Jensen v RQYS Marina Ltd - [2014] QSC 243

SUPREME COURT OF QUEENSLAND

CITATION:

Jensen & Ors v RQYS Marina Ltd & Ors [2014] QSC 243

PARTIES:

LAWRENCE JOHN JENSEN AND CAROLYN HUNTER ROSS
(first applicants)
and
NAIAD AUSTRALIA PTY LTD, ACN 101 463 779
(second applicant)
and
PETER ROBERT FREDERICK LEWIS AND VIRGINIA ELIZABETH LEWIS
(third applicants)
v
R.Q.Y.S. MARINA LTD, ACN 010 217 991
(first respondent)
and
ROYAL QUEENSLAND YACHT SQUADRON LTD, ACN 053 989 272
(second respondent)
and
RQYS NOMINEES PTY LTD, ACN 130 840 523
(third respondent)
and
KEVIN ANTHONY MILLER
(fourth respondent)
and
IAN ROBERT THRELFALL
(fifth respondent)
and
MARK GALLAGHER
(sixth respondent)
and
GEOFFREY JOHN STANHOPE
(seventh respondent)
and
COLIN FRANCIS GIBBONS
(eighth respondent)
and
WILLIAM GEORGE KIRBY
(ninth respondent)
and
GREGORY CLARKE
(tenth respondent)
and
CHARLES RUSSELL MCCART
(eleventh respondent)
and
PETER JOHN CONDE
(twelfth respondent)
and
PAUL CRANSTON HUGHES
(thirteenth respondent)
and
DAVID GILBOUR VIRGO
(fourteenth respondent)

FILE NO:

6086 of 2014

DIVISION:

Trial Division

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court of Queensland

DELIVERED ON:

29 September 2014

DELIVERED AT:

Brisbane

HEARING DATE:

20 August 2014

JUDGE:

Applegarth J

ORDERS:

1.The application is dismissed.

2.The applicants pay the respondents’ costs of and incidental to the application to be assessed on the standard basis.

CATCHWORDS:

CORPORATIONS – MEMBERSHIP, RIGHTS AND REMEDIES – MEMBERS’ REMEDIES AND INTERNAL DISPUTES – PROCEEDINGS ON BEHALF OF COMPANY BY MEMBER – STATUTORY DERIVATIVE ACTION – where some members of company limited by guarantee applied pursuant to s 237(1) of the Corporations Act 2001 (Cth) for leave to bring a proceeding in the name of the company against two other companies and numerous former and current directors of the company – whether it is in the best interests of the company to bring the proceedings – whether there is a serious issue to be tried – whether the applicant is acting in good faith

American Cyanamid v Ethicon [1975] AC 396
Australian Broadcasting Corporation v O’Neill (2007) 227 CLR 57; [2006] HCA 46, cited
Charlton v Baber (2003) 47 ACSR 31; [2003] NSWSC 745, cited
Coeur De Lion Investments Pty Ltd v Kelly (2013) 302 ALR 771; [2013] QCA 160, followed
Cooper v Myrtace Consulting Pty Ltd [2014] FCA 480, cited
Farah v Say-Dee (2007) 230 CLR 89; [2007] HCA 22, cited
MG Corrosion Consultants Pty Ltd v Vinciguerra (2011) 82 ACSR 367; [2011] FCAFC 31, cited
Oates v Consolidated Capital (2009) 233 FLR 283; [2009] NSWCA 183, followed
Ragless v IPA Holdings Pty Ltd (in liq) (2008) 65 ACSR 700; [2008] SASC 90, cited
Re The Presidents Club Ltd; Coeur De Lion Investments Pty Ltd v Kelly[2012] QSC 364, cited
Robash Pty Ltd v Gladstone Pacific Nickel Pty Ltd (2011) 86 ACSR 432; [2011] NSWSC 1235, followed
South Johnstone Mill Ltd v Dennis (2007) 163 FCR 343; [2007] FCA 1448, cited
Swansson v RA Pratt Properties Pty Ltd (2002) 42 ACSR 313; [2002] NSWSC…

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: [2014] QSC 243
Decision Date: 29 September 2014

CaseChat Overview and Summary

In Jensen v RQYS Marina Ltd, the applicants, who were members of the respondent company, sought leave to bring a statutory derivative action on behalf of the company against other companies and various former and current directors. The applicants argued that the company had suffered losses due to the actions of the respondents and sought to hold them accountable. The primary legal issues before the court were whether the proceedings were in the best interests of the company and whether there was a serious issue to be tried. Additionally, the court had to determine whether the applicants were acting in good faith.

The court found that the applicants had not demonstrated that the proceedings were in the best interests of the company, primarily because they had failed to establish that the company was unable to effectively manage its own affairs in relation to the proceedings. The court also concluded that the applicants had not shown that there was a serious issue to be tried. Furthermore, the court determined that the applicants were not acting in good faith, as their primary motivation appeared to be to advance their personal interests rather than those of the company.

Consequently, the court dismissed the application for leave to bring the statutory derivative action. The applicants were ordered to pay the respondents’ costs of and incidental to the application, to be assessed on the standard basis.

Orders

Orders of the court

1.The application is dismissed.

2.The applicants pay the respondents’ costs of and incidental to the application to be assessed on the standard basis.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Jensen & Ors v RQYS Marina Ltd & Ors [2014] QSC 243
PARTIES:	LAWRENCE JOHN JENSEN AND CAROLYN HUNTER ROSS (first applicants) and NAIAD AUSTRALIA PTY LTD, ACN 101 463 779 (second applicant) and PETER ROBERT FREDERICK LEWIS AND VIRGINIA ELIZABETH LEWIS (third applicants) v R.Q.Y.S. MARINA LTD, ACN 010 217 991 (first respondent) and ROYAL QUEENSLAND YACHT SQUADRON LTD, ACN 053 989 272 (second respondent) and RQYS NOMINEES PTY LTD, ACN 130 840 523 (third respondent) and KEVIN ANTHONY MILLER (fourth respondent) and IAN ROBERT THRELFALL (fifth respondent) and MARK GALLAGHER (sixth respondent) and GEOFFREY JOHN STANHOPE (seventh respondent) and COLIN FRANCIS GIBBONS (eighth respondent) and WILLIAM GEORGE KIRBY (ninth respondent) and GREGORY CLARKE (tenth respondent) and CHARLES RUSSELL MCCART (eleventh respondent) and PETER JOHN CONDE (twelfth respondent) and PAUL CRANSTON HUGHES (thirteenth respondent) and DAVID GILBOUR VIRGO (fourteenth respondent)
FILE NO:	6086 of 2014
DIVISION:	Trial Division
PROCEEDING:	Application
ORIGINATING COURT:	Supreme Court of Queensland
DELIVERED ON:	29 September 2014
DELIVERED AT:	Brisbane
HEARING DATE:	20 August 2014
JUDGE:	Applegarth J
ORDERS:	1.The application is dismissed. 2.The applicants pay the respondents’ costs of and incidental to the application to be assessed on the standard basis.
CATCHWORDS:	CORPORATIONS – MEMBERSHIP, RIGHTS AND REMEDIES – MEMBERS’ REMEDIES AND INTERNAL DISPUTES – PROCEEDINGS ON BEHALF OF COMPANY BY MEMBER – STATUTORY DERIVATIVE ACTION – where some members of company limited by guarantee applied pursuant to s 237(1) of the Corporations Act 2001 (Cth) for leave to bring a proceeding in the name of the company against two other companies and numerous former and current directors of the company – whether it is in the best interests of the company to bring the proceedings – whether there is a serious issue to be tried – whether the applicant is acting in good faith American Cyanamid v Ethicon [1975] AC 396 Australian Broadcasting Corporation v O’Neill (2007) 227 CLR 57; [2006] HCA 46, cited Charlton v Baber (2003) 47 ACSR 31; [2003] NSWSC 745, cited Coeur De Lion Investments Pty Ltd v Kelly (2013) 302 ALR 771; [2013] QCA 160, followed Cooper v Myrtace Consulting Pty Ltd [2014] FCA 480, cited Farah v Say-Dee (2007) 230 CLR 89; [2007] HCA 22, cited MG Corrosion Consultants Pty Ltd v Vinciguerra (2011) 82 ACSR 367; [2011] FCAFC 31, cited Oates v Consolidated Capital (2009) 233 FLR 283; [2009] NSWCA 183, followed Ragless v IPA Holdings Pty Ltd (in liq) (2008) 65 ACSR 700; [2008] SASC 90, cited Re The Presidents Club Ltd; Coeur De Lion Investments Pty Ltd v Kelly[2012] QSC 364, cited Robash Pty Ltd v Gladstone Pacific Nickel Pty Ltd (2011) 86 ACSR 432; [2011] NSWSC 1235, followed South Johnstone Mill Ltd v Dennis (2007) 163 FCR 343; [2007] FCA 1448, cited Swansson v RA Pratt Properties Pty Ltd (2002) 42 ACSR 313; [2002] NSWSC…