McNally v Harris (No 3)

In McNally v Harris (No 3), the court considered the appropriate date for assessing equitable compensation for shares, a matter arising from a dispute between the parties regarding the sale of shares. The High Court of Australia was tasked with determining the legal issues surrounding this valuation, which had significant implications for the equitable remedies available to the plaintiff.

The primary legal issue was identifying the correct date to assess the value of the shares for equitable compensation purposes. The plaintiff argued that the value should be assessed on the date the original orders were made, while the defendant contended that it should be assessed on the date of the subsequent orders. This dispute hinged on whether the equitable compensation was a pre-existing debt or a future obligation that crystallised on the date of the orders.

The court resolved that the appropriate date for assessing the value of the shares is the date of the orders. The reasoning was that equitable compensation represents a future obligation that only becomes fixed upon the making of the orders. The court held that until the orders were made, the amount of compensation could not be determined. This interpretation aligns with the principles of equitable compensation, ensuring that the compensation reflects the true loss incurred by the plaintiff.

The final orders of the court confirmed that the value of the shares for equitable compensation purposes is to be assessed on the date the orders were made. This decision provides clarity for future cases involving equitable compensation and the valuation of shares, ensuring that the compensation accurately reflects the loss suffered by the plaintiff.