphasis in original)

28    Tovica Technology sent that invoice and similar invoices to Mr Coronelli, between July 2016 and October 2020, as follows:

29    Each of these invoices included: “In respect for services to date by Tovica Technology Pty Ltd under our Phase 1 agreement for development of ATCXL …”. As can be seen in the above table, the invoices were sent irregularly. The total amounts in the invoices were typically the product of a monthly amount and a number of months. For example invoices 210 and 211 each represented four months’ work (4 x $16,733.33) while invoices 212 to 215 each represented three months’ work (3 x $16,733.33). For each invoice, the work was billed in arrears.

30    Each of those invoices was paid.

31    On or about 8 or 9 September 2016, Mr Coronelli sent an email to Mr Cassisi setting out, in considerable detail, some “initial considerations”.

32    Mr Coronelli’s email with underline text (with Mr Cassisi’s responsive “inline comments” included):

…

What I would need you to appreciate

•    I have and would invest almost 250k GBP over three years (80 in 2015+60 in 2016+102 2017). This isn´t trivial for me, to the contrary…I do have a strong incentive to try and market it at best and find ways of recouping some or most of that in a ´de minimis´ were we to decide to stop after database solution implementation.

    Noted and appreciated! We have the advantage of it being a toolkit of functions so eventually we can find a combination that will sell. The hard part I think is reducing the “try/fail” loop until we get just the right combination that sells fast but at a high enough price point to provide a return, even if in the end it’s just a parked website like a lot of the other small add-ins out there – i.e. people find it and pay automatically online without any real support team, local office, sales etc.

•    I would like the project to continue and hopefully develop across further initiatives we could partially fund via the sales of atcxl. But I need your honest assessment here…

    It’ll be a balance between removing revenue from the company (by paying salaries/dividends) and investing. The part I think is hardest is defining it with the right price point to give enough revenue to allow for flexibility and growth. Only that French company seems to be similar to our goals – I feel the financials for that are key to providing us some better assurance that there is a way to get enough revenue from what is, at the end of the day, “just” an Excel add-in.

•    Were we not to continue, I would really need we come to some form of agreement on future joint or individual exploitation of the code/project were we to decide now it is time to stop. That should extend to the code, that for me would be difficult though to extend/operate but…

•    Agreement should extend to some form of support were I to use the system in the future personally, guaranteeing upgrades to new excel and OS versions.

    We could cover all of this as part of the Tovica IP agreement with the new joint company and also a separate agreement between you personally and Tovica, with the final “link in the chain” being some agreement on what to do if Tovica is closed – i.e. if either of us get “hit by the proverbial bus”:)

(bold and italic emphasis in original; underline emphasis replaces blue font in original)

33    On 30 June 2017, Hagakure was incorporated.

34    Between 22 October 2017 and 7 November 2017, Mr Cassisi and Mr Coronelli exchanged a series of emails with the subject line “Company” and which addressed further the concept of commercialisation through a joint venture company.

35    On 22 October 2017, Mr Cassisi wrote:

Spoke to the accountant and I’m still in favour of the existing proposal from a while back. Specifically, a 50-50 ownership split Australian company for the sales/marketing. And initially this contracts out to my company (Tovica) to do the development.

If the turnover started to push $1M then the sales/marketing company should be non-Australian, with development still with an Australian company but by then it would employ directly developers here (e.g. myself and a team).

As mentioned before, I would like the IP to remain within Tovica – with the necessary exclusivity agreements in place to the sales/marketing company. Apart from tax, another benefit is that this allows for failure, and relaunch of a rebranded version, all without impacting the IP.

However, we really should prepare financial projections for this before setting up any company structure. e.g. how much is the rent for what products/modules, sales projections, target market in terms of countries and people, and expected cashflows resulting from this – including costs (such as when we need staff to really expand the product).

This will also help determine how the funding changes at the point the company is setup.

…

36    On 3 November 2017, Mr Coronelli responded:

Apologies but I am travelling (in NY at the moment) and quite hectic, unfortunately.

A quick attempt to reply, going through your main points.

However, we really should prepare financial projections for this before setting up any company structure. e.g. how much is the rent for what products/modules, sales projections, target market in terms of countries and people, and expected cashflows resulting from this –including costs (such as when we need staff to really expand the product).

This will also help determine how the funding changes at the point the company is setup.

-    I can and I am really thinking about these but I believe we are at a stage where we are close to commercialisation – we have a self-imposed deadline of June 2018 and not preparing would be foolish.

-    I will need to make investment for website and branding and would be happier ( you benefit too, by the way) if these could be in the form of capex we can then detract from further earning, minimising tax liability going forward. We are putting value into the company

-    By the way, we are not getting any benefit on the contributions I am already making…

-    I am not advocating a group of companies, but a formalised structure – I am paying for this, by the way

As mentioned before, I would like the IP to remain within Tovica – with the necessary exclusivity agreements in place to the sales/marketing company. Apart from tax, another benefit is that this allows for failure, and relaunch of a rebranded version, all without impacting the IP.

-    I personally still don’t understand the tax aspect, as transfers of IP can happen at nominal values – in any case, it could be mitigated below

-    What I propose is that we have two Australian companies, both 50/50 ownership, one to hold IP and allow for re-utilisation and one for marketing/commercial.

-    I think this would be the clearer and cleaner situation, to address also the succession issues highlighted in the past.

-    This is also the solution that would give me the most comfort and I believe is fairer.

…

(italic emphasis in original)

37    On 6 November 2017, Mr Coronelli sent a further email:

I just wanted to check you had received email below.

Thanks

38    On the same day, Mr Cassisi sent a response, to which Mr Coronelli responded with comments “inline”. Mr Cassisi’s email, with Mr Coronelli’s “inline” responses in underline, is set out below:

Yep. Skimmed it but haven’t had time to do it justice. My immediate point would be that we need the target market, the pricing and the expected cash flows – and, technically, what modules there are this year so there’s plenty of time before the mid year deadline.

-    That I agree (see below) but, as said, certain expenses will need to take place in any case - I would prefer to have them within a company, as most efficient.

-    As highlighted, I would pay for set up, so I see very little downside for you, in almost all eventualities.

In principal (sic), having two joint-owned Australian companies with the usual dev/sales split is fine: i.e. I can be flexible on the IP thing – the bigger concern in structural terms is funding. Right now, you fund me developing in a very straightforward manner. We want to get to a self-sustaining model, so we need those projected cash flows (which include the projected date that occurs) so we can decide on a way to get there.

My points are very simple:

-    You will have proper financial projections, as soon as I have finished the spreadsheet and we have had time to jointly discuss modules. I am behind because of work related complications - see below.

-    Funding will stay stable (as is) for at least two years, with the option of being reduced ( due to actual sales) in a year. If that is your concern, you have my word ( and I have always backed it up with facts). If the concern is somewhat different, I believe it is important to discuss now.

-     I am sure you realize I have and will continue to invest a lot of money in the project, because I believe in it and in you. For my own security and joint clarity, I feel that it is important that we have a proper framework. We are at a point where we are close to market but, if you decide to stop, I am naked. I have no IP and no ability to bring it to market, losing my investment. We need to regulate, in a simple manner, all eventualities. I hope you do understand.

…

39    On 7 November 2017, Mr Coronelli wrote:

Could I ask you to address all the points structurally? I think it is important

40    On 7 November 2017, Mr Cassisi responded:

…

Is the rough idea something like – we setup the 50-50 split companies as directors, then we do some kind of loan so you can fund the company to pay expenses (like me) and that pays back at some percentage of future sale revenue? Note that I can’t put a large matching capital amount in on setup because the Sydney house sucked in most of it. i.e. my understanding is that this means we can’t go the “capital route” because don’t all shareholders have to contribute as per shareholding?

…

So yes I’m very keen to continue as planned: I feel strongly we do need better preparation market-wise before we actually sell though – but companies can be setup regardless of that, assuming there’s a satisfactory solution for you to fund…

41    On 7 November 2017, Mr Coronelli wrote:

…

To recap, I would see the whole as more protective of you, in a way. For sake of clarity:-

•    I am happy to have the current arrangement (payments to Tovica for your development work) still to be outside of the Company structure, for a period of say two years, or at least until we have sales that can support your work. I assume this would be more efficient for you and I would like you to be as comfortable as possible. If you prefer otherwise, I am open to consider it.

•    I don’t want any claw back on future sales of the development work I funded in the past or will fund over the next two years. I gave some direction & ideas and funding but you put work. It has to be fair for both; maybe I am naïve but I think that if the product is good monies will come back in spades. No clawback is good for you, I believe.

•    I am not expecting you to put capital, we will make equal nominal contributions (1aud$) and the loans I do we will write off – we can have a side letter stating this.

•    I would like the company holding IP for mutual protection – see case of what happens if the unthinkable occurs...( two friends died recently and I am probably a bit sensitive to the topic). I am referring in particular to the email where future revenues could help my family or your family.

•    I would like the operative company – for the time being – to be there as we prepare go to market. I will have costs related to website, branding ,payment systems, etc and I would like it to be efficient. It can be a director loan and I am happy to write it off, I don’t want to have any claw back

•    I will bear the costs of setting up companies and drafting legal agreements (we can include the aspect of protecting our families if you want).

•    I will work with your accountant/tax advisor, so we are sure that the solution doesn’t endanger your tax position – mine is easier, in a way.

All of the above is important as I realise that I personally need to make a big push here and I want to make sure we are on the same page. I am committed if you are.

Let me know

(bold emphasis added)

42    On 7 November 2017, Mr Cassisi responded:

All fine – thanks for clarifying.

…

Keeping current payment arrangements (technically Tovica is contracting for you personally) is definitely easier. Also once both companies are setup it would cover the family issue because the shares would transfer to them in the event of an “errant bus” situation so do we need anything additional? Actually you’ve reminded me I need to deal with the whole Will situation, especially given I’m not married. At least I have to check that shares in this (and Tovica) would transfer across without any weird tax implications (there’s no inheritance tax here as far as I know though).

Loan-wise are you sure it can written off? I can check that one with Charles (the accountant) and can ask him to kick off the new company creation – but we’d need a name….

We should have a catch up all soon …

(bold emphasis added)

43    Mr Cassisi agreed in cross-examination that his statement: “All fine – thanks for clarifying” applied to each of the bullet points in the previous email, including Mr Coronelli’s suggestion: “I would like the company holding IP for mutual protection”.

44    From around June 2020, Mr Coronelli and Mr Cassisi were considering Cryptlex to license vbaZen, among other platforms. They proceeded with Cryptlex because of the lower costs and willingness and responsiveness of the Cryptlex owner to introduce new features that satisfied their needs. The first version of vbaZen that embedded the licensing system provided by Cryptlex was v2.61.

45    As is evident from the invoices identified in the table at [28] above, work continued on Phase 1 of the Project until (at least) October 2020.

46    On 23 October 2020, Mr Cassisi sent an email to Mr Coronelli with the subject line “Ownership document”:

I had a brief chat to my accountant regarding what yours said about “IP” and all that and yes, he’s right, we should sign a simple clear instruction regarding:

Something like this

“

1.    We agree we have entered “Phase 2” as referred to in previous correspondence [see email below]

2.    The “ATCXL” software and IP are fully transferred to a new company at no cost

3.    That company is equally owned by Toni/Aldo or their nominated representatives

4.    The transfer occurs automatically upon incorporation of the new company

Signed by myself on behalf of Tovica, and yourself on behalf of Hagakure

“

The main reason for this is actually to clarify the email chain below – which is all I could find of our original discussions regarding this. It would be useful if you found anything more current?

i.e. the above directly nulls out the definition in the email below and puts a line under the previous activities.

If this works, let me know and I’ll write something up – then we can get that out of the way.

After that, there’s a) ownership structure for me of the new company – I have to ask the accountant then b) how existing Hagakure->Tovica payment structure stays or changes then c) website registration (do we have that?) and company incorporation.

Exciting times! Now just have to lift these Australian travel restrictions so we can celebrate in Ikeda fashion……

(bold emphasis added)

47    The “email below” is the email chain with the subject line “Budget info” which is set out at [22] to [25] above.

48    There followed an exchange of emails between Mr Cassisi and Mr Coronelli between 27 November 2020 and 7 December 2020 with the subject line “Ownership document”:

(1)    Mr Cassisi:

Reminder this needs to be dealt with so we can start that new company up. ;

(2)    Mr Coronelli:

I have been working on that, will send you a copy early next week. ;

(3)    Mr Cassisi:

‘k. ; and

(4)    Mr Coronelli:

Take a look and let me know what you think.

49    Attached to Mr Coronelli’s final email was a draft letter, bearing a date of 3 December 2020, in the following form:

As discussed, I am writing to confirm our agreement regarding the ownership of, and the next steps regarding the proposed development and commercialisation of vbaZen - an add-in for Microsoft Excel primarily aimed at enhancing the VBA language (the “Project”).

In consideration of the payments that have been made by me and my company, Hagakure Limited, to your company, Tovica Technology, since 2015 and the work that you have done since that date, I confirm the following:

o    All existing and future intellectual property rights (“Project IP”) in and to the Project, whether registered or unregistered and including all applications and rights to apply for, and renewals or extensions of, such rights and all similar or equivalent rights or forms of protection which may now or in the future subsist in any part of the world, are and will be owned by us jointly. No other person has or will acquire any such rights.

o    I will arrange and pay for a limited liability company to be incorporated in Australia (“Australia Co”) with the name “vbaZen Technologies Pty Ltd” which will be equally owned and controlled by you and me to which the Project IP will be transferred. It is intended that this will be completed by no later than [DATE].

o    I will arrange for a limited liability company to be incorporated in the UK (“UK Co”) with the name “ vbaZen Technologies UK Limited” which will be equally owned and controlled by you and me and which will be used to commercialise and distribute the Project.

o    Each of us will proceed to assign all Project IP to Australia Co as soon as is reasonably practicable following the incorporation of Australia Co. We will establish a secure online repository where all relevant Project IP will be stored and indexed.

o    Each of us shall procure the subsequent licensing of the Project IP by Australia Co to UK Co as soon as is reasonably practicable following the incorporation of both companies.

o    All future arrangements relating to the commercialisation of the Project will be agreed by us jointly in due course.

o    Each of us shall, and shall use all reasonable endeavours to procure that any necessary third party shall, execute and deliver such documents and perform such acts as may be required for the purpose of giving full effect to the above agreements.

Pending implementation of the foregoing, it is agreed that we continue to each own an equal share in the Project and all relevant Project IP.

Please confirm your agreement to the foregoing by countersigning below.

50    The following exchange then occurred.

51    On 7 December 2020, Mr Cassisi:

The language of some points is pretty opaque to me: I feel the straightforward aim is to make clear the IP is solely owned by the new joint company and that there is no “historical debt of any form” owed by that company to either of us: i.e. it’s a clean slate at point of new company creation.

So I’ve edited the document “ATCXL_vbaZen_Phase2” on OneDrive in the usual spot so it can be edited again directly in place:

•    Firstly I’ve tried to ensure it is clear this follows on from the last written discussion (“ATCXL”, “Phase 2”).

•    I’ve liberally used the delete key – feel free to tweak if there’s something important I didn’t understand so it needs to be added back (highly likely, although most of my time was spent trying and failing to understand the first bullet point:)).

•    Lastly I’ve removed unnecessary detail: what matters is “the line on the past is drawn” and the “IP and ownership is clear” automatically at the point the new Australian company is created – prior to that we continue on as now.

Please also confirm we really need that last bullet point – surely that’s covered by joint ownership/control of the companies in question?

(bold emphasis added)

52    On the same day, Mr Coronelli responded (as written):

I am sincerely surprised.

First I don’ think the text is opaque, it is very clear indeed and respect the spirit of what we discussed.

In second place, you have carefully deleted the portion where the Ip is transferred and jointly owned by us.

On this basis I am not able to proceed and will forced to take appropriate measures.

53    On 8 December 2020, Mr Cassisi responded:

That’s not my intent. I tried to rewrite it in the second bullet point, using “exclusively and totally” which I thought was what the original bullet point was trying to say?

•    The Project source code and associated intellectual property rights will be transferred exclusively and totally to this Australia Co automatically upon its creation.

If i’ve misunderstood please clarify?

54    After several further emails concerning a possible telephone call, Mr Coronelli sent a further document to Mr Cassisi attached to an email stating: “In plain English”. The attachment was in the following form (as written):

As discussed, I am writing to confirm our agreement regarding the ownership of, and the next steps regarding the proposed development and commercialisation of vbaZen – an add-in for Microsoft Excel primarily aimed at enhancing the VBA language (the “Project”).

In consideration of the payments that have been made by me and my company, Hagakure Limited, to your company, Tovica Technology, since 2015 and the work that you have done since that date, I confirm the following:

o    All existing and future intellectual property rights (“Project IP”) in and to the Project, whether registered or unregistered and including all applications and rights to apply for, and renewals or extensions of, such rights and all similar or equivalent rights or forms of protection which may now or in the future subsist in any part of the world, are and will be owned by us jointly. No other person has or will acquire any such rights.

THIS DEFINES WHAT YOU ARE TRANFERING, RELATED TO THE PROJECT, AS DEFINED ABOVE. IF YOU DON’T DEFINE, ALL THE REST IS WORTHLESS.

o    I will arrange and pay for a limited liability company to be incorporated in Australia (“Australia Co”) with the name “vbaZen Technologies Pty Ltd” which will be equally owned and controlled by you and me to which the Project IP will be transferred. It is intended that this will be completed by no later than [DATE].

o    I will arrange for a limited liability company to be incorporated in the UK (“UK Co”) with the name “ vbaZen Technologies UK Limited” which will be equally owned and controlled by you and me and which will be used to commercialise and distribute the Project.

o    Each of us will proceed to assign all Project IP to Australia Co as soon as is reasonably practicable following the incorporation of Australia Co. We will establish a secure online repository where all relevant Project IP will be stored and indexed.

I JUST HAVE ACCESS TO THE EXECUTABLE, THE CODE SITS SOMEWHERE NOT SHARED BY ME, I HAVE NO PROTECTION AFTER ALL THE MONEY I INVESTED IT IN

I WANT AN ONLINE REPOSITORY, OWNED BY THE NEW COMPANY, WHERE EXISTING SITS AND NEW CODE GETS TRANSFERRED TO.

o    Each of us shall procure the subsequent licensing of the Project IP by Australia Co to UK Co as soon as is reasonably practicable following the incorporation of both companies.

o    All future arrangements relating to the commercialisation of the Project will be agreed by us jointly in due course.

o    Each of us shall, and shall use all reasonable endeavours to procure that any necessary third party shall, execute and deliver such documents and perform such acts as may be required for the purpose of giving full effect to the above agreements.

Pending implementation of the foregoing, it is agreed that we continue to each own an equal share in the Project and all relevant Project IP.

Please confirm your agreement to the foregoing by countersigning below.

(underline emphasis added to replace yellow shading contained in original)

55    Mr Cassisi responded:

Thanks! I’ll take a look when I get to the office – can we go over it in our usual call tonight please?

56    There followed emails in which a telephone call was arranged for 8:00pm Sydney time on 8 December 2020. Neither Mr Coronelli nor Mr Cassisi gave evidence concerning such a call.

57    On 8 December 2020, Mr Cassisi sent an email to Mr Coronelli:

OneDrive has the updated version “ATCXL_vbaZen_Phase2.docx”.

I tried to incorporate the existing and future IP ownership, nominal payment for transfer, and physical transfer within the same 2nd paragraph. Note I used “the undersigned” to ensure it covers both us personally and our companies.

The 3rd paragraph mentions the intercompany licensing agreement in general terms.

And a new sentence about “expediting everything”.

I think this covers everything except for this:

•    All future arrangements relating to the commercialisation of the Project will be agreed by us jointly in due course.

That is covered by the 50/50 shareholding split, as we’ll be using Ordinary Shares (same meaning in UK and AU): i.e. everything is joint decision making.

58    Mr Coronelli responded (as written):

I have reviewed and made a couple of tweaks

Point 2

•    Project IP has been broadened a bit, to capture evryhting, shouldn’t be conetnious

•    In ownership, I added jointly , to clarify the spirit

Point 4

In the last point, you are trying to regulate one of several matters that can arise when running a company. These are normally called Reserved Matters such as creating charges, borrowing, making loans, giving guarantees, changing the share capital, paying dividends, acquiring/disposing of particular assets, changing the memorandum & articles of association or voluntarily winding the company up.

The 50/50 ownership doesn’t protect you against this if you don’t limit powers of management and Directors. If you really thought you were protected by the 50/50 why did you include that particular example?

There has to be a simple agreement, where we state that all of the decisions that have to be taken jointly. If you don’t do it, one of the Directors of the Company (they need to be defined & appointed) one of us could go and borrow for example using the IP collateral without the other one knowing.

(underline and bold emphasis in original)

59    Mr Cassisi and Mr Coronelli then exchanged the following emails (as written):

(1)    Mr Cassisi:

Okay. Point 4 was cut ‘n’ pasted from the 2016 email chain – it looks like it doesn’t belong then – so how about we just remove it?

Rest is fine. ;

(2)    Mr Coronelli:

Are you against having a simple agreement and definition of reserved matters? It protects both of us, is very standard and you need to have it to operate a company.

It is good practice, you define the most important things and say that these are subject to a vote and that you have 50% and I 50%, so we need to agree

Technically, as a director, I could go and get a loan without you knowing and do funny stop. It seldom happens but I have seen it ;

(3)    Mr Cassisi:

Sorry – I thought you were suggesting point 4 should be removed to make this agreement simpler. So what you mean is we should enter such an agreement once the company is setup – but – do we need to mention that in this doc?

i.e. I’m happy to remove point 4 to simplify this doc and then we’ll do that agreement once the company is up.

But I really don’t mind leaving point 4 there either as I don’t really know enough about it to have an opinion:) ;

(4)    Mr Coronelli:

There is no harm in leaving it, it is an endeavour and in my view it needs to be done – in a SIMPLE way, no major legal jargon, I promise

Plus it protects on the share transfer that was a concern of yours ;

(5)    Mr Cassisi:

Okay. So let’s print, sign, scan, email. Looks like we’re ready to rock! ;

(6)    Mr Coronelli:

OK, I will try and send it later.

… ;

(7)    Mr Coronelli:

…

I have attached a clean copy, let me know if it is ok ;

(8)    Mr Cassisi:

Looks good. ;

(9)    Mr Coronelli:

Please find attached

(attached to this email was a copy of the proposed agreement, signed by Mr Coronelli); and

(10)    Mr Cassisi:

Likewise attached.

60    The final form of the document as signed by both Mr Coronelli and Mr Cassisi – i.e. the December 2020 agreement – is as follows:

Toni Cassisi    Aldo Coronelli

Tovica Technology Pty Ltd    Hagakure Ltd

Suite 1A Level 2    93 Drayton Gardens

802 Pacific Highway    London SW10 9QU

Sydney NSW    United Kingdom

Australia

Dear Toni,    London, 8th December 2020

Re: vbaZen/ATCXL

As discussed, I am writing to confirm, our agreement regarding entering “Phase 2” of what we previously referred to as “ATCXL” - specifically the next steps regarding its commercialisation as an add-in for Microsoft Excel called “vbaZen” primarily aimed at enhancing the VBA language (the “Project”).

In consideration of all payments that have been made by myself and my company, Hagakure Limited, to yourself and your company, Tovica Technology, for all the work undertaken on the Project, we confirm the following:

1.    I will fund the creation of a limited liability company to be incorporated in Australia (“Australia Co”) with the name “vbaZen Technologies Pty Ltd” which will be equally owned and controlled by you and me.

2.     All source code and intellectual property and other rights (whether registered or unregistered and howsoever and wherever arising) relating to the Project (“Project IP”) being currently owned by the undersigned jointly, will be transferred to Australia Co for a nominal sum of $1AUD. Upon receipt, the Project source code will be physically transferred to a repository of the Australia Co’s choosing.

3.     I will fund the creation of a limited liability company to be incorporated in the UK (“UK Co”) with the name “vbaZen Technologies UK Limited” which will be equally owned and controlled by you and me and which will be used to market and distribute the Project via a suitable licensing arrangement between the companies.

Each of us will endeavour to expedite the implementation of the above. In addition:

4.     Following incorporation of Australia Co and the transfer of the Project IP to Australia Co, we will enter into a shareholders agreement relating to the operation and management of Australia Co which will include, among other things, customary mutual rights of first refusal relating to the transfer of our shares.

Please confirm your agreement to the foregoing by countersigning below.

…

Acknowledged and agreed on: __________________________

Aldo Coronelli for Hagakure Limited

Acknowledged and agreed on: __________________________

Toni Cassisi for Tovica Pty Ltd

(bold emphasis in original)

61    Mr Cassisi accepted that he signed the December 2020 agreement but suggested that he did so because he had no choice. To the extent that he suggested that his will was overborne, I do not accept that suggestion. His contemporaneous emails in the lead up to the signing of the December 2020 agreement – particularly those at [59(5), (8) and (10)] above – indicate otherwise.

62    No steps were taken to implement the December 2020 agreement for some time. The first step – the creation of the Company (i.e. Australia Co) – did not occur until 2023.

63    Between January 2021 and March 2024, Tovica Technology sent the following invoices:

64    Each of these invoices included:

Details:

In respect of services provided to date by Tovica Technology Pty Ltd under our Phase 1 agreement for development of ATCXL …

…

(bold emphasis in original; underline emphasis added)

65    These invoices followed the same pattern as the earlier invoices. They were issued irregularly for work already undertaken and included an amount calculated as a monthly rate multiplied by a number of months.

66    Each of these invoices was paid, with the exception of the final invoice, # 228. That invoice was not paid because the Cassisi Interests and the Coronelli Interests fell out about the date on which that invoice was rendered, as discussed below.

67    As noted at [20] above, Mr Coronelli continued, until 2024, to contribute to the development of the software product. During this period, Mr Coronelli and Mr Cassisi continued to correspond concerning the development of the product. By way of example, on 2 September 2022, Mr Coronelli wrote to Mr Cassisi (as written):

Toni,

Some help here…

Background

•    The output of a modified version of the Matlab code I sent you has been loaded to our drive – folder ‘dataCsvToni’.

•    You will see that the same analysis has been repeated by fund and by month and the output is a .csv file for that combination.

•    The folder is quite large (500 MB) as it covers all the funds that ever were in position.

•    The name of the file follows the structure name_yyyymmdd.

What I would like to do

•    I would like to create a record template with fields mapping the columns of the CSV with some changes to maybe make the retrieval easier ( name and datew combination)

•    I would like to create a record per fund and per month and add it to a vector of records that I would save to disk.

•    I would like each month to retrieve the vectorofrecords and efficiently update it, i.e. check if the fund is present and up to which date it has been updated.

Questions

•    Would the first upload of all the data create a memory problem in Excel? If so, how to avoid it?

•    What would the most efficient way of retrieving info be to then quickly update?

(bold and italic emphasis in original)

68    On 1 February 2023, the Company was incorporated, with the memberships and directorships identified at [2] above. I infer, from an email dated 8 September 2023, that Mr Cassisi’s accountant attended to that incorporation. Mr Cassisi was the “IT Administrator” for the Company.

69    Clauses 7.7, 8.1, 10.2 and 10.6 of the Company’s Constitution provide in so far is presently relevant:

7.    General Meetings

…

7.7    Resolutions

7.7.1     Subject to any requirements in the Act regarding special resolutions, an ordinary resolution is carried if a majority of the votes cast on that resolution are in favour of that resolution.

…

8.    Members’ Voting Rights

8.1    Votes of Members

8.1.1     Subject to this Constitution (particularly clause 8.1.2) and to any rights or restrictions attaching to any class of Shares:

(a)    every Member has the right to vote;

(b)    on a show of hands every Member has one vote; and

(c)    on a poll every Member has one vote for each Share held by them.

…

10.    Directors’ Meetings

…    

10.2    Decision of Questions

10.2.1     Subject to this Constitution, questions arising at a meeting of Directors will be decided by a majority of votes of the Directors present and voting. If there is an equality of votes the chair of a meeting has a second or casting vote in addition to the chair’s vote as a Director.

…

10.6    Chairperson

10.6.1     The Directors will elect a Director as chair of Directors’ meetings and may determine the period for which the chair will hold office.

10.6.2     Where a Director’s meeting is held and:

(a)    a chair has not been elected; or

(b)    the chair is not present within 10 minutes after the time appointed for the commencement of the meeting; or

(c)    the chair is unwilling or unable to act,

the Directors present will elect one of their number to be chair of that meeting.

(bold emphasis in original)

70    It follows that in order for the Company to function, the Coronelli Interests and the Cassisi Interests must act with unanimity.

71    From around September 2023 until about mid-April 2024, Mr Coronelli was able to access the Microsoft Visual Studio account in which Mr Cassisi placed the vbaZen product, as well as the Cryptlex account. Mr Coronelli had access to vbaZen and the Cryptlex vbaZen portal with his own login for the Company account. Mr Cassisi controlled access to vbaZen through the licence keys issued by Cryptlex. I will refer to the place(s) to which Mr Coronelli had access for these purposes as the repository.

72    There is a dispute on the evidence as to whether Mr Coronelli had access to the source code, which is not necessary to resolve.

73    On 17 October 2023, vbaZen Limited (i.e. UK Co) was incorporated in England and Wales with: (1) Mr Cassisi and Mr Coronelli as its directors; and (2) Tovica Technology and Hagakure as its members, each holding 50 of the 100 issued shares.

74    During 2023 and early 2024, Mr Coronelli arranged, and Hagakure funded, trademark registrations, logo design, website domain registration, company registrations and opening of bank accounts for the Company and vbaZen Limited. Mr Coronelli claims that Hagakure spent around $100,000 on undertaking these steps.

75    On 1 February 2024, Tovica Technology rendered invoice #227 to Mr Coronelli at Hagakure which included services rendered for the three months to 7 January 2024.

76    Between 1 March 2024 and 6 March 2024, Mr Coronelli and Mr Cassisi exchanged the following emails with the subject line “my position”. Neither gave evidence of the events which prompted this email exchange.

77    On 1 March 2024, Mr Coronelli commenced the exchange, as follows:

I prefer to write, so you have time to ponder all matters.

While I understand that no product will be perfect at launch, I am not prepared to start with a half-botched solution, in a climate of unjustified frenzy.

We are rushing into things because of an arbitrary deadline that you set for yourself, without even consulting me. It has become cast in stone and the general tone on your side is that I am unwilling to start and that you have been waiting too long. I have found the spirit of some of your continued objections not conducive to a friendly collaboration – moreover , I can assure you, it won’t lead to any success.

I must remind you that I am paying, both for your work and the external providers – therefore my interest should be to finish as quickly as possible to get some revenues, especially in a moment in which I am in between jobs and in the middle of lawsuits. It is very important to stress that all my comments and decisions are dictated by the need to preserve the value of my investment that, as you know, hasn’t been negligible over the years.

My reasonable timeline is for a well thought out launch by end of July

Before that launch, we need to straighten up:-

•    commercial policy ( versions & pricing).

•    full testing of the collections, algorithms.

•    attribution of all the external tools you used.

•    website, a showcase of content but in a sleek and modern framework.

•    full suite of videos.

•    simplified guides, to help the user adopt a product that otherwise is difficult to understand.

•    models’ development, to complement the guides and show difference between versions.

I am not willing to compromise on this and it isn’t posturing, I assure you.

I will be in Brazil all next week.

(bold emphasis added; attached to this email was a spreadsheet setting out a proposed timeline)

78    Mr Coronelli described this email as stating his concern that the Project was not ready to launch, listing a number of items that needed to be finalised, and one in which he proposed an alternative timeline, such that the Project would launch in July 2024.

79    On the same day, Mr Cassisi responded:

Thanks for the detail.

My concern is primarily one only - we have set deadlines before: 1) we said July 2023 (said in London in July 2022) then 2) we said Q1 2024 after we were still doing help icons etc in July 2023.

How are we going to stick to the deadline this time?

My original hope was 3 years. COVID stuffed things up for 2020/21 and part of 22.

But I will have not worked in a bank for around 8 years this year (that matters here). Add 2 for actually drawing 250k USD each best case.

The company is going to have to produce a lot more than that to make up for those 10 years of missed banking bonuses etc.

Now I’m confident it will but it’s become a much bigger risk for me, something that increases as the release date moves.....

So how do we change things so we keep to the new deadline?

80    Later that day, Mr Coronelli responded:

I am not into ‘what if’ scenarios or recriminations - you need to reason with what you have, this is always the starting point in life.

As detailed below, I am not going to release a botched-up version of the software, just out of panic. It won’t protect your or mine chances of success.

I took a conscious decision funding this project out of my savings, and I have no regrets, whatever way it ends. You must come to terms with yours.

I am not willing to take the guilt trip, though. Delays were a function of development ( nothing else) and you moved to Australia not because of this project but because you wanted to grow your kids there. I don’t believe there are so many well paid investment banks jobs there – jobs, that you were tired of, by the way.

Openly, I think the target is reachable and I can put a schedule towards it. I am just concerned things have changed, I don’t feel an affectious society and, if we continue as we did over the last couple of months, it will end up in continuous bickering.

I prefer to block everything today if the right spirit isn’t truly in place. Now it isn’t. Question yourself and let me know once you have thought well about it.

81    On 2 March 2024, Mr Cassisi responded:

Thanks: I will ponder and get back to you later next week.

To help with that, please address my question: how do we keep to the deadline this time?

I appreciate your candid response on that – also – for the faults on my side I need to deal with please just state them Aussie style – i.e. be blunt.

82    On the same day, Mr Coronelli replied:

I assure you I am being harsh with myself too.

Please find attached an idea of how I believe the target is justified.

I am flying tonight and will be in Brazil for a week.

83    On 6 March 2024, Mr Cassisi wrote:

I’ve carefully reviewed the sheet and edited it with additions and comments but I may have made mistakes as it’s complex.

Some of this we have discussed before but I think it is worth spelling it out.

If you think anything is ambiguous, please ask for clarification.

1.    Decisions

Now that we have formed the companies in the way we did, we both have equal weight in decision making.

It is up to me to convince you, or it is up to you to convince me. If there is no agreement, then the action is not taken.

I do not have any extra weight in providing the expertise and you do not have any extra weight when providing the funds.

Those companies were formed with the purpose to sell the product so that is what will happen unless we agree actions to alter that purpose.

2.    Designers

The following should reduce recent tensions:

a)    The Designers were chosen by you prior to the company formation so I will leave you to manage them.

b)    (We have discussed this) I will do a detailed script for each video and you will do local review loops until you think the video matches, or kick it back to me if the script is wrong.

The decision process will still apply on all outputs: i.e. if I like it but can’t convince you, OR, if you like it but can’t convince me, then the output is not used.

3.    Release

The spreadsheet does show some “value add” reasons to delay, so I’ve modified it to achieve my main priority:

At the end of March I would like to start sending private Zoho links to select people for testing and feedback.

Doing that provides positives from a product perspective.

I’ve previously outlined my financial reasons why I’m not happy with moving the release 4 months.

My previous email today about salary proposes an inflation adjustment based only on 2024 onwards.

Therefore I propose a once off payment based on the 12.5% inflation over 2022/2023.

After grossing up by the 45% margin tax rate that comes to 57K AUD, to be added to next week’s invoice.

4.    Delays

What are your proposals for how to deal with delays from the designers impacting the end July release date?

I’m not in favour of missing that date unless there is something materially wrong with the product or purchasing/licensing system.

I hope that such critical things will be discovered by using select people as outlined in 3).

In my view our product is ready and the dark themed website will be good enough so we should drop things or do less to meet the date should that become necessary.

However, we should agree an approach now in case it happens.

I believe with the above strategy we will succeed.

(bold emphasis added)

84    Mr Coronelli’s evidence is that he formed the view based on this correspondence and his understanding of the December 2020 agreement, that he and Mr Cassisi were in agreement that the development work for the product had been completed and, accordingly, that Phase 2 of the Project had commenced. There is no evidence that Mr Coronelli shared this view with Mr Cassisi.

85    On 9 March 2024, Tovica Technology rendered invoice #228 to Mr Coronelli at Hagakure, which included:

Details:

In respect for services provided to date by Tovica Technology Pty Ltd under our Phase 1 agreement for development of ATCXL and related expenses:

Services to 7th March 2024    $20834    2    $41,668.00    AUD

…

(bold emphasis in original; underline emphasis added)

86    As noted above, this invoice has not been paid. Mr Coronelli did not pay it because he was of the view that the invoice was not payable as, in his view, Phase 2 of the Project had commenced.

87    At about this time, the Coronelli Interests retained Azarmi and Company Ltd, which operates as Azarmi Law in London.

88    On 21 March 2024, Azarmi Law wrote to Mr Cassisi:

“vbaZen/ATCXL”

…

We are writing to you in connection with the software development venture which you and your company, Tovica Technology Pty Ltd (“you”), have been involved with, together with our clients since 2015.

As you are aware, from the extensive correspondence between you and our clients and the conduct of the parties since 2015, the software development project, for the creation of an add-in for the programming language native to Excel, VBA, was envisaged and agreed by all parties to require two phases. On termination of Phase 1, the project would enter Phase 2, the details of which were agreed in the letter of 8 December 2020 (copy attached).

As you are further aware throughout the life of the project, it has been fully funded by our clients. This funding included the payment of remuneration to you during Phase 1 of the project. On entering Phase 2, as described in the agreement evidenced by the letter of 8 December 2020, it was agreed that you would become equal shareholders in the two new companies to be incorporated to commercialise the software developed in Phase 1. There was no agreement for our clients to continue to pay you indefinitely, or for an arbitrary timeline that is unilaterally set by only you.

The two companies were incorporated in 2023, that is vbaZen International Pty Ltd and vbaZen Limited and Phase 2 has commenced. As agreed, you are each a Director of the two companies and equal shareholders. There are no other Directors or shareholders.

The intellectual property in the software developed has been transferred to vbaZen International Pty Ltd. The Memorandum and Articles of Association for vbaZen International Pty Ltd require unanimous agreement of both Directors for resolutions to be passed.

However, we understand that there is no shareholders’ agreement in place between the parties, and currently you have reached an impasse on a number of issues. These include the timing of the commercialisation of the project, and your demands for the continued payment of unagreed remuneration in Phase 2.

With regard to the timing of the commercialisation of the project, we are instructed that the initial launch date for the end of March 2024 was proposed by you without consensus, and in our clients’ informed opinion this was likely to jeopardise the prospects of success. Our clients are of the strong opinion that your proposed timing was not taking into account the best interests of the project and the companies and was to a greater degree dictated by your personal circumstances.

With regard to the continuing requests for payment, this is being demanded without the prior agreement of our clients and without any identification of or reference to the deliverables related to Phase 2 on your part, in consideration for payment.

In your proposals for profit sharing, we are instructed that there is also a complete disregard for the fact that your remuneration will be a cost for the companies in Phase 2, rather than an ongoing expense for our clients alone. There has also been a disregard for any mutually agreed business plan which would address our clients’ substantial investment to date in the project and the way in which this will be repaid by the companies. You will appreciate that these are fundamental issues which need to be addressed and agreed between the parties before any further steps may be taken to commercialise the project.

As things stand therefore, our clients will clear your last invoice (invoice no. 228 dated 9 March 2024) but do not intend to pay any further sums to you beyond this.

In the circumstances, we ask that until the parties have mutually agreed upon the terms on which Phase 2 will be implemented, including any further investments which may be required by both parties, you confirm in writing to us within 5 days of the date of this letter that you will:

•    cease to demand further unagreed payments from our clients;

•    not take any further steps to commercialise the software without our clients’ agreement;

•    not act in any way contrary to the interests of both shareholders and the two companies;

•    agree for the source code to be transferred to an escrow.

If you do not wish to co-operate our clients will take any steps necessary in any jurisdiction to protect their interests and those of the companies.

We look forward to hearing from you.

(bold emphasis in original)

89    Between 4 and 7 April 2024, Mr Coronelli and Mr Cassisi engaged in a further exchange of emails. It is unclear from the evidence what prompted this chain of emails.

90    On 4 April 2024, Mr Coronelli wrote:

I will be very brief.

The reason I used a lawyer to communicate was dictated by the need to draw a line in the sand and have a clean slate from where to start over, after weeks, if not months, of problematic dialogue.

As highlighted in the letters sent, I do have a proposal on how to move things forward. Being a proposal, you clearly have all the rights to refuse it. This would determine a stalemate, though.

Before I send my proposals through, though, I need confirmation on your side that:-

-    you haven’t contacted, and you won’t contact, any third party in relation to commercialisation of vbaZen, without our mutual consent.

-    that there are no other copies of the software besides what is in the company’s cloud repository.

-    that you are willing, while negotiations take place, to have the software put in escrow with a specialised lawyer (we can choose jointly).

All the points above are in line with what the agreement we both signed in 2020 provided - they shouldn’t be problematic at all on your side. The absence of confirmation of the above, in writing and in an official document, would force me to take action to protect my rights.

91    On the same day, Mr Cassisi responded:

Thanks for the clarifications.

-    you haven’t contacted, and you won’t contact, any third party in relation to commercialisation of vbaZen, without our mutual consent.

I am assuming that until we negotiate something like a shareholders agreement for phase 2 that we are still operating under phase 1?

If that’s the case, and my usual Tovica phase 1 invoices are paid, then I can give that undertaking.

-    that there are no other copies of the software besides what is in the company’s cloud repository.

Confirmed.

-    that you are willing, while negotiations take place, to have the software put in escrow with a specialised lawyer ( we can choose jointly).

This is confusing as it seems to contradict what the phase 2 agreement says: source is transferred to the vbaZen company and stored in the cloud?

I did that already a while ago.

I think we should try to sort out some of the basics in a shareholders agreement before tackling specifics relating to releasing products for sale.

How we were operating for around 8 years, with you providing problems and me creating solutions with your feedback, worked extremely well.

I feel we need to find a way to get back to something like that.

(bold emphasis added)

92    On 5 April 2024, Mr Coronelli responded:

Your answers are ambiguous in many ways.

I would require clear and concise answers to the following questions:-

-    At point 1 are you saying that you have or will approach other parties, given the reticence to provide a straight answer?

-    At point 1 you say we could be in Phase 1 and at point 4 you say we are in Phase 2. Could you please clarify what your understanding is of the phase we are in?

I remind you that:-

-    the code is owned by the Australian company of which we are 50% shareholders. At the current juncture you can’t take any action I don’t agree to, and the opposite.

-    I remind you that you stated the product is ready for commercialisation; we disagree on commercialisation and governance, in fact.

-    If we were in Phase 1, Hagakure pays Tovica for services and the output (code) is owned by the entity that contracts.

(bold emphasis added)

93    Mr Cassisi wrote:

It’s divided into a) the 2 agreements and b) the related funding.

a)    We have executed the Phase 2 agreement which was to create companies and transfer the source to be owned by one of them etc.

The source/IP is exclusively the responsibility of vbaZen International – i.e. it cannot live anywhere else but in the cloud so cannot be shared with others etc.

The only outstanding action listed in that agreement is a shareholders agreement.

My view is we have the mechanism in the shareholders agreement to set out methods of working based on what was most productive.

b)    Funding is currently Tovica invoicing Hagakure at levels set in 2021.

It seems we wish to maintain the method therefore what needs to be negotiated is the level, with likely expenses and a time limit.

However both the agreements were predicated on the funding – so the outstanding invoice and the one due to be raised tomorrow (usual 6th) need to be paid.

(bold emphasis added)

94    On 6 April 2024, Mr Coronelli wrote:

Very briefly:-

Phase of the Project

-    You recognise in your e-mail we are in Phase 2 of the agreement; we are 50/50 partners and that decisions need to be taken in unanimity, otherwise no action can be taken.

-    The obvious consequence of this is that you can’t contact anyone for commercialisation of the product, something you appear unwilling to state clearly.

Hagakure & Tovica

-    You recognise the product is finished and ready for commercialisation. We currently disagree on commercialisation of the product and governance.

-    You recognise we are in Phase 2, yet you still invoice me for services related to phase 1 - this isn’t possible. By the way, there is no agreement between the two Companies in relation to services related to Phase 1 and its duration.

-    You state: “ It seems we wish to maintain the method (funding) therefore what needs to be negotiated is the level, with likely expenses and time limit.” I want to make it clear that Hagakure doesn’t want to maintain the same method as Tovica (you) is now a 50% partner of the business and, as such, contributions need to be made in equal parts by the two partners.

Way Forward

-    You seem to have put a proposal forward already. Hagakure pays Tovica for not well-defined development services, these costs stay outside of the group companies (vbaZen Limited), we commercialise the product and, if we sell the software, you get 50% of the revenues net of negligible costs and I suck up your expenses. This is something I will never agree to.

-    I can put a proposal forward if you want me too. Otherwise, we are in a stalemate and the product will never be commercialised. If that is the case, we need a third party that monitors no action will be taken by any of the parties involved trying to commercialise the product on its own.

(bold emphasis in original)

95    On 7 April 2024, Mr Cassisi responded:

The date we have been discussing was March 31st with my view being we could meet that date for release and your view being we could not.

Not funding until that date contradicts what you are saying below?

I asked a month ago for your response to my funding proposal yet I’ve still not received it.

96    Between 9 April and 30 April 2024, Mr Cassisi and Mr Coronelli exchanged the following further emails.

97    On 9 April 2024, Mr Coronelli wrote:

I refer to our recent correspondence, ending with your email of 7 April.

You mention in that latest communication that you asked me for your response to your funding proposal a month ago. You are aware that I do not agree with your funding proposal, and this was clearly set out in my solicitor’s letter to you of 21 March 2024, a copy of which is attached. Yet, you keep coming back to this without acknowledging my position.

Despite all your recent comments, it is undeniable that we are in phase 2, you are a 50% shareholder, and, in several communications, you have stated the product is finished.

The next step, as you appear to agree, is for us to conclude a Shareholders’ Agreement. This needs to happen before launch, to ensure our mutual rights and obligations are defined, and the business plan is agreed. It will avoid the current toxic situation but will require significant changes going forward.

If you agree to the points that follow I will then send you a first draft of the Shareholder’s Agreement for review. I will do so only on your written confirmation of the above.

1.    COSTS OF COMMERCIALISATION

I will take care of the costs of commercialisation of the software ( website, videos, guides etc, to be defined) but also of the supervision of the process.

I expressed several times my dissatisfaction for the website you prepared; it was meant to be a structure that the designers could elaborate on, and it became an immutable reality on which you wouldn’t compromise. I am sorry to say but you are no designer (nor am I) – that is why I am relying on professionals.

The image one projects is extremely important, especially when it relates to a start-up. You are trying to communicate something about yourself and encourage the adoption of a product that is already difficult to sell.

2.    PRODUCT LAUNCH

We launch the product in its two versions once I am satisfied that the commercialisation steps have been completed to my satisfaction. I will provide funding for running business expenses (these will be defined and pre-approved in a budget) and you will provide sweat equity in terms of helping on the backend of the commercialisation process and the maintenance of what is already developed (core and pro versions of the product).

Interestingly, the first thing you sent me is a detailed list of what I had to pay you for unspecified development for an extended period. You were also quick to point out that your role description and compensation had to be reviewed as your role grows.

I would remind you that the decision to take on relevant expenditures is a business decision and, as such, it requires approval by both partners. It isn’t a given and I object to it, at this stage. If you have remuneration as a partner, I should have too.

As communicated in my previous e-mail, no remuneration will be provided to Tovica since the product is completed.

3.    PRODUCT ADOPTION

We assess the performance of the product over a reasonable period (12-24 months).

We will clearly receive 50% of eventual profits each and we will be in a better position to assess whether it makes sense for you to continue development on this or other projects and for me to generate ideas and fund them.

Only and only then, we will re-discuss economic terms for the work to be done by Tovica – work that will be part of the costs of the company and that will therefore hit the bottom-line for both Tovica and Hagakure.

Hopefully this period would give us enough time to rebuild the trust that, I confess, on my side is somewhat broken.

Please let me know if you agree to proceed with the above steps.

(underline emphasis replaces blue font in original; bold emphasis in original)

98    Mr Cassisi responded:

Please could I see your counter proposal for just the funding with your expected start/end-dates, estimated budget including major expenses and billing mechanisms.

I can mull over the rest in the meantime (thanks for the details), however, the core of the matter for me is the funding and I don’t quite understand what exactly you’re saying in that regard below.

99    On 10 April 2024, Mr Coronelli wrote:

I thought the last communications were very clear on the points you raised. In the end, as per your last reply, it seems for you it all comes down only to funding and billing mechanism for Tovica.

The key points are the following:-

1. The budget will be for 3rd party providers (mainly designers at this stage), that will terminate the website and help the launch - not Tovica. The timing would be more my concern but end of 3rd quarter is reasonable, given the delays due to this exhausting backwards and forwards.

2, Given we are in phase 2 and the product is complete, there will be no funding from Hagakure to Tovica as development is completed and you are 50% partner.

3. If the product is a success, Tovica will receive its share of profits ( as 50% partner).

At that stage ( after 12/24 months of observation of reception) we might restart development.

If we restart development, we will need to decide an appropriate fee for Tovica for work to be done.

Two points, to be very clear:-

-    this would be abnormal as you are a partner, already deriving profits from the business. It would be a concession that I am happy to do.

-    the costs paid to Tovica would be a cost for vbaZen Limited and, as such, would hit the bottom line for both of us equally.

4. If it isn’t a success, Tovica will not have to pay a dime as Hagakure will have paid 3rd party costs and wouldn’t ask Tovica to re-imburse.

100    Mr Cassisi responded:

Much clearer, thanks.

Final two points – as per the letter, when will the March 6th invoice be paid?

And how are the ongoing Cryptlex/Zoho subscription fees to be handled, given that Tovica is currently paying them directly?

101    Later that day, Mr Coronelli wrote:

Going through your points:-

-    With regards to Cryptlex expenses, I can refund them short term via a Tovica invoice. It would then be better to transfer the account to Hagakure or vbaZen Limited, if the project continues.

-    With regards to invoice of the beginning of March, I have had no factual and definitive reply on all points I raised. Once you have provided clear answers to all the points raised in my email of Tuesday 9 April and the letter of 21 March 2024, I will settle it, provided you change the description to ‘Termination Phase 1 Services Paid in Arrears’.

102    Mr Cassisi responded:

Thanks – for the second point, to ensure nothing is missed out please can you send a single list of the bullet points – please ensure all points are covered (add new ones if necessary) so it is a final definitive list.

I’ve looked more closely at the wording of the first email below but I’m unfortunately still puzzled over how precisely things are supposed to work between now and the end of the “12-24 months observation period”.

Specifically what tasks am I expected to do in that period as “sweat equity”? How is this offset process to work?

103    On 16 April 2024, Mr Coronelli wrote (as written):

As per your further requests, please see below the points you would need to agree upon grouped by areas.

I have put TC in red where you should state ‘Agreed’.

PART1 - PHASE OF PROJECT AND SECURITY OF THE SOFTWARE

The points below are a combination of the ones in the letter sent by my solicitors’

You recognise that we are in phase 2 of the project and we are 50/50 partners with a decision making that requires unanimity.

TC:

You haven’t taken any actions to commercialise the project, approaching third parties in relation to it without my knowledge.

TC:

You won’t take any further steps to commercialise the software without my agreement

TC:

You won’t t act in any way contrary to the interests of both shareholders and the two companies;

TC:

You undertake that no other copies of the software exist if not on vbaZen International Pty’s cloud repository

TC:

You will ask official logs from Microsoft to demonstrate that no part of the software has been copied out of the official repository.

TC:

PART2 - PRE-CONDITIONS

You will find below the pre-conditions necessary to discuss a new partnership agreement below.

You accept the conditions and we start discussing the new partnership agreement:-

-    If we fail to find an agreement, I will have funded commercialisation but the product won’t launch and both you and I won’t be able to use the software.

-    If we find an agreement the product will launch under the governance of the new partnership agreement.

Important notes:-

-    As you will see points 1 & 2 give me discretion on costs of commercialisation and product launch. Therefore, please don’t ask for further explanations to delay the process as the experience is becoming more than frustrating.

-    I have introduced point 3 just to be very clear that no obstruction will be tolerated.

- Point4 will happen under rules we define jointly in a new partnership agreement below. No reason to discuss at this stage

COSTS OF COMMERCIALISATION

I will take care of the costs of commercialisation of the software ( website, videos, guides etc, to be defined) but also of the supervision and final decision making of the process.

I expressed several times my dissatisfaction for the website you prepared; it was meant to be a structure that the designers could elaborate on, and it became an immutable reality on which you wouldn’t compromise. I am sorry to say but you are no designer (nor am I) – that is why I am relying on professionals.

The image one projects is extremely important, especially when it relates to a start-up. You are trying to communicate something about yourself and encourage the adoption of a product that is already difficult to sell.

TC:

CONDUCT DURING PROCESS

It is important you maintain a collaborative and professional attitude throughout the steps of the commercialisation phase.

Should I feel we go back to the previous antics, I will put a stop to the whole process and launch will be aborted.

TC:

PRODUCT LAUNCH

We launch the product in its two versions once I am satisfied that the commercialisation steps have been completed to my satisfaction. I will provide funding for running business expenses (these will be defined and pre-approved in a budget) and you will provide sweat equity in terms of helping on the backend of the commercialisation process and the maintenance of what is already developed (core and pro versions of the product).

Interestingly, the first thing you sent me is a detailed list of what I had to pay you for unspecified development for an extended period. You were also quick to point out that your role description and compensation had to be reviewed as your role grows.

I would remind you that the decision to take on relevant expenditures is a business decision and, as such, it requires approval by both partners. It isn’t a given and I object to it, at this stage. If you have remuneration as a partner, I should have too.

As communicated in my previous e-mail, no remuneration will be provided to Tovica since the product is completed.

TC:

PRODUCT ADOPTION

We assess the performance of the product over a reasonable period (12-24 months), with a decision making process that will be defined in the

We will clearly receive 50% of eventual profits each and we will be in a better position to assess whether it makes sense for you to continue development on this or other projects and for me to generate ideas and fund them. Only and only then, we will re-discuss economic terms for the work to be done by Tovica – work that will be part of the costs of the company and that will therefore hit the bottom-line for both Tovica and Hagakure.

Hopefully this period would give us enough time to rebuild the trust that, I confess, on my side is somewhat broken.

Please let me know if you agree to proceed with the above steps.

TC:

PART3 - FUNDING & TIMING

The budget from the moment in which you agree to all the points in the current e-mail will be for 3rd party providers only (mainly designers at this stage), that will terminate the website and help the launch - not Tovica. I will take care of the costs initially from Hagakure and then from vbaZenLimited.

TC:

Any costs that Tovica sustains for the commercialisation in relation to third parties (Cryptlex for example) should be stated in advance and approved by me before going ahead.

TC:

The timing would be more my concern but the end of 3rd quarter is reasonable, given the delays due to this exhausting backwards and forwards. I will act in the interest of shareholders but I won’t launch without a professional and well structured offering. The deadline is therefore indicative only.

TC:

Given we are in phase 2 and the product is complete, there will be no funding from Hagakure to Tovica as development is completed and you are 50% partner. Any work you will do in the commercialisation phase and in the first 12/24 months won’t be remunerated as you will work, as me, as a partner.

TC:

Given the above, both Hagakure and Tovica ( or you as an individual) can take on other work provided that in no way material developed for vbaZen is used.

TC:

If Tovica is unable to provide its services - in quality of shareholder - as a result of excessive work commitments, a third party will be engaged. The costs of the third party will be split 50/50 between shareholders.

TC:

A proper Non Disclosure Agreement will be drafted and signed by both parties, to protect the integrity of the software.

TC:

Distribution of profits ( if any) during the product test phase will be done according to the current 50/50 split. To be clear, profits will be revenues minus costs incurred during the phase - they won’t include commercialisation costs that will be paid by Hagakure.

TC:

If the two shareholders ( Hagakure and Tovica) agree on further development work - agreement based on the new shareholders agreement- Tovica will have the priority to conduct such works. The remuneration for a tovica will be determined in a separate contract signed by vbazen International Pty & vbaZen Liimted and Tovica.

TC:

To be clear, the above remuneration will be borne by the companies owned by Hagakure and Tovica and will represent company costs to be subtracted from the revenues of the product.

TC:

If the product isn’t a success, the commercialisation costs will be borne by Hagakure while the ongoing costs will be borne by both parties - ongoing costs will be defined in an appropriate budget after the shareholder agreement has been redacted and approved.

TC:

PART 4 - WORK REQUIRED FROM TOVICA

As per your last request, a quick clarification on the points related to the work that Tovica will undertake as 50/50 partner during commercialisation and test phase of the product.

I assume that your main point relates to remuneration. It has already been made clear that in these phases the only inflows for Tovica ( and Hagakure) will be represented by eventual profits if the product is launched. As a result, Tovica is free to take on other work with the caveats described earlier.

The points listed below are non-exhaustive but provide a good indication. If you are unhappy also with these, it would appear to me that the right cooperative spirit is missing. Therefore I will be forced to terminate all these discussions and simply protect the intellectual property of the software in whatever fashion is required.

During the commercialisation phase, Tovica will mainly:-

-    terminate the licensing mechanism.

-    terminate the integration of the payment system.

-    assist in providing instructions for the demonstration videos.

-    assist in the definition of sections of the website.

-    assist in the review of all customer support material.

-    assist in the finalisation of the pricing of the two versions of the software.

During the test phase, Tovica will mainly:-

-    make sure the back end of the website ( licensing, payments etc ) works fine.

-    highlight if there are problems related to website traffic handling.

-    make sure customer’s technical questions ( software & licensing) are properly handled within 24 hours.

-    provide solution and patches to problems highlighted by users or independently found through internal testing.

-    routine maintenance software and documentation - no new development.

TC:

(single underline replaces blue font and double underline replaces red font in original; bold emphasis in original. “TC” is a reference to Mr Cassisi.)

104    On 18 April 2024, Mr Cassisi wrote:

For the points, I’m positive we can come to a compromise we’d both be happy with.

However, first we need to sort out the core point: the funding.

We have a long standing Tovica funding arrangement which forms the foundation of the agreements.

Both agreements, termed phase 1 and phase 2, are built on that funding arrangement.

I’m sure with your extensive financial expertise a way can be found that works for us without actually breaking that core arrangement.

For my part, I’m keen to do this project with you, so I’ll be receptive to whatever you propose to resolve this core point.

105    On 24 April 2024, Mr Coronelli responded:

I refer to your email of 18 April 2024. The list I prepared, at your specific request, was nothing but a collection of the precise points raised in several earlier communications, to which I received no answer.

Your generic response - saying that we will find some form of compromise - is totally unsatisfactory, to be frank, another disappointment and a further erosion of trust. I just ask you to carefully consider why we are in this situation.

The only thing you are interested in is funding.

A couple of observations:-

-    Funding is a term that applies to a company. vbaZen has available funding to go to market, as stated in all communications - I will provide it if I get comfort on the points raised.

-    What you are interested in and focussing on, is effectively an unagreed salary.

-    What is sad and indicative of your motivations is the absence of any willingness to make any efforts to see the product launch.

On the specific point - what is de facto a request for a salary - I reiterate for the last time the only relevant considerations:-

1.    We are in phase 2 and, as such, we are joint shareholders and Directors. You aren’t an employee.

2.    The product is finished and relevant tasks to commercialisation have been outlined. Therefore no compensation for you is justified.

3.    The agreement relating to Phase 2 has no mention of a continuing payment, nor was there an intention or commercial justification for there to be indefinite payments to you, more so when development is finished, as per your own words.

Please reflect once again on the points I sent you and the implications they have for the launch of the product. In absence of a precise reply to all the points, I will be forced to protect my interests in Australia.

106    On 30 April 2024, Mr Cassisi wrote:

In March, I was working flat out on trying to get things ready for a release by the end of March when you decided to not pay for that work - retrospectively.

I would appreciate clarity on why.

Releasing a product is a full time exercise, normally involving a staff of people to manage the rolling releases with social media, blogs and marketing campaigns.

For a premium product it also involves talking to clients, gathering feedback and implementing the requests, and handling support requests.

I’m failing to understand how all that is supposed to be done?

107    On 3 May 2024, Azarmi Law wrote to Mr Cassisi on instructions from Mr Coronelli concerning his loss of access to the repository. That letter was in the following terms:

We refer to our previous correspondence with you (in particular our letter of 21 March 2024) and your ongoing correspondence with our client.

Some very concerning issues have come to our client’s attention in the last week. We understand that:

•    on attempting to access the source code in the usual way, via the licensing system that is contracted by vbaZen International Pty Ltd, he has been denied access to the code by the system;

•    an error is also showing on his ownership of the licence;

•    in trying to access the source code located at dev.azure.com/vbazen he is being denied access and being referred to the administrator, which is you.

We appreciate that these problems with access may be arising out of a technical issue only and it is for that reason we are writing to you before taking any further action. Please let us know by return whether this is a technical issue and if so, please confirm that you will assist our client to remedy it and gain access to the code.

If this situation has arisen as a result of your wilful actions, which would amount to a fundamental and egregious breach of the agreement between the parties, and/or if we do not hear from you, please note that our client will immediately take all legal action necessary in Australia and any other applicable jurisdiction against you and Tovica Technology Pty Ltd, including injunctive proceedings, without further notice to you. If proceedings are commenced, if successful, our client may be able to claim the costs of such proceedings from you, in addition to any damages awarded. We hereby place you on notice of the costs of any such proceedings which may be substantial.

108    Between 5 May and 24 May 2024, Mr Cassisi and Mr Coronelli resumed email correspondence.

109    On 5 May 2024, Mr Cassisi wrote:

You arbitrarily imposed a “pause” in March - so the source remains in the cloud as per our Phase 2 agreement.

I don’t think it’s reasonable to expect support when you have still not paid the March invoice, nor reached agreement.

These are distractions: please focus on the final points so hopefully we can both reach that agreement asap.

Specifically, the mechanics of how this day-to-day “offsetting” is supposed to work:

Releasing a product is a full time exercise, normally involving a staff of people to manage the rolling releases with social media, blogs and marketing campaigns.

For a premium product it also involves talking to clients, gathering feedback and implementing the requests, and handling support requests.

I’m failing to understand how all that is supposed to be done?

(bold emphasis added)

110    On 15 May 2024, Mr Cassisi sent a further email:

We need to bring this to a resolution.

To that end, I’ve carefully reviewed your points and the fundamental issue remains: the offsetting idea cannot work.

I’m willing to compromise and limit the agreed funding period, fix the amount up front, keep the costs down by using no third parties, use a 1-room office of 1, etc.

Please let me know your thoughts,

111    On 21 May 2024, Mr Cassisi sent yet another email:

How about we do this over lunch in Rome in a week or so? I should be able to find flights.

Then we can tie it all off and reach a decision.

112    On 23 May 2024, Mr Coronelli responded:

You may understand your reactions triggered some further soul searching on my side.

I am working on a final attempt to put forward a proposal that could preserve some value of the investments made – it should take me two weeks, as I am engaged also on other matters.

I think it is better to discuss once we have something concrete in front.

113    On 24 May 2024, Mr Cassisi wrote:

The EOFY is coming up here, so we need to decide before then to avoid unnecessary costs in keeping the unused companies open.

We are trying to launch a startup, something that has a well-established method to it.

18M of funding and detailed milestones, both fixed up front, will show whether the product is viable, and there’s a standard way to do that.

Those funds could also be in the form of a long-term company loan, or partly provided by others, to reduce and spread the risk.

It is hard in email to convey these things but we do need to start discussing them to get to that concrete proposal.

114    On or around 30 May 2024, Mr Coronelli engaged Ward Keller solicitors.

115    On 30 May 2024, Mr Cassisi sent an email to Mr Coronelli with the subject line “Concrete starting point” with a detailed proposal.

116    On 7 June 2024, Mr Cassisi sent an email following up his 30 May 2024 email.

117    There followed further correspondence including from Ward Keller and from the Coronelli Interests’ present solicitors, Clifford Chance. No resolution was reached.

118    On or about 8 July 2024, Ward Keller, on instructions from Mr Coronelli, sent a lengthy letter to Mr Cassisi.

119    On 29 July 2024, Mr Cassisi sent an email to Mr Coronelli:

I note the recently received letter states you are “keen to resolve the issues” yet you’ve declined a face-to-face to hash this out and not responded to my detailed proposals from May 30th?

120    On 8 August 2024, Mr Coronelli sent an email to Mr Cassisi (as written):

You are incorrect in your statements, since my replies came through the letter sent by Ward Keller on or around the 8th of July 2024.

The need to go through lawyers is the unfortunate result of your continued unwillingness to provide clear answers to my basic questions.

I agree we should meet in person (in Sydney or Rome) but only once you have taken the steps below:-

1.    Acknowledge that we are in or starting Phase 2 of the project, given we are approaching the steps to commercialisation of the software.

2.    Provide me once again access to the software repository that is and has always been jointly owned by us first and by the Company afterwards, certainly not by you personally. The ownership of the software has been assigned to our jointly owned company, vbaZen International Pty Ltd, to the best of my understanding.

3.    Provide me access to the licencing system again (Cryptlex) and to logs showing which actions you took during the period I could not access the system.

4.    Provide me an open-ended licence, so I can verify any actions or changes made.

These steps are all straightforward. Please could you confirm they are complete and provide access details by this Friday.

Failure to do points 2 to 4 is a breach of your director duties and a limitation of my rights as a director and 50% shareholder of vbaZen International Pty.

I ask you to seriously consider the above because a resolution is really possible if you rectify the actions you shouldn’t have arbitrarily taken. If these steps are taken, I will see this as a sign of your good faith and reciprocal trust and we can move forward with a business plan and budget for commercialisation. If these steps are not taken, I will need to consider whether to take formal steps to protect my investment in the source code and software.

I hope that we can have an open conversation with a positive outcome and look forward to hearing from you.

(bold emphasis added)

121    On 3 September 2024, Clifford Chance, now acting for the Coronelli Interests, sent a further letter of demand to the Cassisi Interests.

122    On 6 September 2024, Mr Cassisi wrote to Clifford Chance:

I acknowledge receipt of your letter at 9am 4th September.

It is unreasonable to expect a substantive response to such complex matters within a few days.

Such a response will therefore be provided within 21 days from receipt - i.e. by 4pm on 24th September.

123    On 20 September 2024, Mr Cassisi wrote to Mr Coronelli:

I refer to Clifford Chance’s letter dated 3 September 2024.

Although I will not traverse the factual matters or legal assertions made in Clifford Chance letter, do not regard them as accepted. The factual background is evidenced in our many emails and our recollection of conversations.

I refer to your email of 8 August 2024 referred to by Clifford Chance and paragraph 9 of their letter:

“Our client wishes to clarify the status of the Project, resolve the outstanding issues and progress the launch of the product. To do so, the requests in the 8 August email must first be addressed. For the avoidance of doubt, it is disproportionate and costly to propose our client travel to Sydney before these matters are confirmed.”

I am willing to meet you *without* preconditions.

I refer to Clifford Chances paragraphs 10(b) and (c). Despite the letter, I do not understand why Hagakure Ltd as a shareholder of vbaZen would be entitled to access the Microsoft Visual Studio account or to open ended access to “the licensing system, Cryptlex and to logs”. In addition, bearing in mind that I developed the program, I do not understand why Hagakure Ltd wants or needs access, or its intention.

Unless we can work together in good faith as directors of vbaZen International Pty Ltd there is a deadlock in its management which cannot be resolved by a shareholders meeting. The consequence would be the objectives of vbaZen are unachievable.

Aldo,

In respect of progressing “the launch of the product”, can you outline your thoughts as to the steps to be taken, by whom and for what remuneration or compensation.

The objective of vbaZen will not be achieved through lawyers. It can only be achieved with us working together in good faith.

124    On 1 October 2024, the Coronelli Interests commenced this proceeding by filing an originating process.

125    During October 2024, agreement was reached between the Coronelli Interests and the Cassisi Interests that a fair valuation of the Company was $1,700,000.

126    On 5 February 2025, counsel for the Cassisi Interests wrote to the solicitors for the Coronelli Interests (as written):

I refer to your client’s proposed amended Originating process provided 16 December 2024, the court orders of 19 December 2024 , the proposed Statement of claim served on 3 February 2025, and the CMC listed for 7 February 2025.

…

On the 19 December 2024 I advised the court the First and Second Defendants were not in a position to provide instructs as to the Third Defendant’s ownership of the Project IP

The First and Second Defendants have reviewed material dating back 12 years and acknowledge vbaZen International Pty Ltd owns the Project IP.

…

(bold emphasis in original)

127    On the same day, the solicitors for the Coronelli Interests responded:

…

6.    Your 5 February Letter does not define “Project IP”. We note that, in the Phase 2 Agreement (as defined in our clients’ draft Statement of Claim), “Project IP” is defined as “All source code and intellectual property and other rights (whether registered or unregistered and howsoever and wherever arising) relating to the Project”.

7.    Please could you clarify your clients’ definition of “Project IP” as set out in the 5 February Letter, particularly whether your clients defined “Project IP”:

(a)    in the same way as that term is defined in the ‘Phase 2 Agreement’; and

(b)    in the same way that ‘vbaZen IP’ is defined in paragraph 16(b) of the Statement of Claim.

…

(italic emphasis in original)

128    On 6 February 2025, counsel for the Cassisi Interests sent an email to my Associate and the solicitors for the plaintiffs which included:

I refer to your email below.

... The First and Second Defendant have acknowledged that the Third Defendant is the owner of the “vbaZen IP”.

…

129    From 5 March 2025, the Cassisi Interests were no longer legally represented in this proceeding. Subsequently, Tovica Technology was granted leave to proceed without a solicitor and to be represented by Mr Cassisi.

130    Mr Coronelli remains without access to the repository.

131    Relations between the Coronelli Interests and the Cassisi Interests have broken down irretrievably and as a result of the Company’s structure, the Cassisi Interests and the Coronelli Interests are in a state of deadlock.

C.     Consideration

132    The central questions for determination are:

(1)    is the intellectual property owned by the Company?;

(2)    if the intellectual property is owned by the Company, then are the Coronelli Interests entitled to relief under s 233 of the Corporations Act?; and

(3)    if the intellectual property is not owned by the Company, then are the Coronelli Interests entitled to: (a) damages for misleading or deceptive conduct; or (b) relief for breach of contract.

C.1    Ownership of the intellectual property

133    In considering the ownership of the intellectual property of the Company it is convenient to start with the December 2020 agreement, which records:

(1)    an acknowledgement that the “Project IP” as defined in that agreement – i.e. “[a]ll source code and intellectual property and other rights (whether registered or unregistered and howsoever and wherever arising) relating to the Project” – belonged to the Coronelli Interests and the Cassisi Interests jointly as at the date of that agreement; and

(2)    the agreement of the Coronelli Interests and the Cassisi Interests that: (a) the Company would be created; and (b) the Project IP would be transferred to the Company.

134    I am satisfied that the Project IP (and to the extent it differs, the vbaZen IP) has been transferred to the Company for the following reasons.

135    First, on or about 1 February 2023, the Company was incorporated with Mr Cassisi and Mr Coronelli as the directors and Tovica Technology and Hagakure as equal members.

136    Secondly, in the emails exchanged by Mr Cassisi and Mr Coronelli between 4 and 7 April 2024 ([90] to [95] above):

(1)    Mr Coronelli sought information that there were no other copies of the software besides what was in the Company’s cloud repository. Mr Cassisi responded: “Confirmed”;

(2)    Mr Coronelli stated that he was willing, while negotiations took place, to have the software put in escrow with a specialised lawyer. Mr Cassisi responded:

This is confusing as it seems to contradict what the phase 2 agreement says: source is transferred to the vbaZen company and stored in the cloud?

I did that already a while ago. ; and

(3)    Mr Cassisi also stated:

…We have executed the Phase 2 agreement which was to create companies and transfer the source to be owned by one of them etc.

The source/IP is exclusively the responsibility of vbaZen International – i.e. it cannot live anywhere else but in the cloud so cannot be shared with others etc.

The only outstanding action listed in that agreement is a shareholders agreement. ;

137    These statements and in particular Mr Cassisi’s statement that the only action in the December 2020 agreement outstanding was the entry into a shareholders agreement, is strong evidence that the ownership of the intellectual property has been transferred to the Company.

138    Finally, the Cassisi Interests, when represented by their counsel, made the following admissions:

(1)    on 5 February 2025, an admission that the Company owns the Project IP. This is plainly a reference to that term as used in the December 2020 agreement ([126] above); and

(2)    on 6 February 2025, an admission that the Company owns the vbaZen IP as defined in the statement of claim, namely “all source code and intellectual property and other rights, whether registered or unregistered, relating to vbaZen (formerly ATCXL)” ([128] above).

C.2    The oppressive conduct case

139    I turn now to the oppressive conduct case.

C.2.1    Overview

140    Part 2F.1 of the Corporations Act deals with oppressive conduct of the affairs of companies. Within Pt 2F.1, s 234 deals with standing to apply for an order under s 233. It provides relevantly that a member, as defined in s 231 of the Corporations Act, has standing. Thus Hagakure, but not Mr Coronelli, has standing to seek relief.

141    Section 232 of the Corporations Act sets out the circumstances in which the Court’s discretion to make an order under s 233 of that Act may be enlivened. It provides:

232     Grounds for Court order

The Court may make an order under section 233 if:

(a)     the conduct of a company’s affairs; or

(b)     an actual or proposed act or omission by or on behalf of a company; or

(c)     a resolution, or a proposed resolution, of members or a class of members of a company;

is either:

(d)     contrary to the interests of the members as a whole; or

(e)     oppressive to, unfairly prejudicial to, or unfairly discriminatory against, a member or members whether in that capacity or in any other capacity.

For the purposes of this Part, a person to whom a share in the company has been transmitted by will or by operation of law is taken to be a member of the company.

(bold emphasis in original)

142    Section 232(a) relates to the conduct of a company’s affairs. The “affairs” of a company are defined broadly and non-exhaustively in s 53 of the Corporations Act, including with respect to the “property” of a company.

143    Sections 232(d) and 232(e) require relevantly that the conduct of the company’s affairs be either “contrary to the interests of the members as a whole” or “oppressive to, unfairly prejudicial to, or unfairly discriminatory against, a member or members whether in that capacity or in any other capacity”.

144    If the Court’s discretion is enlivened by dint of satisfaction of s 232, then the exercise of that discretion is informed by the terms of s 233 of the Corporations Act. That section provides:

233     Orders the Court can make

(1)     The Court can make any order under this section that it considers appropriate in relation to the company, including an order:

(a)    that the company be wound up;

(b)     that the company’s existing constitution be modified or repealed;

(c)     regulating the conduct of the company’s affairs in the future;

(d)     for the purchase of any shares by any member or person to whom a share in the company has been transmitted by will or by operation of law;

(e)     for the purchase of shares with an appropriate reduction of the company’s share capital;

(f)     for the company to institute, prosecute, defend or discontinue specified proceedings;

(g)     authorising a member, or a person to whom a share in the company has been transmitted by will or by operation of law, to institute, prosecute, defend or discontinue specified proceedings in the name and on behalf of the company;

(h)     appointing a receiver or a receiver and manager of any or all of the company’s property;

(i)     restraining a person from engaging in specified conduct or from doing a specified act;

(j)     requiring a person to do a specified act.

Order that the company be wound up

(2)     If an order that a company be wound up is made under this section, the provisions of this Act relating to the winding up of companies apply:

(a)     as if the order were made under section 461; and

(b)     with such changes as are necessary.

Order altering constitution

(3)     If an order made under this section repeals or modifies a company’s constitution, or requires the company to adopt a constitution, the company does not have the power under section 136 to change or repeal the constitution if that change or repeal would be inconsistent with the provisions of the order, unless:

(a)     the order states that the company does have the power to make such a change or repeal; or

(b)     the company first obtains the leave of the Court.

(bold and italic emphasis in original)

145    Thus, in an application brought for relief pursuant to Part 2F.1 of the Corporations Act it is necessary to take the following steps.

146    First, to identify whether the impugned conduct falls within any of s 232(a), (b) or (c) of the Corporations Act.

147    Secondly, if the impugned conduct does fall within any of s 232(a), (b) or (c), then to consider whether that conduct satisfies s 232(d) or (e) of the Corporations Act.

148    Thirdly, if the impugned conduct also satisfies s 232(d) or (e), then to consider – in the exercise of the discretion conferred upon the Court by s 233 – what remedy, if any, is appropriate.

C.2.2    Does the impugned conduct fall within s 232(a), (b) or (c) of the Corporations Act?

149    The first question is whether the impugned conduct falls within s 232(a), (b) or (c) of the Corporations Act.

150    The obvious starting point is the identification of the impugned conduct.

151    In this regard, the conduct pleaded on behalf of the Coronelli Interests is wide-ranging. However, a narrower case, which is a sub-set of the pleading, was advanced at the hearing both in opening and closing submissions.

152    Relevantly, the statement of claim alleges that since in or around April 2024, the Cassisi Interests have denied the Coronelli Interests access to the repository despite demands that access be reinstated. This allegation is particularised by reference to the following communications:

(1)    the letter from Azarmi Law to Mr Cassisi dated 3 May 2024 ([107]) above;

(2)    the email from Mr Cassisi to Mr Coronelli dated 5 May 2024 ([109]) above;

(3)    the letter from Ward Keller to Mr Cassisi dated on or around 8 July 2024 ([118]) above;

(4)    the email from Mr Coronelli to Mr Cassisi dated 8 August 2024 ([120]) above;

(5)    the letter from Clifford Chance to Mr Cassisi dated 3 September 2024 ([121]) above;

(6)    the email from Mr Cassisi to Clifford Chance dated 6 September 2024 ([122]) above; and

(7)    the email from Mr Cassisi to Mr Coronelli dated 20 September 2024 ([123]) above.

153    I am comfortably satisfied from that correspondence and the evidence of Mr Coronelli that the Cassisi Interests have denied the Coronelli Interests access to the repository, at least in the sense of not taking steps to restore that access.

154    I am also satisfied that such conduct is conduct of a company’s affairs, in circumstances where that concept is defined broadly in s 53 of the Corporations Act and the matters stored in the repository are property of the Company.

155    Thus, the denial of access falls within s 232(a) of the Corporations Act. It is unnecessary to consider whether it also falls within s 232(b) or (c) of the Corporations Act.

C.2.3    If the impugned conduct does fall within s 232(a), (b) or (c), then does that conduct satisfy s 232(d) or s 232(e)?

156    I turn now to the second question – whether the denial of access to the repository satisfies s 232(d) or s 232(e) of the Corporations Act.

157    Neither the pleading nor the submissions made on behalf of the Coronelli Interests identify with any clarity which of s 232(d) or s 232(e) is alleged to have been satisfied, or why that is so, save to the extent that it was submitted that the Cassisi Interests’ conduct paralysed the Company and that this was contrary to the interests of the members as a whole.

158    At the heart of the enquiry concerning s 232(e) of the Corporations Act is whether there has been commercial unfairness. In determining whether this has occurred:

(1)    fairness is not to be assessed in a vacuum, but by having regard to the context in which the impugned conduct occurred. That context includes the business of the company, the conduct of the aggrieved party and the nature of the relationship between the people participating in the business;

(2)    a balancing exercise may be involved between competing considerations which arise in the circumstances of the particular case; and

(3)    it is not necessary that the aggrieved party come to the Court with “clean hands”, but the conduct of that party may render the conduct of the other party, even if prejudicial, not unfair (or may affect the relief that the Court may give). This is particularly so if that conduct involves “baiting” the other party to act in the manner subject of complaint

: see In re London School of Electronics Ltd [1986] Ch. 211 at 222 (Nourse J); Morgan v 45 Flers Avenue Pty Ltd (1986) 10 ACLR 692 at 706 (Young J); Fexuto Pty Ltd v Bosnjak Holdings Pty Ltd [1998] NSWSC 413; (1998) 28 ACSR 688 at 739 to 741 (Young J); O’Neill v Phillips [1999] 1 WLR 1092 at 1098 (Lord Hoffmann, with whom Lords Jauncey, Clyde, Hutton and Hobhouse agreed); Joint v Stephens [2008] VSCA 210; (2008) 26 ACLC 1467 at 1497 ([133] to [136]) (Nettle, Ashley and Neave JJA); Tomanovic v Argyle HQ Pty Ltd; Tomanovic v Global Mortgage Equity Corporation Pty Ltd; Sayer v Tomanovic [2010] NSWSC 152 at [39] (Austin J); Re Ledir Enterprises Pty Ltd [2013] NSWSC 1332; (2013) 96 ACSR 1 at 63 to 64 ([213] to [214]) (Black J); Mackay Sugar Ltd v Wilmar Sugar Australia Ltd (ACN 098 999 985) [2016] FCAFC 133; (2016) 338 ALR 374 at 377 to 378 ([9] to [14]) (Gilmour, Jagot and White JJ); In the matter of Anna Bay Resort Pty Ltd [2022] NSWSC 331 at [190] (Rees J); Chief Disruption Officer Pty Ltd (as trustee for the McDonald Family Trust) (ACN 609 702 776) v Michel (No 3) [2022] FCA 1302; (2022) 164 ACSR 476 at 485 [30] (Goodman J); WIJOAV Services Pty Ltd v Goldstone Private Equity Pty Ltd [2025] FCA 622 at [156] (Jackman J); Scott v Aulich, in the matter of Aulich Civil Law Pty Ltd (in liq) [2025] FCA 1329 at [100] (Stewart J); Hurburgh v Hurburgh, in the matter of Richard Pitt & Sons Pty Ltd [2026] FCA 361 at [37] (Neskovcin J).

159    In Catalano v Managing Australia Destinations Pty Ltd [2014] FCAFC 55; (2014) 314 ALR 62 at 66 [9], the Full Court (Siopis, Rares and Davies JJ) stated:

The test of unfairness requires an objective assessment of the conduct in question with regard to the particular context in which the conduct occurs. The question is whether objectively in the eyes of the commercial bystander there has been unfairness, namely conduct that is so unfair that reasonable directors who consider the matter would not have thought the conduct or decision fair. As the test is objective, whether or not the conduct is oppressive will not depend upon the motives for what was done. It is the effect of the acts that is material: Wayde CLR 472–3; ALR 234–5; Campbell [176].

(italic emphasis in original)

160    See also Mackay Sugar at 377 to 378 [12].

161    For s 232(d), commercial unfairness is not required: see Hurburgh at [40]. Nevertheless, the contextual considerations described above are relevant. In Australian Institute of Fitness Pty Ltd v Australian Institute of Fitness (Vic/Tas) Pty Ltd (No 3) [2015] NSWSC 1639; (2015) 109 ACSR 369, Sackar J observed at 380 to 381 ([82] to [84]):

[82]     The concept of “contrary to the interests of the members as a whole” is independent of the “oppressive, unfairly prejudicial or unfairly discriminatory” ground: Turnbull v National Roads and Motorists’ Association Ltd (2004) 50 ACSR 44; [2004] NSWSC 577 at [32] (Turnbull) per Campbell J. The section is of broad compass and “should not be hedged about by implied limitations”: Campbell v Backoffıce Investments Pty Ltd (2009) 238 CLR 304; 257 ALR 610; 73 ACSR 1; [2009] HCA 25 per Gummow, Hayne, Heydon and Kiefel JJ at [178].

[83]     This element of s 232 has not been subject to extensive judicial exegesis. It is, however, clear that such conduct will not necessarily involve commercial unfairness. Campbell J, in Turnbull at [32], observed:

An action is capable of being “contrary to the interests of the members as a whole” in ways other than by being commercially unfair. Being pointlessly wasteful is one example.

[84]     The test is objective: see Goozee v Graphic World Group Holdings Pty Ltd (2002) 42 ACSR 534; [2002] NSWSC 640 at [42]–[44] (Goozee). It is to be determined by reference to whether the conduct adheres to accepted standards of corporate behaviour or is in accordance with how reasonable directors would act in attending to the affairs of the company: Goozee at [41]. The decision of what is contrary to the interests of the members as a whole directs attention not to the interests of the persons who are, in fact, the members for the time being, but rather on the interests of an individual hypothetical member: Goozee at [42].

(italic emphasis in original)

162    Further, conduct that has the effect of paralysing a company in the operation of its business is capable of characterisation as conduct contrary to the interests of the members as a whole within the meaning of s 232(d): Campbell v Backoffice Investments Pty Ltd [2008] NSWCA 95; (2008) 66 ACSR 359 at 400 to 401 [185] (Basten JA); Munstermann v Rayward; Rayward v Munstermann [2017] NSWSC 133 at [22(5)] (Stevenson J).

163    Against that background, I turn now to whether s 232(d) or (e) of the Corporations Act is satisfied.

164    The salient features of the context in which the denial of access to the repository occurred are as follows.

165    From about early March 2024, the relationship between the Coronelli Interests and the Cassisi Interests was severely strained.

166    As the email exchange between 1 and 6 March 2024, which is set out at [77] to [83] above demonstrates, Mr Coronelli and Mr Cassisi disagreed, at least, as to an appropriate date for the launch of the software product. Mr Coronelli was advocating for a launch at the end of July 2024 and stated that he would “prefer to block everything today if the right spirit isn’t truly in place. Now it isn’t.”

167    On the other hand, Mr Cassisi was advocating for an earlier launch date (which appears to have been at the end of March 2024 per the Azarmi Law letter dated 21 March 2024).

168    The next step following the early March 2024 exchange of emails was the rendering of invoice #228 on 9 March 2024 ([85] above). That invoice was for services provided by Tovica Technology in respect of Phase 1 for the two-month period to 7 March 2024, as is plain on the face of that invoice (and confirmed when reference is made to the prior invoice #227).

169    There is no evidence that Mr Coronelli engaged with Mr Cassisi personally with respect to invoice #228 prior to the Azarmi Law letter dated 21 March 2024. That letter indicated that that invoice (but no further invoices) would be paid. It never was.

170    The Azarmi Law letter was a declaration of hostilities. In particular, it contained: (1) implicit suggestions that Mr Cassisi would, inter alia, take steps to commercialise the software product without the agreement of Mr Coronelli and act in a manner contrary to the interests of both the Coronelli Interests and the Cassisi Interests; (2) demands for written undertakings; and (3) a threat of legal action if the demands were not met. The evidence does not establish any basis to believe that Mr Cassisi proposed to act in the manner suggested (and no interim relief was ever sought).

171    In early April 2024, there was a further exchange of emails between Mr Coronelli and Mr Cassisi, which included Mr Coronelli setting out a proposal containing that which he required for the relationship to move forward and an acknowledgement on his part that Mr Cassisi was entitled to refuse that proposal, but that would result in a stalemate ([90] to [95] above). In this exchange of emails, Mr Coronelli also continued the quest commenced by the Azarmi Law letter dated 21 March 2024 of securing the intellectual property of the Project.

172    At a point which is not clear on the evidence, but which occurred prior to Azarmi Law’s 3 May 2024 letter and appears to have been around mid-April 2024, Mr Coronelli was no longer able to access the repository.

173    On 5 May 2024, Mr Cassisi indicated that he was not prepared to provide support (i.e. in the form of access to the repository) in circumstances where invoice #228 had not been paid ([109] above).

174    Further correspondence followed, including from solicitors engaged by the Coronelli Interests, before the proceeding was commenced on 1 October 2024. During that time, the Coronelli Interests did not pay invoice #228 and the Cassisi Interests did not provide the Coronelli Interests with access to the repository.

175    Viewed in the context of the events summarised above, the denial of access to the repository was one step in the saga that was the breakdown of the relationship between the Coronelli Interests and the Cassisi Interests. That saga involved a disagreement as to, at least, the commercialisation of the software product which disagreement was escalated by Mr Coronelli’s engagement of Azarmi Law into a dispute concerning the security of the intellectual property of the Project, which in turn led to a breakdown in the relationship between the Coronelli Interests and the Cassisi Interests that appears to be irretrievable.

176    I note for completeness that it is unnecessary to determine whether: (1) the change from Phase 1 to Phase 2 had occurred; (2) whether that change was to occur at the time that the development for the product had been completed or some other point (such as when all aspects of the December 2020 agreement had been performed, including entry into a shareholders agreement); (3) that point had been reached; or (4) agreement that such a point had been reached was necessary and if so, whether it had been reached.

177    It is sufficient to record that these were issues on which reasonable minds may have differed; and that the position was not so clear cut that the denial of access in the context of the broader dispute constituted conduct that satisfied s 232(d) or s 232(e) of the Corporations Act.

178    For example, on the issue of when Phase 2 commenced:

(1)    Mr Cassisi’s 27 January 2016 email ([25] above) contemplated that Phase 2 would commence when the Coronelli Interests and the Cassisi Interests were “confident our product, website and marketing documentation/strategy is ready …” (bold emphasis in original);

(2)    the December 2020 agreement did not specify when or how Phase 2 would commence;

(3)    neither the Coronelli Interests nor the Cassisi Interests acted in the aftermath of the December 2020 agreement on the basis that Phase 2 had commenced. In this respect:

(a)    Tovica Technology continued to undertake work on the development of the product and to send invoices to the Coronelli Interests for that work. As the table at [63] above illustrates, invoices #217 to #227 were rendered between 13 January 2021 and 1 February 2024 in an amount of $773,851.84;

(b)    these invoices were each expressed to be for services rendered with respect to Phase 1 of the Project;

(c)    the Coronelli Interests paid those invoices; and

(d)    Mr Coronelli continued to contribute to the development of the product during this period (i.e. into 2024).

179    It is inherently unlikely – particularly in view of the strident position taken by Mr Coronelli from March 2024 – that the Coronelli Interests would have paid invoices for services described as relating to Phase 1 of the Project and totalling $764,889.31 if the Coronelli Interests had been operating on the basis that Phase 2 had already commenced.

180    As noted above, Mr Coronelli formed the view on the basis of the early March 2024 email exchange that he and Mr Cassisi were in agreement that the development work for the product had been completed and that accordingly Phase 2 of the Project had commenced. However, his subjective and uncommunicated view was not an agreed measure for the start of Phase 2.

181    Further, although it is also unnecessary to determine whether the Coronelli Interests were liable to pay invoice #228, the Cassisi Interests appear to have had a sound argument that that invoice – relating to services rendered in January and February 2024 for work relating to Phase 1 of the Project (i.e. before the date in early March 2024 on which Mr Coronelli formed the view that Phase 2 had commenced) – was payable regardless of whether Phase 2 had commenced in early March 2024.

182    Finally, the impugned conduct is not conduct that caused the paralysis of the operations of the Company. Rather, as illustrated by the events recounted above, the paralysis of the Company was a function of the broader, and earlier, deterioration in the relationship between Mr Coronelli and Mr Cassisi. Deprivation of access was but one aspect of that saga and did not, of itself, prevent the Company from operating.

183    For all of the above reasons, the denial of access to the repository, albeit conduct that undoubtedly further inflamed the tensions between the two camps, is not conduct that meets the statutory criteria in either s 232(d) or s 232(e) of the Corporations Act.

C.2.4    What remedy, if any, is appropriate?

184    As, for the reasons set out above, I have found that neither s 232(d) nor s 232(e) is satisfied, the discretion under s 233 of the Corporations Act is not enlivened.

185    If the discretion had been enlivened, then I would not have exercised it favourably toward Hagakure in view of its conduct, via Mr Coronelli, as discussed above.

C.3    Misleading or deceptive conduct case and the contract case

186    The misleading or deceptive conduct case and the contract case were founded upon a premise that the Company does not own the vbaZen IP. As I have found that the Company owns the vbaZen IP, these cases fall away.

D.    Conclusion

187    For the reason set out above, the claims brought by the Coronelli Interests fail.

188    There is a further question, namely whether the Court should make an order winding up the Company in circumstances where there is a deadlock between the Coronelli Interests and the Cassisi Interests both at member and director level and the relationship between them appears to be irretrievably broken.

189    The Court has a discretion under s 233 to order the winding up of a company. However, that discretion is enlivened when s 232 of the Corporations Act is satisfied. For the reasons set out above, s 232 is not satisfied and the discretion in s 233 has not been enlivened. Thus, it is not open to the Court to make an order for the winding up of the Company pursuant to s 233 of the Corporations Act.

190    It is, however, open to the Court to make an order for the winding up of the Company pursuant to s 461(k) of the Corporations Act. That section provides the Court with a broad discretion to wind up a company on the basis that it is just and equitable to do so. One of the circumstances in which Courts have previously exercised the power under s 461(k) is where there is a deadlock in the management of a company and a breakdown in the relationship between its members, particularly when the Company is the vehicle by which a quasi-partnership has been conducted.

191    Although there was some discussion during the hearing as to the possibility of the Company being wound up, in my view the parties have not had the opportunity properly to address submissions as to this possibility. Further, and obviously, they have not had the opportunity to address such submissions in the context of the findings that have been made and which are set out above.

192    In these circumstances, I will make orders which will allow the parties an opportunity to confer as to the orders that the Court should make to give effect to these reasons, including as to costs; and whether a winding up order under s 461(k) of the Corporations Act should be made. To the extent that the parties are unable to agree, they will be provided with an opportunity to make short further submissions.

Associate:

Dated:    27 August 2026