The Importance of Directors Complying with their Duties


A large part of ASIC’s role is to ensure that company directors comply with their duties at law and to the companies they lead.

Directors owe a range of duties to the company, including a duty to exercise their powers and duties with care and diligence, and a duty not to improperly use their position to gain an advantage. Directors also owe fiduciary duties.

If ASIC suspects that a director may have breached their duties, then ASIC may investigate and commence enforcement proceedings against the director.

Depending on the severity of alleged breaches, the relevant director of public prosecutions may also pursue directors.

Below are some examples of cases where ASIC has successfully prosecuted directors for breach of duties, and one case where the director of public prosecutions pursued a director.


Australian Securities and Investments Commission v Cassimatis (No 8) [2016] FCA 1023

This case involved two directors of Storm Financial Limited (Storm), Mr and Mrs Cassimatis. Mr and Mrs Cassimatis were also 100% shareholders in Storm.

Storm had an AFSL, and operated by providing financial advice to investors, many of whom were vulnerable due to their age (usually retired, or close to retirement) and financial position (few assets other than their home, and little income). The content of Storm’s advice to these investors was that they should borrow against their unencumbered homes, and use the funds to invest in various structures, mostly shares. Those borrowed funds were also used to pay Storm’s fees.

Many of the investments failed, and Storm’s vulnerable clients were unable to retire, or forced to return to work, because they had to service the debts they had incurred when relying on Storm’s advice.

ASIC alleged that the directors had breached the duty to act with care and diligence, under section 180 of the Corporations Act 2001 (Cth)(s180), by causing or permitting Storm to give inappropriate advice to investors. ASIC alleged that the inappropriate advice caused Storm itself to breach certain provisions of the Corporations Act.

It is important to note that ASIC only alleged that Storm’s model was not viable insofar as it involved investors who fell within the vulnerable class described above. For other investors, for example, investors with high income, several assets, and who are younger so as to be able to recover from any loss, the model was viable.

The directors alleged that the investments only failed because of the GFC, and not because of the model adopted by Storm. Mr and Mrs Cassimatis also suggested that, in any event, because they were the only shareholders of Storm, they could not be liable for any breaches of s180.

The Court found that Mr and Mrs Cassimatis had breached their duties, because they caused or permitted inappropriate advice to be given by Storm. The Court found that the advice to the vulnerable investors was inappropriate for three reasons:

  1. Storm inappropriately classified the investors as ‘balanced investors’ in circumstances where the risk profile of the investors was actually more akin to conservative investors;
  2. Storm inappropriately treated an investor’s family home as an asset in the investment portfolio in circumstances where, if it had not been included, it would have been even more apparent that the investors were being inappropriately advised; and
  3. in any event, the advice was inappropriate because the circumstances of the relevant investors meant that the nature of the investment involved high risk.

Although this inappropriate advice caused a loss to be suffered by investors, and no loss was suffered by Storm as a result, the directors’ conduct still affected Storm’s interests so as to give rise to a breach of duty. The harm that Storm suffered was that it contravened certain provisions of the Corporations Act, making it liable to pay penalties and to be subject to regulatory proceedings. The Court found that this harm was reasonably foreseeable to any person in the directors’ position, acting reasonably.

Mr and Mrs Cassimatis argued that s180 does not apply where the directors are also the sole shareholders of the company. This argument was rejected by the Court on the basis that it was inconsistent with the section, because shareholders cannot ratify a breach of s180, and because there is a public interest in enforcing s180.

This case serves as an important reminder that although an investment model may be viable for some investors, it may not be viable for all investors, and if a company gives inappropriate advice, then the directors may be liable for a breach of duty, even if the company itself does not suffer any immediate financial detriment.

The case is also a good example of the true nature of duties under the Corporations Act, specifically, that they are both public and private in nature. That is, they are private duties in that they are owed to the company and its shareholders, but also public in that there is a public interest in ensuring that directors exercise their duties with care and skill.


Australian Securities and Investments Commission v Flugge & Anor [2016] VSC 779

This case involved the conduct of AWB officers that occurred around 2000, which many people will be familiar with, but the case did not finalise until the end of 2016.

ASIC alleged that Trevor Flugge, a director and the chairman of AWB, breached his duties under ss180 and 181 of the Corporations Act 2001 (Cth). The allegations against Flugge related to selling wheat to Iraq in a manner contrary to the relevant UN sanctions. The effect of the transactions was that the Iraq government was receiving more money than it was permitted to under UN sanctions.

ASIC alleged that Flugge took no steps, or no reasonable steps, to ensure that AWB did not engage in conduct that was contrary to UN sanctions. This included a failure to make enquiries about the requirements for selling and exporting wheat to Iraq, and a failure to ensure that he was informed of those matters.

After a 9 week trial, and a year to write the judgment, the Court found that s180 imposed a duty on Flugge to make the enquiries alleged by ASIC and, by failing to make those enquiries, Flugge breached the duty under s180. Flugge had no knowledge of the requirements for selling and exporting of wheat to Iraq, but by reason of his position as a director, and in the circumstances of the case, he was duty bound to make enquiries. Those enquiries would have revealed that the conduct was improper and ought not to be engaged in. Flugge’s breach caused harm to AWB, including a loss of approximately $781 million in market capitalisation, and significant damage to AWB’s reputation.

ASIC also alleged that Flugge had breached s181, which confers the duty for a director to act in good faith. ASIC suggested that Flugge acted dishonestly in that he was aware of the wrongdoing, and that it would cause substantial harm to AWB if it were ever revealed. The Court was not satisfied that Flugge knew of the wrongdoing, so ASIC’s claim in respect of s181 failed.

The proceedings also sought orders against another officer, Peter Geary. The allegations against Geary included the transactions with Iraq, and other transactions, but ASIC’s claim against Geary failed in its entirety because it had not proved that Geary was under a particular duty in many of the circumstances alleged, or that he had acted unreasonably.

The penalties payable by Flugge for his breaches have not yet been determined by the Court.


Commonwealth Director of Public Prosecutions v Sigalla [2017] NSWSC 52

In November 2016, Andrew Sigalla was convicted on 24 counts of dishonestly using his position as a director to gain a benefit for himself or a third party. This conduct was in breach of section 184 of the Corporations Act (Cth).

The charges related to transferring funds and shares from TZ Limited to himself or related parties, to the tune of circa $8.6 million, over approximately a 2 year period.

Mr Sigalla used most of the $8.6 million for his own benefit, to settle gambling debts with several bookmakers. Some of the money ($1.1 million) was for the benefit of an associate. Only $250,000 of the $8.6 million has been recovered.

In sentencing, the Court remarked that Mr Sigalla’s conduct had obviously harmed TZ Limited and its shareholders, but it had also harmed the investing public, because private investment in public companies is a significant aspect of the market economy, and when investors hear about conduct of this nature, they will be reticent to invest.

The Court also noted:

“The importance of safeguarding and restoring investor confidence in the ASX is a significant reason for criminalising the dishonest use of the position of a director and also bears on the sentences to be imposed.”

The maximum penalty for each of the 24 offences is five years’ imprisonment.

The Court imposed a sentence of 10 years imprisonment, with a non-parole period of six years. Although the sum of money in question was a relevant factor, the severity of the sentence demonstrates how seriously the Court will take deliberate acts of deception and greed.

For more information, please contact Laura Gercken or Ashley Hill.


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Lilly became part of the GRT Lawyers team in October 2022, stepping into the role of Office Assistant. With a wealth of professional experience spanning more than ten years, Lilly has actively contributed in various administrative capacities.

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Dale Copley

Dale began working with GRT Lawyers at the start of 2023 after beginning his legal career with  top-tier firm. He recently retired from professional sports and is relatively new to the legal field, having been admitted in November of 2022.

Dale values the importance of teamwork and advising clients to assist them in achieving their business goals. His experience as a professional athlete has instilled in him the significance of collective efforts and strategic collaboration – qualities that now define his approach to his career in law.

He has a strong interest in equity markets and is acquiring valuable experience by advising on capital raises and various ASX listing rule concerns.


Rebecca Wei

As an accomplished associate corporate lawyer, Rebecca contributes a fresh perspective and a robust work ethic to our legal team. She has swiftly gained experience in corporate law, demonstrating dedication to assisting clients with their legal needs in an ever-evolving business landscape.

Rebecca specialises in capital market transactional matters, contract drafting, and corporate governance. She has supported senior lawyers in advising a diverse range of clients, including established corporations, startups, and entrepreneurs.

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Alana Nisbet

Alana has over 10 years’ experience practicing predominantly in international top tier firms in Australia, London and Guernsey. Her primary practice areas are public and private mergers and acquisitions, equity capital markets and investment funds and she has significant experience advising on complex corporate transactions.

Alana is valued for her exemplary client service and have been ranked as a “Rising Star” for Equity Capital Markets and Mergers & Acquisitions by Legal 500.

Senior Associate

Amarzaya Gantumur

Amarzaya is the Head of GRT Lawyer’s International Projects Division.

She has over 14 years of experience in the global legal industry in both civil and common law jurisdictions. She has acted as counsel in numerous complex corporate and commercial transactions, and litigation matters, including cross border litigation and international commercial arbitration.

As a common law trained lawyer with working experiences in both civil law and common law jurisdictions, Amarzaya is particularly dedicated to international work due to her international clients and her global network. 

Her recent work experience includes representing a Mongolian state-owned entity in an international commercial arbitration (under SIAC rules); representing an Australian/Philippines entity in an international commercial arbitration (under SIAC rules); providing wide range of legal and technical support to a global mining services company in its operation in Mongolia; providing legal and technical support to a Mongolian financial institute in its operation in Australia.   

Amarzaya graduated from the School of Law, National University of Mongolia in 2004 and holds an LLM (Corporate and Finance Law) from the University of Hong Kong. She is fluent in both English and Mongolian. She was appointed as an arbitrator with the Mongolian International Arbitration Centre in 2022. She is a member of various other professional organizations, including the Chartered Institute of Arbitrators (CIArb).

Senior Associate

Rachel Hendrie

Rachel is a commercial dispute resolution lawyer who has experience in litigating significant commercial, construction and financial services disputes and in international arbitration. She is experienced with managing document heavy litigation.

Her experience includes assisting major Australian banks in civil penalty proceedings initiated by AUSTRAC in the Federal Court of Australia concerning AML/CTF compliance and fraud investigations, assisting financial services clients with responding to ACCC and ASIC notices including corporate shareholder and contractual disputes for oil and gas clients in Supreme Courts.

Rachel has worked for global top-tier law firms in both Brisbane and Melbourne.

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Alexander Sloan

Alex is a commercial litigator with experience in funded litigation and class actions. He has acted for publicly listed companies (both ASX and SGX), large private companies, litigation funders, SMEs, and company directors in a range of commercial disputes.

His experience includes complex, cross-border financial services litigation, class actions, product liability, insolvencies, and corporate disputes.

Alex has prosecuted and defended claims in the Supreme Courts of New South Wales, Victoria, Queensland and the ACT, and in the Federal Court of Australia. He also acted in the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.

Alex was admitted to practice as a solicitor in 2015 and worked for several years in a national Australian law firm, prior to joining GRT Lawyers in 2021.

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Aylesha James-Pearson
m 0433 555 812


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Aylesha serves as the General Manager at GRT Lawyers, providing effective leadership and overseeing the day-to-day operations of the firm. In her role, she manages human resources, marketing, events, and directly supervises the Administration team.

Bringing more than 19 years of experience in office management, senior administration, project and event management, as well as human resources, Aylesha has a proven track record of excellence in high-pressure environments. Her wealth of experience and professionalism ensures the seamless functioning of the firm. Aylesha excels in optimizing operational efficiencies by reviewing and implementing systems, policies, and procedures to support business functions, resulting in impactful results. She adopts a holistic approach, balancing a keen eye for detail with a focus on overarching goals.

Aylesha’s passion lies in people and culture, where she actively fosters strong relationships across all levels of the business. She connects with staff to instill the core values of GRT Lawyers and the GRT Foundation, believing in creating value through people. Her approach involves working with passion and understanding, offering support and cultivating relationships that enhance both business and individual performance.


Her career history encompasses multi-faceted roles giving her exposure to the specialty fields of Human Resources, Marketing and Event Management. Roles have included:

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  • Marketing – including roles involving the development and implementation of marketing and business development strategies.
  • Background in planning internal and external events from conception through to execution, displaying qualities of a successful event planner: thorough yet precise, expert knowledge, ingenuity in identifying and solving problems and clear, concise communication.

“There’s always another level up. There’s always another ascension. More grace, more light, more generosity, more compassion, more to shed, more to grow.” -Elizabeth Gilbert


Ashley Hill
m 0415 150 866


  • Commercial litigation
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  • Energy – oil, gas, coal, and electricity
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  • Resources – water and agribusiness
  • Financial services
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  • IT industry disputes
  • IP claims including counterfeiting, passing-off, copyright infringement
  • Mediation, Adjudication and Advocacy


Ashley has in excess of 23 years’ experience as a litigator and disputes lawyer. In his time at GRT Lawyers and working for top-tier Australian and global law firms (in the Middle-East and Singapore), Ashley has acted for clients across multiple continents on complex commercial litigation and international arbitration.


Ashley’s current practice includes investment protection and dispute matters across a number of industry sectors including energy and resources, financial services, technology, agribusiness, tourism, in addition to contentious regulatory, insurance disputes and product liability matters.

The international scope of Ashley’s work has given him a valuable insight into cross-border disputes in common law and civil law jurisdictions. He has practical experience with most of the world’s renowned international commercial arbitration institutions including ICC, LCIA, SIAC, SCC and ICDR/AAA.

Since 2014, Ashley has been listed in ‘Best Lawyers in Australia’ Peer Review for the categories of International Arbitration, Litigation, Insurance and Product Liability.  In 2019, Ashley was added to the Doyle’s Guide Leading Commercial Litigation and Dispute Resolution Lawyers in Queensland.


Ashley holds Bachelor Degrees in Law and Arts (University of New England) and he is:

  • a member of the Queensland Law Society (QLS)
  • Executive Council Member of Asia-Pacific Forum for International Arbitration (AFIA)
  • Associate Member of Australian Centre for International Commercial Arbitration (ACICA); and
  • ordinary member of Australian Insurance Law Association (AILA)

Scott Standen
m 0447 790 009


  • In depth understanding of the M&A processes (public M&A and private M&A transactions)
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  • Capital structure management
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Scott is a founder and Director of GRT Lawyers and GRT Foundation and corporate lawyer. He leads a team of specialist legal professionals, providing advice to organisations of all sizes, from middle market, large corporates and government owned corporations.

Scott’s career spans more than 20 years as a corporate lawyer and has encompassed an in-house general counsel role, director of Statutory Authorities and corporate legal adviser to managing directors, chief financial officers and boards of directors of ASX listed companies.

Scott is regularly called on by clients to provide strategic corporate advice to boards of directors and to project manage merger and acquisition transactions and public equity markets transactions. He prides himself in providing technically accurate and commercially focused corporate advice for public, private and listed companies, boards of directors and corporate advisers.

In particular, Scott advises on public equity markets transactions, debt issuances and restructuring, corporate governance and advisory, regulatory compliance, public and private M&A transactions, contract negotiation and directors’ duties and liabilities.


Scott’s experience includes:

  • Advising Cerro Resources Limited in relation to its public market merger and acquisition deal with Canadian based Primero Gold Limited and the concurrent spin out of assets to Santana Metals Limited and listing of Santana Metals Limited on ASX
  • Advising Discovery Metals Limited in relation to its A$250 million debt restructuring and associated equity raisings and proposed convertible note issue
  • Advising Polymetals Limited in relation to its acquisition by Southern Cross Goldfields by way of scheme of arrangement
  • Advising Southern Cross Goldfields Limited in relation to its A$60 million capital raising transaction involving equity, debt and hybrid securities
  • Dual listing on Hong Kong Exchange of ASX listed company
  • ASX listing of Asia focused technology / media company and
  • ASX listing of Apiam Animal Health Limited, vertically integrated provider of services and product to agricultural industry and
  • ASX listing of P2P Transport Limited.


Scott holds Bachelor Degrees in Law and Business Administration and a Masters of Law. Scott has previously held positions as a Director on the Boards of the Queensland Manufactured Water Authority (and related entities) and the Queensland Bulk Water Authority (and related entities).

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Glenn Vassallo
0422 857 760


  • Public capital markets
  • Corporate law
  • Private capital markets
  • Corporate advisory
  • Corporate structuring
  • Complex corporate disputes
  • Social entrepreneurship


Glenn is a founder of GRT Lawyers and the GRT Foundation. As the Managing Director of GRT Lawyers and chair of the GRT Foundation, Glenn is passionate about working with his highly sophisticated national and international clients to implement their corporate strategy and solve their complex problems.

Glenn is passionate about implementing the corporate strategy of GRT Lawyers and the GRT Foundation. Glenn’s significant experience in formulating and executing complex corporate transactions (including IPOs, takeovers, and other equity capital market transactions) with a particular focus on national and international stock and security exchanges puts him in a unique position to provide excellent advice.


After building GRT Lawyers into a high-quality law firm, and together with his wife Eliza, establishing the GRT Foundation into a sustainable Australian charity, Glenn built GRT App (a subsidiary of GRT Lawyers) and sold that to an ASX listed company. Glenn was the first chairperson of any Australian ASX listed company to successfully chair a real-time virtual meeting of shareholders. He is still today, the only person who has chaired a real-time virtual shareholders meeting for an ASX listed company.

Glenn is often invited to speak on global topics such as capital markets, initial public offerings, takeovers and more recently was invited to New York University to speak at its global conference about social entrepreneurship.


Glenn holds a Bachelor Degree of Law (LLB) and a Bachelor Degree of Commerce. He has been a long-standing member of the Law Council of Australia Company Law Committee and the Queensland Law Society Company Law Committee, member of the Australian India Business Council (Energy and Resources – Subcommittee) and has significant ASX listed board experience.