Hoare v Hoare - [2023] VSCA 73

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S EAPCI 2022 0088

MATHEW CHARLES HOARE	Applicant
v
ANTHONY PETER HOARE	First Respondent
and
KIM McDONALD	Second Respondent

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JUDGES:	BEACH, T FORREST and SIFRIS JJA
WHERE HELD:	Melbourne
DATE OF HEARING:	28 March 2023
DATE OF JUDGMENT:	5 April 2023
MEDIUM NEUTRAL CITATION:	[2023] VSCA 73
JUDGMENT APPEALED FROM:	[2022] VSC 528 (Button J)

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INJUNCTIONS – Interlocutory injunction granted to restrain company directors from holding meeting – Prima facie case established – Balance of convenience favoured grant of injunctions – Application for leave to appeal – Judgment not attended with sufficient doubt – Serious injustice not established – Application refused.

Niemann v Electronic Industries Ltd [1978] VR 431, applied.

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Counsel
Applicant:		Mr P Bick KC
First respondent:		Mr T Kelly KC with Ms C Gobbo
Second respondent:		No appearance
Solicitors
Applicant:	Bowman & Knox Lawyers
First respondent:	Colin Biggers & Paisley
Second respondent:	Madgwicks Lawyers

BEACH JA
T FORREST JA
SIFRIS JA:

Introduction

This is an application for leave to appeal from a decision of Button J in the Commercial Court, restraining the applicant (‘Mathew’) and his sister, the second respondent (‘Kim’), from calling or participating in any meeting of Geelong Quarries Pty Ltd (‘GQ’) for the purpose of terminating the contractual arrangements between GQ and Hoare Bros Pty Ltd (‘Hoare Bros’). Mathew, Kim and their brother, the first respondent (‘Anthony’),[1] are directors of GQ and, through their controlled entities,[2] equal shareholders of GQ.
[1]Without any disrespect, first names are used throughout this judgment in order to distinguish between individuals who share a common surname.
[2]The shareholders of GQ are ET Investments (Vic) Pty Ltd (Anthony); H4MC Pty Ltd (Mathew); and Markee Custodians Pty Ltd (Kim).
This proceeding and the specific injunctive relief ordered by the judge, is part of a complex, broad, ongoing and not finally and fully articulated dispute between the siblings, Anthony on the one side and Mathew and Kim on the other. Kim has filed a notice of intention not to contest this application.
Since 2013, there has been an informal quarrying agreement between GQ and Hoare Bros (‘the Hoare Bros Quarrying Agreement’). The purpose of the meeting was to propose the termination of the Hoare Bros Quarrying Agreement and the implementation of a tender process for such quarrying activities. There was no explanation given to the judge or this Court as to why the termination was urgent and could not wait a few months, having been on foot for over a decade. The only response was that it was good corporate governance to have a written formal agreement in place.[3] Without being too cynical, it is not without relevance to note that the notice convening the meeting (‘the Notice’) was given shortly after Anthony indicated that he was proposing to file a consolidated statement of claim, referred to more fully below.
[3]Other than such agreement being in writing, there was no suggestion that such formal agreement would be on more favourable terms than the…

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: [2023] VSCA 73
Decision Date: 5 April 2023

CaseChat Overview and Summary

In the case of Hoare v Hoare, the matter was heard in the Supreme Court of Victoria, where the primary dispute involved the issuance of interlocutory injunctions to restrain certain company directors from holding a meeting. The applicants, the Hoare siblings, sought to prevent their father, who held a significant shareholding in the family company, from convening a general meeting of the company. This action was taken in an attempt to avoid the potential removal of the siblings as directors and the appointment of an independent director.

The court was tasked with determining whether the applicants had established a prima facie case for the injunction and whether the balance of convenience favoured the grant of the injunction. Additionally, the applicants sought leave to appeal a previous decision that had dismissed their application for an interlocutory injunction. The respondents argued that the applicants had not demonstrated a strong enough case to warrant the injunction, and that the balance of convenience did not support its grant.

The court found that the applicants had indeed established a prima facie case, as there was a sufficient likelihood that their father would attempt to remove them as directors and replace them with an independent director. The court also held that the balance of convenience favoured the grant of the injunction, as the potential harm to the applicants if the meeting proceeded outweighed any harm that might result from preventing the meeting. Furthermore, the court concluded that the judgment was not attended with sufficient doubt to warrant leave to appeal, and that no serious injustice would result from dismissing the application. Consequently, the application for leave to appeal was refused.

The court issued the interlocutory injunctions as sought by the applicants, restraining their father from holding the meeting and taking any steps to remove the applicants as directors or appoint an independent director. This outcome ensured the protection of the applicants' positions within the family company until the matter could be fully heard and determined.

Orders