AFR article post BRTV creditors' meeting, page-119

This is in response to a post up the chain suggesting that there had not been any "fraud".

Do a search on the terms: 'equitable fraud', ' second limb of Barnes v Addy' and 'Royal Brunei Airlines Sdn Bhd v Tan'. In terms of a shareholders' action, there does not need to be criminal fraud/theft. Something less is required to trigger liability. Shareholders who are into this company in a big way would probably be well served by understanding these concepts so they can evaluate their rights.

In Australia, someone can be liable to anyone who suffers loss through a breach of duty by a "fiduciary" (such as a director) where that 'someone' has 'knowingly assisted' in the breach that causes the loss. In Australia, there are 4 categories of "knowing" in this sense: actual knowledge that what is happening is a fraud; willfully shutting your eyes to the obvious; willfully and recklessly failing to make inquiries which an honest and reasonable person would make; knowledge of circumstances which would indicate to an honest and reasonable person that something is not 'kosher" (to use a term). English law refers to the last class as "objective dishonesty". To be liable to the people who suffer loss, the third party does not need to be a fraudster per se.

BIG seems to have dealt with a number of parties, whose conduct will no doubt be examined at some time using this general legal doctrine - which by a Court or not, who knows. Shareholders who want to understand how future civil actions might work, should find a few articles and reported Court cases by searching the above terms. These will mostly be relatively easy to read and understand. It may take 30 minutes - but once you've done it, you'll see how the law would apply in situations where a person or company is involved in a breach by what the law calls a 'fiduciary'. It is quite a powerful legal doctrine.