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A scandalous episode of corporate misconduct: An expensive lesson for directors in GetSwift Ltd

By Associate Professor Anil Hargovan, School of Management and Governance, University of New South Wales, Sydney

The title of the article is drawn from judicial remarks made in a class action brought by investors against GetSwift Ltd (GetSwift),[1] a delisted technology company, for 22 contraventions of continuous disclosure laws[2] and for 40 contraventions of laws dealing with misleading and deceptive conduct.[3]

The focus of this article, however, is on the combined liability and record-breaking penalty judgments[4] by the Federal Court in the GetSwift cases (which runs for nearly 940 pages) which lays bare evidence of a scandalous episode of corporate misconduct.

The multiple contraventions of law were held by the court to be ‘serious, serial and at the heart of GetSwift’s culture’.[5] Significantly, all three directors were knowingly involved in the company’s breach of law and were therefore liable as accessories. Furthermore, all directors also failed to exercise and discharge their duties with the degree of care and diligence under s 180(1) of the Corporations Act.

The Federal Court imposed the largest ever penalty against a company for breaching continuous disclosure laws and misleading the market, ordering GetSwift Ltd to pay a massive penalty of $15 million.[6]

Based on their behaviour, two of the highest penalties were imposed on two of the three directors of GetSwift (Hunter and Macdonald) for corporate misconduct — discussed below.[7]

Against the background of stringent penalties and critical judicial remarks aimed at GetSwift and its directors, it pays to focus on the facts and decision of this case. to understand, what Justice Lee called, the ‘dreadful state of affairs.’[8]


The case concerns GetSwift, a start-up tech company and former market darling listed on the Australian Securities Exchange (ASX), which is now delisted and insolvent. The company saw a dramatic increase in the value of its shares from an issue price of 20 cents in December 2016 to over $4, prior to a trading halt announcement in December 2017, in advance of its second placement, by which GetSwift successfully raised $75 million from investors.  A year later, the share price plunged to $0.52 — a percentage decrease of almost 90 per cent from its all-time high of $4.30, as recorded in December 2018.

As described by the judge, the directors engaged in a public-relations-driven approach to corporate disclosure on behalf of the company, motivated by a desire to make regular announcements of successful entry into agreements with several national and multinational enterprise clients — including Amazon, Commonwealth Bank and Yum Brands.[9]

GetSwift adopted the following business model to drive up its share price — it made several ASX announcements, notwithstanding that some of the agreements had allegedly not progressed beyond a ‘trial period’, and before the potential benefits under the agreements were secure, quantifiable or measurable.

GetSwift failed to inform the market of information that materially qualified the ASX announcements. This included the termination of several agreements that had been the subject of an announcement, and decisions by clients that GetSwift’s services would no longer be utilised beyond the expiry of trial periods with no prospect for revenue.

The legal issues concerned whether GetSwift failed to disclose material information to the ASX and the public, including by not revealing the true status of its actual commercial engagements regarding its various customers.

It also concerned whether GetSwift engaged in misleading or deceptive conduct regarding the nature and scale of the financial benefit that GetSwift stood to obtain from each agreement.

Arising from these concerns, ASIC successfully alleged that the GetSwift breached multiple provisions of the Corporations Act — namely, continuous disclosure law, the directors (Hunter, Macdonald and Eagle) caused the company to breach continuous disclosure laws, the directors (Hunter and Macdonald) engaged in misleading and deceptive conduct and all three directors acted in breach of their duty of care and diligence by exposing the company to risk of legal action and penalties.


ASIC successfully established all three directors were individually liable under s 674(2A) of the Corporations Act due to their involvement in GetSwift’s contravention of disclosure law — as defined under s 79 of the Corporations Act 2001 (Corporations Act). The evidence showed all directors either drafted, directed or authorised the issue of misleading ASX announcements with material omissions.

In assessing whether the three directors acted in breach of their duty of care and diligence under s 180(1), the court embarked on a lengthy review of established legal principles and emphasised the following:[10]

  1. While it is common that a director may contribute to a company’s breach of s 674(2), in effect exposing the company to civil penalties or other liability, the liability of the director does not automatically follow from the company’s contravention.
  2. There is no obligation on directors under s 180(1) to conduct the affairs of the company in accordance with the law generally or the Corporations Act specifically.
  3. Instead, liability under s 180(1) is triggered in circumstances where the director’s failure to exercise reasonable care and diligence has caused, or allowed, the company to contravene the Corporations Act, at least where it was reasonably foreseeable that such contravention might harm the company’s interests.

In assessing the degree of care and diligence that a reasonable person would have exercised if they were a director of a corporation in the circumstances of GetSwift, and if they occupied the same office held by, and had the same responsibilities as the three directors, the court considered many factors as salient including the following:[11]

  • the important function served by the release ASX announcements (the regulatory purpose of conveying to investors information that will likely influence a decision to acquire or dispose of shares in GetSwift)
  • the timely, accurate and complete disclosure of information is critical to ensuring market integrity and efficiency
  • considering the specific circumstances of a company like GetSwift, which was relatively new, not making a profit and was embarking upon a high growth and expansion strategy
  • directors acting in accordance with statutory norms would have taken adequate steps to satisfy themselves as to whether what was being conveyed to the market was accurate and adequate
  • the standard of care must also have regard to the fact that investors would have placed reliance upon announcements as to executed contracts to measure the degree of GetSwift’s success in achieving its strategy as disclosed in the ASX announcements
  • a reasonable person would have appreciated foreseeable risks and taken reasonable steps to mitigate the risks that any ASX announcement was inaccurate or misleading.

Based on the evidence, and legal principles underpinning s 180(1), the court was satisfied that all three directors caused or permitted GetSwift to contravene statutory norms of conduct in circumstances where it was reasonably foreseeable that engaging in the conduct referred to might harm the interests of GetSwift by exposing GetSwift to the risk of legal proceedings for contraventions of the Corporations Act, legal costs and penalties.


In handing down a record breaking $15 million corporate penalty in the penalty judgment, Justice Lee found the corporate wrongdoing was not an isolated event, nor a momentary lapse in judgment.

On the contrary, the evidence showed the corporate behaviour to be ‘insidious’ and ‘tricky’ as the omitted information from public disclosure would not have been discoverable upon enquiry by a third party.[12]  Furthermore, it was held that company’s contravening conduct, which misled the market and created a false market, had real life consequences for the investing public and materially prejudiced the interests of GetSwift’s members.[13] It caused significant losses for many people who purchased securities.

Critically, his Honour also noted the abject failure of good corporate governance practice in GetSwift and held:[14]

… the contraventions were the result of a plan and constituted deliberate conduct by the company, as part of a public-relations-driven approach to corporate disclosure executed by the company’s most senior officers … Those senior officers ignored the company’s continuous disclosure policy and, obviously enough, the company took no remedial or disciplinary steps against them.

Unsurprisingly, the court swiftly rejected the company’s forgiveness defence under s 1317S on the basis that there was no evidence whatsoever to excuse any corporate liability.[15]

The court found there were 32 distinct contraventions by the former CEO and Chair, Mr Hunter, comprising the 16 contraventions of continuous disclosure provisions under s 674(2A) of the Act and an additional 16 distinct contraventions of s 180(1) duty of care and diligence. Mr Hunter was found to have directed and engaged in wrongful conduct over a period of more than 22 months.

Justice Lee found Mr Hunter to not only be a ‘bully’[16] but someone who ‘had a laser-like focus on making money for himself and Mr Macdonald and if that involved breaking the law regulating financial markets, or exposing GetSwift to third party liability, that was of little concern to him.’[17]

Mr Hunter was ordered to pay a penalty of $2 million,[18] disqualified from managing corporations for 15 years[19] and found to be ‘wholly unsuited to be in a position of responsibility in a public company.’[20]

Justice Lee held that such a penalty was deserving to further the requirements of general deterrence and was hopeful it would achieve the following aims:[21]

… others will think twice about adopting a strategy to influence the company’s share price by the release of strategically placed ASX announcements which omit material information that the market requires to make informed decisions. It will also reinforce that a director’s continuous disclosure obligations are to be taken seriously.

Similarly, his Honour found that the former director, Mr Macdonald, was also focused on making money and had ‘little understanding or regard for his legal obligations as a director.’[22]

Mr Macdonald was ordered to pay a penalty of $1 million and disqualified for 12 years for similar breaches of law.  In describing the role of Mr Macdonald, Justice Lee observed this director:[23]

… was ad idem with Mr Hunter in his approach to ASX announcements …  He proceeded with a disregard for the integrity of the market … Of real significance in Mr Macdonald’s case is his lack of insight or contrition … [he] was no mere cat’s paw …  he was an active and eager participant [in the company’s contravention of law]

Disturbingly, Justice Lee found that neither of these directors showed the slightest degree of remorse or contrition, nor did they made any acknowledgment they behaved improperly.[24]

Brett Eagle, a former director and a lawyer by profession who played a lesser role in the contraventions of disclosure and misleading and deceptive law, was nonetheless ordered to pay a penalty of $75,000 and was disqualified from managing corporations for two years.

The court, however, was not swayed by Mr Eagle’s argument not to impose a disqualification order due to the adverse publicity generated by the case and, subsequently, due to his damaged reputation as a director and legal adviser, particularly on corporate governance and compliance issues.

In dismissing such concerns, Justice Lee offered the following reasons:[25]

… it would have been blindingly obvious to anybody at GetSwift that there was something rotten going on. I accept, insofar as it goes, that Mr Eagle made at least some attempts to implement …  some discipline in relation to ASX announcements. But that submission cannot overcome the fact that it was clear by that point Messrs Hunter and Macdonald were operating GetSwift in a manner that was liable to expose shareholders (and the public at large) to serious financial harm … the only rational explanation for Mr Eagle staying the course was the prospect of significant reward.

The court noted that Mr Eagle failed to take an appropriate response, namely, ‘to insist on fundamental changes to the heart of GetSwift’s operations and its corporate governance or, failing those changes being implemented, to resign.’[26]

Additionally, the court took a dim view of Mr Eagle’s submissions and found that he appeared fixated on the harm inflicted upon himself and his professional standing, but not necessarily the harm that was inflicted on others, including company members and the broader public due to corporate misconduct under his watch as director and legal adviser.[27]


The corrupt and unlawful behaviour by GetSwift and its directors, resulting in record breaking penalties, is a sobering reminder that directors have a duty to act in the company’s best interests and to take continuous disclosure obligations seriously.

Manipulation of material information to purposefully generate a favourable share price (such as in a pump and dump scheme) not only offends market integrity rules but can also give rise to director liability for breach of duty of care and diligence. The decision in GetSwift reaffirms the legal principle that directors have a duty under s 180(1) to consider all of the interests of the company, including legal risks and compliance and not just commercial and financial risks.[28]

Associate Professor Anil Hargovan can be contacted on (02) 9385 3577 or by email at

Material published in Governance Directions is copyright and may not be reproduced without permission. The views expressed therein are those of the author and not of Governance Institute of Australia. All views and opinions are provided as general commentary only and should not be relied upon in place of specific accounting, legal or other professional advice.

[1] Webb v GetSwift Limited (No 7) [2023] FCA 90 at [2].

[2] Under s 674 of the Corporations Act 2001 (hereinafter Corporations Act)

[3] Under both s 1041H of the Corporations Act and s 12DA of the Australian Securities and Investments Commission Act 2001.

[4]ASIC v GetSwift Ltd (Liability Hearing) [2021] FCA 1384; ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100.

[5] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [79].

[6] Pursuant to s 1317G(1A) for breach of s 674 of the Corporations Act.

[7] It is noteworthy that the penalties in the GetSwift case were based on the old penalty regime (prior to 13 March 2019) as the cause of legal action preceded the increase in maximum penalties.

[8] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [6].

[9] ASIC v GetSwift Ltd (Liability Hearing) [2021] FCA 1384 at [8].

[10] ASIC v GetSwift Ltd (Liability Hearing) [2021] FCA 1384 at [2525]-[2544].

[11] ASIC v GetSwift Ltd (Liability Hearing) [2021] FCA 1384 at [2553]-[2560].

[12] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [72].

[13] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [73].

[14] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [74].

[15] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [80]-[83].

[16] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [97].

[17] Ibid.

[18] Pursuant to ss 1317G(1) and 1317G(1A) in respect of his contraventions of s 180(1) and s 674(2A) of the Corporations Act.

[19] Pursuant to ss 206C(1) and 206E(1) of the Corporations Act.

[20] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [94].

[21] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [102].

[22] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [111].

[23] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [108]-[111]

[24] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [8].

[25] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [133].

[26] Ibid.

[27] ASIC v GetSwift Ltd (Penalty Hearing) [2023] FCA 100 at [134].

[28] Cassimatis v ASIC [2020] FCAFC 52.

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