Legal Research
Cases
Robins v Incentive Dynamics Pty Ltd (in liq)

Robins v Incentive Dynamics Pty Ltd (in liq)

Link copied

Case Copied 9 April 2003 46 min read

Contents

On this page

Reported Decision:
(2003) 45 ACSR 244
(2003) 21 ACLC 1030

Court of Appeal

CITATION: ROBINS & ORS v INCENTIVE DYNAMICS PTY LTD (in liq) & ANOR [2003] NSWCA 71

HEARING DATE(S): 11 December 2002

JUDGMENT DATE:
9 April 2003

JUDGMENT OF: Mason P at 1; Stein JA at 80; Giles JA at 81

DECISION: Declaration of remedial constructive trust. See also par 79.

CATCHWORDS: Corporations - directors - breach of fiduciary duties - Corporations Law, s232(6)-Corporations Act 2001, s182 - money transferred to company in which directors had an interest - knowing receipt within Barnes v Addy (1864) LR 9 Ch App 244 - personal and proprietary remedies - remedial constructive trust - whether rescission necessary (D)

LEGISLATION CITED: Corporations Law, ss232(6), 286
Corporations Act 2001, s182
Federal Courts (State Jurisdiction) Act 1999

CASES CITED: Australian Securities Commission v Melbourne Asset Management Barnes v Addy (1874) LR 9 Ch App 244
Bathurst City Council v PWC Properties Pty Ltd (1998) 195 CLR 566
Baumgartner v Baumgartner (1987) 164 CLR 137
Belmont Finance Corporation v Williams Furniture Ltd & Ors (No 2) [1980] 1 All ER 393
Bryson v Bryant (1992) 29 NSWLR 188
Chew v The Queen (1992) 173 CLR 626
Daly v Sydney Stock Exchange Ltd (1986) 160 CLR 371
Duke Group Ltd (in liq) v Pilmer (1998) 27 ACSR 1
Farrow Finance Co Ltd (in liq) v Farrow Properties Pty Ltd (in liq) (1997) 26 ACSR 544
Giumelli v Giumelli (1999) 196 CLR 101
Greater Pacific Investments Pty Ltd (in liq) v Australian National Industries Ltd (1996) 39 NSWLR 143
Halifax Building Society v Thomas [1996] Ch 217
Hancock Family Memorial Foundation Ltd v Porteous (2000) 22 WAR 198
Incentive Dynamics Pty Ltd (in liq) v Robins & Ors [1999] FCA 808
Koorootang Nominees Pty Ltd v Australian & New Zealand Banking Group Ltd [1998] 3 VR 16
Linter Group Ltd v Goldberg (1992) 7 ACSR 580
Muschinski v Dodds (1985) 160 CLR 583
Ninety Five Pty Ltd (in liq) v Banque Nationale de Paris [1988] WAR 132
Nominees (receiver and manager appointed) (1994) 49 FCR 334
Paul A Davies (Australia) Pty Ltd (in liq) v Davies (1982) 1 ACLC 66
R v Byrnes and Hopwood (1995) 183 CLR 501
Re Wakim; ex parte McNaly (1999) 198 CLR 511
Rolled Steel Products (Holdings) Ltd v British Steel Corporation [1986] 1 Ch 246
Westdeutsche Landesbank Girozentrale v Islington London Borough Council [1996] AC 669

PARTIES :
Douglas Robert McNeill ROBINS & Ors v INCENTIVE DYNAMICS PTY LTD (in liq) & Anor

FILE NUMBER(S): CA 40155/2000

COUNSEL: Cross-Appellant: F Whelan QC/ J Chippendall
Cross-Respondent: M English (Sol)

SOLICITORS: Appellant: Kemp Strange
Respondent: English Kearns

LOWER COURTJURISDICTION: Federal Court

LOWER COURT FILE NUMBER(S):

LOWER COURT
JUDICIAL OFFICER : Mansfield J

CA 40155/2000

MASON P
STEIN JA
GILES JA
Wednesday 9 April 2003

Douglas Robert McNeill ROBINS & Ors v INCENTIVE DYNAMICS PTY LTD (in liq) & Anor

Facts:

Incentive Dynamics Pty Ltd was a business that established and marketed “incentive…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Keep reading for free

Create a free CaseChat account to read Robins v Incentive Dynamics Pty Ltd (in liq) and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2003] NSWCA 71
Decision Date: 9 April 2003

CaseChat Overview and Summary

The proceeding before the Court of Appeal of New South Wales involved an appeal by the liquidator of Incentive Dynamics Pty Ltd (in liq) against the respondents, who were directors of the company. The dispute concerned allegations that the directors had breached their fiduciary duties by causing company funds to be transferred to a company in which they had an interest.

The primary legal issues before the court were whether the directors had engaged in conduct that constituted a breach of their fiduciary duties under the Corporations Law (specifically s232(6), which predated the Corporations Act 2001, s182), and whether the liquidator was entitled to pursue remedies for knowing receipt based on the principles established in *Barnes v Addy*. The court also considered the availability of personal and proprietary remedies, including the imposition of a remedial constructive trust, and whether rescission of the transactions was a necessary prerequisite for such remedies.

The Court of Appeal found that the directors had breached their fiduciary duties. Applying the principles of knowing receipt, the court determined that the directors had received company property for their own benefit in circumstances where they had knowledge of the breach of trust. The court reasoned that a remedial constructive trust was an appropriate mechanism to address the unconscionable retention of company property by the directors. The court concluded that rescission of the transactions was not a necessary prerequisite for the imposition of a remedial constructive trust in these circumstances.

The Court of Appeal made a declaration of a remedial constructive trust.

Orders

Orders of the court

Declaration of remedial constructive trust. See also par 79.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	ROBINS & ORS v INCENTIVE DYNAMICS PTY LTD (in liq) & ANOR [2003] NSWCA 71
HEARING DATE(S):	11 December 2002
JUDGMENT DATE:	9 April 2003
JUDGMENT OF:	Mason P at 1; Stein JA at 80; Giles JA at 81
DECISION:	Declaration of remedial constructive trust. See also par 79.
CATCHWORDS:	Corporations - directors - breach of fiduciary duties - Corporations Law, s232(6)-Corporations Act 2001, s182 - money transferred to company in which directors had an interest - knowing receipt within Barnes v Addy (1864) LR 9 Ch App 244 - personal and proprietary remedies - remedial constructive trust - whether rescission necessary (D)
LEGISLATION CITED:	Corporations Law, ss232(6), 286 Corporations Act 2001, s182 Federal Courts (State Jurisdiction) Act 1999
CASES CITED:	Australian Securities Commission v Melbourne Asset Management Barnes v Addy (1874) LR 9 Ch App 244 Bathurst City Council v PWC Properties Pty Ltd (1998) 195 CLR 566 Baumgartner v Baumgartner (1987) 164 CLR 137 Belmont Finance Corporation v Williams Furniture Ltd & Ors (No 2) [1980] 1 All ER 393 Bryson v Bryant (1992) 29 NSWLR 188 Chew v The Queen (1992) 173 CLR 626 Daly v Sydney Stock Exchange Ltd (1986) 160 CLR 371 Duke Group Ltd (in liq) v Pilmer (1998) 27 ACSR 1 Farrow Finance Co Ltd (in liq) v Farrow Properties Pty Ltd (in liq) (1997) 26 ACSR 544 Giumelli v Giumelli (1999) 196 CLR 101 Greater Pacific Investments Pty Ltd (in liq) v Australian National Industries Ltd (1996) 39 NSWLR 143 Halifax Building Society v Thomas [1996] Ch 217 Hancock Family Memorial Foundation Ltd v Porteous (2000) 22 WAR 198 Incentive Dynamics Pty Ltd (in liq) v Robins & Ors [1999] FCA 808 Koorootang Nominees Pty Ltd v Australian & New Zealand Banking Group Ltd [1998] 3 VR 16 Linter Group Ltd v Goldberg (1992) 7 ACSR 580 Muschinski v Dodds (1985) 160 CLR 583 Ninety Five Pty Ltd (in liq) v Banque Nationale de Paris [1988] WAR 132 Nominees (receiver and manager appointed) (1994) 49 FCR 334 Paul A Davies (Australia) Pty Ltd (in liq) v Davies (1982) 1 ACLC 66 R v Byrnes and Hopwood (1995) 183 CLR 501 Re Wakim; ex parte McNaly (1999) 198 CLR 511 Rolled Steel Products (Holdings) Ltd v British Steel Corporation [1986] 1 Ch 246 Westdeutsche Landesbank Girozentrale v Islington London Borough Council [1996] AC 669
PARTIES :	Douglas Robert McNeill ROBINS & Ors v INCENTIVE DYNAMICS PTY LTD (in liq) & Anor
FILE NUMBER(S):	CA 40155/2000
COUNSEL:	Cross-Appellant: F Whelan QC/ J Chippendall Cross-Respondent: M English (Sol)
SOLICITORS:	Appellant: Kemp Strange Respondent: English Kearns

LOWER COURTJURISDICTION:	Federal Court
LOWER COURT FILE NUMBER(S):
LOWER COURT JUDICIAL OFFICER :	Mansfield J