McIntyre v Hipkin - [2020] VSC 30

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

TRUSTS, EQUITY & PROBATE LIST

S CI 2018 00448

IN THE MATTER of sections 28 and 34 of the Administration and Probate Act 1958 (Vic)

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IN THE MATTER of Rule 54.02 of the Supreme Court (General Civil Procedure) Rules 2015

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IN THE MATTER of section 41 of the Trustee Act 1958 (Vic)

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IN THE MATTER of Will and Estate of SHIRLEY JOAN LEGGE, deceased

BETWEEN

JANET MARY MCINTYRE (and others according to the attached schedule)	Plaintiff
v
MARGARET ANNE HIPKIN (and others according to the attached schedule)	Defendant

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JUDGE:	Lansdowne AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	2 May 2019; further submissions to 17 May 2019
DATE OF JUDGMENT:	10 February 2020
CASE MAY BE CITED AS:	McIntyre & ors v Hipkin & ors
MEDIUM NEUTRAL CITATION:	[2020] VSC 30

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PRACTICE AND PROCEDURE – Application for stay of the proceeding as abuse of process - Plaintiffs as residuary beneficiaries of an estate seek to remove first and second defendants as trustees of that estate, equitable damages for breach of fiduciary duty and related relief – Plaintiffs and defendants compromised an earlier proceeding seeking substantially the same relief – Whether proceeding should be stayed for abuse of process - Held: no - Plaintiffs also seek to plead causes of action by which they should be relieved from the earlier terms.

PRACTICE AND PROCEDURE – Application to strike out the statement of claim in whole or part – Statement of claim struck out in whole – Whether leave should be given to file a proposed amended statement of claim – Held: no - Whether the plaintiffs should be required to show a proper basis before leave to re-plead is given – Held: no – Environinvest Limited v Pescott and ors [2011] VSC 325 considered but not applied.

CORPORATIONS –Where plaintiffs and first defendant are residuary beneficiaries in respect of shares in a company in which the first and second defendants hold the majority shareholding and of which they are directors - Whether the plaintiffs may bring an oppression proceeding against the first and second defendants – Held: no - the plaintiffs are not members of the company as the shares were not devolved in specie and it is not alleged that the plaintiffs fall within s 234(e) – Corporations Act 2001 (Cth) s 234

CORPORATIONS – Whether plaintiffs holding a residuary share in an estate including shares in a company may seek leave to bring a derivative proceeding against the directors of the company for breach of directors duties – Held: no as the shares were not devolved to the plaintiffs in specie they are not members of the company or entitled to be registered as members– Corporations Act 2001 (Cth) s 236

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Ms C H Sparke QC	MW Law
For the Defendants	Mr S T Pitt	Arnold Bloch Leibler

TABLE…

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 McIntyre v Hipkin

Details

AGLC: McIntyre v Hipkin [2020] VSC 30
Case: [2020] VSC 30
Decision Date: 10 February 2020

CaseChat Overview and Summary

The case of McIntyre v Hipkin involved the plaintiffs, as residuary beneficiaries of an estate, seeking to remove the first and second defendants from their positions as trustees of the estate. They also sought equitable damages for breach of fiduciary duty and related relief. The defendants, who held majority shareholding in a company and were its directors, had previously compromised with the plaintiffs in an earlier proceeding that sought substantially the same relief. The plaintiffs' current proceedings sought to plead causes of action that would relieve them from the earlier terms.

The legal issues before the court included whether the proceeding should be stayed for abuse of process, whether the statement of claim should be struck out in whole, and whether leave should be given to file a proposed amended statement of claim. The court also had to determine whether the plaintiffs, as residuary beneficiaries, could bring an oppression proceeding against the defendants and whether they could seek leave to bring a derivative proceeding against the directors of the company.

The court found that the proceeding should not be stayed for abuse of process as the plaintiffs and defendants had previously compromised their dispute, and the current proceeding was not an abuse of the court process. The court struck out the statement of claim in whole, finding that it did not disclose any reasonable cause of action. The court also declined to grant leave to file an amended statement of claim, finding that there was no proper basis for such an amendment. The court held that the plaintiffs could not bring an oppression proceeding as they were not members of the company and could not seek leave to bring a derivative proceeding against the directors of the company as they were not members or entitled to be registered as members.

The court made no orders as the plaintiffs were not permitted to proceed with their claims.

Orders