The former director of Diamond Hill Mining, also a Bendigo solicitor, has been found by a Supreme Court judge of transferring a mining licence and two parcels of freehold land to another mining company that he had a vested interest in, without proper consent.
Douglas Wakely Cahill was a director of Greater Bendigo Goldmine’s Diamond Hill Mining from February 1996 and June 2008, The Bendigo Advertiser reports.
He was also acting director of a separate company, Huang Jin Mining, at the time.
Diamond Hill claimed Cahill, who is a solicitor at Bendigo law firm Cahills, of breaching his fiduciary duties and statuary obligations under the Corporations Act or alternatively having engaged in misleading conduct contrary to the Fair Trading Act when he transferred the mining licence to Huang Jin.
He also transferred two parcels of land to the transferees and then shareholders of the company: Cahill, Tully Long, Peter Robert Long and Wesley Bernard Cahill.
It said Cahill had acted without consent and that his misleading conduct had resulted in loss and damage.
Cahill argued he has “fully informed consent” of the Diamond Hill board to transfer the mining licence to Huang Jin and to transfer the land to the transferees.
The judgement handed down this week followed hearings in the Supreme Court before judge Justice Clyde Croft in April.
The judge found Greater Bendigo Goldmines did not give consent for the mining licence to be transferred, and if any was given it was not fully informed consent.
Cahill was also found to be acting without consent when he transferred the two parcels of land and breaching his fiduciary duty and statuary duties as Diamond Hill’s director.
“Mr Douglass Cahill was at all relevant times acting as a director of Huang Jin, for himself and as an agent of the other transferees,’’ Justice Croft said.
“The transferees knew of Diamond Hill’s allegations in the proceedings.
“The transferees are bound by Mr Douglass Cahill’s conduct and liable in equity and for any breaches of the Fair Trading Act 1999.’’
The transfers of the land and the retention by the defendants of the benefit of the transfers without payment for them was, “clearly unjust’’, the judge said.
Diamond Hill Mining requested an opportunity to review the judgment before an order was made.
The matter will return to court, at a date to be determined.
Image: Deakin University