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Moffet Decision Announced

In the Scheme of Arrangement documentation issued by Abano Healthcare Group Limited in February 2020, reference was made to an Australian Court decision, and the pending appeal of that decision. The case involved superannuation deduction obligations applicable in respect of a dentist engaged under a services agreement (Dr Moffet) who could be deemed an employee for superannuation purposes.

Abano advises that the Full Court of the Federal Court of Australia late yesterday issued its decision in the appeal of Moffet v Dental Corporation Australia Pty Ltd [2020] FCAFC 118.  The Full Court upheld the lower court’s decision but on different grounds. It is not currently certain what form the final orders will take but a result of the Full Court’s affirms that Dental Corporation Australia has a liability under the Superannuation Guarantee (Administration) Act 1992 to make superannuation contributions for the benefit of, and given the nature of its contracting arrangements with, Dr Moffet.

The effect of the decision is that in certain circumstances, people who are not generally ’employees’ (in particular, people who are independent contractors) will be considered ’employees’ for the limited purpose of employer superannuation contribution.

Abano will now work with its advisers to consider the Moffet appeal decision, to assess whether and the extent to which it applies to Maven’s contracting arrangements with dentists under its Facilities and Administrative Services Agreements, and the potential financial impact, if any, to Abano.

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