Varma v Varma

Case [2010] NSWCA 358
Reported Decision: 81 ACSR 209

New South Wales


Court of Appeal


CITATION: Varma v Varma [2010] NSWCA 358
HEARING DATE(S): 6 December 2010
 
JUDGMENT DATE: 
16 December 2010
JUDGMENT OF: McColl JA at 1
DECISION: 1. That the current interlocutory undertakings entered into by consent on 9 August 2010 be varied so as to allow Taj Food Sales Pty Ltd, the third respondent, (subject to the right of the appellant, if it exists, following the appeal or in any new trial to recover from the first respondent such part of the dividend paid to him, and to recover from the second respondent such part of the dividend paid to him), to declare and to pay a dividend to the first, second and fourth respondents, in accordance with their respective shareholding rights, a sum not exceeding in total $240,000, providing always that the said dividends must only be declared and paid out of the net profit of the third respondent. 2.Costs of the application be costs in the appeal.
[The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
CATCHWORDS: Procedure - appeal - dispute as to ownership of shareholding in company - application for declaration of dividend to enable respondents to fund costs of appeal
LEGISLATION CITED: Corporations Act 2001 (Cth)
Legal Profession Act 2004 (NSW)
CATEGORY: Procedural and other rulings
CASES CITED: Alexander v Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685
Kalifair Pty Ltd v Digi-Tech (Australia) Ltd [2002] NSWCA 383; (2002) 55 NSWLR 737
New South Wales Bar Association v Stephens [2003] NSWCA 95; (2003) 52 ATR 602
Power v Ekstein [2010] NSWSC 137
Re D G Brims & Sons Pty Ltd (1995) 16 ACSR 559
Re Middle Harbour Investments Ltd (in liq) (Court of Appeal, 15 December 1976, unreported)
Varma v Varma [2010] NSWSC 786
Varma v Varma [2009] NSWSC 1086
Whitlam v Australian Securities and Investments Commission [2002] NSWCA 312; (2003) 43 ACSR 73
PARTIES: Gautam Varma - First applicant
Arjun Varma - Second applicant
Taj Food Sales Pty Ltd - Third applicant
Estate of the Late Sah Dev Varma - Fourth applicant
Parveen Varma - Respondent
FILE NUMBER(S): CA 2009/289939
COUNSEL: Mr EG Peterson for the Applicants (First, Second and Fourth respondents to the appeal)
Mr BW Rayment QC with Mr RW Washington for the Respondent (Appellant)
SOLICITORS: Hunt and Hunt Lawyers for the Applicants (First, Second and Fourth respondents to the appeal)
Hall Partners for the Respondent (Appellant)
LOWER COURT JURISDICTION: Supreme Court
LOWER COURT FILE NUMBER(S): SC 2009/289939
LOWER COURT JUDICIAL OFFICER: Ward J
LOWER COURT DATE OF DECISION: 16 July 2010
LOWER COURT MEDIUM NEUTRAL CITATION: [2010] NSWSC 786




                          2009/289939

                          McColl…

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AGLC
Varma v Varma [2010] NSWCA 358
Case
[2010] NSWCA 358
Decision Date

CaseChat Overview and Summary

In *Varma v Varma*, the appellant and respondents were engaged in a dispute concerning the ownership of a shareholding in a company. The respondents sought a declaration that a dividend be paid to enable them to fund the costs of an appeal.

The primary legal issue before the court was whether to vary existing interlocutory undertakings to permit the declaration and payment of a dividend from the company's net profits to the respondents, subject to the appellant's right to recover such amounts if successful in the appeal or a new trial.

McColl JA considered the application for variation of the interlocutory undertakings. The court's reasoning focused on balancing the need for the respondents to fund their appeal against the appellant's potential rights. The court ultimately ordered that the interlocutory undertakings be varied to allow the company to declare and pay a dividend not exceeding $240,000 in total to the first, second, and fourth respondents, in accordance with their shareholding rights. This payment was to be made only out of the company's net profit and was subject to the appellant's right to recover from the first and second respondents any part of the dividend paid to them should the appeal or a new trial be successful. The costs of this application were to be costs in the appeal.

Orders

Orders of the court

1. That the current interlocutory undertakings entered into by consent on 9 August 2010 be varied so as to allow Taj Food Sales Pty Ltd, the third respondent, (subject to the right of the appellant, if it exists, following the appeal or in any new trial to recover from the first respondent such part of the dividend paid to him, and to recover from the second respondent such part of the dividend paid to him), to declare and to pay a dividend to the first, second and fourth respondents, in accordance with their respective shareholding rights, a sum not exceeding in total $240,000, providing always that the said dividends must only be declared and paid out of the net profit of the third respondent. 2.Costs of the application be costs in the appeal.

[The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

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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