McEvoy v Caplan

McEvoy v Caplan concerned an application by Mr McEvoy for leave to bring statutory derivative actions on behalf of two companies, by way of a cross-claim. The primary dispute revolved around whether granting such leave would be in the best interests of the companies, given the potential for a conflict of duties. The matter was heard in the Court of Appeal of New South Wales.

The central legal issues before the Court of Appeal were twofold. Firstly, whether the order dismissing Mr McEvoy's application for leave under section 237 of the *Corporations Act 2001* (Cth) was an interlocutory or final order, and consequently, whether an appeal lay as of right or required leave. Secondly, if leave to appeal was required, whether it should be granted.

The Court of Appeal determined that the order dismissing the application for leave to bring a statutory derivative action was interlocutory. Therefore, an appeal did not lie as of right, and Mr McEvoy was required to seek leave to appeal. The Court found that the primary judge had correctly considered the interests of the companies and that granting leave would have given rise to a conflict of duties, meaning it was not in the best interests of the companies to proceed with the derivative action.

Consequently, the Court of Appeal dismissed the appeal as incompetent, refused Mr McEvoy leave to appeal, and ordered Mr McEvoy to pay the costs of the respondents in the Court of Appeal proceedings.