McNeill v Hearing & Balance Centre Pty Ltd

In McNeill v Hearing & Balance Centre Pty Ltd, the plaintiff, McNeill, sought an order under section 247A of the Corporations Act 2001 to inspect the books and records of the defendant, Hearing & Balance Centre Pty Ltd. McNeill is a unitholder in a unit trust, of which the defendant company serves as trustee. The plaintiff suspected that the company had sold the business of the trust at an undervalue to an entity associated with other shareholder-beneficiaries. The dispute centred around whether McNeill, as a unitholder, had the right to access the trustee's records to investigate these suspicions.

The primary legal issue was whether McNeill, as a unitholder, could invoke section 247A of the Corporations Act to compel the company to allow inspection of its books. The court had to determine if McNeill's application was made in good faith and for a proper purpose, which are necessary conditions for such an order. The court also needed to consider the relationship between McNeill's rights as a beneficiary unitholder and the company's duties as a trustee.

The court found that McNeill's application was made in good faith and for a proper purpose, as he sought to investigate the alleged undervaluation of the trust's business. The court recognised that McNeill, as a beneficiary unitholder, had a legitimate interest in the trust's affairs. It concluded that McNeill was entitled to access the company's records to verify his suspicions. The court issued an order granting McNeill the right to inspect the relevant books and records of the defendant company, affirming that such access was necessary to protect the interests of the unit trust's beneficiaries.