II Developments Pty Ltd v II Developments JV Pty Ltd - [2017] ACTSC 408

SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

Case Title:	II Developments Pty Ltd v II Developments JV Pty Ltd
Citation:	[2017] ACTSC 408
Hearing Date:	22 September, 7 November 2017
Date of Last Submissions:	24 November 2017
DecisionDate:	22 December 2017
Before:	Mossop J
Decision:	See [50]
Catchwords:	CORPORATIONS – WINDING UP – Joint-venture company – role of company at an end – breakdown in the relationship between the shareholders – it is just and equitable that the company be wound up
PARTNERSHIP – DISSOLUTION AND WINDING UP – application for the dissolution of a partnership and the appointment of receivers – whether appropriate to order dissolution of a partnership – whether appropriate to appoint receiver to partnership – capacity of receiver to resolve substantive disputes between parties – receiver appointed pending determination of mechanism for resolution of disputes
Legislation Cited:	Corporations Act 2001 (Cth), ss 461(1)(e), 461(1)(k) Court Procedures Act 2004 (ACT), ss 63, 63(2), 63(3) Court Procedures Rules 2006 (ACT), rr 1534, 2720-2741 Partnership Act 1963 (ACT), ss 40(1)(f), 44(1), 45(2) Uniform Civil Procedure Rules 2005 (NSW) r 20.20
Cases Cited:	Cuming v Hennessy [2005] NSWSC 1219 Daniels v Smith [2006] NSWSC 1424 In re TTC (SA) Pty Ltd (in liq) (1983) 32 SASR 532 Korda v Silkchime [2010] WASC 155; 243 FLR 269 Lising Nominees Pty Ltd v Monkton Pty Ltd [2017] ACTSC 336 Liquor National Wholesale Pty Ltd v The Redrock Co Pty Ltd [2007] NSWSC 392 Morkaya v Parkinson [2008] NSWSC 1050 Re GB Nathan and Co P/L (in liq) (1991) 24 NSWLR 674 at 680 Rowlands v MacDonald [2002] NSWSC 282 Ruut v Head (1996) 20 ACSR 16 Tate v Barry (1928) 28 SR (NSW) 380
Parties:	SC 280 of 2017 II Developments Pty Ltd (ACN 149 395 380) (First Plaintiff) Ivan Bulum (Second Plaintiff) II Developments JV Pty Ltd (ACN 149 369 577) (First Defendant) Ivan Ivankovic (Second Defendant) SC 281 of 2017 II Developments Pty Ltd (ACN 149 395 380) (Plaintiff) I & M Ivankovic Pty Limited (ACN 008 578 292) (Defendant)
Representation:	Counsel P Walker SC and W D B Buckland (Plaintiffs) M Hassall (Second Defendant (SC 280 of 2017) Defendant (SC 281 of 2017))
Solicitors Trinity Law (Plaintiffs) Just Dispute Resolution (Second Defendant (SC 280 of 2017) Defendant (SC 281 of 2017))
File Numbers:	SC 280 of 2017 SC 281 of 2017

MOSSOP J:

Introduction

In proceedings SC 280 of 2017 by originating process filed 2 August 2017 II Developments Pty Ltd (‘IID’) and Ivan Bulum seek orders that II Developments JV Pty Ltd (‘the Joint-Venture Company’) be wound up pursuant to s 461(1)(e) or (k) of the Corporations Act 2001 (Cth). The first defendant is the Joint-Venture Company and the second defendant is I & M Ivankovic Pty Limited (‘I & M’). At the hearing, the application under s 461(1)(e) was not pressed. Consequential orders were also sought. Section 461(1)(k) permits the Court to order the winding‑up of a company if “the Court is of opinion that…

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.

Continue reading II Developments Pty Ltd v II Developments JV Pty Ltd

Details

AGLC: II Developments Pty Ltd v II Developments JV Pty Ltd [2017] ACTSC 408
Case: [2017] ACTSC 408
Decision Date: 22 December 2017

CaseChat Overview and Summary

II Developments Pty Ltd commenced proceedings against II Developments JV Pty Ltd seeking an order that the latter be wound up. The latter company was a joint venture company, the only shareholders of which were the two parties. The case was heard in the Supreme Court of New South Wales. The joint venture had broken down, with the parties having stopped co-operating and one party effectively barring the other from participating in the joint venture. The Court was asked to determine whether the relationship between the shareholders had broken down to the point that it was just and equitable to wind up the company.

The central issue was whether the relationship between the shareholders had broken down to the point that it was just and equitable to wind up the company. The Court noted that in a joint venture such as this, the relationship between the parties was critical, and the parties were required to co-operate in the venture. The Court held that the relationship had indeed broken down, with one party effectively barring the other from participating in the joint venture. This was sufficient to establish that it was just and equitable to wind up the company.

The Court held that the relationship between the shareholders had broken down to the point that it was just and equitable to wind up the company. The Court held that the conduct of one of the shareholders was such that it was effectively barring the other party from participating in the joint venture, and that the relationship had broken down to a point where there was no realistic prospect of the venture continuing. The Court found that the company should be wound up.

The Court ordered that the respondent company be wound up. The Court also made an order for costs.

Orders

Orders of the court

See [50]

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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