Fraser, in the matter of Logan Estates Pty Limited (ACN 009 660 986) v Logan Estates Pty Limited (ACN 009 660 986)

[2008] FCA 1782

FEDERAL COURT OF AUSTRALIA

Fraser, in the matter of Logan Estates Pty Limited (ACN 009 660 986) v Logan Estates Pty Limited (ACN 009 660 986) [2008] FCA 1782

IN THE MATTER OF LOGAN ESTATES PTY LIMITED (ACN 009 660 986), MUNDOOLUN PTY LIMITED (ACN 009 673 312) AND BENCLASS PTY LTD (ACN 084 211 263), ROBERT MARTIN FRASER v LOGAN ESTATES PTY LIMITED (ACN 009 660 986), MUNDOOLUN PTY LIMITED (ACN 009 673 312), BENCLASS PTY LTD (ACN 084 211 263), ALEXANDER DUNCAN FRASER, SIMON MARTIN FRASER, MICHAEL WILLIAM FRASER and DOUGLAS ROSS FRASER

VID 365 OF 2007

DOWSETT J
12 SEPTEMBER 2008
BRISBANE

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	VID 365 OF 2007

IN THE MATTER OF:

LOGAN ESTATES PTY LIMITED
(ACN 009 660 986)

MUNDOOLUN PTY LIMITED
(ACN 009 673 312)

BENCLASS PTY LTD
(ACN 084 211 263)

BETWEEN: ROBERT MARTIN FRASER
Plaintiff

AND:

LOGAN ESTATES PTY LIMITED (ACN 009 660 986)
First Defendant

MUNDOOLUN PTY LIMITED (ACN 009 673 312)
Second Defendant

BENCLASS PTY LTD (ACN 084 211 263)
Third Defendant

ALEXANDER DUNCAN FRASER
Fourth Defendant

SIMON MARTIN FRASER
Fifth Defendant

MICHAEL WILLIAM FRASER
Sixth Defendant

DOUGLAS ROSS FRASER
Seventh Defendant

JUDGE:	DOWSETT J
DATE OF ORDER:	12 SEPTEMBER 2008
WHERE MADE:	BRISBANE

THE COURT ORDERS THAT:

1.The notice of motion filed 22 August 2008 be dismissed.

2.The plaintiff pay the defendants’ costs of the motion.

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

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	VID 365 OF 2007

IN THE MATTER OF:

LOGAN ESTATES PTY LIMITED
(ACN 009 660 986)

MUNDOOLUN PTY LIMITED
(ACN 009 673 312)

BENCLASS PTY LTD
(ACN 084 211 263)

BETWEEN: ROBERT MARTIN FRASER
Plaintiff

AND:

LOGAN ESTATES PTY LIMITED (ACN 009 660 986)
First Defendant

MUNDOOLUN PTY LIMITED (ACN 009 673 312)
Second Defendant

BENCLASS PTY LTD (ACN 084 211 263)
Third Defendant

ALEXANDER DUNCAN FRASER
Fourth Defendant

SIMON MARTIN FRASER
Fifth Defendant

MICHAEL WILLIAM FRASER
Sixth Defendant

DOUGLAS ROSS FRASER
Seventh Defendant

JUDGE:	DOWSETT J
DATE:	12 SEPTEMBER 2008
PLACE:	BRISBANE

REASONS FOR JUDGMENT

1. In these proceedings the plaintiff seeks to wind up the first, second and third defendants (“Logan Estates” “Mundoolun” and “Benclass” respectively) on the ground of oppressive conduct or, alternatively, orders for acquisition of the plaintiff’s shares in these companies. 

2. The plaintiff has four older half-brothers (the “four brothers”).  They are the fourth to seventh defendants.  The plaintiff and the four brothers have the same father (the “father”).He is now deceased.  The family has owned and occupied a property outside of Brisbane since 1842.  At relevant times the family has used the land and other land in the area for cattle raising, including agistment, sand mining and property development.  The plaintiff has never been actively engaged in the family business.  For many years he has lived away from the property and outside of Australia.  Each of the companies is engaged in some aspect of the family business.  The plaintiff complains that the affairs of each company have been run in ways which were, and are, oppressive to him, favouring the interests of his brothers and, whilst he was alive, his father, rather than the interests of the relevant companies.  The alleged conduct occurred over many years, going back to 1980.  The plaintiff did not become a shareholder in any of the companies until 1984 and cannot complain of conduct which occurred prior to that time.  However earlier conduct may have some evidentiary relevance.

3. The plaintiff seeks particulars of three aspects of the defendants’ defence.  The defendants plead that in 1980 the four brothers, their father and the companies agreed to re-arrange the family business.  This re-arrangement resulted in the father, the four brothers and their families acquiring specific rights to use particular family assets.  They were allowed to use certain land for agistment purposes in consideration of their paying outgoings.  See paras 19.4.2-19.5 of the defence.  The defendants do not plead that any particular amounts were paid pursuant to such arrangements.  Counsel for the defendants indicated that they will not seek to establish that any such payments were paid.  As I understand it, the defendants plead only that they have conducted themselves in a particular way, namely in accordance with the terms of the alleged agreement.  They do not plead compliance with any particular terms of it. 

4. The plaintiff seeks particulars of outgoings met by the four brothers and their families.  It does not seem to me that it is necessary, in order that the plaintiff address the defence, that particulars of amounts paid since 1980 be provided. At a superficial level, it might seem that the defendants allege such payments but, as I have observed, a more careful reading of the pleading demonstrates that this is not the case.    The submissions made by counsel for the plaintiff suggest that he requires this information for the purpose of advancing his own case rather than in clarification of the defence.  If so, he may interrogate, should he so desire.  That is not a course which I would advise.  Further, I understand that some particulars are available.  They appear, in one form or another, in the company accounts which have been made available to the plaintiff.  It would not be reasonable to require the defendants to provide further particulars. 

5. The second aspect concerns the conduct of sand mining activities on the family’s land.  Substantial amounts have been derived by way of royalties from such activities.  It seems that as a result of the 1980 arrangements, two of the brothers and their families were directly engaged in the sand mining operation and initially received larger shares of the royalties than did the other brothers, including the plaintiff.  That arrangement has now been altered so that only one of the brothers and his family are engaged in the operation.    However the plaintiff’s objection to the disproportionate sharing of royalties remains.  The plaintiff has alleged in his statement of claim that various quantities of material have been extracted.  The defendants have, in effect, admitted that allegation.  The plaintiff now seeks particulars of amounts extracted.  That request seems to be misconceived.  The defendants have admitted the allegation.  I cannot see that any further particulars are required.

6. Finally, the plaintiff identifies, in para 43 of the statement of claim, a “service fee” of $327,000 which was included in the 2003 accounts of Logan Estates.  He pleads that it was recorded in the accounts “without any proper justification and contrary to the interests of the members of Logan Estates as a whole.”  The defendants admit that the amount was recorded but otherwise deny the allegation, providing particulars of the reasons for the entry.  In effect, the entry was made to record dispositions of land made prior to the Plaintiff’s acquisition of any relevant interest in the companies.  The plaintiff has no prima facie right to challenge a transaction which occurred prior to such acquisition, although he is entitled to challenge the assertion that the transaction occurred.  The particulars sought do not seem to relate to the defendants’ case as pleaded.    

7. In the circumstances, the notice of motion will be dismissed.  I order that the plaintiff pay the defendants’ costs of the motion.

I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Dowsett.

Associate:

Dated:       27 November 2008

Counsel for the Plaintiff:	Mr R Fraser
Solicitor for the Plaintiff:	Slater & Gordon
Counsel for the Defendants:	Mr G Harris
Solicitor for the Defendants:	McCullough Robertson

Date of Hearing:	12 September 2008
Date of Judgment:	12 September 2008