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Selected cases

Full Court of the Federal Court of Australia · [2026] FCAFC 21

The Property Mentors Australia v Touch for Health

A Full Federal Court case about an investment memorandum, property development timing and return representations, and personal liability...

Full Court of the Federal Court of Australia10 Mar 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

  • Investment documents should never promise timing or returns unless the numbers have a defensible basis in the actual trust deed, project documents and commercial...
  • A Full Federal Court case about an investment memorandum, property development timing and return representations, and personal liability for misleading conduct.

Use this to check

  • Future statements about development timing and investor returns need reasonable grounds.
  • Return tables must match the trust deed or company documents.
  • Directors or promoters can be personally liable if they make or approve misleading investment material.

Decision snapshot

  1. 1

    What happened

    • Investors put money into a proposed residential development at Secret Harbour, Western Australia.
    • The investment was promoted through an Information Memorandum for the Secret Harbor Unit Trust.
    • The dispute focused on representations about how long the investment would run and what return investors could expect.
    • A table in the Information Memorandum suggested a return above 20 percent and, in the investors' case, a much higher range.
  2. 2

    What the court had to decide

    • The Full Court considered misleading or deceptive conduct under s 12DA of the ASIC Act, reasonable grounds for future representations about timeframe and profit, whether the primary judge's fact findings should be disturbed, whether individuals engaged in misleading conduct as principals, and whether pre-judgment interest should be disturbed.
  3. 3

    What the court decided

    • The Full Court dismissed the appeal.
    • It allowed part of the investors' cross-appeal by varying the declarations so that The Property Mentors Australia, Luke Harris and another respondent were declared to have engaged in misleading or deceptive conduct through the Information Memorandum.
    • The existing damages, interest and costs orders made by the primary judge were not disturbed, and the appellants and a related respondent were ordered to pay costs of the appeal and cross-appeal.

Practical impact

Practical read

  • Investment documents should never promise timing or returns unless the numbers have a defensible basis in the actual trust deed, project documents and commercial assumptions.
  • A glossy information memorandum will not save a business if its return table does not match the legal structure.

Useful next steps

  • Future statements about development timing and investor returns need reasonable grounds.
  • Return tables must match the trust deed or company documents.
  • Directors or promoters can be personally liable if they make or approve misleading investment material.
  • An assumption that is not built into the legal documents is dangerous in an investor-facing memorandum.
  • Reconcile every investor return table against the trust deed, constitution or shareholders agreement.

Practical read

This case is a clean warning for anyone raising money for a development, fund, unit trust or startup project. The investors were not just complaining that a project went badly. The key problem was that the Information Memorandum said things about timing and returns that did not properly line up with the underlying trust structure.

The Full Court dismissed the main appeal. It also allowed part of the cross-appeal, making clear that the individuals who wrote, approved and sent the Information Memorandum could themselves have engaged in misleading conduct as principals. Acting through a company did not automatically keep them out of the conduct question.

For businesses, the practical rule is this: before circulating an investment deck, information memorandum or financial projection, tie every return statement back to the actual documents. Check the trust deed, shareholder rights, waterfall, fees, assumptions, priority rules and timing. If the legal structure would dilute or change the return, the marketing document needs to say so plainly.

Checks to run

Key points

  • Reconcile every investor return table against the trust deed, constitution or shareholders agreement.
  • Document the basis for timing and profit forecasts before sending an information memorandum.
  • Flag assumptions, dilution, fees and capital-return mechanics in plain language.
  • Have someone independent read the investment document against the legal structure.
  • Do not assume company status shields individuals who personally prepare or approve misleading material.

Key takeaways

  • Future statements about development timing and investor returns need reasonable grounds.
  • Return tables must match the trust deed or company documents.
  • Directors or promoters can be personally liable if they make or approve misleading investment material.
  • An assumption that is not built into the legal documents is dangerous in an investor-facing memorandum.

Related topics

Finance, Payments & SecurityCompanies & StartupsConsumer Law & Trading

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