LCM Litigation Fund Pty Ltd v Coope; Coope v LCM Litigation Fund Pty Ltd (No 2) [2015] NSWSC 992

LCM Litigation Fund Pty Ltd v Coope; Coope v LCM Litigation Fund Pty Ltd (No 2) [2015] NSWSC 992

Mr Coope did not engage in serious misconduct by failing to disclose the 20 per cent Vannin Malta interest in relation to the Wind Down Proposal, because the proposal was not pursued, the board rejected it peremptorily, and the point had not been reached where disclosure was required. However, when making the Separation Proposal he remained joint managing director and was obliged by cl 4.1(c) of the Employment Contract and his duties to LCM to disclose the simultaneous Employment Proposal under which he would head Vannin Malta in Australia and Asia and compete with LCM. His failure to disclose that significant and detrimental matter created an undisclosed conflict between his personal...

Jurisdiction
Australia
Judgment Date
24 July 2015
Procedural Posture
Employment Contract and Corporations Dispute in the Equity Division / Principal Judgment After Hearing
Outcome
LCM was entitled to terminate Mr Coope's employment for serious misconduct; Mr Coope was not entitled to damages.
Legal Topics
['termination for Serious Misconduct' 'managing Director Employment Contract' 'director Duties and Conflicts of Interest' 'disclosure of Competing Employment Proposal' 'damages for Wrongful Termination' 'corporations Act Restrictions on Termination Benefits']
['contracts' 'employment Law' 'corporations Law'] ['termination for Serious Misconduct' 'managing Director Employment Contract' 'director Duties and Conflicts of Interest' 'disclosure of Competing Employment Proposal' 'damages for Wrongful Termination' 'corporations Act Restrictions on Termination Benefits']

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 1 Authorities cited 2 Party arguments 2 Amounts and remedies 1
Sign in to unlock

Procedural Posture

Employment Contract and Corporations Dispute in the Equity Division / Principal Judgment After Hearing

Legal Issues

  1. 1 ["Whether Mr Coope's failure to disclose that an element of the Vannin or Wind Down Proposal was that he would acquire a 20 per cent shareholding in Vannin Malta amounted to serious misconduct under the Employment Contract." "Whether Mr Coope's failure to disclose, when making the Separation Proposal to LCM, that he was simultaneously making an Employment Proposal to Vannin amounted to serious misconduct." "Whether LCM was entitled to terminate Mr Coope's employment under cl 19.9(b) of the Employment Contract." 'If LCM was not entitled to terminate, whether Mr Coope would be entitled to damages and whether any such damages would be unavailable or capped by ss 200B or 200F(2) of the Corporations Act 2001 (Cth).']

Ratio Decidendi

Mr Coope did not engage in serious misconduct by failing to disclose the 20 per cent Vannin Malta interest in relation to the Wind Down Proposal, because the proposal was not pursued, the board rejected it peremptorily, and the point had not been reached where disclosure was required. However, when making the Separation Proposal he remained joint managing director and was obliged by cl 4.1(c) of the Employment Contract and his duties to LCM to disclose the simultaneous Employment Proposal under which he would head Vannin Malta in Australia and Asia and compete with LCM. His failure to disclose that significant and detrimental matter created an undisclosed conflict between his personal...

Court Disposition

LCM was entitled to terminate Mr Coope's employment for serious misconduct; Mr Coope was not entitled to damages.

Orders

  • ['The parties were invited to confer and agree on the orders, including as to costs, necessary to give effect to the reasons.']