Australian Marine Contractors partners Matthew Mitchell, Oliver Barz and Bjorn Farley fall out

A businessman who owns a commercial diving company is fighting his expulsion from a marine contracting outfit over allegations he has conflicting duties. He has lost the first battle in the spiralling dispute.

Australian Marine Contractors director Matthew Mitchell. Picture: Facebook

A Northern Territory businessman who owns a commercial diving company is fighting his expulsion from a marine contracting firm owned by himself and two others over allegations he has a conflict of interest.

Matthew Mitchell, via his company M.J.M Holdings (NT) Pty Ltd, has launched proceedings in the Federal Court of Australia against his two fellow shareholders in Australian Marine Contractors Pty Ltd, Oliver Barz and Bjorn Farley (via company Wavelength Assets Pty Ltd).

He is claiming his fellow company directors have acted prejudicially, oppressively or unfairly towards him in expelling him from Australian Marine Contractors (AMC).

AMC, which was incorporated in November 2015, provides “a range of marine services and products, including mooring services and subsea operations,” Justice Patrick O’Sullivan said in a recent decision.

Relations between the trio soured in early 2022, when Mr Mitchell established commercial diving business Oceantec.

“Since 2019, AMC has considered and taken steps to expand its services to provide commercial diving services directly,” Justice O’Sullivan said.

Australian Marine Contractors director Bjorn Farley. Picture: Facebook

“Mr Farley and Mr Barz became increasingly concerned that Mr Mitchell’s involvement with the establishment and management of Oceantec constituted a conflict of interest with his role as a director of AMC.”

At a directors’ meeting on October 31, 2022, Mr Farley “voiced his concerns and proposed a formal resolution for Mr Mitchell’s removal as director if he did not voluntarily resign”.

“Mr Mitchell denied any conflict of interest,” Justice O’Sullivan said.

A week later, on November 8, Mr Farley and Mr Barz convened a board meeting, which Mr Mitchell was neither notified of, nor attended, where they resolved to expel the latter from the company.

Documentation confirming the removal was filed with corporate regulator ASIC on November 17.

According to Justice O’Sullivan, Mr Mitchell and Mr Farley met a year later to discuss Mr Mitchell’s shareholding in AMC, via his company M.J.M Holdings (NT).

“There are conflicting accounts of what was discussed,” Justice O’Sullivan said.

“Both depose that Mr Farley made a proposal to buy out MJM’s shares in AMC.

Australian Marine Contractors director Oliver Barz. Picture: Facebook

“However, Mr Mitchell asserts that Mr Farley made a threat that if his proposal was not agreed, he would transfer AMC’s assets to another company and dissolve AMC with the effect that M.J.M’s shareholding would become worthless.”

Mr Farley denies the allegation.

In early June of this year, Mr Mitchell sought an injunction to prevent his removal as director, divestment of assets, the appointment of external administrators, or dealing with his M.J.M shares.

However, by his judgment of June 27, Justice O’Sullivan determined none of these steps were necessary.

He found regardless of whether Mr Mitchell was validly removed as director in November 2022, he had, in a de facto sense, not performed the role since then, so there was no urgent need to reinstate him.

It would also be counter-productive due to the “obviously acrimonious relationship” between the trio, Justice O’Sullivan said.

Mr Farley and Mr Barz had also undertaken to provide M.J.M. with an “appropriate period of notice” if they decide to dispose of any of AMC’s assets, thus protecting the shareholder’s position.

The substantive issues of whether Mr Mitchell was validly removed from AMC, whether he was conflicted in his duties, and whether he would be entitled to any relief by order of the court, will be determined at a later date.