Sheref v UFC Trading Enterprise Pty Ltd - [2024] WASC 344

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   SHEREF -v- UFC TRADING ENTERPRISE PTY LTD [2024] WASC 344
CORAM:   HILL J
HEARD:   11 SEPTEMBER 2024
DELIVERED          :   13 SEPTEMBER 2024
PUBLISHED           :   19 SEPTEMBER 2024
FILE NO/S:   COR 113 of 2024
BETWEEN:   DINO SHEREF
First Plaintiff
GAVIN YONG KHOON YAP
Second Plaintiff
AND
UFC TRADING ENTERPRISE PTY LTD
First Defendant
YU LU
Second Defendant

Catchwords:

Corporations - Meetings - General meeting - Meetings convened of first defendant invalid for inadequate notice and lack of quorum - Meetings not called in accordance with company constitution or s 249D and s 249F of the Corporations Act 2001 (Cth) - Whether orders should be made under s 1322 of the Corporations Act 2001 (Cth) to validate resolutions passed at meetings - Turns on own facts

Corporations - Meetings - Application for court to order meeting under s 249G of the Corporations Act 2001 (Cth) - Whether impracticable to call meeting of the defendant’s shareholders - Whether directions should be given under s 1319 of the Corporations Act 2001 (Cth) that quorum satisfied if one member of company is present - Turns on own facts

Legislation:

Corporations Act 2001 (Cth) s 249D, s 249F, s 1319, s 1322

Result:

Application for orders under s 1322 of the Corporations Act 2001 (Cth) dismissed
Orders made for convening of meeting under s 249G of the Act

Category: B

Representation:

Counsel:

First Plaintiff	:	Ms M G S Crowley
Second Plaintiff	:	Ms M G S Crowley
First Defendant	:	No appearance
Second Defendant	:	Mr T J Poli

Solicitors:

First Plaintiff	:	Su & Co
Second Plaintiff	:	Su & Co
First Defendant	:	No appearance
Second Defendant	:	Kings Park Legal

Cases referred to in decision:

Amlaki FZ LLC v Pinnacle Network (Australia) Pty Ltd [2008] FCA 1491
Atkins v North Australian Aboriginal Justice Agency Ltd [2024] FCA 686
BI Constructions Pty Ltd v Shad & Anor [2010] NSWSC 484
Chalet Nominees (1999) Pty Ltd v Murray [2012] WASC 147
Re Opera Photographic Ltd [1989] 1 WLR 634
Re Pembury Pty Ltd [1993] 1 Qd R 125

HILL J:

(This judgment was delivered extemporaneously and has been edited from the transcript to include references, headings and to correct matters of grammar and expression.)

By an originating process dated 11 July 2024, the plaintiffs seek a range of orders in relation to the first defendant.[1] The primary relief sought, pursuant to s 1322 of the Corporations Act 2001 (Cth) (Act), concerns the validity of resolutions that were passed on 17 April 2024 and 24 May 2024, purporting to appoint the first plaintiff and the second plaintiff as directors of the Company. In the alternative, the plaintiffs seek an order and directions pursuant to s 249G and s 1319 of the Act for the court to convene a general meeting of the Company with the quorum to be constituted if one member holding at least 51% of the shareholding is present.
[1] In these…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [2024] WASC 344
Decision Date: 19 SEPTEMBER 2024

CaseChat Overview and Summary

The matter before the Court involved Sheref, a shareholder of UFC Trading Enterprise Pty Ltd, who challenged the validity of certain meetings and resolutions passed by the company. The disputes centred on the adequacy of notice provided for the meetings and the presence of a valid quorum, as well as the ability to convene a meeting under the Corporations Act 2001 (Cth). The case was heard in the Federal Court of Australia.

The primary legal issues revolved around the validity of the meetings and resolutions of UFC Trading Enterprise. Sheref argued that the meetings were not called in accordance with the company's constitution or sections 249D and 249F of the Corporations Act 2001 (Cth). Sheref sought orders under section 1322 of the Act to validate the resolutions passed at these meetings, if appropriate. Additionally, Sheref applied for the Court to order a meeting under section 249G of the Corporations Act 2001 (Cth) on the grounds that it was impracticable to call a meeting of the company’s shareholders. The Court was also asked to give directions under section 1319 of the Act that a quorum would be satisfied if one member of the company was present.

In its decision, the Court found that the meetings convened by the first defendant were invalid due to inadequate notice and the absence of a valid quorum. The Court noted that the meetings did not comply with the requirements of the company's constitution or the relevant sections of the Corporations Act 2001 (Cth). However, the Court determined that it was not appropriate to validate the resolutions passed at these meetings under section 1322 of the Act, as the circumstances of the case did not warrant such an outcome. Regarding the application for a meeting under section 249G of the Act, the Court found it impracticable to convene a meeting of the company’s shareholders. Consequently, the Court directed under section 1319 of the Act that a quorum would be satisfied if one member of the company was present.

The Court ordered that the resolutions passed at the invalid meetings of UFC Trading Enterprise Pty Ltd would remain invalid. Additionally, the Court directed that a quorum for future meetings would be satisfied if one member of the company was present. These orders were tailored to the specific circumstances of the case, reflecting the unique facts and legal issues presented by Sheref.

Orders