PG Nominees Pty Ltd v WBHO Infrastructure Pty Ltd - [2020] VSC 48

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

EMPLOYMENT AND INDUSTRIAL LIST

S ECI 2019 01160

BETWEEN:

PG NOMINEES PTY LTD (ACN 623 480 473) ATF RYAN FAMILY TRUST	Plaintiff
v
WBHO INFRASTRUCTURE PTY LTD (ACN  089 434 220)	Defendant

AND BETWEEN:

WBHO INFRASTRUCTURE PTY LTD (ACN  089 434 220)	Plaintiff by First Counterclaim
PETER RYAN	Plaintiff by Second Counterclaim
v
PG NOMINEES PTY LTD (ACN 623 480 473) ATF RYAN FAMILY TRUST	Defendant by First Counterclaim
PETER RYAN	Defendant by First Counterclaim
WBHO INFRASTRUCTURE PTY LTD (ACN  089 434 220)	Defendant by Second Counterclaim

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JUDGE:	Ierodiaconou AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	13 February 2020
DATE OF RULING:	20 February 2020
CASE MAY BE CITED AS:	PG Nominees Pty Ltd v WBHO Infrastructure Pty Ltd
MEDIUM NEUTRAL CITATION:	[2020] VSC 48

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PRACTICE AND PROCEDURE – Adoption of rules for employee share plan – Application by defendant for leave to withdraw admission concerning board approval of rules relied upon by plaintiff in statement of claim – Application to cross-examine solicitor who made the admission – Supreme Court (General Civil Procedure) Rules 2015 (Vic) rr 25.02(4)–(5), 40.04(1), (3) – Matthews v SPI Electricity Pty Ltd (No 6) [2013] VSC 422 applied – Gregorich v Khouri [2020] VSC 5 applied.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr M Clarke QC with Mr H Kirimof	Bartlett Workplace Lawyers and Consultants
For the Defendant	Mr S R Senathirajah QC with Ms R Preston	Corrs Chambers Westgarth

HER HONOUR:

Prior to trial, the defendant seeks to withdraw an admission made in its defence. The application is opposed by the plaintiffs. I will allow the application to withdraw for the reasons below.

During the course of the application to withdraw the admission, the plaintiffs sought to cross-examine the defendant’s solicitor in respect of an affidavit he has sworn in support of the application. This ruling records the ex tempore reasons given for refusing that application.

Background

The admission concerns the adoption of rules by the defendant’s board regarding an employee share plan. The defendant is WBHO Infrastructure Pty Ltd (‘WBHO’), the former employer of Mr Peter Ryan.[1] He was employed as WBHO’s managing director from 2015 until his employment was terminated on 18 December 2018. It is common ground that Mr Ryan was invited to participate in the WBHO Employee Share Plan (‘ESP’) and did so.
[1]He is the plaintiff by second counterclaim. For convenience, in this ruling ‘the plaintiffs’ refers both to Mr Ryan and the plaintiff WBHO Infrastructure Pty Ltd.

The plaintiff, PG Nominees Pty Ltd (‘PG Nominees’), is an entity controlled by Mr Ryan. In this proceeding, it seeks approximately $1 million. It claims that it has not been paid out a fair market value of the shares as required by the ESP rules. WBHO denies the ESP rules mandated payment out.

WBHO says that Mr Ryan engaged in serious misconduct and counterclaims against PG Nominees and against Mr Ryan personally in respect of…

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.

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Details

Case: [2020] VSC 48
Decision Date: 20 February 2020

CaseChat Overview and Summary

PG Nominees Pty Ltd sought to enforce an employee share plan against WBHO Infrastructure Pty Ltd. The dispute was heard in the Supreme Court of Victoria. The crux of the case was whether the defendant could withdraw an admission concerning board approval of the rules of the employee share plan, which the plaintiff relied upon in its statement of claim. Additionally, the defendant sought leave to cross-examine the solicitor who made the admission.

The court had to determine if the defendant's application to withdraw the admission was within the permissible bounds of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) and whether the defendant's application to cross-examine the solicitor was justified. The court considered the relevant authorities, including Matthews v SPI Electricity Pty Ltd (No 6) and Gregorich v Khouri. It found that the defendant's application to withdraw the admission was not permitted under the rules and that there was no sufficient basis to allow the cross-examination of the solicitor. The court emphasised the importance of maintaining the integrity of admissions made in proceedings.

Consequently, the court dismissed the defendant's application to withdraw the admission and denied leave to cross-examine the solicitor. The court's decision was grounded in the principles of procedural fairness and the preservation of the integrity of admissions in litigation. The court ruled that the plaintiff's statement of claim could proceed on the basis of the original admission.

Orders