Chapmans Ltd v Australian Stock Exchange Ltd [1995] FCA 471

Chapmans Ltd v Australian Stock Exchange Ltd [1995] FCA 471

The respondent's power to suspend securities was exercisable at absolute discretion and not subject to any implied contractual restriction as alleged. The applicant was given a reasonable opportunity to be heard prior to suspension. While procedural fairness required opportunity to be heard and the respondent had a duty to act fairly and honestly, there was no duty to act in a way that was 'merely' reasonable, nor a general duty to provide reasons unless fairness so demanded in the circumstances.

Parties
Applicant: Chapmans Limited; Respondent: Australian Stock Exchange Limited
Jurisdiction
Australia
Judgment Date
27 June 1995
Procedural Posture
Corporations Law Proceeding / Judgment Delivered Following Consideration of Reserved Questions
Outcome
Reserved questions answered in favour of the respondent; implied contractual term not found; reasonable opportunity to be heard was given; respondent not bound to act 'reasonably' but bound to act fairly.
Legal Topics
Stock Exchange Powers, Suspension of Securities, Natural Justice, Contractual Terms
Corporations Law Stock Exchange Powers Suspension of Securities Natural Justice Contractual Terms

Case Brief

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Parties

Chapmans Limited

Applicant

Australian Stock Exchange Limited

Respondent

Procedural Posture

Corporations Law Proceeding / Judgment Delivered Following Consideration of Reserved Questions

Legal Issues

  1. 1 Whether an implied contractual term limits the respondent's power to suspend or remove applicant's securities
  2. 2 Whether applicant received reasonable opportunity to be heard before suspension
  3. 3 Whether respondent's power must be exercised 'reasonably' or fairly

Ratio Decidendi

The respondent's power to suspend securities was exercisable at absolute discretion and not subject to any implied contractual restriction as alleged. The applicant was given a reasonable opportunity to be heard prior to suspension. While procedural fairness required opportunity to be heard and the respondent had a duty to act fairly and honestly, there was no duty to act in a way that was 'merely' reasonable, nor a general duty to provide reasons unless fairness so demanded in the circumstances.

Court Disposition

Reserved questions answered in favour of the respondent; implied contractual term not found; reasonable opportunity to be heard was given; respondent not bound to act 'reasonably' but bound to act fairly.

Orders

  • The terms of the contract between the parties do not include an implied term or condition in the terms pleaded in paragraph 9 of the further amended statement of claim.
  • The applicant was provided with a reasonable opportunity to be heard in relation to the decision to suspend the quotation of the securities.