Miles v Sydney Meat-Preserving Company (Limited) [1912] HCA 87

Miles v Sydney Meat-Preserving Company (Limited) [1912] HCA 87

By majority (Griffith C.J. and Barton J.), the conduct of the company and its directors in operating not with the object of earning profits for distribution among all shareholders but to serve the interests of graziers is not ultra vires, nor a legal fraud on the minority. The company’s constitution grants the majority shareholders full power to set policy so long as their acts fall within the company’s powers and no assets are wrongfully appropriated to the exclusion of others. The minority’s complaint relates to a matter of internal management and policy, not breach of legal duty or fraud, and such matters are not judicially enforceable unless acts are ultra vires or a true fraud on the...

Parties
Appellant; Plaintiff: William John Miles; Respondent; Defendant Company: Sydney Meat-preserving Company (Limited); Respondent; Director: William Wright Richardson; Respondent; Director: Walter Russell Hall; Respondent; Director: John Bassett Christian; Respondent; Director: Lewis Porter Bain
Jurisdiction
Australia
Judgment Date
19 December 1912
Procedural Posture
Appeal From Supreme Court of New South Wales (eq) / High Court of Australia – Final Judgment
Outcome
appeal dismissed
Legal Topics
Powers of Majority, Ultra Vires, Fraud on the Minority, Injunctions, Distribution of Profits, Purpose of Trading Corporations
Company Law Equity Powers of Majority Ultra Vires Fraud on the Minority Injunctions Distribution of Profits Purpose of Trading Corporations

Case Brief

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Parties

William John Miles

Appellant; Plaintiff

Sydney Meat-preserving Company (Limited)

Respondent; Defendant Company

William Wright Richardson

Respondent; Director

Walter Russell Hall

Respondent; Director

John Bassett Christian

Respondent; Director

Lewis Porter Bain

Respondent; Director

Procedural Posture

Appeal From Supreme Court of New South Wales (eq) / High Court of Australia – Final Judgment

Legal Issues

  1. 1 Whether the directors and majority of shareholders can conduct the business of a company otherwise than with a view to making profits available for distribution amongst all shareholders; whether such conduct constitutes a fraud on the minority or is ultra vires the company.

Ratio Decidendi

By majority (Griffith C.J. and Barton J.), the conduct of the company and its directors in operating not with the object of earning profits for distribution among all shareholders but to serve the interests of graziers is not ultra vires, nor a legal fraud on the minority. The company’s constitution grants the majority shareholders full power to set policy so long as their acts fall within the company’s powers and no assets are wrongfully appropriated to the exclusion of others. The minority’s complaint relates to a matter of internal management and policy, not breach of legal duty or fraud, and such matters are not judicially enforceable unless acts are ultra vires or a true fraud on the...

Court Disposition

appeal dismissed

Orders

  • Appeal dismissed with costs.