PMFresh Pty Ltd v Watt

1. [1]

   By a Further Amended Summons filed on 4 March 2026, the Plaintiff in these proceedings, PMFresh Pty Ltd, seeks an order that the First Defendant, Benjamin Nicholas Watt, pay it equitable compensation or compensation under s 1317H of the Corporations Act 2001 (Cth) for several sums of money which have been paid to various entities. It is not presently necessary to deal with the other relief sought against the First Defendant.

2. [2]

   Orders are also sought against the Second Defendant, Christopher John Watt, for lesser sums pursuant to the same equitable or statutory claims. Although there is also a claim against the Third Defendant, Produce Australia Pty Ltd, I need not deal with those issues on this occasion. For the purposes of this application, I shall refer to the First and Second Defendants as “the Defendants”.

3. [3]

   The Defendants were directors of the Plaintiff from 1 April 2022 until 25 March 2025. They were also executives from September 2024 until around April 2025. It is contended, in the Further Amended Commercial List Statement (the FACLS), that whilst a director of the Plaintiff, the First Defendant caused the Plaintiff to enter into transactions and make payments for his personal benefit that were not in the interests of the Plaintiff. One example was an amount of $880,165 paid to Pimas Gale, a firm of builders, for construction work at properties at Rozelle. Those properties were owned by either the First Defendant with his wife, Mrs Maria Watt, or solely by the latter.

4. [4]

   The payments orchestrated by the Defendants from the Plaintiff’s funds fall into five categories: renovation payments to builders and contractors for work undertaken to properties owned by the First Defendant and/or his wife, rental payments, personal expenses (of almost $2 million), unjustified employee payments and the purchase of some convertible notes.

5. [5]

   The Plaintiff alleges that, in engineering these transactions, the First Defendant breached his fiduciary and statutory duties as a director under ss 180–182 of Corporations Act. Similar claims, albeit for (as stated) considerably lesser sums of money, are made against the Second Defendant as a former director of the Plaintiff.

6. [6]

   The FACLS contains certain additions to the Amended Commercial List Statement (the ACLS) filed on 12 September 2025, namely:

   1. (1)

      the Plaintiff has added, at [C7](h), a payment of $119,900 made on 15 August 2023 by the Plaintiff to Pimas Gale arising from an invoice dated 1 April 2023. The amendment is not, itself, of great significance. In fact, the total sum alleged to have been paid to Pimas Gale in the amount of $881,165 did not change between the filing of the ACLS and the FACLS;

   2. (2)

      particulars, in relation to these payments, have been added as a schedule to the FACLS in a table styled “Annexure A”, which is cross-referenced to [C7](a)–(h). That table identifies the dates of the Pimas Gale invoices, the invoice numbers, the date that such invoices were paid and the amounts drawn from an NAB bank account totalling the aforesaid sum of $880,165; and

   3. (3)

      the provision of a number of other schedules in the FACLS which, inter alia, identify the dates on which other payments were made from the Plaintiff’s bank accounts to third parties for the benefit of the Defendants.

7. [7]

   Mr Giles SC, who together with Mr McMeniman of Counsel appeared for the Plaintiff, submitted that the Plaintiff was not concerned so much with the specific dates upon which such money was paid. Rather, the Plaintiff’s claim is founded on the material fact that large amounts of money were withdrawn from the Plaintiff’s bank accounts and paid to a number of recipients who had no connection with the Plaintiff and whose services were for the personal benefit of the Defendants and/or the First Defendant’s wife, Mrs Watt.

8. [8]

   Whilst the Defendants, on 7 November 2025, filed a Commercial List Response to the ACLS, they have not yet filed a Commercial List Response to the FACLS.

9. [9]

   In their Commercial List Response, the First and Second Defendants admit, in relation to the Pimas Gale invoices, that:

   1. (1)

      the Plaintiff paid each of the invoices, namely, those identified in [7](a)–(g), but do not know the date on which each invoice was paid;

   2. (2)

      the First Defendant caused the Plaintiff to pay those invoices;

   3. (3)

      the invoices related to work performed at the property located at 702/29 Margaret Street, Rozelle, or the property located at 705/29 Margaret Street, Rozelle;

   4. (4)

      those properties were owned either by the First Defendant and his wife or solely by Mrs Watt;

   5. (5)

      the payment of those invoices benefited or advantaged the First Defendant, or Mrs Watt, or both of them; and

   6. (6)

      the payment of each of those invoices was of no benefit to the Plaintiff.

10. [10]

    The Defendants make similar admissions with respect to the Vaughn Electrical invoices, the Sivien invoices, the Signature Cinema invoices, the other renovation invoices (with the exception of [32](b), about which they do not make admissions) and the lease of the 705/29 Margaret Street property. Further, limited admissions are made concerning the employment of certain individuals, payments made to the Defendants, as well as payment to a third party for convertible notes.

11. [11]

    The Defendants state that in early February 2026, circumstances changed materially when the First Defendant learned that the NSW Police Financial Crimes Squad (State Crime Command) (the NSWPF) were investigating him for fraud in relation to works performed at the Rozelle Properties – the very subject matter of his previous admissions. Detective Senior Constable Hartigan had contacted Pimas Gale seeking invoices, correspondence, payment records and details of work performed.

12. [12]

    Because of this recent development, the Defendants no longer wish to make these admissions in their Commercial List Response to the FACLS. They also seek to be excused from filing any evidence in their defence until the close of the Plaintiff’s case on the basis that doing so may tend to incriminate them or expose them to penalty. The Plaintiff’s primary response is that the proverbial horse has bolted, because once the admissions have been made, they cannot be retracted.

13. [13]

    Pursuant to the Defendants’ Notice of Motion filed on 25 February 2026, the Defendants seek orders that their Commercial List Response, in answer to the FACLS dispense with the requirements of rr 14.14 and 15.1 of the Uniform Civil Procedure Rule 2005 (NSW). Those rules provide the following:

14. [14]

    The Plaintiffs seek to dispense with these requirements on the grounds of privilege against self-incrimination and exposure to civil penalty insofar as those rules would otherwise apply, with the exception of:

    1. (1)

       certain paragraphs within Part A and Part B of the FACLS; and

    2. (2)

       paragraphs [1]–[6], [64]–[68], [73]–[75] and [78]–[72] in Part C of the FACLS.

15. [15]

    In relation to the remaining Part C contentions, the First Defendant seeks an order that entitles him to respond to those allegations with two statements, one being a statement of non-admission and the other being a statement whereby he invokes the privileges against self-incrimination and exposure to civil penalty.

16. [16]

    A similar order is sought by the Second Defendant allowing him to respond to paragraphs [64]–[68], [68A]–[68M], [69], [70], [71](b)–(c), [72A] and [81]–[82] of the Part C contentions as per the two statements referred to in the preceding paragraph.

17. [17]

    The Defendants also seek to be relieved from pleading any facts and particulars in support of any statutory defence, or other positive case asserted by way of defence, if those facts and/or particulars would tend to self-incriminate and/or expose them to civil penalty.

18. [18]

    In support of the Notice of Motion, the Defendants rely upon three affidavits of Stephen David Lloyd, the solicitor for the Defendants. Those affidavits are dated 26 September 2025, 25 February 2026 and 1 March 2026. The Defendants also tendered an affidavit of Peter Cotter affirmed 16 April 2026 and paragraphs 6–14 of an affidavit of Tara Lee Phelan dated 22 April 2026, the solicitor with carriage of this matter for the Plaintiff (who operates under the supervision of a partner of Norton Rose Fulbright (NRF)). The Plaintiff did not object to this affidavit material.

19. [19]

    I will deal with each of these proposed orders sequentially.

20. [20]

    To understand the basis upon which the Defendants seek these orders, it is necessary to identify the issues raised by the proceedings, the admissions made in the existing Commercial List Response as well as the existence of the ongoing NSWPF investigation.

The NSWPF investigation

1. [21]

   The Defendants assert that the NSWPF investigation concerns the very same conduct as that alleged against them in these proceedings. The Plaintiff did not appear to dispute this but, equally, I doubt that the Plaintiff has much insight into the investigations apart from providing preliminary information to NSWPF.

2. [22]

   The Defendants rely on an outline of submissions. The Defendants relied upon those same submissions in an application before Nixon J on 23 April 2026 by which the Commissioner of Police, pursuant to ss 130 and 131A of the Evidence Act 1995 (NSW), sought to prevent the Plaintiffs from producing certain documents (pursuant to a Notice to Produce) containing submissions that were previously made to him.

3. [23]

   In that application, the Defendants opposed the Commissioner’s claim for public interest immunity over the Plaintiff’s submission. As to the content of the Notice to Produce, Mr Delany, Counsel for the Defendants, submitted to Nixon J:

4. [24]

   As stated above, the Defendants rely upon Exhibit 2, being paragraphs 6–14 of the affidavit of Ms Phelan. Paragraph 12 of Ms Phelan’s affidavit refers to a file note taken by her of a discussion which took place at NRF’s offices between members of the NSWPF, various NRF solicitors and a representative of the Plaintiff.

5. [25]

   I accept that some part of the NSWPF investigation concerns part of the claims pleaded against the Defendants in the FACLS.

6. [26]

   The Defendants submit that this overlap causes sufficient prejudice to them to justify granting dispensation so as to prevent self-incrimination.

Legal principles

1. [27]

   The privilege against self-incrimination is a common law right by which a natural person may refuse to answer any question or produce any document or thing which may tend to incriminate them: Sorby v Commonwealth (1983) 152 CLR 281; [1983] HCA 10 (Sorby) at 288 (Gibbs CJ), 309 (Mason, Wilson and Dawson JJ).

2. [28]

   Although there is some scholarly debate about exactly when Chancery first recognised the privilege, there is evidence of this occurring from at least the 16th century: The Vice-Countess Montague’s Case Cary 12; 21 ER 5 (Ch). The privilege is intended to ensure that those who allege criminality must prove it: Environment Protection Authority v Caltex Refining Co Pty Ltd (1993) 178 CLR 477; [1993] HCA 74 at 532 (Deane, Dawson and Gaudron JJ).

3. [29]

   It is a substantive legal right. As such, without clear statutory authority to the contrary, it overrides procedural rules, including those that concern pleadings: Pyneboard Pty Ltd v Trade Practices Commission (1983) 152 CLR 328; [1983] HCA 9 at 340 (Mason ACJ, Wilson and Dawson JJ); MacDonald v Australian Securities and Investments Commission (2007) 73 NSWLR 612; [2007] NSWCA 304 (MacDonald) at 619 [39], 621 [57] (Mason P, Giles JA agreeing).

4. [30]

   The protection conferred by the privilege extends to both direct and indirect risk of self-incrimination: MacDonald at 623 [66]. The privilege attaches to information that may set in train a process which may lead to incrimination or the discovery of real evidence of an incriminating character. To enliven the privilege, the applicant must show that there is a bona fide real and appreciable risk of criminal prosecution if they answer the question objected to: Sorby at 294.

5. [31]

   While there is no agreed definition or explanation, “real and appreciable” has been distilled as the distinction between a risk that is “appreciable” or “recognisable” as opposed to one which is “remote”, “insubstantial”, “tenuous or illusory”: Rolfe v Pinnacle ACT Pty Ltd [2025] FCA 638 at [23] (Kennett J).

6. [32]

   Once the Court forms the view that an applicant is in danger of risks from which they seek protection, the applicant is to be afforded some latitude in judging for themselves the effect of providing any requested information: Re Intercontinental Development Corporation Pty Ltd (1975) 1 ACLR 253 at 259 (Bowen CJ in Eq).

7. [33]

   Admissions contained in unverified pleadings may not, alone, expose an applicant to sufficient risk: Laws v Australian Broadcasting Tribunal (1990) 170 CLR 70; [1990] HCA 31 at 86 (Mason CJ and Brennan J). However, an admission may support an inference that claimants accept the truth of the allegation pleaded, such that it may be an admission against interest in any subsequent civil penalty or criminal proceeding: Re Bleecker Property Group Pty Ltd (in liq) [2023] NSWSC 858 at [45] (Williams J).

8. [34]

   In civil actions where no claim for a penalty is made, the applicant must demonstrate that providing the information requested would tend to subject them to the claimed risk before they can rely on the privilege: Australian Securities and Investments Commission v Mining Projects Group Ltd (2007) 164 FCR 32; [2007] FCA 1620 at 37 [10] (Finkelstein J), cited in Auscity Enterprises Pty Ltd v Kismet Ventures Pty Ltd [2015] NSWSC 100; 110 ACSR 119 at 125 [26] (Harrison J) (Auscity).

9. [35]

   Where a person has already by an admission implicated themselves, repeating that admission does not increase their jeopardy: Rio Tinto Zinc Corporation v Westinghouse Electric Corporation [1978] AC 547 at 574 (Lord Denning MR); BTR Engineering Ltd v Patterson (1990) 20 NSWLR 724 at 730 (Giles JA).

10. [36]

    The privilege is effectively indivisible and an assertion of, or claim to exercise it, ought not to be conditioned upon fine choices about where it starts and ends: Auscity at 126 [32].

11. [37]

    Identification of the likelihood of a risk requires specification of the risk: MacDonald at 615 [12] (Spigelman CJ). In relation to the risks said to arise from the filing of a response to the FACLS, the Defendants contend that, without the dispensation sought in this motion, they are exposed to the following:

    1. (1)

       risk of prosecution from pleading to the allegations contained in the FACLS;

    2. (2)

       risk of criminal prosecution for the First Defendant arising from the active NSWPF investigation into the works at the Rozelle property;

    3. (3)

       risk that the investigation extends to the broader subject matter of all related proceedings;

    4. (4)

       risk that the Second Defendant is being, or will be, investigated and prosecuted;

    5. (5)

       risk that further pleading to the FACLS would add links in any chain of evidence, thus increasing their jeopardy;

    6. (6)

       risk that pleading to specific dates and payment mechanisms would assist the NSWPF in deciding whether to prosecute;

    7. (7)

       the risk that any evidence served would be irretractable and could be used by the NSWPF both in deciding whether to prosecute and at any trial;

    8. (8)

       risk that admissions made in pleadings would constitute admissions against interest that could be used in the criminal proceedings;

    9. (9)

       any judgment based on admissions contained in the First Defendant’s existing Commercial List Response would make those admissions irretractable; and

    10. (10)

        risk that selective disclosure may, through what has already been admitted, expose them to greater jeopardy.

12. [38]

    Some of those risks overlap or are different formulations of the same risk.

13. [39]

    As can be seen from the cases set forth at [27]–[36] above, the Defendants need only clear a relatively low hurdle.

Real and appreciable risk

1. [40]

   I am required to determine whether there is a real and appreciable risk that the Defendants will, or potentially will, be exposed to the risks identified at [37] above if not granted the orders they seek.

2. [41]

   As I have observed already, the FACLS largely repeats the ACLS. The sole difference between the documents is the addition, in the FACLS, of text which identifies:

   1. (1)

      the Plaintiff’s bank accounts and dates from which the payments were made from those bank accounts; and

   2. (2)

      the dates on which the Plaintiff made payments reimbursing the First Defendant where he had made payments to third parties using his American Express card.

3. [42]

   The Plaintiff, during oral submissions, highlighted that the Defendants have thus far admitted the contention made in [C70] of the ACLS. Specifically, that the Plaintiff has suffered loss and damage and the First Defendant is liable to compensate the Plaintiff in the amount of the Pimas Gale invoices, the Vaughn Electrical invoices, the Sivien invoices, the Signature Cinema invoices and the other renovation invoices, save for a small part of the “other renovation invoices”.

4. [43]

   Not only does the First Defendant accept liability but, in having pleaded an admission in response to [C70] of the FACLS, he has admitted the identity of the recipients of the funds as well as the total amounts paid to those recipients. The First Defendant, by this motion, seeks to withdraw those admissions and replace them with non-admissions. He also wishes to be relieved of the need to properly plead to the particulars, being the dates when incremental amounts were paid to a particular recipient, in circumstances where the total sums paid have already been admitted.

5. [44]

   It is difficult, in light of the admissions already made, to see how being required to plead to what are substantially the same contentions, albeit now replete with dates on which individual payments were made, is sufficient to constitute a real and appreciable risk that would provide the NSWPF with information which may incriminate the Defendants.

6. [45]

   The crux of the Defendants’ argument is that, by being made to repeat admissions already made, the repeated admissions are, somehow, more deliberate, significant or potent in their effect or intent. I do not accept that argument. The force of an admission is not multiplied by its repetition. I do not accept that an admission made once is less cogent than its subsequent repetition(s). Nor do I consider there to be any real and appreciable risk to the Defendants from being required to plead to the additional particulars that form the largest addition to the FACLS. Having already conceded the total payments and admitted liability, the First Defendant should not now be allowed to retreat where the admissions are contained in a filed document which is available publicly even if the Defendants were allowed to subsequently dilute their response with prophylactic non-admissions. This remains true even having regard to the low bar the law imposes in such matters.

7. [46]

   I do not consider there to be any real and appreciable risk to the Defendants. I refuse the relief they seek here and require them to properly plead in response to the FACLS.

8. [47]

   One particular concern raised by the Defendants is that being required to plead to specific dates on which payments were made could expose them to risk of an indictment being able to be framed. This is implicitly based on an underlying assumption that the admissions made to date are not, themselves, sufficient to frame one.

9. [48]

   This argument can be dispatched promptly. The time and place at which an offence is alleged to have been committed is not an element of the offence but merely a matter for which it is necessary to provide particulars in order to inform the accused of the nature of the charge. Where a date is not an essential part of an alleged offence, the date of that offence is not generally a material particular: WGC v The Queen (2007) 233 CLR 66; [2007] HCA 58 at 109 [156] (Crennan J).

10. [49]

    I do not by this mean that the date contained in the indictment is irrelevant. An accused person is entitled to prepare their case and go to court on the assumption that the evidence will be related to the date alleged, unless given notice to the contrary. If that date is departed from and an accused person is disadvantaged, they should have an opportunity to deal with the change: Johnson v Miller (1937) 59 CLR 467; [1937] HCA 77 at 489 (Dixon J). Indeed, if the date is not an element of the offence, the prosecution may allege that an offence occurred between certain dates, and the accused may still be convicted if the offence was committed outside of those dates: R v Dossi (1918) 13 Cr App R 158 at 159–160 (Atkin J, Darling and Shearman JJ agreeing).

11. [50]

    Of course, no criminal charges have been brought and so I cannot determine whether the dates for any offence are material. However, based on the information before me at this time, I do not imagine that it would be necessary for any indictment to set forth the precise dates on which payments occurred. This is because the Defendants have already admitted that the total amounts were paid from the Plaintiff’s bank account or reimbursed to the First Defendant’s account. Whether those amounts were sent in one transaction or across a number of transactions on various dates is, to my mind, at this stage, immaterial.

12. [51]

    Finally, I must deal with the order sought by the Defendants that they be relieved of the requirement to file their affidavit evidence until the Plaintiff’s case closes. It follows from what I have already said that, in not being satisfied as to the existence of any real and appreciable risk, I see no reason to interfere with the orthodox protocols concerning the timing of affidavits being filed and served. It would be antithetical to the intended operation of the Commercial List, as well as s 56 of the Civil Procedure Act 2005 (NSW), to effectively bifurcate a hearing by the inevitable delay that would occur if the Defendants were allowed to await the closure of the Plaintiff’s case before making a forensic decision as to whether to file and serve evidence and, if so, to what extent. For these reasons, I am disinclined to make such an order.

Orders

1. [52]

   Accordingly, I make the following orders:

   1. (1)

      The Defendants’ Notice of Motion filed on 25 February 2026 be dismissed.

   2. (2)

      The Defendants pay the Plaintiff’s costs of the motion.