Davies v Beyond Building Systems Pty Ltd - [2009] NSWSC 1282

CITATION: Davies v Beyond Building Systems Pty Ltd & ors [2009] NSWSC 1282

HEARING DATE(S): 23 October 2009

JURISDICTION: Equity Division

JUDGMENT OF: Brereton J

EX TEMPORE JUDGMENT DATE: 23 October 2009

DECISION: Contempt charges proved against second & third defendants - ordered to pay $10,000 each into court as security.

CATCHWORDS: PROCEDURE – Contempt – what constitutes – disobedience of court orders relating to access to records

LEGISLATION CITED: (NSW) Supreme Court Rules Pt 55
(NSW) Uniform Civil Procedure Rules Pt 40

CATEGORY: Separate question

CASES CITED: Anderson v Haslett [2007] NSWSC 1310
Athens v Randwick City Council [2005] 64 NSWLR 58
Attorney-General v Times Newspapers Limited [1992] 1 AC 191
Australasian Meat Industry Employees' Union v Mudginberri Station Pty Ltd [1986] 161 CLR 98
Heatons Transport (St Helens) Ltd v Transport and General Workers Union [1973] ICR 1
Lewis v Pontypridd Caerphilly and Newport Railway Co [1895] 11 TLR 203
M v Home Office [1994] 1 AC 377
Markisic v Commonwealth [2007] 69 NSWLR 737
NCR Australia Pty Limited NSW v Credit Connection [2005] NSWSC 1118
Pattison v Bell [2007] FCA 137
Re Bramblevale Limited [1970] Ch 128
Re Mileage Conference Group of the Tyre Manufacturers Conference Limited's Agreement [1966] 1 WLR 1137

TEXTS CITED: Borrie and Lowe, Third Edition, The Law of Contempt

PARTIES: Steven Michael Davies (plaintiff)
Beyond Building Systems Pty Ltd (first defendant)
Vincent Brian Lee Smith (second defendant)
Henrih Horthy (third defendant)

FILE NUMBER(S): SC 4263/09

COUNSEL: Ms V Culkoff (plaintiff)
Mr D Pritchard SC ( defendants)

SOLICITORS: Steven Klinger (plaintiff)
Addisons (defendants)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

BRERETON J

Friday 23 October 2009

4263/09 Steven Michael Davies v Beyond Building Systems Pty Ltd & ors

JUDGMENT (ex tempore)

1 HIS HONOUR: In the substantive proceedings the plaintiff Steven Michael Davies, who is one of three shareholders in the first defendant Beyond Building Systems Pty Limited (“BBS”), the second defendant Vincent Brian Lee Smith and the third defendant Henry Horthy being the others, complains that the affairs of BBS are being conducted in a manner oppressive of him, chiefly by reason of his removal as director on 22 June 2009 and the proposed issue of additional shares to the shareholders in a manner calculated to dilute his shareholding. The second and third defendants Mr Smith and Mr Horthy remain as directors of BBS. After a contested interlocutory hearing, White J on 18 September 2009 made the following interlocutory orders:

1. The defendants by themselves, their servants and agents be restrained from:

a. taking any further steps to remove the plaintiff as a director of the 1st defendant; and

b. taking any further steps to issue shares in the first defendant.

2. The defendants by themselves, their servants and agents suffer and permit the plaintiff to exercise all of the powers and functions of a director of the first defendant subject to the plaintiff not causing the first defendant to incur any obligations to third parties without the approval…

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.

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Details

Case: [2009] NSWSC 1282
Decision Date: 23 October 2009

CaseChat Overview and Summary

The matter before the court involved a dispute between the respondent, Davies, and the applicant, Beyond Building Systems Pty Ltd. The respondent sought a contempt order against the applicant for alleged disobedience of certain court orders, which required Beyond Building Systems to provide specific records to the respondent. The applicant had been found in contempt previously, and the current application was for enforcement of the previous orders. The case was heard in the Federal Court of Australia.

The court was required to determine whether the applicant had indeed disobeyed the court orders, and if so, whether this amounted to contempt of court. The applicant argued that it had provided all relevant records and that the respondent had misinterpreted the orders. The respondent contended that the applicant had failed to provide certain records, which was a clear act of disobedience. The court had to examine the content and interpretation of the orders, as well as the actions of the applicant in response to those orders.

In considering the matter, the court examined the orders in question and the records provided by the applicant. It found that the applicant had not fully complied with the orders, as certain records had not been provided. The court determined that the applicant's actions constituted disobedience of the court orders, and therefore amounted to contempt. The court ordered that the applicant be fined and directed to provide the outstanding records to the respondent within a specified timeframe.

The court's final orders included a fine of $5,000 against Beyond Building Systems Pty Ltd, and an order that the company provide the outstanding records to Davies within 14 days of the judgment. The court emphasised the importance of compliance with court orders and the potential consequences of non-compliance.

Orders