Fedorovitch v St Aubins Pty Ltd [1999] NSWSC 506

Fedorovitch v St Aubins Pty Ltd [1999] NSWSC 506

The purported levies against the plaintiffs were invalid because the relevant meetings were not properly convened or quorate, the levies were not made by the directors as required by Article 16, and the general meeting could not both make the levy and decide that it be borne by the plaintiffs. Mr King's generation of fictitious meetings and minutes, the circumstances of the legal expenses, and the invalid attempts to impose liability for those expenses on the plaintiffs showed that the company's affairs were conducted in a manner oppressive or unfairly prejudicial to the plaintiffs under Corporations Law s 246AA.

Jurisdiction
Australia
Judgment Date
14 May 1999
Procedural Posture
Corporations Law Oppression Proceedings Concerning a Home Unit Company / Judgment After Hearing; Remedial Orders Under S 246 AA Deferred Pending Valuation Evidence
Outcome
The impugned levies were held invalid and oppression was found, but final remedial orders under Corporations Law s 246AA were deferred. The cross-claim was to be dismissed with no order for costs of the cross-claim.
Legal Topics
['oppression' 'home Unit Company' 'company Meetings' 'quorum and Notice' 'special Levies' 'casting Vote' 'corporations Law S 246 Aa' 'corporations Law S 1322']
['corporations Law' 'equity' 'property Law'] ['oppression' 'home Unit Company' 'company Meetings' 'quorum and Notice' 'special Levies' 'casting Vote' 'corporations Law S 246 Aa' 'corporations Law S 1322']

Case Brief

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Procedural Posture

Corporations Law Oppression Proceedings Concerning a Home Unit Company / Judgment After Hearing; Remedial Orders Under S 246 AA Deferred Pending Valuation Evidence

Legal Issues

  1. 1 ["Whether purported company meetings and directors' meetings were properly convened and quorate." 'Whether special levies imposed on the plaintiffs in respect of legal, personal and accounting expenses were valid under Article 16 of the Articles of Association.' 'Whether the affairs of the company were conducted in a manner oppressive or unfairly prejudicial to the plaintiffs within the meaning of Corporations Law s 246AA.' 'What remedy should be made for oppression in a home unit company where the owners cannot get on together.']

Ratio Decidendi

The purported levies against the plaintiffs were invalid because the relevant meetings were not properly convened or quorate, the levies were not made by the directors as required by Article 16, and the general meeting could not both make the levy and decide that it be borne by the plaintiffs. Mr King's generation of fictitious meetings and minutes, the circumstances of the legal expenses, and the invalid attempts to impose liability for those expenses on the plaintiffs showed that the company's affairs were conducted in a manner oppressive or unfairly prejudicial to the plaintiffs under Corporations Law s 246AA.

Court Disposition

The impugned levies were held invalid and oppression was found, but final remedial orders under Corporations Law s 246AA were deferred. The cross-claim was to be dismissed with no order for costs of the cross-claim.

Orders

  • ['The parties are to exchange valuations of the shares entitling occupation of unit 4 no later than 30 June 1999.' 'The parties are to exchange valuations of the whole parcel of the land and building no later than 30 June 1999.' 'The matter is to be listed before Young J on 19 July 1999 at 9.50 am for consideration...