SUPREME COURT OF QUEENSLAND
CITATION:
Gallop Reserve Pty Ltd v Matton Developments Pty Ltd & Anor [2019] QSC 113
PARTIES:
GALLOP RESERVE PTY LTD
ACN 010 759 421
(plaintiff)
v
MATTON DEVELOPMENTS PTY LTD
ACN 100 028 340
(first defendant)
AND
STEPHEN ROSS CLARK
(second defendant)FILE NO/S:
SC No 6522/17
DIVISION:
Trial Division
PROCEEDING:
Trial
DELIVERED ON:
13 May 2019
DELIVERED AT:
Brisbane
HEARING DATE:
21 – 23 November 2018
JUDGE:
Holmes CJ
ORDER:
1. The balance of the funds paid into court by the solicitors for the first defendant in February 2018 is to be paid, with any accrued interest, to the plaintiff.
2. It is declared that:
(a) The litigation funding agreement executed on 12 March 2012, and the Deed of Variation by which it was ratified, are valid and effective;
(b) the Continuation Deed is valid and effective;
(c) the plaintiff is entitled to apply monies received from the proceeds of the first defendant’s settlement with CGU Limited to discharge amounts owing to it in respect of the litigation funding agreement, as varied, in priority to amounts owed in relation to the loan agreement between the first defendant and Westpac Banking Corporation.
3. The second defendant’s counterclaim is dismissed.
CORPORATIONS – INTERNAL ADMINISTRATION OF CORPORATIONS – COMPANY OFFICERS – APPOINTMENT OF COMPANY DIRECTORS – CONSEQUENCE OF DEFECTS IN APPOINTMENT OF DIRECTORS – where the plaintiff entered into an agreement to provide litigation funding to the first defendant, one of whose two directors was the second defendant – where the litigation funding agreement was invalidly executed by the first defendant’s other director, Kenward – where Kenward purported to hold a directors’ meeting without the second defendant and appointed a third director of the first defendant, despite the absence of a quorum – where Kenward and the director purportedly appointed signed a Deed of Variation to ratify the litigation funding agreement and a power of attorney in favour of Kenward – whether the absence of a quorum for the purported appointment of the third director was a mere procedural irregularity automatically validated by s 1322(2) of the Corporations Act – whether the conditions in 1322(6) of the Corporations Act applied so that this Court should declare under s 1322(4) of that Act that the appointment of the purported director was not invalid – whether the plaintiff was entitled by virtue of s 128(2) and s 129 of the Corporations Act to assume that the actions of the director purportedly appointed were performed with authority and that the power of attorney and Deed were duly executed
ESTOPPEL – ESTOPPEL BY CONDUCT – RELIANCE – where the plaintiff contends that the first defendant represented through its solicitors’ production of various agreements and Kenward’s execution of a Deed pursuant to a power of attorney that Kenward had authority to make decisions on its behalf and that the litigation funding agreement was binding on it – where the plaintiff contends that the second defendant by failing to take any steps to revoke…
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- AGLC
- Gallop Reserve Pty Ltd v Matton Developments Pty Ltd [2019] QSC 113
- Case
- [2019] QSC 113
- Decision Date
CaseChat Overview and Summary
The court was required to determine whether the litigation funding agreement and its subsequent variation were valid and enforceable. It also needed to decide whether the plaintiff could apply the settlement funds received from a third party to discharge debts owed under the litigation funding agreement before settling debts owed under a separate loan agreement. Finally, the court needed to decide whether the second defendant was liable for legal costs.
The court found that the litigation funding agreement was valid and enforceable. It held that the Continuation Deed was also valid and that the plaintiff could apply the settlement funds to discharge debts under the litigation funding agreement before settling debts under the loan agreement. The court dismissed the counterclaim, finding that the second defendant was liable for legal costs.
The court ordered that the balance of the funds paid into court by the solicitors for the first defendant, with accrued interest, be paid to the plaintiff. The court also declared that the litigation funding agreement and the Continuation Deed were valid and enforceable, and that the plaintiff could apply the settlement funds to discharge debts under the litigation funding agreement before settling debts under the loan agreement. The second defendant’s counterclaim was dismissed.
Orders
Orders of the court
1. The balance of the funds paid into court by the solicitors for the first defendant in February 2018 is to be paid, with any accrued interest, to the plaintiff.
2. It is declared that:
(a) The litigation funding agreement executed on 12 March 2012, and the Deed of Variation by which it was ratified, are valid and effective;
(b) the Continuation Deed is valid and effective;
(c) the plaintiff is entitled to apply monies received from the proceeds of the first defendant’s settlement with CGU Limited to discharge amounts owing to it in respect of the litigation funding agreement, as varied, in priority to amounts owed in relation to the loan agreement between the first defendant and Westpac Banking Corporation.
3. The second defendant’s counterclaim is dismissed.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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