New Zealand Case Law: Decisions & Judgments

Topic

Corporate opportunity

Legal area

Court

17 Nov 2023

WILLIAM JAMES WATERHOUSE LECKIE v ANTHONY AND WENDY BEVERLEY [2023] NZCA 570

Citation

[2023] NZCA 570
Court

Court of Appeal

The Court upheld the High Court: leave under s165 was properly granted because each derivative plaintiff had reasonably arguable claims that the appellants diverted a closely connected commercial opportunity and misused information obtained in their capacities as directors; the derivative action was not duplicative of s174 shareholder claims; the companies may meet initial reasonable costs under s166; the application to adduce further evidence on appeal was declined as not cogent.
17 Apr 2014

YAO WEI HE V ZHIXIONG CHEN CA590/2013 [2014] NZCA 153

Citation

[2014] NZCA 153
Court

Court of Appeal

The appeal was dismissed. The Court found the s165(3) threshold satisfied because NZPIL did not intend to bring proceedings (deadlock, ceased trading, liquidation application). It held Chen Snr was a de facto director under s126(1)(b) and NZPIL had an arguable claim for breach of s131 (corporate opportunity), but the pleadings were confused, several reliefs sought were beyond the company's capacity or jurisdiction (eg HK company), and given NZPIL had ceased trading and liquidation was pending a prudent business person would not pursue a derivative action; leave was therefore refused and the l…
15 Oct 2012

BURTON V THOMPSON HC AK CIV 2012-404-1465

Citation

openlaw-5726bfa3_3e42_46b2_b355_365f4289930b.pdf
Court

High Court

Because a receiver had been appointed the court held a derivative action was unnecessary and declined to grant injunctive relief on the corporate‑opportunity point given anti‑competitive features; on the costs applications there was no basis for uplift or a second counsel certificate so no order as to costs was made and costs were to lie where they fall.
23 Feb 2006

ORD AND FENTON V CALAN HEALTHCARE PROPERTIES LIMITED AND ANOR HC AK CIV 2004-404-1786

Citation

openlaw-d523311d_d622_4b89_a75f_a26410ea4a96.pdf
Court

High Court

Leave declined because the applicants' primary contractual entitlement case had low prospects of success, corporate opportunity claims were undermined by evidence of knowledge/consent and the involvement and investigation by experienced independent directors, the likely recoverable quantum did not justify the substantial costs, and it was not in the company's interests nor a course a prudent business person would pursue.
3 Feb 2006

ILION TECHNOLOGY CORPORATION V ROBIN THEODORUS JOHANNINK AND ORS HC AK CIV 2004-404-003358

Citation

openlaw-2a9ae98a_f081_4a8c_aa1e_ed1c42559184.pdf
Court

High Court

Where agreements to purchase shares were made during capital raising periods or where investors approached the manager (PML) and the director learned of the opportunity by reason of his office, the director was obliged to disclose the approach to the board and obtain fully informed consent before selling his or associated interests' shares; failure to do so constituted a breach of fiduciary duty entitling the company to an account of profits. The Phoenix Trust received profits with imputed knowledge and holds part on constructive trust; the accountant was not liable for dishonest assistance.

New Zealand Case Law

WILLIAM JAMES WATERHOUSE LECKIE v ANTHONY AND WENDY BEVERLEY [2023] NZCA 570

YAO WEI HE V ZHIXIONG CHEN CA590/2013 [2014] NZCA 153

BURTON V THOMPSON HC AK CIV 2012-404-1465

ORD AND FENTON V CALAN HEALTHCARE PROPERTIES LIMITED AND ANOR HC AK CIV 2004-404-1786

ILION TECHNOLOGY CORPORATION V ROBIN THEODORUS JOHANNINK AND ORS HC AK CIV 2004-404-003358