Leviston v PQ Management Pty Ltd [2022] FCA 787

Leviston v PQ Management Pty Ltd [2022] FCA 787

The oral agreement reached for completion required calculation of the purchase price as at 30 June 2017 with interest payable for July. Mr Leviston failed to establish entitlement to additional sums or unjust enrichment claims. PQ Management's call option was not exercised in accordance with the Shareholders Agreement, rendering the share transfer invalid. The defendants' subsequent conduct constituted oppression under s 232 of the Corporations Act. The appropriate remedy is for PQ Management to purchase Leviston's shares at fair value as at 30 June 2020, less prior payments, and with an appropriate mechanism for interest.

Parties
Plaintiff: Andrew Troy Leviston; First Defendant: PQ Management Pty Ltd; Second Defendant: Donald Neal Ison; Third Defendant: Gregory Shane Eldridge; Fourth Defendant: Treated Waste Agencies Pty Ltd
Jurisdiction
Australia
Judgment Date
08 July 2022
Procedural Posture
Commercial and Corporations / Final Judgment
Outcome
Declaration and orders granted; relief for oppression; monetary adjustment pending valuation.
Legal Topics
Construction of Contracts, Shareholder Oppression, Options—put and Call, Variation of Agreements, Power of Attorney in Shareholders Agreements
Contract Law Corporations Law Construction of Contracts Shareholder Oppression Options—put and Call Variation of Agreements Power of Attorney in Shareholders Agreements

Case Brief

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Parties

Andrew Troy Leviston

Plaintiff

PQ Management Pty Ltd

First Defendant

Donald Neal Ison

Second Defendant

Gregory Shane Eldridge

Third Defendant

Treated Waste Agencies Pty Ltd

Fourth Defendant

Procedural Posture

Commercial and Corporations / Final Judgment

Legal Issues

  1. 1 Whether oral variation of written Share Sale Agreement altered completion terms
  2. 2 Whether notice of exercise of call option by PQ Management was valid under Shareholders Agreement
  3. 3 Whether transfer of shares pursuant to the call option was effective

Ratio Decidendi

The oral agreement reached for completion required calculation of the purchase price as at 30 June 2017 with interest payable for July. Mr Leviston failed to establish entitlement to additional sums or unjust enrichment claims. PQ Management's call option was not exercised in accordance with the Shareholders Agreement, rendering the share transfer invalid. The defendants' subsequent conduct constituted oppression under s 232 of the Corporations Act. The appropriate remedy is for PQ Management to purchase Leviston's shares at fair value as at 30 June 2020, less prior payments, and with an appropriate mechanism for interest.

Court Disposition

Declaration and orders granted; relief for oppression; monetary adjustment pending valuation.

Orders

  • Declaration that the purported exercise of the call option by PQ Management on 9 March 2020 was ineffective.
  • Declaration that the purported transfer of plaintiff's 60,901 shares in Treated Waste Agencies Pty Ltd on 29 May 2020 was invalid and of no effect.