McNally v Harris (No. 3) [2008] NSWSC 861

McNally v Harris (No. 3) [2008] NSWSC 861

Equitable compensation was to be assessed at the date of making the orders, using the last available share price of $1.78 per share, because the obligation is to restore the trust estate at the time recoupment is effected and the plaintiffs did not prove that, had the shares been restored earlier, they would have sold them at a higher price. The defendants could not compel the plaintiffs to accept shares in specie instead of monetary compensation.

Jurisdiction
Australia
Judgment Date
08 August 2008
Procedural Posture
Equity Proceedings Seeking Equitable Compensation and Tracing/account of Proceeds of Disposal of Oxiana Shares / Assessment of Quantum of Equitable Compensation After Plaintiffs Elected Equitable Compensation
Outcome
Judgment was entered for the first and eighth plaintiffs against the first, second and third defendants for equitable compensation assessed at $1.78 per share; the judgments were not cumulative and the defendants' request to satisfy judgment by delivery of shares was rejected.
Legal Topics
['equitable Compensation' 'breach of Trust' 'assessment Date for Compensation' 'value of Shares' 'restitution in Specie']
['equity' 'trusts' 'equitable Remedies'] ['equitable Compensation' 'breach of Trust' 'assessment Date for Compensation' 'value of Shares' 'restitution in Specie']

Case Brief

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Procedural Posture

Equity Proceedings Seeking Equitable Compensation and Tracing/account of Proceeds of Disposal of Oxiana Shares / Assessment of Quantum of Equitable Compensation After Plaintiffs Elected Equitable Compensation

Legal Issues

  1. 1 ['How the quantum of equitable compensation for disposed Oxiana shares should be assessed' 'Whether equitable compensation should be assessed by reference to the share price on the first day of hearing or at the date of orders' 'Whether the defendants could satisfy monetary judgments by delivery of Oz Minerals shares']

Ratio Decidendi

Equitable compensation was to be assessed at the date of making the orders, using the last available share price of $1.78 per share, because the obligation is to restore the trust estate at the time recoupment is effected and the plaintiffs did not prove that, had the shares been restored earlier, they would have sold them at a higher price. The defendants could not compel the plaintiffs to accept shares in specie instead of monetary compensation.

Court Disposition

Judgment was entered for the first and eighth plaintiffs against the first, second and third defendants for equitable compensation assessed at $1.78 per share; the judgments were not cumulative and the defendants' request to satisfy judgment by delivery of shares was rejected.

Orders

  • ['Judgment in favour of the first plaintiff and the eighth plaintiff against the first defendant in the sum of $1,390,180.' 'Judgment in favour of the first plaintiff and the eighth plaintiff against the second defendant in the sum of $1,390,180.' 'Judgment in favour of the first plaintiff and the eighth plaintiff...