Smolarek & Anor v Liwszyc & Ors

[2006] HCATrans 636

[2006] HCATrans 636

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Perth  No P13 of 2006

B e t w e e n -

HANNA SMOLAREK

First Applicant

CHRISTINA SMOLAREK

Second Applicant

and

DAVID LIWSZYC AND GHEORGHE EMIL DUTA

First Respondents

EZNUT PTY LTD (ADMINISTRATORS APPOINTED)

Second Respondent

Application for special leave to appeal

Publication of reasons and pronouncement of orders

GUMMOW J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON WEDNESDAY, 15 NOVEMBER 2006, AT 9.24 AM

Copyright in the High Court of Australia

__________________

GUMMOW J:   The applicants are mother and daughter.  The first applicant had developed a new type of commercial fastener.  She worked with the first respondent, Mr Liwszyc, to incorporate a company, Eznut Pty Ltd (“Eznut”), which is the third respondent in these proceedings.  The first applicant and the first and second respondents were directors in Eznut.  Eznut is under voluntary administration.

The parties disagreed over an issue of shares in Eznut.  A general meeting was held where the only persons present were the first applicant and her daughter.  At the general meeting, the first applicant purported to pass a resolution that her daughter be appointed as a director of Eznut.  Soon after this meeting, the first applicant purported to remove both the first and second respondents as directors of Eznut.

The first and second respondents commenced proceedings in the Supreme Court of Western Australia, claiming breach of fiduciary, statutory and contractual duties.  Hasluck J granted interlocutory relief, holding that there were serious questions to be tried as to the validity of the appointment of the second applicant as a director, and the attempted removal of the respondents as directors.  Hasluck J ordered that the first and second respondents be reinstated as directors, and that the second applicant be restrained from acting as a company director.

The Court of Appeal (Steytler P, McLure and Buss JJA) upheld the grant of interlocutory relief, except that order reinstating the second respondent as a director.  The Court of Appeal subsequently ruled that its order setting aside Hasluck J’s order to reinstate the second respondent take effect only from the date of its pronouncement.

The applicants apply to this Court out of time, but the delay is explained.  However, the application raises no question that would justify a grant of special leave.  No error has been shown in the judgment of the Court of Appeal, and the applicants’ assertion of bias by that Court is without foundation.  The extension of time is granted but special leave is refused.

Pursuant to r 41.10.5 we direct the Registrar to draw up, sign and seal an order dismissing the application for special leave.  I publish the disposition signed by Heydon J and myself.

AT 9.26 AM THE MATTER WAS CONCLUDED