AAT upholds and increases ASIC’s disqualification decision of QLD director

The Administrative Appeals Tribunal (AAT) has upheld ASIC’s decision to disqualify Mr Dudley Quinlivan from managing corporations and has extended the period of his disqualification from three years to five years, the maximum period prescribed for an administrative banning under the Corporations Act 2001 (the Act).

The AAT was satisfied with the evidence presented by ASIC that Mr Quinlivan is not fit to be a director. The AAT identified a number of serious concerns, in relation to Mr Quinlivan’s conduct as a director, including:
(a) a failure to keep proper records of intercompany arrangements;
(b) a failure to keep proper accounts;
(c) a failure to select and supervise competent subordinates;
(d) a failure to remain familiar with the affairs of the various companies;
(e) a failure to attend to taxation obligations; and
(f) permitting companies to trade while insolvent.

The AAT found that there was a significant risk that Mr Quinlivan would fail to live up to his commitments as a director and that the public needed to be protected against that possibility.

Background
On 21 November 2008, ASIC disqualified Mr Quinlivan from managing corporations for three years pursuant to section 206F of the Act. Mr Quinlivan was disqualified because of his involvement in fourteen companies that were wound up in insolvency between 2002 and 2007: National Consolidated Investments Pty Ltd, Coastal Administration Services Pty Ltd, Remi Morgan Burns Pty Ltd, Australian Financial Management Corporation Pty Ltd, Consolidated Property Investments Pty Ltd, Manorbase Pty Ltd, First Home Buyer (Aust) Pty Ltd, Ausblue Pty Ltd, Shellston Pty Ltd, Coventry Finance Pty Ltd, Rental Options Pty Ltd, Statefort Pty Ltd, Freedom Mortgages Pty Ltd and Scottsdale Homes No 10 Pty Ltd.

On 27 November 2008, Mr Quinlivan lodged an appeal in the AAT for a review of ASIC’s decision.

Since ASIC’s original decision to disqualify Mr Quinlivan, further evidence came to ASIC’s attention concerning his conduct as a director. In light of this evidence, ASIC asked that the AAT disqualify Mr Quinlivan for a period of five years. ASIC expressed concern that Mr Quinlivan continued to be involved in large scale commercial property developments.