Perception Pty Ltd & Anor v Myalong Pty Ltd & Anor [2001] NSWIRComm 158

Perception Pty Ltd & Anor v Myalong Pty Ltd & Anor [2001] NSWIRComm 158

The arrangement was unfair within s106 because the $30,000 payment was an advance for expenses and setoff against commission, not an upfront fee, and the respondents could not justify retaining more than $5,250 for expenses. The asserted construction of clause 6, under which Myalong would receive a success fee for a capital raising to which it made no substantial contribution, was also unfair; clause 6 should be varied so the fee is confined to capital raising resulting from Myalong's independent efforts that contributed substantially to its achievement.

Jurisdiction
Australia
Judgment Date
17 July 2001
Procedural Posture
Application Under S106 of the Industrial Relations Act 1996 / Judgment
Outcome
Application allowed; declaration of unfairness made; clause 6 varied; repayment and costs orders to be made.
Legal Topics
['unfair Contract' 'capital Raising Agreement' 'advance Against Commission and Expenses' 'restitution' 'variation of Contract Term' 'jurisdiction Under S106']
['industrial Relations' 'contract Law'] ['unfair Contract' 'capital Raising Agreement' 'advance Against Commission and Expenses' 'restitution' 'variation of Contract Term' 'jurisdiction Under S106']

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Procedural Posture

Application Under S106 of the Industrial Relations Act 1996 / Judgment

Legal Issues

  1. 1 ['Whether the contract or arrangement between the applicants and respondents was one whereby work was performed in an industry in and of New South Wales so as to satisfy the jurisdictional prerequisite under s106 of the Industrial Relations Act 1996.' 'Whether the $30,000 paid to the respondents was an upfront fee or an advance for expenses and setoff against commission.' 'Whether clause 6 entitled Myalong to a success fee on any capital raising within two years after termination, even if Myalong performed no substantial work contributing to it.' 'Whether the contract or arrangement was unfair within the meaning of s106.']

Ratio Decidendi

The arrangement was unfair within s106 because the $30,000 payment was an advance for expenses and setoff against commission, not an upfront fee, and the respondents could not justify retaining more than $5,250 for expenses. The asserted construction of clause 6, under which Myalong would receive a success fee for a capital raising to which it made no substantial contribution, was also unfair; clause 6 should be varied so the fee is confined to capital raising resulting from Myalong's independent efforts that contributed substantially to its achievement.

Court Disposition

Application allowed; declaration of unfairness made; clause 6 varied; repayment and costs orders to be made.

Orders

  • ['Clause 6 is to be varied to provide that the entitlement to a fee is confined to capital raising resulting from the independent efforts of Myalong such that those efforts contributed substantially to the achievement of the capital raising.' 'Myalong is to repay the sum of $30,000 to Perception save for the sum of...