In the matter of Richardson & Wrench Holdings Pty Limited [2013] NSWSC 1990

In the matter of Richardson & Wrench Holdings Pty Limited [2013] NSWSC 1990

The purported amendment of the second defendant's articles of association by members' circular resolution was invalid because the appointment of Kie Chie Wong as corporate representative of the plaintiff did not confer authority to assent to a resolution without a meeting under s 250D of the Corporations Act 2001; accordingly, the resolution was not validly made and had no effect. If this conclusion were incorrect and the irregularity considered merely procedural, substantial injustice would arise in entrenching minority control, warranting a declaration of invalidity or a modification of the constitution.

Jurisdiction
Australia
Judgment Date
07 November 2013
Procedural Posture
Corporations List Proceedings (equity Division) / Final Judgment (substantive and Interlocutory Applications Determined)
Outcome
Declared the amendment invalid; costs to plaintiff; order to lodge with ASIC.
Legal Topics
['articles of Association' 'corporate Representative Authority' "members' Resolutions" 'oppressive Conduct' 'modification of Constitution']
['corporations Law'] ['articles of Association' 'corporate Representative Authority' "members' Resolutions" 'oppressive Conduct' 'modification of Constitution']

Case Brief

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Procedural Posture

Corporations List Proceedings (equity Division) / Final Judgment (substantive and Interlocutory Applications Determined)

Legal Issues

  1. 1 ["Whether the amendment of the second defendant's articles of association by members' circular resolution was valid and effective" 'Whether the purported appointment of a corporate representative authorised voting on circular resolutions' 'Whether the amendment or the process was oppressive under Corporations Act 2001 s 232' 'Whether the irregularity (if any) was merely procedural and could be remedied under s 1322']

Ratio Decidendi

The purported amendment of the second defendant's articles of association by members' circular resolution was invalid because the appointment of Kie Chie Wong as corporate representative of the plaintiff did not confer authority to assent to a resolution without a meeting under s 250D of the Corporations Act 2001; accordingly, the resolution was not validly made and had no effect. If this conclusion were incorrect and the irregularity considered merely procedural, substantial injustice would arise in entrenching minority control, warranting a declaration of invalidity or a modification of the constitution.

Court Disposition

Declared the amendment invalid; costs to plaintiff; order to lodge with ASIC.

Orders

  • ["Declared the purported amendment of the second defendant's articles by members' circular resolution dated 23 July 2013 inserting new article 44A invalid and of no effect." 'Noted that, if not for the above, the court would have declared the resolution invalid pursuant to Corporations Act s 1322(2) and/or ordered...