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Selected cases

Federal Court of Australia · [2026] FCA 60

CIP Group v So

A Federal Court company-dispute case about derivative leave, late amendments, witness problems and litigation authority.

Federal Court of Australia6 Feb 2026

Plain-English explainers, not legal advice. Check the linked official source before you rely on a specific section, and get advice for your situation.

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Quick read

  • Shareholder and joint-venture litigation can turn on who is authorised to sue for the company, whether late pleading changes are fair and whether the case still serves...
  • A Federal Court company-dispute case about derivative leave, late amendments, witness problems and litigation authority.

Use this to check

  • Derivative actions need clear authority and an ongoing company-interest rationale.
  • Late pleading changes can be allowed, but only where fairness and trial management support them.
  • Witness availability and self-incrimination issues can force major case changes.

Decision snapshot

  1. 1

    What happened

    • CIP Group Pty Ltd v So was part of a long-running dispute involving many companies and individuals connected with property-development entities.
    • The Court used agreed shorthand for the Clancy parties, the So parties, the TM parties and the Carver's Reach entities.
    • Earlier derivative leave had allowed the applicants to bring claims in the name of companies.
    • Before trial, the Clancy parties sought substantial amendments to their originating application and statement of claim.
  2. 2

    What the court had to decide

    • The Federal Court had to decide whether to allow substantial amendments shortly before trial and whether to revoke derivative leave previously granted under sections 236 and 237 of the Corporations Act.
    • The issues included delay, prejudice, pleading sufficiency, the effect of liquidation after leave had been granted, conflicts in instructions, whether the proceeding remained in the companies' best interests and whether the applicants were acting in bad faith.
  3. 3

    What the court decided

    • The Court allowed the Clancy parties' amendments in part and dismissed the applications by the So and TM parties to revoke derivative leave.
    • It also corrected an earlier order concerning one respondent.
    • The case was to be timetabled toward trial, with the Court emphasising efficient progression of the long-running dispute.

Practical impact

Practical read

  • Shareholder and joint-venture litigation can turn on who is authorised to sue for the company, whether late pleading changes are fair and whether the case still serves the company's interests after receivership or liquidation.
  • Governance records matter long before trial.

Useful next steps

  • Derivative actions need clear authority and an ongoing company-interest rationale.
  • Late pleading changes can be allowed, but only where fairness and trial management support them.
  • Witness availability and self-incrimination issues can force major case changes.
  • Receivership or liquidation does not automatically end a company-backed claim.
  • Dispute strategy should be recorded at board and shareholder level before litigation escalates.

Practical read

This case is dense, but the small-business lesson is clear. Once shareholders or joint-venture participants start litigating in the name of a company, the company itself becomes part of the strategy. Who can authorise the claim? Is the litigation still in the company's interests? What happens if the company later goes into liquidation? What if the main witness can no longer give evidence?

The Court allowed some amendments but not everything. It also refused to revoke derivative leave. That does not mean late changes are easy. The judgment shows how hard the Court looks at delay, prejudice, trial disruption, pleading clarity and whether the case can still be run fairly.

For founders and property joint ventures, the lesson is to keep governance authority and dispute records clean. If a company claim may be needed, board minutes, shareholder approvals, receiver or liquidator status, conflicts, instructions and witness availability all become part of the litigation risk. A messy authority trail can become its own fight before the commercial dispute is even heard.

Checks to run

Key points

  • Record who is authorised to instruct lawyers for each company.
  • Check conflicts where one director or shareholder controls litigation decisions.
  • Keep derivative action reasons tied to the company's interests, not just personal pressure.
  • Test whether pleadings can be proved if a key witness becomes unavailable.
  • Update litigation authority when receivers or liquidators are appointed.

Key takeaways

  • Derivative actions need clear authority and an ongoing company-interest rationale.
  • Late pleading changes can be allowed, but only where fairness and trial management support them.
  • Witness availability and self-incrimination issues can force major case changes.
  • Receivership or liquidation does not automatically end a company-backed claim.
  • Dispute strategy should be recorded at board and shareholder level before litigation escalates.

Related topics

Companies & StartupsContracts & CommercialCommercial Leases & Property

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