Countouris v Kallos - [2008] NSWSC 840

CITATION: Countouris v Kallos [2008] NSWSC 840

HEARING DATE(S): 08/08/08

JURISDICTION: Equity Division

JUDGMENT OF: Young CJ in Eq

EX TEMPORE JUDGMENT DATE: 8 August 2008

DECISION: Notice of motion dismissed with costs.

CATCHWORDS: CORPORATIONS [32]- Remedies where oppression- Plaintiffs seek injunction to prevent defendants from holding an annual general meeting- Plaintiffs claim that this may amount to oppression to them because their supporters' membership applications have not yet been processed- Quaere whether injunction lies- Delay in bringing the application- Court reluctant to restrain meetings- Application refused.

LEGISLATION CITED: Corporations Act 2001 (Cth), ss 203D, 232

PARTIES: Peter Countouris & Others (P1-12)
Themis Kallos & Others (D1-18)

FILE NUMBER(S): SC 2881/07

COUNSEL: T D Tzovaras (S) (P)
D E Grieve QC (D)

SOLICITORS: Tzovaras Legal (P)
Watson & Watson (D)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

YOUNG CJ in EQ

Friday 8 August 2008

2881/07 – COUNTOURIS v KALLOS

JUDGMENT

1 HIS HONOUR: This is a motion in a dispute over the control of a Parish of the Greek Orthodox Church. The parties unfortunately have been in litigation for some time and there appears to have been an unsuccessful mediation and the general matter is back before the Court on the 18th of this month. However, the problem that confronts the Court today in the duty list is that on 14 July 2008, the people who claim to be the current directors and current secretary have convened an annual general meeting to be held next Sunday 10 August 2008.

2 The Parish has adopted as its operating vehicle a public company limited by guarantee entitled the Greek Orthodox Parish and Community of Burwood and District St Nectarios Ltd. I refer to that as "the company".

3 Article 71 of the company's Articles of Association provides that elections of members of the committee shall be held within one month of the second annual general meeting and each second successive annual general meeting thereafter.

4 It has been the custom and I am informed from the bar table that when the relevant annual general meeting is held, an election committee is chosen and forthwith there is an election for the members of the committee (which is virtually the board of directors) for the ensuing year.

5 On 14 July 2008 the secretary sent out a notice indicating that the annual general meeting would be held at 3pm next Sunday and warning people that they needed to be financial by 2 August 2008 in order to vote. The formal notice of meeting included:

“(E) To elect the election committee to conduct the election of committee members so that the number of committee members will be 12; and

(G) To conduct the election of 12 committee members."

6 Unless the Court makes some contrary order or unless the meeting itself next Sunday agrees to adjourn, the plaintiffs say that an election will take place which will be unfair and oppressive to the plaintiffs (who appear to be persons not…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Countouris v Kallos

Details

AGLC: Countouris v Kallos [2008] NSWSC 840
Case: [2008] NSWSC 840
Decision Date: 8 August 2008

CaseChat Overview and Summary

The case of Countouris v Kallos involves a dispute between shareholders of a company. The plaintiffs, Countouris and others, sought an injunction to prevent the defendants from holding an annual general meeting (AGM). They argued that the meeting should not proceed until their supporters' membership applications had been processed, as they believed this would result in oppression of the plaintiffs by the defendants. The court was required to determine whether the plaintiffs were entitled to an injunction to prevent the AGM and if there were any valid reasons to delay the bringing of the application.

The court considered the legal issues regarding the right to seek an injunction to prevent the AGM and the circumstances under which such an injunction may be granted. The plaintiffs' main contention was that the delay in processing their supporters' membership applications amounted to oppression, which would entitle them to seek an injunction. The court also needed to examine the defendants' position and whether there were any compelling reasons to hold the AGM despite the plaintiffs' concerns. Furthermore, the court had to consider whether the plaintiffs' delay in bringing the application would impact their chances of success.

The court found that the plaintiffs had not established a sufficient case for oppression to warrant an injunction. The court was reluctant to restrain the holding of the AGM, given the potential impact on the company's operations and the rights of other shareholders. The court also noted that the delay in bringing the application might have affected the plaintiffs' chances of success. Ultimately, the court refused the plaintiffs' application for an injunction. As a result, the defendants were allowed to proceed with the AGM.

Orders