Clarke v Bridges

[2004] FCA 394

FEDERAL COURT OF AUSTRALIA

Clarke v Bridges [2004] FCA 394

CORPORATIONS – winding up – just and equitable – two-man company – deadlocked board

Corporations Act 2001 (Cth) s 461(1)(k)

Ebrahimi v Westbourne GalleriesLtd. [1973] AC 360 referred to
Tivoli Freeholds Ltd., Re [1972] VR 445 cited
Yenidje Tobacco Company, Limited., In re [1916] 2 Ch 426 cited

STEPHEN CLARKE v LEITH ANDREW BRIDGES and 2BC PTY LTD

V 316 of 2004

FINKELSTEIN J
23 MARCH 2004
MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 316 of 2004

BETWEEN:	STEPHEN CLARKE Plaintiff
AND:	LEITH ANDREW BRIDGES and 2BC PTY LTD Defendants
JUDGE:	FINKELSTEIN J
DATE OF ORDER:	23 MARCH 2004
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

1.        2BC Pty Ltd be wound up.

2.Kenneth John Stout of Boutique Corporate Advisory of Level 2, 111 Collins Street, Melbourne Victoria be appointed Liquidator of the Company.

3.        The Plaintiff’s application be otherwise dismissed.

4.        The costs of the hearing on 23 March 2004 be costs in the winding up.

5.The Plaintiff pay the First Defendant’s costs incurred on 12 March 2004, such costs to be taxed in default of agreement.

6.The First Defendant pay one half of the Plaintiff’s costs incurred on 16 March 2004, such costs to be taxed in default of agreement.

7.The requirement for giving any notice of the winding up of the company required by the Corporations Act 2001 (Cth) or the Corporations Regulations, other than the notice given to the Australian Securities and Investments Commission pursuant to s 470 of the Act, be dispensed with.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 316 of 2004

BETWEEN:	STEPHEN CLARKE Plaintiff
AND:	LEITH ANDREW BRIDGES and 2BC PTY LTD Defendants

JUDGE:	FINKELSTEIN J
DATE:	23 MARCH 2004
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

1. In 2001 Mr Clarke and Mr Bridges decided to open a wine bar in Blackburn, an outer Melbourne suburb.  On the advice of Mr Clarke’s accountant they purchased a shelf company, 2BC Pty Ltd, to own and operate the business.  Each man holds two of the four issued shares.  Together they are the only directors.

2. Mr Bridges and his wife own the premises upon which the company conducted its business.  Mr Clarke says that the parties agreed that the company would be granted a three year lease of the premises with two further options for three years each.  The lease was oral; formal documents were never executed.  The company spent money refurbishing the property to obtain a permit to operate the premises as a wine bar.  The bar opened for business in February 2002.

3. In mid 2003 relations between Mr Clarke and Mr Bridges deteriorated.  In September 2003 Mr Bridges and his wife served a notice to quit and in October 2003 the business shut down when the company vacated the premises.  The business was sold two months later for about $72,000 despite…