Link Contracting Pty Ltd v MONTIEN Resources Pty Ltd

[2000] WASC 292

LINK CONTRACTING PTY LTD -v- MONTIEN RESOURCES PTY LTD & ORS [2000] WASC 292

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2000] WASC 292
Case No:	CIV:2142/2000	Heard:	29 NOVEMBER 2000
Coram:	MASTER BREDMEYER	Delivered:	1/12/00
No of pages:	4	Judgment Part:	1 of 1
Result:	Application dismissed
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Parties:	LINK CONTRACTING PTY LTD (ACN 009 101 053) MONTIEN RESOURCES PTY LTD (ACN 009 258 066) DUNEDIN RESOURCES PTY LTD (ACN 075 767 083) MICHAEL LAURENCE JAMES KIERNAN
Catchwords:	Stay of execution pending the hearing of appeal
Legislation:	Nil
Case References:	Nil Canada Enterprises Corp Ltd v MacNab Distilleries Ltd [1987] 1 WLR 813 Hamersley Iron Pty Ltd v Lovell (No 2) (1998) 20 WAR 79 Hunt v Knabe (No 2) (1992) 8 WAR 96 Langdale v Danby [1982] 3 All ER 129 The Annot Lyle (1886) 11 PD 114 Wilson v Church (No 2) [1879] 12 Ch D 454

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION : LINK CONTRACTING PTY LTD -v- MONTIEN RESOURCES PTY LTD & ORS [2000] WASC 292 CORAM : MASTER BREDMEYER HEARD : 29 NOVEMBER 2000 DELIVERED : 1 DECEMBER 2000 FILE NO/S : CIV 2142 of 2000 BETWEEN : LINK CONTRACTING PTY LTD (ACN 009 101 053)

Plaintiff

AND

MONTIEN RESOURCES PTY LTD (ACN 009 258 066)
First Defendant

DUNEDIN RESOURCES PTY LTD (ACN 075 767 083)
Second Defendant

MICHAEL LAURENCE JAMES KIERNAN
Third Defendant

Catchwords:

Stay of execution pending the hearing of appeal

Legislation:

Nil

(Page 2)

Result:

Application dismissed

Representation:

Counsel:

Plaintiff : Mr A W Fairweather
First Defendant : Mr S Penglis
Second Defendant : Mr S Penglis
Third Defendant : Mr S Penglis

Solicitors:

Plaintiff : Bennett & Co
First Defendant : Freehills
Second Defendant : Freehills
Third Defendant : Freehills

Case(s) referred to in judgment(s):

Nil

Case(s) also cited:

Canada Enterprises Corp Ltd v MacNab Distilleries Ltd [1987] 1 WLR 813
Hamersley Iron Pty Ltd v Lovell (No 2) (1998) 20 WAR 79
Hunt v Knabe (No 2) (1992) 8 WAR 96
Langdale v Danby [1982] 3 All ER 129
The Annot Lyle (1886) 11 PD 114
Wilson v Church (No 2) [1879] 12 Ch D 454

(Page 3)

1 MASTER BREDMEYER: This is an application by the defendants for a stay of execution of my summary judgment order pending the determination of the defendants' appeal. I have not heard argument to the contrary so I will assume the grounds of appeal are arguable.

2 A stay can be granted, inter alia, if the appeal would be nugatory without it. The defendants have argued for that. They know from evidence before the court on the injunction hearings that the plaintiff, Link Contracting Pty Ltd ("Link"), is struggling financially. If allowed to enjoy the 2 million shares and 2 million options in CML, the subject of my summary judgment order, it might sell the shares and use the proceeds to pay off debts. The 2 million shares are said to be worth $770,000. So, if the defendants win the appeal and the action, they will not get those funds back nor will they be able to recover equivalent damages from the impoverished Link. Normally that is a good argument but not in this case.

3 The defendants' case is that its unit trust arrangement is consistent with the agreement of 10 March 1998 made with Ellison. It did not issue any shares in Dunedin to Ellison or to interests associated with Ellison as contemplated by the agreement but it gave him 5 units (being half of the total) in the Montien Resources Unit Trust. Leaving aside for the moment the 239,391 shares in CML which were not the subject of my summary judgment order, the sole assets of the trust appears to be the 4 million shares and 4 million options in CML. On the defendants' case Ellison is entitled, beneficially, to half of those shares and options. I do not mean that he is entitled in specie to the shares and options but he can take proper steps to get paid for them. He can apply, under cl 37A and item 9 of the schedule of the trust deed, to the trustee for the redemption of his units in the trust. If he had been given shares in Dunedin, as contemplated by the agreement of 10 March 1998, he could apply to the court by leave as a shareholder to wind up the company on the just and equitable ground and thereby recover half the shares in specie or their value on the winding up.

4 If the defendants win the appeal and win the action in relation to the 4 million shares and the 4 million options in CML, then, on the defendants' case, Ellison is entitled by virtue of his units in the trust to the beneficial ownership of half of those shares and options, or at least to get paid for them. Ellison at all times says that they are owned by Link and not by him. He says he will hold them for Link. What, I ask, is the point of the appeal?

(Page 4)

5 The defendants have argued that Link has not only got 2 million shares and 2 million options under my order but Ellison remains a half owner of the remaining 2 million shares and 2 million options held by the trustee together with the further 239,391 shares in CML which I have already mentioned. The defendants say that Ellison might attempt to somehow realise on these assets. I consider that an unfounded fear. The ownership of those assets is disputed and is to be resolved in the trial of the balance of the action. Any attempt by Ellison to recover those shares or payment for them, for example, by redemption, would be met by injunctive relief. I consider that fear is unjustified and that these assets are irrelevant to the determination of this application.

6 I consider that the defendants have raised no special circumstances justifying a stay of execution and that the plaintiff should be entitled to the fruits of its win.