In the matter of BG Iron and Steel Pty Ltd [2014] NSWSC 1433

In the matter of BG Iron and Steel Pty Ltd [2014] NSWSC 1433

A declaration should be made that relevant board resolutions were passed in breach of clause 10 of the Cooperation and Investment Agreement. However, an ongoing injunction is inappropriate given the declaration's sufficiency and the possibility of changed circumstances in future events.

Parties
First Plaintiff: Francis Xiao; Second Plaintiff: Edward Lee; Third Plaintiff: Jianxiong Ye; Fourth Plaintiff: BG Resources Pty Ltd; First Defendant: BG Iron and Steel Pty Ltd; Second Defendant: Stephen Chan; Third Defendant: Yi Ying Choi; Fourth Defendant: Fung Wa Wong; Fifth Defendant: Yingkin Wong; Sixth Defendant: Nanyang Mining Resources Investment Pty Ltd
Jurisdiction
Australia
Judgment Date
17 October 2014
Procedural Posture
Corporations List Proceeding / Post Judgment; Consequential Orders
Outcome
Declaration made that board resolutions were passed in breach of the agreement; no injunction granted; costs to plaintiffs.
Legal Topics
Board Resolutions, Injunctions, Costs, Interpretation of Agreements
Corporations Law Equity Board Resolutions Injunctions Costs Interpretation of Agreements

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Parties

Francis Xiao

First Plaintiff

Edward Lee

Second Plaintiff

Jianxiong Ye

Third Plaintiff

BG Resources Pty Ltd

Fourth Plaintiff

BG Iron and Steel Pty Ltd

First Defendant

Stephen Chan

Second Defendant

Yi Ying Choi

Third Defendant

Fung Wa Wong

Fourth Defendant

Yingkin Wong

Fifth Defendant

Nanyang Mining Resources Investment Pty Ltd

Sixth Defendant

Procedural Posture

Corporations List Proceeding / Post Judgment; Consequential Orders

Legal Issues

  1. 1 Whether board resolutions were passed in breach of clause 10 of the Cooperation and Investment Agreement
  2. 2 Whether injunctive relief should be granted to restrain defendants from removing a director contrary to the agreement
  3. 3 Appropriate form of final orders, including costs

Ratio Decidendi

A declaration should be made that relevant board resolutions were passed in breach of clause 10 of the Cooperation and Investment Agreement. However, an ongoing injunction is inappropriate given the declaration's sufficiency and the possibility of changed circumstances in future events.

Court Disposition

Declaration made that board resolutions were passed in breach of the agreement; no injunction granted; costs to plaintiffs.

Orders

  • Declare that the resolutions of the Board of BG Iron and Steel Pty Ltd purportedly passed on 17 February 2014 to remove Mr Edward Lee as a director of 3E Steel Pty Ltd at the general meeting of 3E on 20 February 2014 were passed in breach of clause 10 of the Cooperation and Investment Agreement dated 2 December 2010.
  • The Second to Sixth Defendants pay the First to Fourth Plaintiffs' costs of these proceedings, including costs occasioned by the application for interlocutory relief heard by the Court on 19 February 2014, as agreed or as assessed.