"But you're the ones stopping the company from suing?!" | Tydeman v Asgard Group [2023] FCA 486
208 بار بازدید -
12 ماه پیش
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The Ps (a parent and
The Ps (a parent and their child) were the dirs and only shareholders of the D. The D was trustee of an SMSF and the Ps were beneficiaries: [1], [2]
The Ps, proceeding without legal advice, sought leave to cause D to sue for some alleged trust property: shares.
The Ps said FormerTCo, a former Tee of the SMSF, owned shares in OtherCo, that FormerTCo became deregistered, and the shares (which the Ps said were trust property) were unlawfully bought back by OtherCo: [5]
The Ps sought leave to cause the D to sue OtherCo to get the shares back. (A claim against the Commonwealth was not pressed): [5], [6]
The Ps said they could not cause D to commence the proceedings as to do so would breach their fiduciary duties: [7]
The evidence regarding the alleged buy-back was unclear and included heavy redactions: [13] - [23]
In 2016 FormerTCo resigned and was later deregistered. The Ps appointed themselves trustees. In 2022 they retired as trustees and appointed the D: [25] - [27]
The Court was left to consider the s237 derivative action criteria: [30]
s237(2)(a): the Court found D would not bring the proceedings, but that was only because the Ps refused to cause it to do so: [33] - [38]
s237(2)(b): the Court found Ps’ application was not brought in good faith. It was the Ps’ conduct that prevented D from bringing the application. The purpose of the derivative action is the opposite - to allow people without control of a company to bring proceedings on its behalf: [39] - [43]
s237(2)(c): the Court considered it was not in D’s best interests that leave be granted as the Ps’ indemnity was insufficient, and the claim’s prospects were poor: [44] - [46]
s237(2)(d): the Court found there was “little more than bare assertion” to suggest the buyback was unlawful or improper, but the evidence did disclose a serious question to be tried: [48]
The facts were the subject of twelve (!) other related pieces of litigation over the years from 2013: [52]
The Ps’ heavily redacted evidence and failure to disclose apparently relevant matters traversed in the other litigation left the Court in a state of “considerable disquiet” about whether the entire position had been disclosed by the Ps: [53]
Questions of abuse of process and Anshun estoppel also arose, without sufficient evidence to make a definite finding: [54]
Noting a number of criteria for leave had not been satisfied, leave to bring the derivative action was refused: [60]
The Ps also sought a mandatory injunction requiring D to bring the proceedings but failed to show they would suffer grave damage if the injection were not granted, nor to indemnify D: [62]
The Ps’ application failed.
___
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The Ps, proceeding without legal advice, sought leave to cause D to sue for some alleged trust property: shares.
The Ps said FormerTCo, a former Tee of the SMSF, owned shares in OtherCo, that FormerTCo became deregistered, and the shares (which the Ps said were trust property) were unlawfully bought back by OtherCo: [5]
The Ps sought leave to cause the D to sue OtherCo to get the shares back. (A claim against the Commonwealth was not pressed): [5], [6]
The Ps said they could not cause D to commence the proceedings as to do so would breach their fiduciary duties: [7]
The evidence regarding the alleged buy-back was unclear and included heavy redactions: [13] - [23]
In 2016 FormerTCo resigned and was later deregistered. The Ps appointed themselves trustees. In 2022 they retired as trustees and appointed the D: [25] - [27]
The Court was left to consider the s237 derivative action criteria: [30]
s237(2)(a): the Court found D would not bring the proceedings, but that was only because the Ps refused to cause it to do so: [33] - [38]
s237(2)(b): the Court found Ps’ application was not brought in good faith. It was the Ps’ conduct that prevented D from bringing the application. The purpose of the derivative action is the opposite - to allow people without control of a company to bring proceedings on its behalf: [39] - [43]
s237(2)(c): the Court considered it was not in D’s best interests that leave be granted as the Ps’ indemnity was insufficient, and the claim’s prospects were poor: [44] - [46]
s237(2)(d): the Court found there was “little more than bare assertion” to suggest the buyback was unlawful or improper, but the evidence did disclose a serious question to be tried: [48]
The facts were the subject of twelve (!) other related pieces of litigation over the years from 2013: [52]
The Ps’ heavily redacted evidence and failure to disclose apparently relevant matters traversed in the other litigation left the Court in a state of “considerable disquiet” about whether the entire position had been disclosed by the Ps: [53]
Questions of abuse of process and Anshun estoppel also arose, without sufficient evidence to make a definite finding: [54]
Noting a number of criteria for leave had not been satisfied, leave to bring the derivative action was refused: [60]
The Ps also sought a mandatory injunction requiring D to bring the proceedings but failed to show they would suffer grave damage if the injection were not granted, nor to indemnify D: [62]
The Ps’ application failed.
___
If you'd like to contact me please look for James d'Apice or Coffee and a Case Note on your favourite social media spot - I should pop up right away!
And please look out for my podcast, Coffee and a Case Note, wherever you get your podcasts.
#coffeeandacasenote
#auslaw
12 ماه پیش
در تاریخ 1402/04/18 منتشر شده
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