The employer tried to wipe her entitlements - the court found a contract structure it couldn't ignore
When Australia's first commercial spaceport collapsed into liquidation, its former chief executive came out of court owed millions over the payout she was promised.
On June 19, 2026, the Federal Court found that Carley Scott, the former CEO of Equatorial Launch Australia, was entitled to $2,367,430.25 under a special contract built around her work for the start-up, plus $17,458.58 in unpaid employment entitlements. The Court has asked both sides to file proposed orders putting those reasons into effect.
Scott's story with ELA started in 2018. The company was planning a rocket-launch site in East Arnhem Land, and she came on first as a contractor, then as CEO from November 2019 on a $250,000 salary. On top of that, the company signed a separate deal in October 2019 promising her up to $5 million in convertible notes, released in stages over five years.
Her employment ended in March 2022. Then the fight began.
ELA's main argument was that the original deal had been swapped out for an employee share option plan that Scott had agreed to. Justice Dowling didn't accept that. He found the contract had been varied in 2021 to drop some funding conditions, but never replaced. Scott, he said, never actually signed up to the share plan - there was no signed cancellation document, no new contract, no finished paperwork. He described the company chair, who drove the proposed switch, as having overstated Scott's agreement to it, and he found Scott's evidence "credible and truthful" after she gave it over four days.
For HR leaders, the standout is how the company's serious-misconduct defence failed.
ELA claimed Scott had breached duties of loyalty and good faith - pointing to her handling of invoices and the contract change - and that this should erase her accrued entitlements. The Court did not accept that, on a clean structural point. Nothing in the commitment contract let the company cancel it for misconduct and claw back what had already built up. ELA asked the Court to read in such a term. Dowling declined, calling it neither reasonable nor equitable: on that logic, Scott could have lost almost $5 million over alleged misconduct a week before the deal matured. And there was a simpler route, he noted - terminate the employment contract for misconduct and let the commercial contract run on its own terms. He added that, in any event, Scott's conduct in negotiating and varying the contract could not amount to misconduct, given his findings about that evidence.
The lesson sits in the structure. ELA had deliberately split its executive arrangements into two documents - an employment contract and a commercial "commitment" contract - signed by the same people at about the same time. The Court treated that as a choice the company made, and refused to graft a forfeiture clause onto the commercial deal after the fact.
The decision also flags a trap for any employer cutting big exit-linked cheques to senior people. Part of Scott's claim - $2 million tied to the contract's final two years - ran into Corporations Act rules that require shareholder approval for benefits given in connection with an executive's loss of office. Shareholders never approved it and no exemption fit, so the Court found that slice unenforceable. Scott still kept the earlier $3 million component (less salary already paid), because it had vested over time rather than being triggered by her departure.
She picked up the smaller items too. ELA accepted during the hearing that it had breached her contract by not paying a phone allowance, agreed at $2,742.97, and the Court awarded a further $14,715.62 for reimbursement of her 2021 work travel. A claimed $25,000-a-year vehicle allowance failed, though, because she didn't prove an actual quantified loss.
The takeaway for HR is simple under the law. If you want the option to strip an executive's accrued benefits for misconduct, write it into the contract that holds those benefits - don't assume a court will imply it. And if a payout is linked to someone leaving a board or executive role, check whether shareholder approval is required before you promise it.
