Thomas v D'Arcy

Case [2005] QCA 68

SUPREME COURT OF QUEENSLAND

CITATION:

Thomas v D’Arcy & Ors [2005] QCA 68

PARTIES:

GRAHAM ARNOLD PRANCE THOMAS
(plaintiff/appellant)
v
IAN KENNETH D’ARCY
(first defendant/first respondent)
ALEXANDER MACGILLIVRAY
CRAIG DOUGLAS GREEN
LYNDEN ELIZABETH STONE
JACQUELINE KNOWLMAN
(second defendants/second respondents)

FILE NO/S:

Appeal No 7736 of 2004
SC No 740 of 1995

DIVISION:

Court of Appeal

PROCEEDING:

General Civil Appeal

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

18 March 2005

DELIVERED AT:

Brisbane

HEARING DATE:

1 March 2005

JUDGES:

McPherson and Williams JJA and White J
Separate reasons for judgment of each member of the Court, each concurring as to the orders made

ORDERS:

1.    Appeal dismissed costs

2.    Plaintiff given leave to deliver within 28 days such further amended statement of claim as he may be advised

CATCHWORDS:

CORPORATIONS – CORPORATE FINANCE – SHARES – OTHER MATTERS – order striking out parts of statement of claim – application of rule that shareholder in a company is not entitled to claim or receive damages for a loss consisting of a diminution in the value of shares resulting from loss or injury to the assets of the company

Corporations Act 2001 (Cth), s 236

Property Law Act 1974 (Qld), s 85(1)

Christensen v Scott [1996] 1 NZLR 273, distinguished
Gould & Anor v Vaggelas (1985) 157 CLR 215, applied
Johnson v Gore Wood & Co [2002] 2 AC 1, applied
Macaura v Northern Assurance CompanyLimited & Others [1925] AC 619, cited
Metyor Inc v Queensland Electronic Switching Pty Ltd [2003] 1 Qd R 186, [2002] QCA 269, cited
Prudential Assurance Co Ltd v Newman Industries Ltd (No 2) [1982] Ch 204, applied
Roberts v Coventry Corporation [1947] 1 All ER 308, cited

Salomon v A Salomon & Company Limited & Others [1897] AC 22, cited

COUNSEL:

D A Savage SC, with R J Anderson, for the appellant
A M Pomerenke for the respondents

SOLICITORS:

Abbott Tout for the appellant

Brian Bartley & Associates for the respondents

  1. McPHERSON JA:  In this appeal against orders striking out parts of the statement of claim as amended, the appellant is Graham Thomas. He is the plaintiff in an action in the Supreme Court against members of the defendant firm of solicitors (of whom the first defendant is one) for damages for breach of their retainer or negligence in performing it. In his statement of claim the plaintiff alleges that he retained the defendants as his solicitors in November 1987 to provide advice “in relation to the management of [his] business interests and his personal affairs”: para 3(a). Although it does not in terms say so, para 3(a) is, I think, to be understood as alleging that it was legal rather than any other advice that the defendants were retained to provide.

  1. What follows here is a summary of allegations in the statement of claim or their effect. At relevant times, the plaintiff was the owner of half of the issued shares in Movado Pty Ltd and half of…

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AGLC
Thomas v D'Arcy [2005] QCA 68
Case
[2005] QCA 68
Decision Date

CaseChat Overview and Summary

The case of Thomas v D'Arcy involved a dispute between the plaintiff, Mr Thomas, and the defendant, Mr D'Arcy. The plaintiff sought damages for a loss he alleged to have suffered as a result of the defendant's actions, which were claimed to have resulted in a diminution in the value of his shares in a company. The matter was heard in the Supreme Court of Victoria. The court was tasked with determining whether the plaintiff's claim was valid under the principle that a shareholder in a company is not entitled to claim or receive damages for a loss consisting of a diminution in the value of shares resulting from loss or injury to the assets of the company.

The primary legal issue before the court was whether the plaintiff's claim for damages due to a loss in the value of his shares was valid under the principle mentioned above. The court had to consider whether the plaintiff's loss was directly attributable to the defendant's actions and whether such a claim was permissible under the law. The court also needed to examine the facts of the case to determine if there was any basis for the plaintiff's claim to succeed.

The court found that the principle that a shareholder in a company is not entitled to claim or receive damages for a loss consisting of a diminution in the value of shares resulting from loss or injury to the assets of the company was applicable in this case. The court held that the plaintiff's loss was not a direct result of the defendant's actions but rather a consequence of the company's financial situation. The court concluded that the plaintiff's claim was not valid, and the application to strike out parts of the plaintiff's statement of claim was successful. The court dismissed the appeal and ordered the plaintiff to deliver a further amended statement of claim within 28 days. The plaintiff was also granted leave to deliver such further amended statement of claim as he may be advised.

Orders

Orders of the court

1. Appeal dismissed costs

2. Plaintiff given leave to deliver within 28 days such further amended statement of claim as he may be advised

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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