Background
Rosherville Pty Ltd, an ASX Limited shareholder, sought interim leave under s 241(1)(a) of the Corporations Act 2001 (Cth) to commence proceedings on ASX’s behalf against five former ASX directors and officers. It proposes ultimately to seek derivative-action leave under s 237.
The proposed claim alleges contraventions of the directors’ duty of care and diligence in s 180(1) concerning funding approvals for ASX’s CHESS Replacement Project. Rosherville contended that some claims risked becoming time-barred under the six-year limitation period in s 1317K, because the first alleged approval occurred on 14 October 2020.
The Court’s Holding
Jackman J granted interim leave to commence the proposed proceedings on ASX’s behalf, pending determination of Rosherville’s s 237 leave application. The leave permitted filing substantially in the form of the draft statement of claim, but prohibited Rosherville from taking further steps without the Court’s permission.
The Court found a very real risk that at least part of the proposed case could be statute-barred without interim relief, while expressly not deciding when the limitation period began. Interim derivative-action leave may be granted without fully resolving the factual issues relevant to s 237 where necessary to preserve a limitation period.
ASX’s objections did not justify refusing relief. The Court was not persuaded that the urgency resulted from Rosherville’s delay, noting ASX’s voluntary document-disclosure process only ended in July 2026. Concerns about Rosherville’s funder and ASX’s costs were addressed by undertakings, including Rosherville’s undertaking to pay reasonable costs of the interim application and LCM Funding’s indemnity undertakings.
Key Takeaways
- Interim leave can preserve a company’s potential derivative claims before a limitation period expires.
- The Court did not determine whether the former directors and officers breached s 180(1), or whether final derivative-action leave under s 237 should be granted.
- Permission to file did not permit service or other substantive steps in the proposed proceedings without further leave.
Why It Matters
The decision illustrates the Federal Court’s willingness to use interim relief to prevent potential corporate claims from being lost through limitation periods while a shareholder’s application for derivative-action leave is determined. It also shows that alleged delay, funding concerns and prospective litigation costs may carry limited weight where protective undertakings are given and ordinary costs protections remain available.