Webb Distributors (Aust) Pty Ltd v Victoria [1993] HCA 61

Webb Distributors (Aust) Pty Ltd v Victoria [1993] HCA 61

Shareholders holding non-withdrawable shares in the building societies, seeking damages related to misrepresentations in connection with their acquisition of shares, cannot prove for those damages in the winding up of the societies. The statutory scheme—specifically s.360(1)(k) of the Companies (Victoria) Code as applied to building societies by s.121(4) of the Building Societies Act—incorporates the rule in Houldsworth v City of Glasgow Bank, which precludes both rescission and damages claims by shareholders against the company in liquidation in respect of their shares. This applies irrespective of whether the damage was due to misleading or deceptive conduct. The Trade Practices Act...

Jurisdiction
Australia
Procedural Posture
Appeal / High Court Judgment After Appeal From Supreme Court of Victoria Appeal Division
Outcome
Appeal dismissed (by majority judgment).
Legal Topics
['winding Up' 'capacity of Shareholders to Claim Damages' 'priority of Claims in Liquidation' 'trade Practices Act Remedies']
['corporations Law' 'insolvency Law'] ['winding Up' 'capacity of Shareholders to Claim Damages' 'priority of Claims in Liquidation' 'trade Practices Act Remedies']

Case Brief

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Procedural Posture

Appeal / High Court Judgment After Appeal From Supreme Court of Victoria Appeal Division

Legal Issues

  1. 1 ['Whether unliquidated damages claimed by non-withdrawable shareholders are provable in the liquidation of building societies' 'Whether shareholders are precluded from rescinding their contracts after winding up and from maintaining an action for damages in relation to the acquisition of shares' 'Application of the rule in Houldsworth v City of Glasgow Bank to building societies and whether it is affected by the Trade Practices Act']

Ratio Decidendi

Shareholders holding non-withdrawable shares in the building societies, seeking damages related to misrepresentations in connection with their acquisition of shares, cannot prove for those damages in the winding up of the societies. The statutory scheme—specifically s.360(1)(k) of the Companies (Victoria) Code as applied to building societies by s.121(4) of the Building Societies Act—incorporates the rule in Houldsworth v City of Glasgow Bank, which precludes both rescission and damages claims by shareholders against the company in liquidation in respect of their shares. This applies irrespective of whether the damage was due to misleading or deceptive conduct. The Trade Practices Act...

Court Disposition

Appeal dismissed (by majority judgment).

Orders

  • ['Appeal dismissed.' 'The costs of all parties to the appeal be costs in the windings up of Pyramid Building Society, Geelong Building Society and Countrywide Building Society.']