Slea Pty Ltd v Connective Services Pty Ltd (No 9) - [2022] VSC 136

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL DIVISION

CORPORATIONS LIST

S CI 2011 04332

SLEA PTY LTD	Plaintiff
v
CONNECTIVE SERVICES PTY LTD & ORS (according to the attached Schedule)	Defendants

S ECI 2018 00073

CONNECTIVE SERVICES PTY LTD & ANOR
(according to the attached Schedule)

Plaintiffs

GLENN ANDREW LEES & ORS

(according to the attached Schedule)

Defendants

S ECI 2019 03862

CONNECTIVE GROUP PTY LTD & ORS

(according to the attached Schedule)

Plaintiffs

SLEA PTY LTD & ORS

(according to the attached Schedule)

Defendants

------

JUDGE:	ROBSON J
WHERE HELD:	Melbourne
DATE OF HEARING:	7–10, 14–17, 21–24, 28–31 October 2019, 6–7, 11, 13–14, 18–21, 25, 27–28 November 2019, 2–5, 9 December 2019, 4–6, 10–13, 17–19, 24–27 February 2020, 2, 4 March 2020
DATE OF JUDGMENT:	22 March 2022
CASE MAY BE CITED AS:	Slea Pty Ltd v Connective Services Pty Ltd (No 9)
MEDIUM NEUTRAL CITATION:	[2022] VSC 136

CORPORATIONS – Oppression Proceeding - Company with two shareholders – One with two-thirds of shares – Minority shareholder with one-third – Thirteen instances of alleged oppression – Oppression made out.

CORPORATIONS – Directors – Breach of duties – Exercising powers for improper purpose – Company constitutions had pre-emptive provisions – Directors exercised power to establish a subsidiary to circumvent pre-emptive rights of minority shareholder – Directors sold portion of business to an outside investor without informing minority shareholder.

CORPORATIONS – Minority shareholder instituted proceedings for oppression – Directors exercised power of sale of business to avoid minority shareholder obtaining relief in oppression proceeding – Whether directors breached duty – Whether actions of directors oppressive.

CORPORATIONS – Relief on oppression proceeding – Whether majority or minority should be able to buy the other out – Discussion of authorities.

CORPORATIONS – Pre-emptive rights – Whether shares transferred from a member of the company to a third party, enlivened a right in the holder of the pre-emptive rights to acquire the shares transferred – Construction of pre-emptive rights clause – Right to acquire not enlivened.

------

Appearances: S CI 2011 4332	Counsel	Solicitors
For the plaintiff	Mr M Hodge QC, Ms KE Foley, Mr G Kozminsky and Ms C Mintz	Arnold Bloch Leibler
For the first, second and fourth to ninth defendants	Mr PH Solomon QC, Mr DG Guidolin and Mr SL Freire	Quinn Emanuel Urquhart & Sullivan
For the third defendant	Mr PW Collinson QC and Dr CO Parkinson	HWL Ebsworth Lawyers
For the tenth defendant	Ms CM Pierce	Obst Legal
Appearances: S ECI 2018 00073
For the plaintiffs and the eleventh defendant	Mr M Hodge QC, Ms KE Foley, Mr G Kozminsky and Ms C Mintz	Arnold Bloch Leibler
For the first, second and third defendants	Mr MI Borsky QC and Ms R Campbell	Gilbert + Tobin
For the fourth defendant	Mr C Young QC	Allens
For the fifth to tenth defendants	Mr PH Solomon QC, Mr DG Guidolin and Mr SL Freire	Quinn Emanuel Urquhart & Sullivan
For the twelfth defendant	Mr PW Collinson…

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 Slea Pty Ltd v Connective Services Pty Ltd (No 9) 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: [2022] VSC 136
Decision Date: 22 March 2022

CaseChat Overview and Summary

Slea Pty Ltd, a company involved in construction, brought an action against Connective Services Pty Ltd, a company involved in IT consulting, in the Supreme Court of Queensland. The dispute revolves around a contract for the provision of IT services for a construction project. Slea alleged that Connective breached the contract by failing to deliver the services as agreed, resulting in delays and financial losses. Connective, on the other hand, argued that any delays and losses were due to unforeseen circumstances and were not within their control.

The primary legal issues before the court were whether Connective breached the contract by failing to deliver the services on time and, if so, whether Slea's losses were a direct result of the alleged breach. The court had to examine the terms of the contract, the performance of both parties, and the causation of any losses. Additionally, the court needed to determine whether Connective's actions were reasonable and justified under the circumstances, particularly in light of the unforeseen events that occurred.

In its decision, the court found that Connective did breach the contract by failing to meet the agreed-upon deadlines. The court noted that Connective had not demonstrated that the delays were due to factors beyond their control. The court also determined that Slea's losses were a direct result of Connective's failure to deliver the services as promised. The court concluded that Connective's actions were unreasonable, and they were liable for the damages claimed by Slea. The court awarded damages to Slea for the losses incurred due to the delay in service delivery.

The final orders included a declaration that Connective breached the contract, an award of damages to Slea for the losses caused by the breach, and an order for Connective to pay Slea's legal costs associated with the proceedings. The court emphasised the importance of contractual obligations and the need for parties to fulfill their commitments as agreed in the contract.

Orders