Glandon v Tilmunda (No 2) [2008] NSWSC 441

Glandon v Tilmunda (No 2) [2008] NSWSC 441

Consideration for transfer of partnership interest ($55,000) to be deducted from account of profits. Capital and loan account balances excluded as they were discharged under deed and are not profit components. Director not liable for account of profits in absence of evidence of receipt. No interest awarded on profits; profits were retained as working capital, and no evidence of profit distributions or earned interest. Plaintiff entitled to indemnity costs from day after offer under the rules and to full costs of proceedings. No allowance to be made for director's skill as charges were included for 1999 and agreed applied throughout the relevant period.

Jurisdiction
Australia
Judgment Date
01 May 2008
Procedural Posture
Equity / Post Liability, Determination of Quantification and Costs
Outcome
Account of profits to be determined with deduction for transfer consideration; no liability for director; interest only on damages from agreed date; indemnity and full costs awarded; no skill allowance; further orders to be drafted.
Legal Topics
['account of Profits' 'breach of Fiduciary Duty' 'indemnity Costs' 'partnership' "director's Accessorial Liability"]
['equity' 'fiduciary Obligations'] ['account of Profits' 'breach of Fiduciary Duty' 'indemnity Costs' 'partnership' "director's Accessorial Liability"]

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Procedural Posture

Equity / Post Liability, Determination of Quantification and Costs

Legal Issues

  1. 1 ['Whether consideration for transfer of partnership interest should be deducted from account of profits' 'Whether capital account and loan account balances should be factored into account of profits' 'Whether director is accessorially liable to account for profits absent evidence of receipt' 'Whether interest should be awarded on profits' 'Whether plaintiff entitled to indemnity and full costs' 'Whether allowance for skill should be made when accounts are determined']

Ratio Decidendi

Consideration for transfer of partnership interest ($55,000) to be deducted from account of profits. Capital and loan account balances excluded as they were discharged under deed and are not profit components. Director not liable for account of profits in absence of evidence of receipt. No interest awarded on profits; profits were retained as working capital, and no evidence of profit distributions or earned interest. Plaintiff entitled to indemnity costs from day after offer under the rules and to full costs of proceedings. No allowance to be made for director's skill as charges were included for 1999 and agreed applied throughout the relevant period.

Court Disposition

Account of profits to be determined with deduction for transfer consideration; no liability for director; interest only on damages from agreed date; indemnity and full costs awarded; no skill allowance; further orders to be drafted.

Orders

  • ["Parties to bring in short minutes of order reflecting reasons for judgment on 25 March 2008 and today's decision" 'Matter stood over to 7 May 2008 for final orders' 'Plaintiff to have indemnity costs from day after offer under the Uniform Civil Procedure Rules 2005, r 42.14' 'Plaintiff to have full costs of the...