Harris v Harris

Case [2021] NSWCA 329


Court of Appeal


Supreme Court


New South Wales

Medium Neutral Citation: Harris v Harris [2021] NSWCA 329
Hearing dates: 29 November 2021
Date of orders: 17 December 2021
Decision date: 17 December 2021
Before: Basten JA at [1]
Gleeson JA at [2]
Brereton JA at [89]
Decision:

(1)   Appeal dismissed.

(2)   Appellants to pay the first and second respondents’ costs.

Catchwords:

CIVIL PROCEDURE – application to vacate hearing – where admissions by appellants of loan balances outstanding – appellants belatedly sought access to records held by provisional liquidator in aid of potential application to withdraw admissions – primary judge found appellants had access to relevant documents and delayed seeking and reviewing documents – whether appellants deprived of opportunity to review documents – whether error in discretionary decision refusing to vacate the hearing

CIVIL PROCEDURE – pleadings – where derivative proceedings on behalf of company to recover management fees – where pleadings alleged certain management fees were “excessive” – defence asserted entitlement to reasonable remuneration – parties had served lay and expert evidence as to reasonable remuneration – respondents’ written opening put in issue whether remuneration was reasonable – whether appellants put on notice of case they had to meet

Legislation Cited:

Corporations Act 2001 (Cth), ss 180, 236, 237, 247A, 461

Supreme Court Act 1970 (NSW), s 75A

Uniform Civil Procedure Rules 2005 (NSW), rr 14.27, 42.1, 51.53, 51.36

Cases Cited:

Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170; [1981] HCA 39

Banque Commerciale S.A. (En Liqn) v Akhil Holdings Ltd (1990) 169 CLR 279; [1990] HCA 11

Barclay Mowlem Construction Ltd v Dampier Port Authority [2006] WASC 281; (2006) 33 WAR 82

Betfair Pty Ltd v Racing New South Wales (2010) 189 FCR 356; [2010] FCAFC 133

Dare v Pulham (1982) 148 CLR 658; [1982] HCA 70

Durham v Durham (2011) 80 NSWLR 335; [2011] NSWCA 62

Gould v Mount Oxide Mines Ltd (in liq) (1916) 22 CLR 490; [1916] HCA 81

House v The King (1936) 55 CLR 499; [1936] HCA 40

In re the Will of F B Gilbert (dec) (1946) 46 SR (NSW) 318

In the matter of Sirrah Pty Ltd (in prov liq) [2017] NSWSC 1683

In the matter of Sirrah Pty Ltd (in prov liq) [2018] NSWSC 1802

In the matter of Sirrah Pty Ltd (in prov liq) [2021] NSWSC 140

In the matter of Sirrah Pty Ltd (in prov liq) [2021] NSWSC 140

In the matter of Sirrah Pty Ltd (in prov liq) [2021] NSWSC 413

Link 2 Pty Ltd v Ezystay Systems Pty Ltd [2016] NSWCA 317

Newton v Ellis [2012] NSWCA 106

Thomson v STX Pan Ocean Co Ltd [2012] FCAFC 15
Whall v Stamp [2019] NSWCA 163

Category:Principal judgment
Parties: William Francis Harris (First appellant)
Harris Health Care Pty Ltd (ACN 071 243 617) (Second appellant)
Gregory Thomas Brown (First respondent)
Monica Mary Brown (Second respondent)
Sirrah Pty Ltd (ACN 000 417 247) (Third…

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Details
AGLC
Harris v Harris [2021] NSWCA 329
Case
[2021] NSWCA 329
Decision Date

CaseChat Overview and Summary

The appeal concerned an application to vacate a hearing in proceedings brought by the appellants on behalf of a company to recover management fees. The appellants had admitted the outstanding loan balances but later sought access to records held by a provisional liquidator, ostensibly to support an application to withdraw those admissions. The primary judge had refused to vacate the hearing, finding that the appellants had had access to the relevant documents and had delayed in seeking and reviewing them. The appeal therefore raised questions as to whether the appellants were deprived of an opportunity to review the documents and whether the primary judge had erred in the exercise of discretion by refusing to vacate the hearing.

The court was also required to consider whether the appellants had adequately put the respondents on notice of the case they had to meet. The derivative proceedings alleged that certain management fees were "excessive," while the defence asserted an entitlement to reasonable remuneration. Both parties had served lay and expert evidence on the issue of reasonable remuneration, and the respondents' written opening submissions had raised the question of whether the remuneration was reasonable.

The court found no error in the primary judge's discretionary decision to refuse to vacate the hearing, concluding that the appellants had not been deprived of an opportunity to review the relevant documents. Furthermore, the court held that the appellants had been sufficiently put on notice of the case they had to meet regarding the reasonableness of the management fees. Accordingly, the appeal was dismissed, and the appellants were ordered to pay the first and second respondents’ costs.

Orders

Orders of the court

(1) Appeal dismissed.

(2) Appellants to pay the first and second respondents’ costs.

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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