Background
Six investor plaintiffs brought proceedings against Stonepoint Capital Management Pty Ltd (in liquidation) and associated entities, including fourth defendant Phillip Sean Hunt, arising out of representations made between December 2021 and March 2022 concerning the Stonepoint Capital Fund. In the primary judgment — Garan Holdings Pty Ltd v Stonepoint Capital Management Pty Ltd (in liq) (No 2) [2026] NSWSC 373, delivered 5 June 2026 — Peden J found that Hunt and the other active defendants engaged in misleading and deceptive conduct under the Australian Consumer Law, the Corporations Act 2001 (Cth), and the Australian Securities and Investments Commission Act 2001 (Cth), and that Stonepoint breached its contractual obligation to pay monthly distributions at a rate of at least 1% of invested funds.
Following that judgment, the parties were directed to confer on final orders. No agreement was reached, and on 17–18 June 2026 the Court heard competing proposed orders from the plaintiffs and from Hunt (who appeared self-represented). Hunt sought to introduce qualifications limiting the apparent scope of the declarations, a set-off against distribution damages based on historically above-1% payments, a proportionate costs allocation among all defendants, and language requiring reference back to the primary reasons to understand the extent of his liability.
The present judgment (No 3) resolves those disputes and enters the final orders of the Court.
The Court’s Holding
Peden J accepted the plaintiffs’ proposed orders, as amended in one minor respect, and rejected each of Hunt’s submissions. The Court declined to incorporate Hunt’s proposed “clarifications” and notations into the declarations, holding that the purpose of final orders is to give clear, self-contained effect to the reasons in the primary judgment — not to require readers to return to those reasons to understand the scope of liability. The Court found that the primary judgment had expressly determined that Hunt personally made each of the misleading representations to the plaintiffs, so qualifications suggesting otherwise were inconsistent with those findings and inappropriate.
On the distribution damages dispute, the Court rejected Hunt’s argument that over-1% payments made in earlier periods should be credited against the contractual shortfall damages. No defendant had pleaded that those excess distributions were made by mistake, sought any restitutionary remedy, or relied on a set-off. The plaintiffs had sued only for the periods of breach; there was no pleaded or argued basis to net out earlier surpluses. The Court did accept one minor concession by the plaintiffs — reducing the distribution damages figure by $1,384 to account for investments not held for a full month — arriving at a corrected figure of $3,004,417.69. Hunt’s costs proposal (proportionate allocation among all defendants) was also rejected: as the only defendant who actively defended, and having been found materially liable, it was appropriate that he bear costs jointly and severally with the other defendants for the periods they were active.
The Court entered declarations of misleading and deceptive conduct under s 18 ACL, ss 29(b) and 29(g) ACL, ss 1041E and 1041H Corporations Act, and ss 12DA and 12DB ASIC Act; a declaration of personal liability under s 197 Corporations Act making Hunt individually liable for Stonepoint’s obligations he cannot discharge; equitable compensation of $15,370,839.27 plus compound interest of $1,162,512.71 against the first, fourth and seventh defendants; breach of contract damages of $3,004,417.69 against Stonepoint; and statutory damages of $4,257,325.83 against the first, second, third and fourth defendants, with appropriate provisions to prevent double recovery.
Key Takeaways
- Final orders must be self-contained and give clear effect to the primary judgment; a court will reject attempts to embed qualifications that require readers to consult the reasons to understand the scope of a defendant’s liability.
- A defendant cannot obtain a credit against contractual distribution damages for earlier above-threshold payments unless a set-off, mistake, or restitutionary basis was pleaded and argued — an “under promise, over deliver” marketing strategy does not generate an equitable offset.
- Under s 197 of the Corporations Act, a director can be held personally liable to discharge a company’s judgment debt where the company is in liquidation and cannot satisfy the liability itself.
- A sole actively-defending defendant found materially liable on multiple grounds will bear costs jointly and severally; a bare, unsubstantiated request for proportionate allocation among all defendants will be refused.
- Compound interest on equitable compensation and interest on costs from the date of payment are available remedies that the Court will award in appropriate investment fraud litigation.
Why It Matters
This decision is a practical guide to post-judgment disputes in complex investment litigation. It reaffirms that final orders serve an independent communicative function and must stand alone — defendants cannot use the orders stage to reintroduce ambiguity that was resolved against them in the principal reasons. For practitioners, it underscores the importance of pleading set-off or restitutionary defences in the originating proceedings: failure to do so forecloses credit arguments at the damages stage, even where the underlying mathematics might otherwise support them.
The case also illustrates the cumulative exposure faced by individual promoters of failed managed investment schemes. Hunt’s personal liability — grounded simultaneously in the Australian Consumer Law, the Corporations Act (including the director liability provision in s 197), and the ASIC Act — resulted in a multi-million dollar judgment alongside an adverse costs order, notwithstanding that the corporate defendants had entered liquidation. Investors and insolvency practitioners will note the Court’s willingness to trace and hold in trust funds paid through related entities pending distribution orders.