Crawley v Short

The proceeding concerned an appeal and cross-appeal arising from a decision of the primary judge regarding claims of oppression brought by Mr. Crawley against Mr. Short in relation to several companies. The dispute centred on allegations of Mr. Short's oppressive conduct as a director towards Mr. Crawley as a shareholder.

The Court of Appeal was required to determine, among other things, the appropriate remedy for the proven instances of oppression, specifically whether a compulsory purchase order for Mr. Crawley's shares was appropriate. Further issues included the method of valuing those shares, particularly the relevance of potential capital gains tax (CGT) liabilities and selling costs in determining the net value of the company's assets, which consisted solely of land and a business. The applicability of equitable defences, such as laches and delay, to an oppression suit was also a point of contention.

The Court considered the principles of corporate oppression and the remedies available under the relevant legislation. It addressed the valuation of shares in the context of a compulsory buy-out, examining whether CGT and selling costs should be deducted from the gross proceeds of sale to arrive at the true value. The Court also analysed the elements of laches and delay, noting that the degree of knowledge required for the defence to succeed depends on the specific circumstances. The Court affirmed that directors owe fiduciary duties to shareholders and that the defence of laches may be applicable in oppression proceedings, subject to the established legal principles.

The appeal and cross-appeal were allowed in part, with the parties directed to submit short minutes of order to address the calculations of adjustments.