A recent Federal Court judgment shows why seeking to prove fraud without red hands and smoking guns is folly, and why Melbourne liquidator Robyn Erskine must rue the day she replaced struck-off practitioner David Iannuzzi as liquidator of North Shore Property Developments Pty Ltd (NSPD).
“the claim is brought only by Ms Erskine (not by North Shore). It is hard to see how there can be a “previous position” involving Ms Erskine, who was not involved in the negotiation of the settlement deed or a party to it, or why she has a claim in equity in her own right against parties alleged to have deceived Mr Iannuzzi.” Justice Geoffrey Kennett.
Handed down by Justice Geoffrey Kennett on Wednesday the decision in North Shore Property Developments Pty Ltd (in liq) v Haddad (No 2) [2025] FCA 642 shuts the door on Erskine’s efforts to have the court order that a deed of settlement and release (The Deed) entered into by Iannuzzi and builder Eddy Haddad in mid-July 2017 has since been validly rescinded.
If granted, such an order would’ve allowed Erskine to potentially recover some of the costs she’s incurred pursuing the matter, costs which began to mount when she applied for an extension of time within which to potentially bring uncommercial transaction claims Iannuzzi had settled back in 2017, costs of an unsuccessful appeal and costs associated with public examinations of the individuals involved which she commenced in 2020.
The claims Iannuzzi initially identified related to apartments bought off the plan by Haddad, supposedly at significant undervalue, from NSPD’s development at 72 – 74 Gordon Crescent Lane Cove.
Eddy Haddad was a director of 72 – 74 Gordon Crescent Lane Cove Pty Ltd. His brother and developer John Haddad was a director of NSPD.
As part of the 2020 proceedings notices to produce were issued and a document disgorged which Justice Kennett refers to as “The Reston Appraisal”.
This was essentially a purported valuation of the apartments allegedly created in 2012 which its author denied was a genuine document when he was provided an opportunity to examine it during the public examinations.
The Reston Appraisal had supposedly been sent to Iannuzzi’s then colleague Steve Naidenov in mid-2017 during the settlement negotiations.
Unfortunately for Erskine her legal team at Norton Rose Fullbright failed to satisfy Justice Kennett that Iannuzzi ever saw The Reston Appraisal before agreeing to settle the claims for $32,500.
“It is reasonable to infer that one of Mr Iannuzzi’s staff would have noticed it and read it,” the judge said.
“However, there is no reason to conclude that Mr Iannuzzi himself would have read the document, let alone given it any thought, without having his attention drawn to it.”
In hindsight Erskine should have attended more closely to the words of Justice David Yates, who in 2018 said when refusing her application for an extension of time within which to bring claims: “The plaintiff is unable to point to any material fact or matter that would provide an extant and arguable reason to set aside the Deed of Release and Settlement,” Justice Yates said.
“I accept that, in that state of affairs, any claim under s 588FF(1) of the Act, as now foreshadowed, is devoid of any prospects of success.”
As can be seen, this week’s decision is far from the first nail a court has driven into this coffin of Erskine’s making, but nor is it necessarily the last.
After dismissing her application Justice Kennett granted the successful respondents’ request that they be given leave to make further submissions as to costs.
Costs was one of the issues Erskine wanted resolved in her favour in this latest proceeding, having been ordered to pay $155,000 in costs to 72 – 74 Gordon Crescent Lane Cove Pty Ltd in 2018 and further costs following the loss of an appeal to that 2018 decision the following year.
Erskine didn’t respond when we asked if she was considering an appeal but given the absence of success extending back seven years and her recent move to a position as a consultant after RSM last month acquired her firm Brooke Bird it would appear that the locker’s last shell has been shot.
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Further reading:
Struck off liquidator languishing in negligence limbo
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