Re Estate Soulos - [2022] NSWSC 1507

Supreme Court

New South Wales

Medium Neutral Citation: Re Estate Soulos [2022] NSWSC 1507
Hearing dates: 5-9, 12 and 15-16 September 2022
Decision date: 07 November 2022
Jurisdiction: Equity
Before: Lindsay J
Decision:
Findings made in support of orders to be made in an oppression suit and in a variety of other proceedings. The form of orders to be made is to be the subject of further submissions.

Catchwords:
CORPORATIONS — Members’ rights and remedies — Oppression — Where conduct is oppressive to, unfairly prejudicial to, or unfairly discriminatory against minority – Where conduct is contrary to the interests of the members as a whole – Directors engaged in conduct with total disregard to the interests of another shareholder – Oppression found
SUCCESSION — Family provision — Claims by adult children excluded from management of family company – Shares in company without commercial value in the absence of voting rights – Orders for provision moulded to facilitate participation in management

Legislation Cited:
Corporations Act 2001 Cth
Limitation Act 1969 NSW
Probate and Administration Act 1898 NSW
Succession Act 2006 NSW

Cases Cited:
Australian Institute of Fitness Pty Ltd v Australian Institute of Fitness (Vic/Tas) Pty Ltd (No 3) [2015] NSWSC 1639
Australian Securities and Investments Commission v Maxwell [2006] NSWSC 1052; 59 ACSR 373; 24 ACLC 1308
Bassett v Bassett [2021] NSWCA 320
Devereaux-Warnes v Hall (No 3) (2007) 35 WAR 127
Delaforce v Simpson-Cook (2010) 78 NSWLR 483
Fexuto Pty Ltd v Bosnjak Holdings Pty Ltd [2001] NSWCA 97; (2001) 37 ACSR 672
Hedman v Frazer [2013] NSWSC 1915
In the matter of Computer Room Solutions Pty Limited [2021] NSWSC 845
In the matter of Imperium Projects Pty Ltd [2015] NSWSC 16
In the matter of L&B Seafood Pty Ltd [2022] NSWSC 100
In the matter of Ledir Enterprises Pty Ltd (2013) 96 ACSR 1; [2013] NSWSC 1332
In the matter of QB Foods Pty Limited [2021] NSWSC 1227
In the matter of Tzavaras & Sons Pty Ltd [2022] NSWSC 359
Levin v Clark [1962] NSWR 686
Munstermann v Rayward [2017] NSWSC 133
Parker v Auswild; Bergmuller v Auswild [2022] VSCA 8
Pontifical Society for the Propagation of the Faith v Scales (1962) 17 CLR 9
Re Lowes Park Pty Ltd; Headlam v Lowes Park Pty Ltd (1994) 62 FCR 535
Sgro v Thompson [2017] NSWCA 326
Sidhu v Van Dyke (2014) 251 CLR 505
Slack v Rogan; Palffy v Rogan (2013) 85 NSWLR 253
William Bkassini v Sonya Sarkis [2017] NSWSC 1487
Zong v Lin [2022] NSWCA 136

Category: Principal judgment
Parties:
(1) Case No 2018/00050908 (“the James Proceedings”)

Parties:
Cross-Claimant: James Soulos
First Cross Defendant: Con Kristallis
Second Cross Defendant: Trevor Ian Cork
Third Cross Defendant: Nicholas Andrew Soulos

Representation:
Counsel:
Cross Claimant: A Cheshire SC (on 15-16 September 2022) and T Rollo
First and second cross defendants: V Bedrossian SC, N Bilinsky and M Jaieth
Third cross defendant: E Herman (on 5,7,8,15,16 September 2022)

Solicitors:
Cross Claimant: Carroll & O’Dea
First and Second Cross Defendants: McPhee Kershaw
Third cross defendant: Herman Legal

(2) Case No 2019/00026988 (“the Dennis Proceedings”)

Parties:
Plaintiff: Dimosthenis (Dennis) Soulos
First Defendant: Con Kristallis
Second Defendant: Trevor Ian Cork
Third Defendant: Nicholas Andrew Soulos
Fourth Defendant: James Soulos
Fifth Defendant: Esperia Court Pty Ltd ACN 000457492
Sixth Defendant: A&R Management Pty Ltd ACN 000431694
Seventh Defendant: Maria Pagones

Representation:
Counsel:
Plaintiff: M Elliott SC and E Finnane
First and Second Defendants: V Bedrossian SC, N Bilinsky and M Jaieth
Third Defendant: E Herman, solicitor (on 5, 7, 8, 15, 16 September 2022); A Hursh, solicitor (on 6 September 2022)
Fourth Defendant: A Cheshire SC (on 15-16 September 2022) and T Rollo
Fifth Defendant: M Izzo SC with O Jones
Sixth Defendant: No appearance
Seventh Defendant: J Kelly SC and B O’Connor

Solicitors:
Plaintiff: McCabes
First and Second Defendants: McPhee Kershaw
Third Defendant: Herman Legal
Fourth Defendant: Carroll & O’Dea
Fifth Defendant: Chalk Behrendt Lawyers
Sixth Defendant: No appearance
Seventh Defendant: Uther Webster and Evans

(3) Case No 2019/00027080 (“the Maria Proceedings”)

Parties:
Plaintiff: Maria Pagones
First Defendant: Con Kristallis
Second Defendant: Trevor Ian Cork
Third Defendant: Nicholas Andrew Soulos

Representation:
Counsel:
Plaintiff: J Kelly SC and P Muscat
First and Second Defendants: V Bedrossian SC, N Bilinsky and M Jaieth
Third Defendant: V Bedrossian, N Bilinsky and M Jaieth

Solicitors:
Plaintiff: Uther Webster and Evans
First and Second Defendants: McPhee Kershaw
Third defendant: McPhee Kershaw

(4) Case No 2021/00108316 (“the Esperia Court Proceedings”)

Parties:
Plaintiff: Maria Pagones
First Defendant: Esperia Court Pty Ltd
Second Defendant: Con Kristallis and Trevor Ian Cork as executors of the Estate of the late Rene Soulos
Third Defendant: Nicholas Andrew Soulos
Fourth Defendant: John Nicholas Soulos

Representation:
Counsel:
Plaintiff: J Kelly SC and B O’Connor
First Defendant: M Izzo SC with O Jones
Second Defendant: V Bedrossian, N Bilinsky and M Jaieth
Third and Fourth Defendants: M Izzo SC and O Jones
Solicitors:
Plaintiff: Uther Webster and Evans
First Defendant: Chalk Behrendt Lawyers
Second Defendant: McPhee Kershaw
Third and Fourth Defendants: Wotton Kearney

File Number(s): 2018/00050908 (“the James Proceedings”)
2019/00026988 (“the Dennis Proceedings”)
2019/00027080 (“the Maria Proceedings”)
2021/00108316 (“the Esperia Court Proceedings”)

JUDGMENT

INTRODUCTION

The Deceased: A Central Personality

At her funeral the officiating priest opened his eulogy with a declaration that “the Iron Lady of Strathfield is no more”.
He may have spoken too soon. In the several proceedings between her four children she has manifested an afterlife as the central personality in the proceedings. A proud product of Sparta, her self-perception was that of a “strong person”. Her children remember her, at least in her prime, as a dominant, dominating personality. She was not, however, a sophisticated person. As she aged, she became frail, troubled by a loss of hearing and erratic. She was fiercely proud of her family. She was a prolific will-maker. She left her affairs in a mess.

The Deceased’s Will Admitted to Probate

Irene (known as Rene) Soulos (“the deceased”) was born in Greece in November 1919. She arrived in Australia in or about 1935 or 1936. She died on 27 January 2018, aged 98 years, leaving a will dated 13 March 2017 (her last will) probate of which was granted on 31 March 2021 to the executors named in the will: her accountant Con Kristallis (“Mr Kristallis”), her solicitor Trevor Ian Cork (“Mr Cork”) and her son, Nicholas Andrew Soulos (“Nick”).
The instrument of grant was issued on 31 March 2021 pursuant to an order made on 12 February 2021 (in the proceedings numbered 2018/00050908) for its admission to probate in solemn form.
Pending the grant of probate, the executors administered the estate of the deceased pursuant to an interim grant of administration made by the Court on 10 December 2018.

The Deceased’s Family

The deceased was married once only, to Andreas “Tatsos” Soulos, known as Andrew Soulos. The marriage took place in or about November 1940.
Andrew Soulos was born in Greece in July 1904. He arrived in Australia in or about 1925. He died in December 2003, aged 98 years leaving a will dated 3 February 2003 probate of which (not in evidence) was evidently granted to the executors named in the will: Nick, Nick’s son John; and Andrew, a son of the testator’s son, James.
By that will, as she survived him, Andrew Soulos left the whole of his estate to his wife, Rene the deceased in the current proceedings.
The four children of their marriage survived them:

a son, Dimitrios (known as James), born in September 1941 and now aged 81 years.

a daughter, Maria, born in June 1945 and now aged 77 years.

a son, Dimosthenis (known as Dennis), born in July 1949 and now aged 73 years.

a son, Nicholas (known as Nick), born in July 1951 and now aged 71 years.

At the time of her death, the deceased had 12 grandchildren and several great-grandchildren. One of her grandchildren (Andrew, a son of Maria) has since died, leaving a son for whose welfare Maria is particularly solicitous.
James married Margaret (against the express wishes of his parents) in February 1971. They have four children:

Rene, born in October 1974 and now aged 48 years.

Andrew, born in May 1976 and now aged 46 years.

Spyridon, born in January 1979 and now aged 43 years.

Evangelos (Evan), born in November 1980 and now aged nearly 42 years.

Maria moved to Greece in 1969. She married Christos Pagones in June 1970. They have two surviving children. Their eldest child, Nikolai (Nikos) was born in March 1971 and is now aged 51 years. Their second child, Andrew was born in May 1972 and died in April 2019, aged 47. Their third child, Charalambos (Babi) was born in March 1976 and is now aged 46 years.
Dennis married Kerrie in March 1978. They separated in October 1994 and were divorced in 1998. There are three children of their marriage:

Katrina, born in September 1979 and now aged 43 years.

Alexie, born in October 1980 and now aged nearly 42 years.

Dimitri, born in September 1986 and now aged 36 years.

Dennis and Kerrie agreed upon a matrimonial property settlement which was formerly recorded in a document styled “Terms of Settlement” and dated 21 November 2000, shortly thereafter made the subject of orders by the Family Court of Australia.
Nick married Christina on a date not disclosed in the evidence. They have two children:

Andrew, born in February 1979 and now aged 43 years.

John, born in December 1980 and now aged 41 years.

The Deceased’s Wealth in Land

At the time of her death, the deceased was a wealthy woman with ownership or control of substantial parcels of land (mostly in the inner western suburbs of Sydney) including, through Esperia Court Pty Ltd (“Esperia Court”), property in Strathfield Town Centre.
Her estate included other assets (about $759,000 with the National Australia Bank, shares worth about $3,300 in a public company, loans said to be owed by James and the sons of Nick and three plots at Rookwood Cemetery) but her landholdings are at the centre of attention in these proceedings.
For probate purposes, her executors estimated that her estate (comprising all forms of property) had a total value of about $35.854 million.
At the time of her death, she was the registered proprietor of substantial parcels of land in her own name (in NSW) with a total estimated value of about $16.95 million. Those properties comprised:

77 The Boulevard, Strathfield (Lot 3 in deposited plan 24953), her place of residence at the time of her death.

79 The Boulevard, Strathfield (Lot 2 in deposited plan 24953).

8 Parsons Avenue, Strathfield (Lot 1 in deposited plan 174127).

132-134 Smith Street, Summer Hill (Lot 1 in deposited plan 909796).

Unit 1, 15 The Esplanade, Balmoral Beach (Lot 1 in Strata Plan 10764).

At the time of her death, the deceased also owned a unit in Tripoli, Greece, of comparatively lesser value, worth about $80,000.
The property at 77 The Boulevard, Strathfield was (with the consent of Nick, to whom it was gifted under the will of the deceased) sold by the deceased’s executors to fund expenses in administration of her estate. The other identified properties remain within the control of the executors.
The sale of 77 The Boulevard, Strathfield may require the executors, before the distribution of any estate property, to give close consideration to section 46C(2) of the Probate and Administration Act 1898 NSW and Part II of the Third Schedule to the Act.
Against the marginal note “Administration of Assets”, section 46C(2) is in the following terms:

“Where the estate of a deceased person is solvent the deceased person’s real and personal estate shall, subject to the provisions of any Act as to charges on property of the deceased and to the provisions, if any, contained in the deceased person’s will, be applicable towards the discharge of the funeral, testamentary, and administrative expenses, debts and liabilities, payable thereout in the order mentioned in Part II of the Third Schedule.”

Section 46C(3) of the Act defines the word “solvent” to mean, for the purpose of the section, “sufficient”. In the context of the section, the meaning of the word “solvent” is informed by the definition, in section 46C(3), of the word “insolvent” which is defined to mean “insufficient for the payment in full of the debts and liabilities of the deceased person”.
Part II of the Third Schedule is headed “Order of Application of Assets Where the Estate is Solvent”.
Under that heading it sets out the following list of assets:

“1.   Assets undisposed of by will, subject to the retention thereout of a fund sufficient to meet any pecuniary legacies.
2.   Assets not specifically disposed of by will, but included (either by a specific or general description) in a residuary gift, subject to the retention out of such property of a fund sufficient to meet any pecuniary legacies, so far as not provided for as aforesaid.
3.   Assets specifically appropriated or disposed of by will (either by a specific or general description) for the payment of debts.
4.   Assets charged with or disposed of by will (either by a specific or general description) subject to a charge for the payment of debts.
5.   The fund, if any, retained to meet pecuniary legacies.
6.   Assets specifically disposed of by will, rateably according to value.”

The Court has not been invited, in the determination of the current proceedings, to consider the operation of section 46C(2) or Part II of the Third Schedule.
Under cross-examination, Mr Cork disclaimed any intention to exercise his right as an executor to apply to the Court for commission. Whether he adheres to his declared intention not to claim commission remains a matter for him. In the absence of debate, I decline to proceed on the footing that he no longer has a right to claim commission.
Mr Kristallis expressly reserved whatever rights he might have as an executor to claim commission.
No part of the deceased’s estate has yet been distributed by her executors. They appear to have taken the view that, given the multitude of competing claims made in these proceedings, prudence has dictated that, pending determination of the proceedings, they leave management of Esperia Court in the hands of its directors (Nick and his son John) and otherwise maintain the status quo.

The Deceased’s Wealth in Shares in Private Companies with Land Holdings

The deceased enjoyed control of land through her ownership of management shares in the main corporate vehicle of the Soulos family (to put the point neutrally), Esperia Court, and her ownership of shares in another family corporate vehicle, A&R Management Pty Ltd (“A&R”). For probate purposes her executors estimated that her Esperia Court shares were worth $14.775 million and her A&R shares were worth $2.8 million.
Esperia Court Pty Ltd. Esperia Court was at the time of the deceased’s death, and remains, the registered proprietor of the following parcels of land in or about the Strathfield town centre:

1 The Boulevard, Strathfield (Lot 1 in deposited plan 173763).

3-9 The Boulevard, Strathfield (Lot 1 in deposited plan 172769).

2-10 Churchill Avenue, Strathfield (Lot 1 in deposited plan 173685).

At the time of the deceased’s death Esperia Court also owned an 80% interest in 12-14 (often described as “12”) Churchill Avenue, Strathfield (Lot 1 in deposited plan 305568) as a tenant-in-common with Nick and his son John, who held their 20% interest as joint tenants. The title to the property remains registered in the names of Esperia Court, Nick and John.
Much controversy in these proceedings attends the acquisition of 12 Churchill Avenue, Strathfield (known as the Symond Arcade) by Esperia Court, Nick and John in 2017. They purchased the property, by contracts exchanged on 28 March 2017 and completed on 14 November 2017, for $30 million, including a $3 million deposit, with finance provided by National Australia Bank.
Controversy also attends that part of 2-10 Churchill Avenue, Strathfield upon which Esperia Court once conducted a private hotel business in the nature of a boarding house (known as the Strathfield Private Hotel) which the company leased to SPH Holdings Pty Ltd (“SPH”), a company owned and controlled by Nick, on terms said to be uncommercial.
The acquisition of the Symond Arcade and the SPH lease both lie at the heart of allegations by Maria that the affairs of Esperia Court have been managed in a manor oppressive of her as a shareholder in the company.
A&R Management Pty Ltd. A&R was at the time of the deceased’s death, and remains, the registered proprietor of 10 Chapman Street (Lot 8 of section B in deposited plan 482), “10 Chapman Street”.
10 Chapman Street was purchased for $350,000 in the name of A&R in or about September 1998. The memorandum of transfer (dealing number 5491301) is undated but it was apparently stamped on 14 October 1998 and it was registered by the Registrar General on 23 December 1998.
Controversy attaches to beneficial ownership of 10 Chapman Street because Dennis claims a beneficial entitlement to all the shares in A&R (excluding perhaps shares claimed by Maria) or the property itself arising from inter vivos dealings with the deceased.
A&R has not been separately represented in these proceedings, I infer, because of uncertainty as to the identity of the person or persons entitled to shares in the company. Nevertheless, all competing interests are before the Court.

The General Nature of Disputation

Overlaying disputes about particular parcels of land are disputes about entitlements to shares in Esperia Court and in A&R; a claim by Maria (supported by James and Dennis) for Esperia Court to be wound up in oppression proceedings (brought under sections 232-233 of the Corporations Act 2001 Cth) against the deceased’s estate, Nick and John; and claims for family provision orders (under Chapter 3 of the Succession Act 2006 NSW) brought against the estate of the deceased by each of James, Maria and Dennis.
Maria’s allegation of oppression is accompanied by allegations that Nick and John, as directors of Esperia Court, breached obligations they owed to the company as fiduciaries, and comparable obligations owed by reference to sections 180, 181 and 182 of the Corporations Act 2001 (Cth).
Questions about the valuation of land and shares held by the deceased in Esperia Court loom large in both the oppression proceedings and the family provision proceedings.
Although the constitution of the several proceedings before the Court takes a more complex form, because of a need for separate representation of the estate of the deceased (by, at least, the two executors not children of the deceased) and Esperia Court (currently under the day-to-day management of Nick and his son John as directors of the company), a major focus of the real questions in dispute in the proceedings is upon:

a strong desire on the part of Nick and John to retain control of Esperia Court and its strategic property holdings in the Strathfield Town Centre; and

a perceived common interest of Maria, James and Dennis in seeking to realise any interest they have as shareholders in Esperia Court by obtaining either:

an order that the company be wound up (under section 233 of the Corporations Act 2001 Cth or Chapter 3 of the Succession Act 2006 NSW); or

orders for management shares in Esperia Court (held by the deceased at the time of her death and gifted by her will to Nick) to be distributed equally between all four of the deceased’s children so as to enable all of them to participate in management of the affairs of the company and thereby to obtain material returns on the limited classes of shares they hold in the company.

Maria, for her part, also seeks orders against Nick and his son John designed, in one way or another, to have Nick and John account for benefits received by them arising from their acquisition of an interest in Symond Arcade and for benefits received by SPH arising from its leasing of the Strathfield Private Hotel.
At the commencement of the hearing a solicitor acting for Nick in his personal capacity (Mr E Herman) appeared before the Court, in the proceedings brought by James and Dennis, to announce that Nick had “withdrawn his separate defence”. Precisely what was meant by that became clear when Mr Herman sought, and was given, an opportunity to make closing submissions on behalf of Nick. In essence, those submissions were to the effect that Nick relied upon the submissions made by his co-executors (Messrs Kristallis and Cork) and the submissions made on behalf of Esperia Court (presently under the day-to-day control of Nick and his son John).
Nick’s core submission on his own account was that the Court should not make any order for the winding up of Esperia Court or for dilution of his control of the company through ownership of all management shares in the company (because that would be contrary to the deceased’s testamentary intentions) but “a moderate and a just and wise outcome” would be to adopt changes to the constitution of the company proposed by the lawyers for the company.
The proposal of the company (which is to say, under its current management, Nick and John by another name), as recorded in MFI X35 (a solicitor’s letter dated 18 August 2022) is for a suite of amendments to the articles of association of Esperia Court, inter alia, to “equalise the payment of dividends”; to make provision for the company’s books to be audited each year, at the cost of any member who requests an audit; and to regulate remuneration predicated upon an assumption of Nick retaining control of the company.
At the beginning of the hearing of the proceedings I made, without objection by any party, an order (confirming an order earlier made) that the four sets of proceedings listed for hearing by the Court be heard together with evidence in each set of proceedings to be evidence in each other set of proceedings so far as may be material.
Although disputes between the deceased’s children (and Nick’s son, John) are many and varied, an unusual feature of the proceedings is that much of the evidence adduced in the proceedings was adduced without objection or cross-examination. Perhaps the most striking examples of this are:

First, James’ evidence that his parents required him to surrender his shares in Esperia Court to them as punishment for his determination to marry Margaret against their wishes, and their subsequent reconciliation with him and Margaret following the birth of the first grandchild (named after the deceased).

Secondly, Dennis’ evidence that promises were made to him by the deceased about his future entitlements to 10 Chapman Street (via shares in A&R), and those promises were relied upon by him.

Thirdly, evidence that each of the deceased and her late husband (the parents of the principal contestants before the Court) made representations to their children that provision was made for the welfare of all the children in allocation to them respectively of shares in Esperia Court (designated as “A”, “B”, “C” and “D” class shares) which carry a right to participation in a winding up of the company, but no right to vote, no right to dividends, and no right to participation in management of the company.

Not far removed from these examples is the evidence of Nick about the circumstances in which he and his son John came to join with Esperia Court on 28 March 2017 in their entry into a contract for the purchase of the Symond Arcade. The facts necessary to establish the allegations of “oppression” made by Maria (with the support of James and Dennis) can be discerned in the affidavit evidence of Nick himself. The basic narrative of what occurred is there, although supplemented by the evidence of his sons, Andrew and Nick, the deceased's professional advisers (the accountant, Mr Kristallis and the solicitor Mr Cork) and the real estate agent (Mr Pignataro) who, although acting as agent for the vendor of the Symond Arcade, liaised closely with Nick in negotiations leading to an exchange of contracts. A broader examination of the evidence does not displace the basic narrative presented by Nick.
During the course of the final hearing, the parties jointly applied to the Court for orders under section 27 of the Succession Act 2006 NSW for rectification of clauses 6-9 (inclusive) of the deceased’s will to correct a misdescription of shares in Esperia Court gifted to James, Dennis and Nick. All affected parties having joined in the application, and the parties having persuaded the Court that it was proper to do so, rectification orders were made as sought.
An affidavit sworn by the solicitor for the executors of the estate of the deceased confirms that all persons affected by:

the executors’ application for a grant of probate of the deceased’s will dated 13 March 2017; or

the respective applications made by James, Dennis and Maria for family provision relief,

were in a timely manner served with notice of the proceedings on those applications.

All persons served with notice of the proceedings (including the deceased’s grandchildren) were adults at the time they were served.
The deceased’s will dated 13 March 2017 having been admitted to probate in solemn form, the present relevance of the service of notice of proceedings is that parties affected by the applications for family provision relief before the Court have been given an opportunity to appear in the proceedings to contest the applications or otherwise to protect their interests. None have appeared in response to the notices served upon them.

Questions of Credit

Questions of credit do not loom large in these proceedings save possibly in connection with an assessment of the evidence of Nick and, more particularly, his son John relating to the acquisition of the Symond Arcade and the conduct of the Strathfield Private Hotel by Nick’s company, SPH. Their self-perception that they acted only at the direction of the deceased in their capacity as directors of Esperia Court is not one that can, objectively, be embraced.
The evidence of members of the extended Soulos family was, perhaps, coloured by their perspective of dealing with the deceased as the family’s matriarch and by their perceptions of what might be a fair, and proper, outcome of the proceedings.
The evidence of the deceased’s accountant (Mr Kristallis) and her solicitor (Mr Cork) was more objective but, perhaps, more circumspect than it might otherwise have been because it might not unreasonably be said of them that it was under their watch that the deceased conducted her affairs, and those of Esperia Court, with a disrespect for formalities that, with her demise, has created uncertainty within the Soulos family. In retrospect, her dominance of the family has left (literally) doubtful legacies.
The evidence of James, Dennis and Maria is not without an element of exaggeration in matters of peripheral significance in dealing with the principal questions for determination in the proceedings. That is, perhaps, a product of combining claims for family provision relief with other types of claim, and the deployment in these proceedings of evidence which appears to have its origins in a now-resolved probate suit. There is much evidence which, with the same discipline demonstrated by counsel in their cross-examination of witnesses, could have been refined.
In assessing the evidence of the deceased’s children an allowance needs to be made for the fact that they are no longer young. James, in particular, is dependent upon his son Andrew (an accountant) for management of his affairs. As witnesses, all of James, Maria, Dennis and Nick presented themselves as weary of the Soulos family’s experience of protracted litigation and bewildered by it. In the case of James, Maria and Dennis a large part of their bewilderment appears to have origins in disappointed expectations of what would occur on their parents’ deaths.
What was different about the evidence of Nick and John was a strong belief on their part that they are entitled, as successors in business of the deceased, to exercise control of Esperia Court; to determine, as they see fit, whether, when and how other members of the Soulos family benefit from the family business; and to intermingle their personal affairs with those of Esperia Court if and to the extent necessary to develop real estate.
Nick is so persuaded of the desirability of developing Esperia Court’s prime real estate in Strathfield that he finds the opposition of his siblings to his plans almost incomprehensible. In particular, he shares the deceased’s simmering resentment that, before the deceased’s death, James sought to reclaim his shares in Esperia Court and to have their underlying, net-asset value realised for the benefit of himself and his family. Nick also resents what he sees as Maria’s assertion of unmeritorious claims over Esperia Court; unmeritorious because, living in Greece, she was always too remote to play any constructive role in the Company’s day-to-day operations.
Nick has been reinforced in his sibling rivalry by the objective fact that the deceased was anxious to have Esperia Court’s real estate developed and the company retained in the ownership and control of the male line of the Soulos family. As a son of the deceased, and with two sons (but no daughters) of his own, he was well-placed to humour the deceased and serve her purposes. Whether he was closer to the deceased than his siblings because he was her youngest child and stayed near at hand as they carried on with their lives was not, in terms, explored in the evidence.
Nick regards himself as the person responsible for the conduct of the Company’s business in the last years of the deceased’s life and development opportunities arising from acquisition of the Symond Arcade. He presents himself as the bearer of burdens imposed on him by the deceased, both in the acquisition of the Symond Arcade and in the conduct of the business of the Strathfield Private Hotel. He seems unaware that some of the tension between himself and James arises from the fact that, during the deceased’s latter years, Nick took over routine leasing work that James had formerly done for the deceased.
There is a contradiction at the heart of Nick’s case. On the one hand, he invites the Court to accept that he (and John) never wanted to acquire an interest in the Symond Arcade (they wanted Esperia Court to acquire 100 percent of it) and Nick never wanted to take a lease of the Strathfield Private Hotel (he only arranged for his company SPH to take a lease to oblige the deceased). He took on these burdens, reluctantly he says, at the request or direction of the deceased. On the other hand, he has fought an adversarial battle to retain the benefit of the “burdens” he says he was reluctant to assume.
This contradiction is perhaps explained by Nick’s conviction that Esperia Court’s real estate should be retained and developed (as the deceased intended by her will) and he is only an agent of sorts for the deceased and the Soulos family of her imagination.
John’s evidence reflects an over-enthusiastic acceptance by him of his father’s perspective of the Soulos family and the opportunities available to him personally in his conduct of Esperia Court under the control of Nick and himself. Like his father, he seeks self justification in a belief that his decision-making has been motivated, not by self interest, but by a desire to benefit the whole Soulos family.
Notable for its greater objectivity is the evidence of Nick’s other son, Andrew. He was on the fringe of intense discussions that took place on the morning of 28 March 2017 leading to Esperia Court, Nick and John that day entering a contract to purchase Symond Arcade. He resisted pressure from the deceased to join Nick and John in the acquisition of a personal interest in the Arcade. He expressed doubts about the fairness of a transaction that privileged his branch of the Soulos family over those of his uncles and auntie.
At the end of the day, although the different perspectives and interests of members of the Soulos family may play a part in an assessment of their evidence, much of the evidence is largely uncontroversial and the questions for determination by the Court focus attention on objective facts.

The Central, Intractable Problem

The most difficult questions for determination are those about the legitimacy of how Esperia Court has been managed in the past and whether there is any proper foundation for the Court to make orders (and, if so, what orders) affecting its ongoing operation. Those questions arise most directly in connection with Maria’s “oppression” suit and the family provision applications of James, Maria and Dennis.
In the course of the hearing of these proceedings some disputes have been resolved or left to the Court to make a determination in the absence of active opposition. The central, intractable problem that affects all the children of the deceased and, incidentally, others is whether it is open to the Court to make orders (and, if so, should the Court make orders):

for Esperia Court to be wound up so that a substantial capital value for the shares of the deceased’s children can be realised without delay; or alternatively,

for the management shares in Esperia Court to be distributed (equally) between the deceased’s children so that they can each have a say in the future operation of the company.

Under the pressure of his siblings’ claims Nick has advanced a proposal for opening up to his siblings a limited role in management of Esperia Court with the prospect of dividends shared on an equal basis. He seeks, nevertheless, to retain control of Esperia Court and, with that control, to pursue proposals for development of the company’s properties.
Esperia Court, Nick and John also made an “open offer” (by a solicitor’s letter dated 6 September 2022, Exhibit E14) to purchase Maria’s shares in the company for $7 million on extended and highly qualified terms. The offer was formally rejected by Maria by a solicitor’s letter dated 14 September 2022 (Exhibit M44). No similar offer was made to James or Dennis.
In his own words, Nick wants “to grow and improve [Esperia Court’s] assets for the benefit of [his] family and [his] siblings and their families”. That aspiration implicitly entails any economic interest of James, Maria and Dennis being subordinated to Nick’s management control of Esperia Court and pursuit of his proposal for the development of the company’s properties in Strathfield. Whether they might ultimately be persuaded of the merits of Nick’s proposals for the commercial development of property, they resist his insistence upon control of Esperia Court, and impaired personal relationships within the Soulos family militate against co-operation.

THE CORPORATE VEHICLES OF THE SOULOS FAMILY

Esperia Court

Constitution. Esperia Court was incorporated (registered) on 6 May 1964 with two shareholders. As appears in the company’s memorandum of association and its articles of association (both dated 5 May 1964) the deceased and her late husband (Andrew Soulos) each subscribed for a single management share.
The Articles of Association were amended at an annual general meeting held in November 1969. A significant feature of the amendments made to the articles at that time was the introduction of the office of a “Governing Director”.
Shareholders. The articles record that the nominal share capital of the company of $25,000 is divided into:

1,000 management shares of £1 ($2) each, numbered 1-1,000.

4,000 “A” class shares of £1 each, numbered 1,001-5,000.

4,000 “B” class shares of £1 each, numbered 5,001-9,000.

4,000 “C” class shares of £1 each, numbered 9,001-13,000.

4,000 “D” class shares of £1 each, numbered 13,001-17,000.

4,000 “E” class shares of £1 each, numbered 17,001-21,000.

4,000 “F” class shares of £1 each, numbered 21,001-25,000.

The issued share capital of the company comprises:

500 management shares.

3,000 “A” class shares, numbered 1,001-4,000.

3,000 “B” class shares, numbered 5,001-8,000.

3,000 “C” class shares, shares, numbered 9,001-12,000.

3,000 “D” class shares, shares, numbered 13,001-16,000.

According to the company’s Register of Members, on 30 June 1964:

The deceased’s husband Andrew was issued with 299 management shares, bringing to 300 the total number of management shares then held by him.

The deceased was issued with 199 management shares, bringing to 200 the total number of management shares then held by her.

Dennis was issued with 3,000 “A” class shares, numbered 1,001-4,000.

James was issued with 3,000 “B” class shares, numbered 5,001-8,000.

Maria was issued with 3,000 “C” class shares, numbered 9,001-12,000.

Nick was issued with 3,000 “D” class shares, numbered 13,001-16,000.

According to the Register of Members:

On 31 May 1973 James’ 3,000 “B” class shares were transferred by him to his parents. 1,500 of those shares (numbered 5,001-6,500) were transferred to his father, the deceased’s husband. The other 1,500 shares (numbered 6,501-8,000) were transferred to his mother, the deceased.

On 30 September 1999 Dennis’ 3,000 “A” class shares were transferred by him to the deceased.

In evidence is a stamped Transfer of Shares form dated 2 April 1972 (signed by James as transferor and by his parents as transferees) evidencing a transfer of James’ shares in the Company for “nil” consideration.
Dennis’ transfer of his shares to the deceased on 30 September 1999 is consistent with the 1998, 1999 and 2000 annual returns of the Company, read together.
On the death of the deceased’s husband in December 2003, the shares then registered in his name were transferred to the deceased. She thus received from him:

300 management shares, bringing her holding of management class shares to a total of 500.

1,500 “B” class shares, bringing her holding of “B” class shares (all sourced from James’ original holding) to 3,000 shares.

James’ evidence is that he was required by the deceased to transfer his 3,000 “B” class shares to his parents because they did not approve of his marriage to Margaret in February 1971. He says that his loss of these shares was a price he was obliged by parental pressure to pay for his decision to marry his wife.
James’ evidence is corroborated by minutes of meetings of the Company relating to declarations of dividends to shareholders. He alone was excluded from a declaration of dividends for the year ended 30 June 1970. The minutes for subsequent years are consistent with the absence of any declaration of dividends in his favour. When, in 1974, there was an adjustment of the Company’s profits for the 1972 year James was again the only family member excluded. The fact that no dividends declared in favour of the children appears ever to have been paid does not diminish the force of James’ exclusion.
Any inconsistency in dates attributed to James’ transfer of his shares does not detract from the fact that there is a cluster of significant events around the date of his marriage. That is consistent with his complaint that he was, by parental pressure, obliged to surrender his shares to his parents as a form of punishment.
Dennis’ evidence is that his 3,000 “A” class shares were transferred to the deceased at the insistence of his parents because they wanted to preserve them within the Soulos family during a period when he was engaged in family law proceedings associated with his divorce from Kerrie. He says that his parents insisted upon this transfer, but told him that they would in due course transfer the shares back to him. The evidence includes contemporaneous documentation that supports Dennis’ contention that, when she took a transfer of his shares in September 1999, the deceased regarded herself as holding the shares on trust for him.

Dennis’ evidence is that Kerrie was aware of this when they effected their property settlement. For her part, Kerrie’s evidence is that she always believed that Dennis owned one quarter of the shares in the Company, and that she always disclaimed any personal interest in them.
Whether or not Dennis’ evidence is to be accepted in every respect, his claim to ownership of the 3,000 “A” class shares initially issued to him has been vindicated by orders made in these proceedings, with the consent of all parties, on 9 September 2022.
An ASIC search of the company as at 9 September 2022 records the identity of its shareholders as being the following:

The deceased (more accurately, her deceased estate):

500 management shares.

3,000 “A” class shares.

3,000 “B” class shares.

Maria: 3,000 “C” class shares.

Nicholas: 3,000 “D” class shares.

The deceased’s “A” class shares represent those initially issued to Dennis and subsequently transferred to his parents at their request. Her “B” class shares represent those initially issued to James and subsequently transferred to his parents at their request. No consideration passed from either parent to either son for either transfer.
With the consent of all parties to the proceedings, on 9 September 2022 orders were made to the effect, inter alia, that:

(a) the register of members of Esperia Court be rectified so as to delete the record of transfer of 3,000 “A” class shares from Dennis to the Deceased, and record Dennis as the holder of 3,000 “A” class shares in the Company.
(b) the Company provide such notification as is necessary to the Australian Securities and Investments Commission of the correct details with respect to the identity of the holder of the 3,000 “A” class shares in the Company.

Directors. The deceased’s husband was a director of Esperia Court from the date of its incorporation until the date of his death. The deceased likewise was a director of the company from the date of its incorporation to the date of her death.
Nick’s son John became a director of the company in December 2003, upon the death of his grandfather. Nick became a director of the company in December 2016. They both remain directors. They are the only directors of the company.
Secretary: The deceased was the secretary of Esperia Court between the date of its incorporation and her death. Nick has been secretary of the company since 30 July 2019.
Rights Attaching to Shares: Articles 7 and 8 of Esperia Court’s articles of association define the rights attaching to shares in the Company.
Those articles are in the following terms:

“[7]   The holders of Management shares shall:
(a)   Be the only persons entitled to vote at any meeting of the Company;
(b)   Be entitled to receive a fixed preferential non-cumulative dividend at the rate of 5 pounds per centum per annum on the capital paid up thereon, payable as regards each year out of the profits for that year without any right in the case of deficiency to resort to profits of prior or subsequent years but shall not be entitled to receive any further or other dividend.
[8]   The holders of ‘A’, ‘B’, ‘C’, ‘D’, ‘E’ and ‘F’ class shares shall be entitled:

To receive in any year such dividend (if any) as the Directors may from time to time determine, in respect of any particular class of shares;

To receive (to the exclusion of all other members of the Company) any distribution whether by way of dividend or reduction of capital or otherwise of any premium paid to the Company in respect of any shares in the Company;

To receive (to the exclusion of all other members of the Company) any surplus on a winding up after repayment to all members of the amount of capital paid up on their shares,

but the holders of such shares shall not be entitled to receive notice of or to attend and vote at meetings of members of the Company.”

Article 9 provides that “[the] shares [in the Company] shall be under the control of the Directors who may allot or otherwise dispose of the same to such persons on such terms and conditions and either at premium or at par, or (subject to the provisions of the Companies Act) at a discount and at such times as the Directors think fit …”. This provision needs to be read in the context of the powers of a Governing Director of the Company under article 86 of the Company’s articles of association.
There has been no debate in these proceedings about whether it would be open to the directors of the Company, since the death of the deceased and her husband, to allot the unissued shares in the Company in a manner that would operate to the detriment of one or more of the deceased’s children without varying rights attached to any shares.
The Office of “Governing Director”: Esperia Court’s articles of association (as amended) make provision for the office of a “Governing Director”, the occupant of which enjoys almost absolute powers of management over the affairs of the Company.
It is sufficient for the moment to extract articles 75, 76, 86 and 107:

“GOVERNING DIRECTOR
[75]. The term ‘Governing Director’ shall for the purpose of these articles mean:
(a)   Andrew Soulos [the husband of the deceased] until he dies or ceases to be a Director of the Company and thereafter Rene Soulos [the deceased];
(b)   An alternative or substitute Governing Director appointed by Andrew Soulos or after he dies or ceases to be a Director Rene Soulos pursuant to these Articles but subject to any limitation of powers contained in such appointment;
(c)   A successor (if any) after death appointed by Andrew Soulos after the death of Rene Soulos or after he dies or ceases to be a director by Rene Soulos pursuant to these Articles but subject to any limitation of powers contained in such.
If and when there shall no longer be a Governing Director as defined by these Articles, the other Directors (if any) shall convene a general meeting of the Company for the purpose of electing a Board of Directors; and in default of such meeting taking place within 14 days of such time, then any member or the Secretary may convene such meeting for such purpose upon giving proper notice pursuant to the could Articles of the Company.

DIRECTORS APPOINTMENTS ETC
[76]   At the first annual general meeting of the Company held after there ceases to be a Governing Director all the directors shall retire from office and at the annual general meeting in every subsequent year one-third of the directors for the time being or if their number is not three or a multiple of three then the number nearest one third shall retire from office. A retiring Director shall be eligible for re-election. …
POWERS OF GOVERNING DIRECTOR
[86]   The Governing Director shall as far as the law allows have power to exercise all the powers conferred upon the Company in general meeting by the Memoranda of Association and by the Articles and shall have authority to exercise all the powers, authorities and discretions by the Articles expressed to be vested in the Board or in the Directors jointly; and all other Directors for the time being of the Company shall be under his control, and shall be bound to conform to his directions in regard to the Company’s business or in respect of particular matters or classes of matters or by way of particular or general limitation of authority. The Governing Director shall not be required to devote any of his time to the management, control and superintendents of the business of the Company.
In addition to the other authorities expressly or by implication hereby conferred on a Governing Director as aforesaid, the Governing Director shall have to the exclusion of general meetings and of the Board absolute authority (subject to the [Companies] Act) to do the following:
(a)   appoint any person as Directors of the Company;
(b)   define and restrict their powers and fix their duties and remuneration;
(c)   determine his own remuneration as Governing Director;
(d)   remove any Director, hower [sic] appointed;
(e)   convene a general meeting of the Company;
(f)   appoint and remove the Managing Director, secretary and other officers of the Company;
(g)   determine who shall be admitted as shareholders;
(h)   determine what resolutions shall be proposed at general meetings and Board meetings respectively;
(i)   determine what mode of valuing the Company’s assets shall be adopted;
(j)   determine what amounts shall be carried to the Reserve Fund and the Depreciation Fund respectively and how those Funds shall be dealt with;
(k)   determine the dividend to be declared on individual shares and in this context he may declare dividends:
(i)   one or more classes of shares to the exclusion of other classes;
(ii)   at different rates on different classes of shares respectively;
(iii)   on any particular share or shares to the exclusion of other shares;
(iv)   at different rates on different individual shares;

(l)   determine what business within the scope of the Memorandum of Association shall be undertaken or given up by the Company;
(m)   determine when and to what extent and in what manner and upon what terms and conditions and for what purpose the Directors may exercise their powers of borrowing or raising any sum or sums of money;
(n)   determine what amounts (if any) may be withdrawn from the loan accounts of the various shareholders and what amounts may be called up on any of the shares of such shareholders …
SUCCESOR TO GOVERNING DIRECTOR
[107]   A Governing Director may by Deed or Will or codicil appoint a person (being a member or non-member) to exercise all or any of his powers as Governing Director after his death and may limit and define such of his powers as are to be conferred on such appointee, his remuneration and the duration of such appointment PROVIDED THAT such appointee may not appoint an alternate in his place or a successor after his death.”

Under the heading “Interpretation”, article 2 includes a provision that “[words] importing the masculine gender only shall include the feminine gender”.
Observations. The deceased at no time appointed a Governing Director of the Company in succession to herself.
The parties agree that the last paragraph of article 75 was enlivened upon the death of the deceased. However, no general meeting of the Company has been convened for the purpose of electing a Board of Directors pursuant to article 75 pending the determination of these proceedings.
No dividends appear ever to have been paid in favour of any holder of the “A” to “D” class shares.
Minutes of meetings of the Company (usually the deceased and her husband, whether in the character of directors or that of shareholders) for the years ending 30 June between 1967 and 1996 inclusive record that dividends were declared for 1967-1972 and 1974. No dividends were declared for the 1972 year until (upon an adjustment of accounts) 1973. The practice of dividends being declared appears to have come to an end at the end of that time or possibly in 1974 or 1975.
The fact that dividends were “declared” does not mean that they were ever “paid”. There is no evidence of an accumulation of dividends for the children in loan accounts with the Company. It is likely that declarations of dividends were unaccompanied by payments of any kind.
In these proceedings, Nick and John are accused by Maria of acting in breach of fiduciary and statutory duties, owed by them to the Company as directors of Esperia Court, when engaging in what might be characterised as “self dealing transactions” involving their acquisition of an interest in the Symond Arcade and (in the case of Nick) the grant to Nick’s company SPH of a lease for the Strathfield Private Hotel on terms commercially favourable to him.
The significance of the Governing Director provisions of the company’s articles (particularly article 86) is that Nick and John contend, in relation to the impugned transactions, that:

they acted at the direction of the deceased, in her capacity as the Governing Director of the Company, as they were obliged by article 86 to do;

the content of any duties owed by them to the company as directors must be assessed against their obligation under article 86 to do as directed by the deceased; and

because the deceased, as Governing Director of the company, had “power to exercise all the powers conferred upon the company in general meeting” and “authority to exercise all the powers, authorities and discretions … vested in … the Directors jointly”, her directions that Nick and John give effect to the impugned transactions operate in the same manner as if the company in general meeting had ratified the impugned transactions, thereby providing a complete answer to Maria’s allegations of breach of duty.

The contention of Nick and John that they acted at the direction of the deceased in her capacity as the Governing Director of the Company evidently does not depend upon knowledge by them of the existence of the office of Governing Director or the deceased’s occupation of it.
On their own evidence, they were not aware of the existence of the office of Governing Director until after the death of the deceased. If their evidence that they acted at the direction of the deceased is accepted, a factor in their obedience to the will of the deceased was likely to have been knowledge that she held the Management Shares in the Company. It is just as likely, however, that their obedience to her will was a combination of social convention within the Soulos family and enlightened self-interest as she favoured those who conformed to her will.
Ultimately, the contention that Nick and John acted at the direction of the deceased “as they were obliged to do”, focuses attention on the form of the constitution of the Company rather than Nick and John’s knowledge of its provisions. The critical factor is that with the power (by virtue of her ownership of all management shares) to control all meetings of the Company, the deceased might be taken to have authorised, or ratified, any breaches by Nick and John of fiduciary obligations they owed to the Company as its directors, and the content (if not the existence) of their obligations must be examined in the context of the deceased’s “exclusive” powers of management.
Nick and John rely heavily upon the judgment of Brereton J in Australian Securities and Investments Commission v Maxwell [2006] NSWSC 1052; 59 ACSR 373; 24 ACLC 1308 at [100] and [102]-[103], here reproduced in the context of associated paragraphs (with emphasis added):

“[96] Section 180(1) of the Corporations Act provides as follows:
A director or other officer of a corporation must exercise their powers and discharge their duties with the degree of care and diligence that a reasonable person would exercise if they:
(a) were a director or officer of a corporation in the corporation’s circumstances; and
(b) occupied the office held by, and had the same responsibilities within the corporation as, the director or officer.

[97] Section 181(1) provides as follows:
A director or other officer of a corporation must exercise their powers and discharge their duties:

(a) in good faith in the best interests of the corporation; and
(b) for a proper purpose.
[98] Section 182(1) provides as follows:
A director, secretary, other officer or employee of a corporation must not improperly use their position to:

(a)   gain an advantage for themselves or someone else; or
(b)   cause detriment to the corporation.
[99] The statutory duty imposed by s 180(1) reflects, and to some extent refines, that which obtains at general law. As Santow J (as his Honour then was) explained in ASIC v Adler (2002) 41 ACSR 72, [372], both the common law and equity imposes on directors a duty of care and skill [Permanent Building Society (in liq) v Wheeler (1994) 11 WAR 109; 14 ACSR 109; Daniels (formerly practising as Deloitte Haskins & Sells) v Anderson (1995) 37 NSWLR 438; 16 ACSR 607], the content of which is essentially the same as the statutory duty [Sheahan v Verco (2001) 79 SASR 109; 37 ACSR 117, 134 (Mullighan J); Daniels v Anderson, 603 (Powell JA); see also Australian Innovation Ltd v Petrovsky (1996) 21 ACSR 218, 222 (Lockhart J)]. Similarly, the statutory duties imposed by s 181 and s 182 reflect, and to some extent refine, corresponding obligations of directors under the general law.
[100]   In determining whether a director has exercised reasonable care and diligence, as s 180(1) expressly contemplates, the circumstances of the particular corporation concerned are relevant to the content of the duty. These circumstances include the type of company, the provisions of its constitution, the size and nature of the company’s business, the composition of the board, the director’s position and responsibilities within the company, the particular function the director is performing, the experience or skills of the particular director, the terms on which he or she has undertaken to act as a director, the manner in which responsibility for the business of the company is distributed between its directors and its employees, and the circumstances of the specific case [Re City Equitable Fire Insurance Co Ltd [1925] Ch 407, 427; (Romer LJ); Commonwealth Bank of Australia v Friedrich (1991) 5 ACSR 115, 125 (Tadgell J); ASC v Gallagher (1993) 11 WAR 105; 10 ACSR 43; 11 ACLC 286; Daniels v Anderson, 504-505; ASIC v Adler, [372]; Explanatory Memorandum to the CLERP Bill 1999 (para 6.75)].
[101]   Directors are not required to exhibit a greater degree of skill in the performance of their duties than may reasonably be expected for persons of commensurate knowledge and experience, in the relevant circumstances [ASC v Gallagher]. And while directors are required to take reasonable steps to place themselves in a position to guide and monitor the management of the company [Daniels v Anderson (1995) 37 NSWLR 438, 495-505; 16 ACSR 607, 659-668], they are entitled to rely upon others, at least except where they know, or by the exercise of ordinary care should know, facts that would deny reliance [Re City Equitable Fire Insurance Co; Biala Pty Ltd v Mallina Holdings Ltd (No 2) (1993) 11 ACSR 785, 856–8; 11 ACLC 1082; (1994) 15 ACSR 1, 60–2; Daniels v Anderson (1995) 37 NSWLR 438, 502-504; 16 ACSR 607, 665–6; Re Property Force Consultants Pty Ltd (1995) 13 ACLC 1051 (QSC)].
[102]   The constitution of the corporation, and concomitantly the identity of those to whom the duty is owed, is of importance because the duties referred to in ss 180, 181 and 182 are not duties owed in the abstract, but duties owed to the corporation. As Clarke and Sheller JJA observed in Daniels v Anderson (at NSWLR 504), the duties imposed by former s 232 (the predecessor of s 180) reflected the concept of negligence at general law, in that a director owes to the company a duty to take reasonable care in the performance of the office. In Vrisakis v ASC (1993) 9 WAR 395, 449–50; 11 ACSR 162, 211–13; Ipp J (as his Honour then was) (with the concurrence of Malcolm CJ) held that although the statutory duty of care and diligence would be contravened if a director had not exercised a reasonable degree of care and diligence in the exercise of his powers or the discharge of his duties, even if there was no actual damage, that could only be so if it was reasonably foreseeable that the relevant conduct might harm the interests of the company - which means the corporate entity itself, the shareholders, and, where the financial position of the company is precarious, the creditors of the company - and, moreover, that in determining whether the relevant duty had been breached, the foreseeable risk of harm must be balanced against the potential benefits which could reasonably be expected to accrue to the company from that conduct [see also ASIC v Doyle (2001) 38 ACSR 606, 641]. As His Honour explained:
Under s 229(2), however, there is no reference to damage suffered by the company, and an offence may notionally be committed under that section without any damage having been sustained. The question is merely whether the defendant director has exercised a reasonable degree of care and diligence in the exercise of his powers in the discharge of his duties. Nevertheless, a criminal offence will not have been committed if an omission to take care did not carry with it a foreseeable risk of harm to the company. No act of commission or omission is capable of constituting a failure to exercise care and diligence under s 229(2) unless at the time thereof it was reasonably foreseeable that harm to the interests of the company might be caused thereby. That is because the duty of a director to exercise a reasonable degree of care and diligence cannot be defined without reference to the nature and extent of the foreseeable risk of harm to the company that would otherwise arise.

Further, the mere fact that a director participates in conduct that carries with it a foreseeable risk of harm to the interests of the company will not necessarily mean that he has failed to exercise a reasonable degree of care and diligence in the discharge of his duties. The management and direction of companies involve taking decisions and embarking upon actions which may promise much, on the one hand, but which are, at the same time, fraught with risk on the other. That is inherent in the life of industry and commerce. The legislature undoubtedly did not intend by s 229(2) to dampen business enterprise and penalise legitimate but unsuccessful entrepreneurial activity. Accordingly, the question whether a director has exercised a reasonable degree of care and diligence can only be answered by balancing the foreseeable risk of harm against the potential benefits that could reasonably have been expected to accrue to the company from the conduct in question.

[103] One consequence of this, of present significance, is that where there is an identity of interest between the directors and the shareholders, so that in effect the directors are the shareholders, the requirement to prevent self-interested dealing, constrain management and strengthen shareholder control – which is fundamental purpose and rationale of these duties - is much less acute. That is a circumstance which can impact considerably on the content of the duties. The significance of a correspondence between the identity of the directors and the shareholders is illustrated by the circumstance that, at general law, a fully informed general meeting can prospectively or retrospectively ratify the actions of directors of the company, though they involve negligence, breach of fiduciary duty or the exercise of the directors’ powers for an improper purpose [North-West Transportation Co Ltd v Beatty (1887) 12 App Cas 589; Furs Ltd v Tomkies (1936) 54 CLR 583; 9 ALJ 419; Hogg v Cramphorn [1967] Ch 254, 265-266; [1966] 3 All ER 420 (Buckley LJ); [1970] Ch 122 (CA); Regal (Hastings) Ltd v Gulliver [1967] 2 AC 134n; [1942] 1 All ER 378; Winthrop Investments Ltd v Winns Ltd [1975] 2 NSWLR 666; (1975) 1 ACLR 219]. Where the directors and the shareholders are one and the same, ratification is implicit. Although the shareholders of a company cannot release the directors from their statutory duties imposed by s 180, 181 and 182 [Forge v ASIC (2004) 52 ACSR 1, 81-82; ASIC v Australian Investors Forum Pty Ltd (No 2) (2005) 53 ACSR 305, 314-315; Angas Law Services Pty Ltd (in liq) v Carabelas (2005) 53 ACSR 208, 219 [32]], their acquiescence in a course of conduct can affect the practical content of those duties, including any question of whether directors acted with a reasonable degree of care and diligence, and whether they made improper use of their position [Angas Law Services Pty Ltd (in liq) v Carabelas, 218-219, [29]-[32]].
[104] There are cases in which it will be a contravention of their duties, owed to the company, for directors to authorise or permit the company to commit contraventions of provisions of the Corporations Act. Relevant jeopardy to the interests of the company may be found in the actual or potential exposure of the company to civil penalties or other liability under the Act, and it may no doubt be a breach of a relevant duty for a director to embark on or authorise a course which attracts the risk of that exposure, at least if the risk is clear and the countervailing potential benefits insignificant. But it is a mistake to think that ss 180, 181 and 182 are concerned with any general obligation owed by directors at large to conduct the affairs of the company in accordance with law generally or the Corporations Act in particular; they are not. They are concerned with duties owed to the company. …”

Even if article 86 provides, in substance, a defence for Nick and John against allegations of breach of fiduciary and statutory duties, it does not displace the operation of sections 232-233 of the Corporations Act 2001 Cth in an “oppression suit” under those sections. The text of article 86 itself recognises that limit on the powers of a Governing Director in use of the expressions “so far as the law allows” and “subject to the [Companies] Act”. However, the registration of a company pursuant to the companies legislation must be taken, in any event, to create an entity governed by the legislation, including, in this case, sections 232-233 of the Corporations Act 2001.

A&R

Constitution: A&R was incorporated (registered) on 31 July 1963 with the name A&R Soulos Investments Pty Ltd. It changed its name to A&R Management Pty Ltd on or about 7 September 1998. The Company’s memorandum of association and its articles of association are not in evidence but I infer, from the Company’s register of members, that the deceased and her late husband (Andrew Soulos) each subscribed for a single share, and the nominal capital of the company comprises 1,000 ordinary shares of £1 ($2) each.
Shareholders. The register of members of the Company records that on 5 September 1963 shares were issued to each member of the family:

the deceased’s husband Andrew was issued with 299 shares, bringing to 300 the total number of shares then held by him.

the deceased was issued with 299 shares, bringing to 300 the total number of shares then held by her.

James was issued with 100 shares.

Dennis was issued with 100 shares.

Maria was issued with 100 shares.

Nicholas was issued with 100 shares.

There is some confusion in reconstructed records of the company as to whether any or all of the shares of the children were later transferred to their parents. That confusion focusses upon a diary note of a meeting held on 26 April 2018 attended by two of the executors of the deceased’s estate (Nick and Mr Kristallis) and Mr Kristallis’ son, Andrew, an accountant. The diary note was disclaimed by Mr Kristallis. It was apparently prepared by his son Andrew.
It records an observation that ASIC records at that time showed Andrew Soulos and the deceased each owning 500 shares in the company, a total of 1,000. It records an opinion that the ASIC records were incomplete because share transfers from the Soulos children to their parents “were never executed nor stamped correctly and therefore never happened (per advice from Trevor Corke [sic])”, coupled with a notation that Andrew Kristallis was “to adjust ASIC records”.
The diary note also contains an entry suggesting that Nick bore some responsibility for ensuring that the executors obtained legal and tax advice in relation to the share ownership and whether market rent needed to be charged to, and paid by, Dennis for his occupation of 10 Chapman Street.
For his part, in his cross-examination Mr Cork denied giving any advice in terms attributed to him in the diary note and he expressed uncertainty as to whether the deceased owned 1,000 shares in the Company at the time of her death. He was not at the meeting diarised.
At most, the diary note evidences an attempt to reconstruct the company’s share register upon an assumption that the membership of the Company recorded in the register of members as at 5 September 1963 remained the true position because purported transfers of the children’s shares to their parents were legally ineffective. In my opinion, that assumption is misplaced or, at least, an unsafe guide to ownership of the Company’s share capital.
Some clarity might be thought to emerge from the minutes of a meeting of directors of the Company (the deceased and her late husband) on 22 June 1982, signed by the deceased as “ chairman” of the meeting.
Against a marginal note, “Transfer of Shares”, the following appears in those minutes:

“It was resolved the transfer of shares
From Nicholas Soulos to Andrew Soulos 100 shares.
From James Soulos to Andrew Soulos 100 shares.
From Dennis Soulos to Rene Soulos 100 shares.
From Maria Soulos to Rene Soulos 100 shares.”

In evidence are copies of the register of members of the Company which, read as a whole, are consistent with this resolution. Each entry relating to each child records a transfer of shares (issued on 5 September 1963) resulting in “nil” shares being held by that child. The entries relating to Dennis and Nick are dated 22 June 1982. The entries relating to James and Maria are undated.
Entries in the register of members relating to Andrew Soulos and the deceased are more complete. They record that on 22 June 1982 the shares of Nick and James were transferred to Andrew, and the shares of Dennis and Maria were transferred to the deceased.
The same entries record that on the date of Andrew’s death his 500 shares in the Company were transferred to the deceased, bringing her total share ownership to 1,000. Those entries are consistent with Andrew’s will in favour of the deceased.
The evidence includes an email dated 15 December 2021 addressed by the solicitor for the executors of the deceased’s estate to the solicitors of other parties in the proceedings. In substance, it is in the following terms:

“Further to our virtual meeting on 14 December 2021, and the concern raised that the beneficial ownership of the A&R Management shares did not rest with the estate.
We now enclose a zip file which includes relevant documents identifying the transfer of shares from your respective clients [the children of the deceased]. We are instructed that at the time of the transfer the company was effectively a shelf company and held no assets of any significance.”

The enclosed “zip file” appears to have included a diary note prepared by the executor’s solicitor on 22 May 2014, the minutes of the directors’ meeting of 22 June 1982; and incomplete “share transfer forms” signed respectively by Dennis, James, Nick and (allegedly) Maria.
The handwritten diary note (on an extract of an ASIC record) reads as follows:

“Phone call with ASIC 22.5.14 confirms this return (recording the deceased and her late husband as owners each of 500 shares) shows the change of shareholding from kids to Rene and Andrew Soulos lodgement [?] signing 31.12.94.”

Each of the share transfer forms signed by the children is incomplete. None of them identifies a transferee or consideration for the transfer. None of them is stamped. The transfer forms signed by Dennis and Nick are both dated 22 June 1982. The transfer forms signed by James bears no date. The transfer form signed by Maria is totally blank, but for her (alleged) signature, on a different printed form than those used for her siblings.
The transfer form signed by Nick appears to have been signed by his father, as transferee, consistently with the directors’ minutes. However, the transfer form signed by James was signed by the deceased as transferee, not her husband as the minutes record. The transfer form signed by Nick appears to have been signed by the deceased’s husband as transferee, not by the deceased as contemplated by the minutes.
The directors’ minutes are consistent with the company’s annual return dated 31 December 1994 referred to in the solicitor’s handwritten note in so far as they record that, by whatever means, by that date the only shareholders of the company were the deceased and her husband, each owning 500 shares (the total issued capital of the company).
ASIC searches of the company dated 11 March 2021 and 17 September 2021 both record that (as at that date):

each of the deceased and her husband held 500 shares in the company.

each of the deceased’s four children held 100 shares in the company.

Those ASIC searches (which may take the form they do because of the diarised meeting of 28 April 2018) suggest that a primary document recording the shareholdings of the deceased and her husband was the 1994 annual return of the company, and that the primary document recording the shareholding of the children was the company’s annual return for 1990.
There are at least two irregularities in the 2021 ASIC searches. The first is that, although the deceased’s husband was recorded as a shareholder in 2021, he died in December 2003. The second is that he is also recorded as having served as director of the company from the date of its incorporation in 1963 until 12 September 2007, an afterlife of sorts.
The Company’s 1993 annual return (relating to the financial year ending 30 June 1993 and an annual general meeting held on 31 December 1993), signed by the deceased’s husband on 29 January 1994, records that each of the deceased and her husband then held 300 shares in the company and that each of their four children held 100 shares.
The Company’s 1994 annual return (relating to the financial year ending 30 June 1994 and an annual general meeting held on 31 December 1994), signed by the deceased’s husband on 31 December 1994, records that the only shareholders in the company at that time were the deceased and her husband, each holding 500 shares.
A comparison of the 1993 and 1994 annual returns, without more, suggests that a transfer of the children’s shares to their parents was, in some sense, formally recognised at some time in the 1994 calendar year. That is consistent with the handwritten diary note of the executors’ solicitor. It is not consistent with the minutes of the meeting of directors of the Company dated 22 June 1982.
Director and Secretary. Prior to the death of the deceased’s husband Andrew, he and the deceased both occupied the office of director of A&R and she also occupied the office of secretary. From the date of Andrew’s death in 2003, it appears to be common ground that the only director and secretary of the company was the deceased. Her occupation of those offices dated from the date of incorporation of the company.
No party to these proceedings has contended that the Soulos parents lacked authority to represent A&R or to bind the company as officers of the company. In particular, no party has contended that Andrew and the deceased lacked authority to bind the company in representations made to Dennis about ownership of, or dealings with, 10 Chapman Street.
Observations. James and Nick appear not to have regarded themselves as holders of shares in A&R for an indefinite period of time, if ever. Neither listed his shares in the company as a personal asset for the purpose of these proceedings. Neither claims relief to confirm, or establish, an ownership of A&R shares.
Dennis and Maria each claim an entitlement to 100 shares in the company in these proceedings.
Maria’s claim is based upon her evidence that: (a) from a discussion with her late father, she knew that she was a shareholder in A&R; (b) to the best of her recollection, she did not sign the blank share transfer form purporting to bear her signature; and (c) her purported signature on the share transfer form does not resemble her signature.
This evidence was unchallenged in cross-examination of Maria. I accept it as probative of the fact that she did not execute the share transfer form said to have been executed by her. There is insufficient evidence to support an inference that she, by means of the disputed transfer form, or otherwise, authorised a transfer of her shares to the deceased.
Dennis’ claim requires closer attention in the context of his claim to beneficial ownership of all the shares in the company or 10 Chapman Street. That is because his evidence is that he was the intended purchaser of the property until he was persuaded by his parents to make way for A&R on the basis that, upon their deaths, all the shares in the company would be left to him. Upon their assurance of that, he says, he deferred to them: he took possession of the property nominally as a tenant and effected renovations which he would never have effected without his parents’ encouragement to believe in his ultimate ownership of the property through A&R.
On his own admission, Dennis has no recollection of ever owning (or transferring) shares in A&R. He “first learned about these matters” after the commencement of these proceedings.
Maria’s evidence entitles her to orders for rectification of the A&R share register to record her as the holder of the 100 shares issued to her on 5 September 1963. The internal records of the company evidencing a transfer of her shares to the deceased are not corroborated by evidence of a transfer in fact having been effected, and her evidence militates against a finding of transfer.
Turning to the shares issued to Maria’s brothers: Leaving aside problems for the executors of the deceased (and the beneficial owner, or owners, of the shares in A&R) arising from what appears to have been a failure to pay stamp duty on share transfers ostensibly effected by the children on or about 22 June 1982, I am inclined to infer (from the Company’s register of members, the admittedly incomplete share transfer forms, the assertion by the deceased and her husband of a capacity to leave all the shares in the Company to Dennis upon their deaths, and the absence of any assertion by the boys before the commencement of these proceedings that they were entitled to A&R shares, and acquiescence within the Soulos family to Dennis’ occupation of 10 Chapman Street) that the true position as to ownership of the A&R share capital is as follows:

as at 5 September 1963, an issue of shares resulted in Andrew Soulos holding 300 shares, the deceased holding 300 shares, and each of the four children holding 100 shares.

on or about 22 June 1982 each of the children other than Maria signed a share transfer form in blank and delivered it to their parents with authority for the parents to transfer the shares to themselves.

In the absence of evidence that she knew about and approved a transfer of her shares to the deceased, Maria must be taken to have retained her 100 shares in the company.

From 22 June 1982 or thereabouts, Andrew held 500 shares, the deceased held 400 shares and Maria held 100 shares.

Upon the death of Andrew, his 500 shares passed under his will to the deceased so that she held a total of 900 shares and Maria retained her 100 shares.

At the present time, the estate of the deceased holds an entitlement to 900 shares in the company and Maria holds an entitlement to 100 shares.

Before acting upon this analysis I propose to allow the parties an opportunity to make submissions about it. In the meantime I reserve any concluded opinion about the whereabouts of beneficial ownership to shares in the Company.

THE WILL OF THE DECEASED

Under the will of the deceased, as rectified by orders made in these proceedings, the deceased’s principal beneficiaries are her four children, with specific pecuniary legacies to members of the deceased’s extended family.
In several clauses of her will, the deceased expresses a wish that Esperia Court remain within the Soulos family and that particular properties also be retained within the family. Her commonly acknowledged preference for the male line of the Soulos family also finds expression in the will. She appears to have had a dynastic tendency of mind.
Some of the affidavits read in these proceedings appear to have been prepared in aid of a challenge to the validity of the deceased’s will, implicitly grounding in these proceedings an invitation to the Court to infer, inter alia, that she did not know or approve the contents of the will. The proximity in time between the date of execution of the will (13 March 2017) and the date upon which Esperia Court contracted to acquire the Symond Arcade (28 March 2017) has also been used forensically to suggest a link between the two, directed towards a submission that Nick and his son John, acting in their own interests, and in disregard of their obligations as directors of Esperia Court, improperly exercised influence over the deceased in their management of Esperia Court.
My purpose in noting these forensic undercurrents is to expose them to view as of marginal, if any, relevance to pleaded questions for determination by the Court. They may have relevance to questions of credit but, it should be noted, the deceased’s will was admitted to probate in solemn form and there has been no collateral attack on the validity of the will in these proceedings. I must take the will of the deceased as evidencing the last duly expressed, testamentary intentions of a free and capable testatrix.

Consideration

Has Section 232 been Engaged? Maria’s oppression suit was commenced by an originating process filed on 19 April 2021, subsequently amended on 21 May 2021, and conducted at the final hearing by reference to an amended statement of claim filed on 15 November 2021.
As the case was argued before me, I accept that, in making a determination about whether section 233 of the Corporations Act 2001 Cth has been engaged (by reference to one or the other, or both, of the limbs of section 232(d)-(e) of the Act), it is necessary to form an opinion about the existence, or otherwise, of “oppression” by reference to the date of institution of the proceedings: 19 April 2021.
A common thread in analysis of the acquisition of the Symond Arcade (in 2017) and the leasing of the Strathfield Private Hotel to SPH (in and from January 2015) is:

the total disregard by the directors of Esperia Court for the interests of the Company as a whole or the interests of Maria, in particular, as a member of the Company; and

decision-making in the exercise of the powers of the directors of Esperia Court designed, ostensibly to give effect to the personal preferences of the deceased:

to benefit Nick, John and their branch of the Soulos family personally in economic ownership of the properties of the Company; and

to lock Nick’s siblings (not only Maria) into a management regime for the Company in which benefits from the operation of the affairs of the Company could be received by them only at the discretion of Nick following the death of the deceased.

I am satisfied that this characterisation of the conduct of the deceased (until her death on 27 January 2018) and Nick and John in their exercise of their respective powers as directors of Esperia Court is an accurate statement of how the affairs of the Company were managed from at least January 2015, continuing to today.
I am satisfied that Maria has, objectively, established that the affairs of Esperia Court have been, and are being, conducted in a manner that is contrary to the interests of the members of the Company as a whole (within the meaning of section 233(d) of the Corporation Act 2001 Cth), and in a manner oppressive to, unfairly prejudicial to and unfairly discriminatory against her (within the meaning of section 232(e)) in relation to:

the acquisition of the Symond Arcade and the conduct thereafter of a partnership between Esperia Court, Nick and John for the conduct of a business involving leases of rental space within Symond Arcade to tenants for profit; and

the leasing of the Strathfield Private Hotel by Esperia Court to SPH in terms which were not at arm’s length or commercially reasonable as regards the length of the lease and the absence of any provision for its early termination in the event of development of Esperia Court’s real estate.

In my opinion, the notional objective commercial bystander would be satisfied that the affairs of Esperia Court were, and are, being conducted unfairly in that the directors of the Company have treated, and continue to treat, the Company as their own.
I am satisfied that that is the case notwithstanding that, shortly after the death of the deceased, Nick convened a meeting of his siblings to try to enlist them in his vision of how the properties of Esperia Court could be developed; in 2019 he floated a proposal for equalisation of shareholder entitlements to dividends from Esperia Court, a variation of which he continues to hold out to them; and, during the course of the final hearing, he and John, on behalf of themselves and Esperia Court, offered to buy out Maria’s shares for a substantial sum, but less than their full potential value. A constant feature of the thinking of Nick and John is their retention of control of Esperia Court.
The fact that the deceased held the position of Governing Director of Esperia Court, and all the management shares in the Company, when the Symond Arcade was acquired and SPH was granted its lease over the Strathfield Private Hotel, provided no justification for her disregard of the interests of Maria as a member of the Company, more particularly (but not only) because of the expectation of material benefit from the Company that she and her late husband had created and fostered in Maria (and her siblings).
The fact that the deceased held a dominant position in the management of Esperia Court (because she occupied the office of Governing Director and held all management shares in the Company) provided no justification for Nick or John to disregard the interests of Maria as a member of the Company, to acquiesce in decisions of the board of directors adversely affecting the interests of Maria; or to obtain and retain personal benefits contrary to the interests of the Company as a whole and contrary to the interests of Maria, in particular.
In the context of the determination of Nick (with the active support of John) to deploy Esperia Court’s property in a redevelopment project, the grant by Esperia Court to SPH of a long term lease without the benefit of a demolition clause, and the acquisition of the Symond Arcade by Esperia Court in co-ownership with Nick and John, were major steps (outside the ordinary course of any business of Esperia Court) affecting the nature and conduct of the business conducted by Esperia Court as a family company. The acquisition of the Symond Arcade, in particular, stretched, and continues to stretch, the financial resources of the Company, rendering it heavily dependent upon external finance.
In my opinion, each of the deceased, Nick and John (by pursuit of their self-interests in disregard of those of Maria) breached their duties (under each of sections 180(1), 180(2), 181(1) and 182(1) of the Corporations Act 2001 Cth as directors, primarily in the acquisition of the Symond Arcade on what were essentially speculative terms given the strained finances of Esperia Court, but also in the grant by Esperia Court of a long term lease of the Strathfield Private Hotel to SPH on terms that were less than commercial in so far as they empowered Nick, through SPH, to have a special power in evolving proposals for development of the Company’s properties.
In my opinion, these breaches of statutory duties (or comparable general law duties) serve not as a means of holding the directors to account for the payment of compensation to the Company but to inform the nature and extent of the relief necessary, and appropriate, to put an end to the “oppression” found to have affected the conduct of the affairs of Esperia Court.
The Nature of Section 233 Relief. The issue of what, if any, relief should be granted to Maria under section 233 of the Corporations Act 2001 Cth falls to be determined as at the date of the hearing of the proceedings or, more particularly, at the time final orders are made in disposition of the proceedings.
The object of a grant of relief is to terminate the effects of oppression. Any grant of relief must be proportionate to that end.
This is not a case in which it can be said that there is no continuing oppression because the constitution of Esperia Court, the ownership and operation of the business of Symond Arcade, and the terms of SPH’s lease of the Strathfield Private Hotel (in combination with the determination of Nick and John to maintain their control of Esperia Court and its property) militate against the conduct of the affairs of Esperia Court without the taint of oppression.
In my opinion, there is no proper foundation for an order that Nick and John “buy out” Maria in circumstances in which, by the open offer made to Maria in the course of the hearing of the proceedings, Nick and John demonstrated an incapacity to pay to Maria the full amount of the value of her shares predicated upon a winding up of Esperia Court, and an unwillingness (and financial incapacity) to buy out the shareholdings of Dennis and James confirmed during the course of these proceedings. A “buy out” order is beyond the financial capacity of any party to fund.
Although Esperia Court is financially stretched, I proceed to assess the relief to be granted to Maria upon an assumption that the Company is solvent and that an order for its winding up by the Court would be a disproportionate form of remedy.
It might be that, in the aftermath of these proceedings, the shareholders of Esperia Court will, in general meeting, take any one of a number of alternative courses of action. They might resolve to wind up the Company, to liquidate the Company’s assets, to redevelop its real estate, or to manage its affairs in the ordinary course of business. However, decisions of that nature can, and in my opinion should, be left to the members and directors of the Company once the effects of oppression have been terminated.
Subject to allowing the parties to be heard as to the form of orders to be made under section 233 of the Corporations Act 2001 Cth, I propose to make orders to the effect that:

all shares in Esperia Court be reclassified as ordinary shares of a single class, with equal rights to notice of meetings, voting, dividends and any surplus on a winding up of the Company.

the management shares formerly held by the deceased be distributed equally between her children with the intent that each hold 125 of those shares in addition to any other shares held by them.

the office of Governing Director of the Company be abolished.

Nick and John hold their interest in the Symond Arcade (as co-owners with Esperia Court) on trust for Esperia Court (susceptible to an order that it be transferred to, or vested in, the Company), subject to a charge in their favour of a just allowance (to be agreed between the parties or in default of agreement, determined by the Court) for any capital expenditure made by them in the acquisition of the Arcade.

The partnership between Esperia Court, Nick and John for the conduct of the business of the Symond Arcade be wound up on the service by any partner on six months’ notice in writing or otherwise as may be agreed.

the lease of the Strathfield Private Hotel between Esperia Court (as lessor) and SPH (as lessee) be varied to include a term that it may be determined by either party to the lease on six months’ written notice (or otherwise as may be agreed) without cause.

Nick and John be required to retire as directors of Esperia Court (at a general meeting of members of the Company convened to elect new directors) without prejudice to any entitlement they may have to be reappointed as directors.

a general meeting of the members of the Company be convened, under the supervision of the Court, for the purpose of electing a new board of directors, comprising a nominee of each of the four children of the deceased (or a duly authorised attorney or, in the event of death, a legal personal representative of a deceased’s estate) and an independent director.

I am mindful that it may be appropriate to review this scheme of orders in light of evidence of the terms upon which (after the conclusion of the final hearing) the NAB loan due to be repaid on 31 October 2022 was (if it was) refinanced.
An object of the scheme is to facilitate an orderly transition of the management of Esperia Court to a regime untainted by oppression.
I am not minded to make orders to the effect that, upon an exercise of the Court’s jurisdiction under section 233 of the Corporations Act 2001 Cth, Nick and John pay compensation to the Company referable to acquisition of the Symond Arcade or the grant of a lease of the Strathfield Private Hotel to SPH. The rights of the Company can be accommodated by orders to the effect that the interest of Nick and John in the Arcade be held on trust for the Company and that the Company be empowered to terminate the Hotel lease without cause.
Maria’s submission that Nick and John should pay compensation to the Company for their acquisition of an interest in the Arcade is predicated upon an assumption that they retain that interest. Although the Hotel lease reserves for the Company less rent than might be available if it were converted to office space or let to an outsider, it was open to the deceased to choose to preserve the licence under which the Hotel apparently operated pending any decision about redevelopment of the Company’s land.
The vice in the conduct of the affairs of the Company has been the closed regime of management which has facilitated decision making that disregards the interests of the Company as a whole (and the particular interests of Maria) and locks ordinary shareholders into dependency upon the discretion of directors with an adverse interest. The proposed orders are intended to address that vice.

FAMILY PROVISION CLAIMS

Introduction

James, Maria and Dennis have each made an application for a family provision order under Chapter 3 (sections 55-100) of the Succession Act 2006 NSW.
Each of their applications was made within the time limited by section 58(2) of the Act: 12 months from the date of death of the deceased (27 January 2018). An application is generally taken to have been made at the time when a claim is first made for a family provision order in an applicant’s originating process. Maria’s application was made in a summons filed on 25 January 2019, upon which she relied at the final hearing. James’ application was made by a cross claim filed on 16 January 2019, although he relied on an amended pleading at the final hearing. Dennis’ application was made on by a summons filed on 25 January 2019, although he too relied upon an amended pleading at the final hearing.
Each applicant has standing to make an application for a family provision order because, as a child of the deceased, he or she is an “eligible person” within the meaning of sections 57(1)(c) and 59(1)(a).
The large questions for determination on each application are:

whether at the time when the Court is considering the application, adequate provision for the proper maintenance, education or advancement in life of the applicant has not been made by the will of the deceased: section 59(1)(c).

if so, whether, having regard to the facts known to the Court at the time the order is made, an order for provision ought to be made for the maintenance, education or advancement in life of the applicant out of the estate of the deceased: section 59(2).

Section 60 is in the following terms:

“60   Matters to be considered by Court
(cf FPA 7-9)
(1)   The Court may have regard to the matters set out in subsection (2) for the purpose of determining:
(a)    whether the person in whose favour the order is sought to be made (the “applicant” ) is an eligible person, and
(b)    whether to make a family provision order and the nature of any such order.
(2)   The following matters may be considered by the Court:
(a)    any family or other relationship between the applicant and the deceased person, including the nature and duration of the relationship,
(b)    the nature and extent of any obligations or responsibilities owed by the deceased person to the applicant, to any other person in respect of whom an application has been made for a family provision order or to any beneficiary of the deceased person’s estate,
(c)    the nature and extent of the deceased person’s estate (including any property that is, or could be, designated as notional estate of the deceased person) and of any liabilities or charges to which the estate is subject, as in existence when the application is being considered,
(d)    the financial resources (including earning capacity) and financial needs, both present and future, of the applicant, of any other person in respect of whom an application has been made for a family provision order or of any beneficiary of the deceased person’s estate,
(e)    if the applicant is cohabiting with another person--the financial circumstances of the other person,
(f)    any physical, intellectual or mental disability of the applicant, any other person in respect of whom an application has been made for a family provision order or any beneficiary of the deceased person’s estate that is in existence when the application is being considered or that may reasonably be anticipated,
(g)    the age of the applicant when the application is being considered,
(h)    any contribution (whether financial or otherwise) by the applicant to the acquisition, conservation and improvement of the estate of the deceased person or to the welfare of the deceased person or the deceased person’s family, whether made before or after the deceased person’s death, for which adequate consideration (not including any pension or other benefit) was not received, by the applicant,
(i)    any provision made for the applicant by the deceased person, either during the deceased person’s lifetime or made from the deceased person’s estate,
(j)    any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person,
(k)    whether the applicant was being maintained, either wholly or partly, by the deceased person before the deceased person’s death and, if the Court considers it relevant, the extent to which and the basis on which the deceased person did so,
(l)    whether any other person is liable to support the applicant,
(m)    the character and conduct of the applicant before and after the date of the death of the deceased person,
(n)    the conduct of any other person before and after the date of the death of the deceased person,
(o)    any relevant Aboriginal or Torres Strait Islander customary law,
(p)    any other matter the Court considers relevant, including matters in existence at the time of the deceased person’s death or at the time the application is being considered.”

There is no need in the present proceedings to consider whether any property should be designated as notional estate of the deceased. The deceased’s actual estate is ample enough to meet any family provision order that might conceivably be made, and no application has been pressed by any applicant for an order designating property as notional estate.
There is no need to consider the operation of any indigenous customary law. Each of the applicants and the person most likely to bear the burden of any family provision order that might be made (Nick) are Australians born of Greek heritage.
An exercise of the Court’s family provision jurisdiction requires an evaluative process of reasoning. In Bassett v Bassett [2021] NSWCA 320 at [171] the Court of Appeal described the following statement as a “useful summary” of the approach to be taken:

“In the exercise of its statutory powers in the determination of an application for a family provision order (in particular, sections 59(1)(c) and 59(2) of the Succession Act), the Court must generally endeavour to place itself in the position of the deceased, and to consider what he or she ought to have done in all the circumstances of the case, in light of facts now known, treating him or her as wise and just rather than fond and foolish (In re Allen [1922] NZLR 218 at 220-221; Bosch v Perpetual Trustee Co Ltd [1938] AC 463 at 478-479; Scales Case (1962) 1[0]7 CLR 9 at 19-20), making due allowance for current social conditions and standards (Goodman v Windeyer (1980) 144 CLR 490 at 502; Andrew v Andrew (2012) 81 NSWLR 656) and, generally consulting specific statutory criteria referred to in section 60(2) of the Act so far as they may be material.”

In each case the criteria for which the Succession Act provides must be applied to the facts of the particular case without resort to normative generalisations. Although it is customary for practitioners to discuss cases using shorthand expressions to refer to the criteria for which sections 59(1)(c) and 59(2) provide, any analysis must remain focused on the text of the legislation. It does not, in terms, require an applicant to establish a “need” or call for an assessment of a deceased’s “moral duty” despite the practical utility of those expressions in some cases.

The concepts of “adequate” and “proper” embedded in section 59(1)(c) are relative to the facts of the particular case: Pontifical Society for the Propagation of the Faith v Scales (1962) 17 CLR 9 at 19-20. Decision making on such topics is fact sensitive. Nevertheless, it is sometimes said that “adequate” is concerned with the quantum of provision, whereas “proper” is concerned with a standard of maintenance, education and advancement in life of an applicant for relief: Devereaux-Warnes v Hall (No 3) (2007) 35 WAR 127 at [72]-[77]. What is “adequate” and “proper” in a particular case depends on the circumstances of the case.
Upon an exercise of family provision jurisdiction, the Court is not necessarily constrained by a deceased person’s statements of testamentary intention. That is inherent in the nature of the jurisdiction and the necessity for its exercise on evidence of facts that may not have been known to the deceased person. Nevertheless, a deliberate scheme of testamentary dispositions by a capable testator is entitled to respect: Slack v Rogan; Palffy v Rogan (2013) 85 NSWLR 253 at [127], approved in Sgro v Thompson [2017] NSWCA 326 at [1]-[2] and [83]-[87].
In the present proceedings, notice must be taken of the deceased’s firm views. She had a strong concept of “family”. She wanted the Soulos family to work together to develop the property that she, her husband and her children had accumulated. She favoured the male line of the family. As a member of the family who shared her vision of the future, she favoured Nick and his branch of the family even though, according to her lights, she sought to make generous provision for each branch of the family.
Although respect must be shown for the deceased’s testamentary intentions, the scheme of her will has been undermined by erroneous assumptions. The need for an order that the will be rectified to correct misdescriptions of shares in Esperia Court left to James and Dennis may be left to one side. Fundamentally, the will was predicated upon a false assumption that the deceased was beneficially entitled to all of the shares in A&R and to Dennis’ shares in Esperia Court, as well as a false assumption that A&R was beneficially entitled to 10 Chapman Street. The deceased also evidently had no regard to James’ moral claim to the return of all the shares in Esperia Court he dutifully surrendered as a price paid for his love match marriage. Nor did she have regard to the possibility that, if she placed Esperia Court within the control of Nick and he pursued his plans for development of the Company’s properties, any benefits conferred on his siblings by their shareholdings in the Company could be illusory, dependent upon the discretion of a person unable to command the respect given by all family members to her in her lifetime.
As any relief granted under Chapter 3 of the Succession Act 2006 NSW and any relief granted under section 233 of the Corporations Act 2001 Cth must be assessed at the date of determination of these proceedings, allowance must be made in both contexts for the potential interaction of each form of relief.
Despite tensions within the Soulos family, and a breakdown in the relationships between the deceased’s children in the wake of her death, fairness to all concerned requires an acknowledgement that each of the children (James, Maria, Dennis and Nick) had a close and loving relationship with the deceased throughout her lifetime, as they did with their father throughout his lifetime. That is true of James, no less than his siblings, even though his choice of spouse attracted parental disapproval.
It is equally pertinent to note the advanced ages of each of the deceased’s children and the primacy given to each of the applicants for family provision relief to their legitimate expectations of material wealth associated with the conduct of the affairs of Esperia Court, and their hope to be able to pass on wealth to their own children and grandchildren.
I am not minded, in disposition of any of the applications for family provision relief before the Court, to make an order that Esperia Court be wound up so that the applicants can realise the net asset backing value of their shares in the Company. There is, however, in my opinion, strong force in Maria’s submission that a gift which is subject to the exercise of a discretion by a third party, such as may be made by way of a discretionary testamentary trust or (as in the present case) shares without rights of participation in the management of a company, is not a proper provision in favour of a donee. Such a gift is illusory because the discretion in question may never be exercised in favour of the donee: William Bkassini v Sonya Sarkis [2017] NSWSC 1487 at [304]-[305], citing with approval Hedman v Frazer [2013] NSWSC 1915 at [180]-[185].
The illusory character of the rights attaching to the “A”, “B”, “C” and “D” class shares of Esperia Court absent any intervention by the Court is tangibly illustrated by expert evidence that they have no commercial value unless the Company is wound up but, if the Company were to be wound up, a value of $3 million would attach to every 1,000 shares.
There is no evidence attributing a particular value to the shares if Esperia Court is not wound up, but the rights of shareholders to participation in management of the affairs of the Company and to any surplus assets on a winding up, are equalised. Nevertheless, a reasonable inference is that shares with rights uniform with all other shares in the Company may have a substantial value and be able to be sold or used as security for a borrowing of funds.
In my opinion, each of James, Maria and Dennis has been left without adequate provision for his or her maintenance, education or advancement in life if and to the extent they are unable to unlock the asset-backed value of their “A”, “B” and “C” class shares in Esperia Court and they remain without a voice in management of the Company. That is because they were, throughout the joint and several lives of their parents, encouraged in an expectation that the shares would enable them to enjoy substantial material wealth in their mature years and the shares, in themselves, provide a measure of what the parents regarded as proper provision for their children. For this reason, I propose to make orders (supported by orders made under Chapter 3 of the Succession Act 2006 NSW, as well as orders made under section 233 of the Corporations Act 2001 Cth) to the effect that, in addition to any provision made for them in the will of the deceased, they each receive 125 of the 500 shares held by the deceased in her lifetime in the character of management shares in Esperia Court.

James’ Family Provision Application

James’ application for a family provision order is the most challenging of the three applications before the Court, at least as regards his claim for the remaining 1,000 “B” class shares in Esperia Court left by the deceased to Nick rather than to him.
There are five fundamental reasons for that. First, although James’ case is able to be presented as that of an impecunious claimant his impecuniosity is in part due to a decision, of his own making, to place property in a discretionary trust for the benefit of his family, rendering him reliant upon the continuing support of his wife and children in management of the trust. Secondly, respect needs to be given to the deceased’s deliberate intention that Nick be favoured over James, albeit that the favour the deceased showed towards Nick was in part a response to Nick’s displacement of James in the performance of work for Esperia Court after 2008 or thereabouts; Nick’s displacement of James’ soured relationships between James (on the one hand) and Nick and the deceased (on the other hand). Thirdly, James’ claim is essentially grounded less on “need” than upon a “moral” claim for return to him of all the shares which his parents, he submits “unjustly”, required him to surrender as a consequence of a marriage of which they disapproved. Fourthly, James’ claim is based on an expectation, fuelled by the deceased during her lifetime, that his shares (upon which no dividends had ever been paid to him) would be returned to him upon the deceased’s death so that, in common with his siblings, he could enjoy substantial material wealth. Fifthly, James’ advanced age might be thought to limit the extent of any personal, future “need” on his part beyond the satisfaction he might experience from passing family wealth onto his own children.
Paying attention to all these factors, and the extent of the deceased’s bounty as expressed in her will (particularly, 2,000 shares in Esperia Court and ownership of 79 The Boulevard, which has an agreed value of $2.3 million), the Court might reasonably conclude that James has not been left without “adequate” or “proper” provision from the estate of the deceased.
The constraint imposed by the will on his ability to sell freely and without qualification 79 The Boulevard might well have warranted an intervention of the Court. But, whether or not that is the case, the effluxion of time has nearly erased the burden of the constraint. The operation of the constraint, for the period of five years from the death of the deceased on 27 January 2018, is about to expire.
What would a wise and just testatrix in the position of the deceased do with James’ application, taking into account community standards and the whole circumstances of the case?
In my opinion, in the circumstances of the present proceedings the question of what is “adequate and proper” for the purpose of section 59(1)(c) is closely associated with the question of what, if any, family provision order “ought” to be made in disposition of James’ application for relief upon an exercise of the discretion for which section 59(2) provides. That is because I accept that, within the community of the deceased (her extended family) if not also within the broader community, the allocation of 3,000 shares to each of the deceased’s children was long seen as necessary and appropriate to make proper provision for them. This was in recognition of the roles they played in helping the family to acquire the wealth embedded in the assets of Esperia Court, including the fact that they acquiesced in the absence of any payment of dividends to them throughout what must be seen as the better part of their lives. The expectation of James and other members of the Soulos family was that James’ shares would be returned to him. Nick, for his part, had no expectation that he would be the beneficiary of any of the shares formerly held by James.
In my opinion, wisdom and justice point to the making of an order that, in addition to the provision made for James in the will of the deceased, he receive the 1,000 shares in Esperia Court given to Nick and that Nick bear the burden of that order for provision.
This outcome is consistent with what, in my opinion, is demanded by wisdom, justice and community standards in so far as it makes good the injustice of the deceased’s confiscation of James’ shares at the commencement of what appears to have been, in retrospect, a long and happy marriage.
In my opinion, for the reasons I have articulated, James should have the benefit of all 3,000 of the shares formerly held by him, together with 125 of the 500 shares formerly held by the deceased as management shares. Nothing more can be justified in circumstances in which the deceased’s testamentary constraint on James’ disposal of 79 The Boulevard is about to expire and, in any event, if required to be complied with, it does not diminish the value of James’ enjoyment of the value of the property.
There is no need to make an adjustment under Chapter 3 of the Succession Act 2006 NSW in favour of Nick as compensation for his “loss” of the 1,000 shares gifted to him but, by the Court’s orders, returned to James. That is because: (a) Nick retains the 3,000 shares held by him in Esperia Court independently of the will of the deceased; (b) he retains under the will of the deceased 125 of the 500 “management shares” formerly held by the deceased; and (c) he also retains a right, in due administration to be compensated for the executors’ sale of 77 The Boulevard (for $4,201,000), gifted to him in the deceased’s will. His sons, to whom he is close, retain the deceased’s Balmoral Beach unit with an agreed value of $2.1 million, with any indebtedness to the estate for finance provided for acquisition of property forgiven.

Maria’s Family Provision Application

In my opinion, Maria has been left without “adequate and proper” provision for her education, maintenance and advancement in life from the estate of the deceased only in so far as she has not been given, by force of the deceased’s will, 125 of the 500 shares formerly held by the deceased as management shares.
In my opinion, that measure of the inadequacy of “proper” provision made for Maria in the will of the deceased informs an exercise of the discretion to be exercised in her favour under section 59(2) of the Act.
In my opinion, there is no foundation for the making of a family provision order in the form of a legacy in lieu of the gift of 8 Parsons Avenue made to Maria in the will. She retains her 3,000 shares in Esperia Court and the deceased’s Greek property.
On the evidence before the Court, 8 Parsons Avenue has a value in the vicinity of $1.35-1.5 million.

Dennis’ Family Provision Application

Dennis’ application for family provision relief invites analysis in terms similar to those applied to Maria’s application.
In common with James and Maria, he should receive 125 of the 500 shares formally held by the deceased as management shares in Esperia Court. That is necessary for him, and them, to have an entitlement to participation in management of the affairs of Esperia Court and, so, to realise the underlying value of the 3,000 shares all parties now acknowledge to be his entitlement independently of the will of the deceased.
Had Dennis’ claim to beneficial ownership of 10 Chapman Street and the deceased’s shares in A&R not been successful, a family provision order that vested in him all the deceased’s shares in A&R might conceivably have been an appropriate application of sections 59(1)(c) and 59(2) of the Succession Act 2006 NSW. Dennis might be said to have been left without “adequate” or “proper” provision for his education, maintenance and advancement in life out of the estate of the deceased had his ownership of 10 Chapman Street (directly or indirectly) not been vindicated, and orders necessary to secure his ownership of that property might, in all the circumstances of the case, have been relief that “ought” to have been made. But maybe not.
Hesitancy about that conclusion arises from the fact that Dennis has secured his ownership of shares in Esperia Court and, by the deceased’s will, he has been left 132-134 Smith Street (a property with an estimated value within the range of $3.4-5.8 million).

CONCLUSION

Before any final orders are made in disposition of these proceedings, I propose to entertain such, if any, submissions that might be made about:

my provisional findings about beneficial entitlements to shares in A&R.

any modifications that may be perceived to be necessary to the scheme of orders under section 233 of the Corporations Act 2001 Cth that I have proposed arising from the fact that NAB’s loan of $29,050,000 to Esperia Court, Nick and John fell due on 31 October 2022, after the conclusion of the final hearing.

the form of the orders to be made to give effect to these reasons for judgment generally, including particularly the section 233 orders.

the amount of any allowance to be made in favour of Nick and John consequent upon their transfer to Esperia Court of their interests in the Symond Arcade land.

the identity of a person or persons who might be suitable to be nominated:

as chairman of the meeting of the members of Esperia Court to be convened to elect a new board of directors.

to act as an independent director on the board of the company.

any problems that might arise from the non-payment of stamp duty on intra-family share transfers.

As presently advised, I propose to deal with any disputes about orders for costs after final orders are made in disposition of all substantive disputes.
In the meantime, I record the following summary of the types of orders that appear necessary to determine the proceedings:

Orders under section 233 of the Corporations Act 2011 Cth, as proposed in these reasons for judgment, with or without modification in light of current arrangements for repayment of NAB’s loan.

Orders to make good James’ entitlement to his 3,000 shares in Esperia Court and 125 of the deceased’s management shares.

Orders to make good Maria’s entitlement to one share in A&R and 125 of the deceased’s management shares.

Orders to make good Dennis’ entitlements to 10 Chapman Street, the deceased’s shares in A&R and 125 of her management shares.

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Decision last updated: 07 November 2022

Medium Neutral Citation:	Re Estate Soulos [2022] NSWSC 1507
Hearing dates:	5-9, 12 and 15-16 September 2022
Decision date:	07 November 2022
Jurisdiction:	Equity
Before:	Lindsay J
Decision:	Findings made in support of orders to be made in an oppression suit and in a variety of other proceedings. The form of orders to be made is to be the subject of further submissions.
Catchwords:	CORPORATIONS — Members’ rights and remedies — Oppression — Where conduct is oppressive to, unfairly prejudicial to, or unfairly discriminatory against minority – Where conduct is contrary to the interests of the members as a whole – Directors engaged in conduct with total disregard to the interests of another shareholder – Oppression found SUCCESSION — Family provision — Claims by adult children excluded from management of family company – Shares in company without commercial value in the absence of voting rights – Orders for provision moulded to facilitate participation in management
Legislation Cited:	Corporations Act 2001 Cth Limitation Act 1969 NSW Probate and Administration Act 1898 NSW Succession Act 2006 NSW
Cases Cited:	Australian Institute of Fitness Pty Ltd v Australian Institute of Fitness (Vic/Tas) Pty Ltd (No 3) [2015] NSWSC 1639 Australian Securities and Investments Commission v Maxwell [2006] NSWSC 1052; 59 ACSR 373; 24 ACLC 1308 Bassett v Bassett [2021] NSWCA 320 Devereaux-Warnes v Hall (No 3) (2007) 35 WAR 127 Delaforce v Simpson-Cook (2010) 78 NSWLR 483 Fexuto Pty Ltd v Bosnjak Holdings Pty Ltd [2001] NSWCA 97; (2001) 37 ACSR 672 Hedman v Frazer [2013] NSWSC 1915 In the matter of Computer Room Solutions Pty Limited [2021] NSWSC 845 In the matter of Imperium Projects Pty Ltd [2015] NSWSC 16 In the matter of L&B Seafood Pty Ltd [2022] NSWSC 100 In the matter of Ledir Enterprises Pty Ltd (2013) 96 ACSR 1; [2013] NSWSC 1332 In the matter of QB Foods Pty Limited [2021] NSWSC 1227 In the matter of Tzavaras & Sons Pty Ltd [2022] NSWSC 359 Levin v Clark [1962] NSWR 686 Munstermann v Rayward [2017] NSWSC 133 Parker v Auswild; Bergmuller v Auswild [2022] VSCA 8 Pontifical Society for the Propagation of the Faith v Scales (1962) 17 CLR 9 Re Lowes Park Pty Ltd; Headlam v Lowes Park Pty Ltd (1994) 62 FCR 535 Sgro v Thompson [2017] NSWCA 326 Sidhu v Van Dyke (2014) 251 CLR 505 Slack v Rogan; Palffy v Rogan (2013) 85 NSWLR 253 William Bkassini v Sonya Sarkis [2017] NSWSC 1487 Zong v Lin [2022] NSWCA 136
Category:	Principal judgment
Parties:	(1) Case No 2018/00050908 (“the James Proceedings”) Parties: Cross-Claimant: James Soulos First Cross Defendant: Con Kristallis Second Cross Defendant: Trevor Ian Cork Third Cross Defendant: Nicholas Andrew Soulos Representation: Counsel: Cross Claimant: A Cheshire SC (on 15-16 September 2022) and T Rollo First and second cross defendants: V Bedrossian SC, N Bilinsky and M Jaieth Third cross defendant: E Herman (on 5,7,8,15,16 September 2022) Solicitors: Cross Claimant: Carroll & O’Dea First and Second Cross Defendants: McPhee Kershaw Third cross defendant: Herman Legal (2) Case No 2019/00026988 (“the Dennis Proceedings”) Parties: Plaintiff: Dimosthenis (Dennis) Soulos First Defendant: Con Kristallis Second Defendant: Trevor Ian Cork Third Defendant: Nicholas Andrew Soulos Fourth Defendant: James Soulos Fifth Defendant: Esperia Court Pty Ltd ACN 000457492 Sixth Defendant: A&R Management Pty Ltd ACN 000431694 Seventh Defendant: Maria Pagones Representation: Counsel: Plaintiff: M Elliott SC and E Finnane First and Second Defendants: V Bedrossian SC, N Bilinsky and M Jaieth Third Defendant: E Herman, solicitor (on 5, 7, 8, 15, 16 September 2022); A Hursh, solicitor (on 6 September 2022) Fourth Defendant: A Cheshire SC (on 15-16 September 2022) and T Rollo Fifth Defendant: M Izzo SC with O Jones Sixth Defendant: No appearance Seventh Defendant: J Kelly SC and B O’Connor Solicitors: Plaintiff: McCabes First and Second Defendants: McPhee Kershaw Third Defendant: Herman Legal Fourth Defendant: Carroll & O’Dea Fifth Defendant: Chalk Behrendt Lawyers Sixth Defendant: No appearance Seventh Defendant: Uther Webster and Evans (3) Case No 2019/00027080 (“the Maria Proceedings”) Parties: Plaintiff: Maria Pagones First Defendant: Con Kristallis Second Defendant: Trevor Ian Cork Third Defendant: Nicholas Andrew Soulos Representation: Counsel: Plaintiff: J Kelly SC and P Muscat First and Second Defendants: V Bedrossian SC, N Bilinsky and M Jaieth Third Defendant: V Bedrossian, N Bilinsky and M Jaieth Solicitors: Plaintiff: Uther Webster and Evans First and Second Defendants: McPhee Kershaw Third defendant: McPhee Kershaw (4) Case No 2021/00108316 (“the Esperia Court Proceedings”) Parties: Plaintiff: Maria Pagones First Defendant: Esperia Court Pty Ltd Second Defendant: Con Kristallis and Trevor Ian Cork as executors of the Estate of the late Rene Soulos Third Defendant: Nicholas Andrew Soulos Fourth Defendant: John Nicholas Soulos Representation: Counsel: Plaintiff: J Kelly SC and B O’Connor First Defendant: M Izzo SC with O Jones Second Defendant: V Bedrossian, N Bilinsky and M Jaieth Third and Fourth Defendants: M Izzo SC and O Jones Solicitors: Plaintiff: Uther Webster and Evans First Defendant: Chalk Behrendt Lawyers Second Defendant: McPhee Kershaw Third and Fourth Defendants: Wotton Kearney
File Number(s):	2018/00050908 (“the James Proceedings”) 2019/00026988 (“the Dennis Proceedings”) 2019/00027080 (“the Maria Proceedings”) 2021/00108316 (“the Esperia Court Proceedings”)