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Axsesstoday Limited Class Action

Background on Axsesstoday Limited

Axsesstoday Limited (AXL) was established in 2012 and operated as a lender to small to medium sized enterprises and was listed on the Australian Stock Exchange.
 
On 26 June 2018, AXL offered to issue $50 million in simple corporate bonds described as “Axsesstoday Bonds – Series A, tranche 1” pursuant to the terms of the Offer Specific Prospectus dated 26 June 2018 (Bonds). 
 
Several months after issue, AXL was found to be in breach of one or more banking covenants. The major cause of those breaches was the implementation of a new Australian Accounting Standard (AASB9) which, amongst other things, altered the requirements for the recognition of arrears, leading to a breach of the relevant arrears ratio.  The directors ultimately appointed administrators in April 2019.
 
A Deed of Company Arrangement was subsequently entered into, under which investors received a payment in the vicinity of 27 cents in the dollar, leaving a significant shortfall on their investment.

Federal Court Proceedings

On 20 August 2020 Hicksons filed a class action in the Federal Court of Australia on behalf of a significant proportion of the bondholders, each of whom have signed a litigation funding agreement with Therium Litigation Finance Atlas AFP IC and a Retainer Agreement with Hicksons. The Representative applicant is Compumod Investments Pty Ltd as trustee of a staff superannuation fund.
 
The proceedings were commenced against Axsesstoday Limited (AXL) and Pricewaterhouse Coopers Securities Limited (PwCS), seeking recovery of the shortfall on the Bonds and interest payments which were not made. PwCS was the accounting advisor in connection with the prospectus documentation, which is alleged to have contained significant shortcomings.
 
The applicant alleges, among other things, that AXL made misleading and deceptive statements in, and omitted information that was required to be disclosed in, its prospectus, contravening the Corporations Act 2001 and the Australian Securities and Investments Commission Act 2001. It is further alleged that in providing accounting advice in relation to the prospectus, PwCS was involved in those contraventions, in addition to itself engaging in misleading or deceptive conduct.
 
Significantly, the information which ought to have been contained in the prospectus is information concerning the likely potential effect of AASB9 on the financial statements of AXL and its ability to comply with its banking covenants. 

Want to find out more?

Further information is contained in our FAQ. 

If you would like further information regarding the class action and whether you are eligible to register, please contact Premier Litigation Funding Management at [email protected] or email Hicksons at [email protected].

Key documents
  1. Frequently asked Questions 
  2. Originating Application filed 20 August 2020
  3. Statement of Claim filed 20 August 2020
  4. Amended Statement of Claim filed 21 September 2021
  5. First Respondent’s Defence to Amended Statement of Claim filed 24 November 2021
  6. Second Respondent’s Defence to the Amended Statement of Claim filed 24 November 2021
  7. Second Respondent’s Notice of Cross-Claim filed on 24 November 2021
  8. Second Respondent’s Statement of Cross-Claim filed on 24 November 2021
  9. Applicant’s Reply to the First Respondent’s Defence to the Amended Statement of Claim filed 13 December 2021
  10. First Respondent’s Defence to the Second Respondent's Cross-Claim filed 24 December 2021
  11. Second Respondent's Reply to the First Respondent's Defence to Cross-Claim filed 18 February 2022
  12. Further Amended Statement of Claim filed 10 May 2022
  13. First Respondent's Defence to the Further Amended Statement of Claim filed 23 May 2022
  14. Second Respondent's Defence to the Further Amended Statement of Claim filed 20 May 2022
  15. Second Respondent's Amended Statement of Cross-Claim filed 23 May 2022
  16. First Respondent's Defence to Amended Statement of Cross-Claim filed 3 June 2022
  17. Second Respondent's Reply to First Respondent's Defence to Amended Cross-Claim filed 10 June 2022
  18. Further Amended Originating Application filed 17 April 2023
  19. Second Further Amended Statement of Claim filed 17 April 2023
  20. First Respondent’s Defence to the Second Further Amended Statement of Claim filed 2 June 2023
  21. Second Respondent’s Defence to the Second Further Amended Statement of Claim filed 2 June 2023
  22. Second Respondent’s Further Amended Statement of Cross Claim filed 2 June 2023
  23. First Respondent's Defence to Further Amended Cross Claim filed 18 July 2023
  24. Second Respondent's  Reply to Defence to Further Amended Statement of Cross-Claim filed 1 August 2023
  25. Third Further Amended Statement of Claim filed 22 December 2023
  26. Third to Sixth Respondents’ Defence to Third Further Amended Statement of Claim filed 16 February 2024
  27. Second Respondent’s Defence to Third Further Amended Statement of Claim filed 21 February 2024
  28. Second Further Amended Statement of Cross-Claim filed 5 March 2024
  29. Cross-Respondents' Defence to Second Further Amended Cross-Claim filed 18 March 2024
  30. Opt Out Notice filed 13 March 2024
Case updates

The applicant filed the Third Further Amended Statement of Claim (3FASOC) on 22 December 2023 joining AXL’s insurer to the proceedings. We note that the insurance policy held by the former first respondent was entered into by DUAL on behalf of the four underwriters at Lloyds, who have been joined as the third to sixth respondents (Underwriters).
 
The Underwriters filed their Defence to the 3FASOC on 16 February 2024 and PwCS filed its Defence to the 3FASOC on 21 February 2024.
 
Further, PwCS filed its Further Amended Cross-Claim on 5 March 2024, with the Underwriters filing their response on 18 March 2024.
 
In relation to the substantive proceedings, the applicant has filed and served both its expert evidence and proposed tender bundle. PwCS has also filed and served its affidavit evidence and proposed tender bundle.
 
The parties have also prepared and provided to Justice Markovic a joint list of common questions which will result in a more efficient trial. Orders have also been made for the preparation for hearing, including orders for the parties to file submissions and prepare a Court Book.
 
By order of the Court, the proceedings has been referred to further mediation which is to occur by 28 May 2024. The case remains provisionally listed for hearing in June 2024.

Proposed Settlement between the Applicant and the Underwriters

The applicant and the Underwriters have agreed to settle the class action between them.
 
Hicksons Lawyers, senior counsel and junior counsel acting for the applicant consider the settlement sum to be reasonable in all of the circumstances and represents the best possible outcome against the Underwriters at this time.
 
Any class members who object to or oppose the proposed settlement are required to inform Hicksons Lawyers and the Court on or by 23 May 2024.
 
The settlement is subject to approval by a judge of the Federal Court. The judge will hold a hearing to decide whether to approve the settlement on 27 May 2024 at 11am at the Federal Court of Australia in Sydney.
 
If the Court approves the proposed settlement, Group Members will be notified by way of an update on this website.
 
The Class Action will continue against the remaining respondent, PwCS, and is listed for hearing before another judge of the Federal Court in June 2024. PwCS presently maintains a cross-claim against the Underwriters.

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