The case concerned Sharon McDonagh, who received advice to set up an SMSF after she gained $640,000 in compensation for brain damage in a car accident in 2011.
Following this advice, she set up The McDonagh Family Superannuation Fund in 2013 with herself as the only member, and McDonagh Management Pty Ltd as corporate trustee with herself as the sole director and shareholder.
Her accountant, Andrew Trovas of Alpha Consulting, claimed he was given authority by Ms McDonagh to transact on behalf of the company, and subsequently made loans through the fund to a number of individuals as well as transferred directorship of the company to the mother of his associate, Adrian Hall.
In 2018, Mr Trovas again changed directorship of the company to another associate, Steven Vickers, who was serving time in prison for dealing with property suspected of being the proceeds of crime.
During this time period, Ms McDonagh had attempted to launch legal proceedings to recover the funds lent out as loans to Mr Trovas’ associates, but the other parties disputed her ability to act on behalf of the company as she no longer had directorship, and executed a deed of settlement with Mr Vickers releasing them from the legal proceedings.
ASIC finally deregistered the company in April 2019 because of outstanding filing fees, which Ms McDonagh was not in a position to pay.
Taking all this into account, the court ordered the reinstatement of the company under Ms McDonagh’s sole directorship, as well as the issuing of a new corporate key so that Mr Trovas would no longer have authority to act on behalf of the company.
