CIC Insurance Ltd v Hannan & Co Pty Ltd

In the case of CIC Insurance Ltd versus Hannan & Co Pty Ltd, the plaintiff sought to wind up the defendant company. The plaintiff, CIC Insurance Ltd, held 97% of the shares in Hannan & Co Pty Ltd, with the remaining shares held by a director of the plaintiff, who was also a shareholder. The defendant company had no directors in office and no one willing to be appointed, leading to a dispute over whether the company could be wound up by a special resolution passed by the sole shareholder. The case was heard in the Supreme Court of Queensland.

The primary legal issues that the court had to address were whether a special resolution to wind up the company could be passed by the sole shareholder signing a minute, and whether the absence of directors and unwillingness of any individual to be appointed justified winding up on the ground that it was just and equitable to do so. The court also needed to determine the basis upon which a provisional liquidator would be appointed.

The court held that a special resolution to wind up a company could be passed by a sole shareholder signing a minute, provided it was in accordance with the company’s constitution and the Corporations Act. The court further determined that the absence of directors and unwillingness of any individual to be appointed did not, in itself, justify winding up the company on the ground that it was just and equitable to do so. The court noted that winding up on the just and equitable ground is an equitable remedy and that the company in question was not insolvent. The court concluded that appointing a provisional liquidator would be appropriate to ensure the company’s affairs were managed properly until the winding up was resolved. The court ordered that a provisional liquidator be appointed to manage the company's affairs.