Justice Richard Refshauge delivered on Thursday his decision in favour of the Commonwealth in the territory’s longest outstanding legal case.

The marathon legal fight began after the government attempted to recover about $8.7million of taxpayers’ funds transferred illegally to two companies connected to Davis Samuel Corporate Advisory Services in 1998.

The Commonwealth pursued criminal charges against several investors in the company without success.

It then launched action in the ACT Supreme Court to retrieve the money, as well as damages and interest.

The investors fought back, launching a $4.3billion counter-claim to recover profits they said they lost when the lawsuit stopped them from introducing a ‘‘lottery style’’ capital-raising plan to Australian financial markets.

The investors argued the Commonwealth had breached a contract to invest in the company, flouted the Trade Practices Act, and that government negligence was behind the original $8.7million transfer.

The group also called for a royal commission into alleged abuse of power by the Australian Securities and Investments Commission and the Australian Securities Exchange.

Justice Refshauge heard the civil case over 44 days in 2008 and he reserved judgment in October that year.

The final 544-page judgment, delivered on Thursday, involved 30 parties and a complex web of claims and counter-claims.

Justice Refshauge rejected the $4.3billion counter-claim after finding the original $8.725million payment was void and illegal.

“The claim of such damages is conceptually unsustainable,” the judge wrote.

Justice Refshauge also said the royal commission request was groundless, finding the defendants had misinformed an ASIC inquiry in November 2008 about the purchase of shares using the $8.7million payment.

“That lie seems to me to support an inference that at least [one defendant] was not willing to acknowledge the receipt of funds from the Commonwealth at that time,’’ Justice Refshauge said.

“Indeed, the inference to be drawn, and that I do draw, is that as a fact, the primary defendants were not at all keen to acknowledge receipt of funds from the Commonwealth, they seemed positively to hide it.”

He gave leave to the Commonwealth to attempt to recover the funds.

But Justice Refshauge conceded the case was likely to continue on appeal to a higher court.

One defendant, Bill Forge, was in court on Thursday and confirmed the respondents would challenge the decision.

“Justice Refshauge said this would end in the High Court and that’s exactly where it will go,” Mr Forge said.