Westchester Pty Ltd v Triton Resources Ltd

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   WESTCHESTER PTY LTD & ANOR -v- TRITON RESOURCES LTD [2001] WASC 57

CORAM:   MASTER BREDMEYER

HEARD:   2 MARCH 2001

DELIVERED          :   7 MARCH 2001

FILE NO/S:   CIV 2262 of 1999

Consolidated with CIV 2182 of 2000 by Order made 20/11/2000

BETWEEN:   WESTCHESTER PTY LTD

First Plaintiff

PETER JOHN AUGUSTIN REMTA
Second Plaintiff

AND

TRITON RESOURCES LTD
Defendant

Catchwords:

Pleading - Illegal contract - Whether unenforceable - Public company giving a financial benefit to a related party

Legislation:

Corporations Law, s 103, s 243H, s 243K, s 243ZE, s 1317HA, s 1317HD

Result:

Application allowed

Representation:

Counsel:

First Plaintiff                :     Mr M D Cuerden

Second Plaintiff            :     Mr M D Cuerden

Defendant:     Mr N A Odorisio

Solicitors:

First Plaintiff                :     Hammond Worthington

Second Plaintiff            :     Hammond Worthington

Defendant:     Clayton Utz

Case(s) referred to in judgment(s):

Yango Pastoral Company Pty Ltd v First Chicago Australia Ltd (1978) 139 CLR 410

Case(s) also cited:

Dalgety Australia Ltd v Rubin, unreported; SCt of WA; Library No 5485; 24 August 1984

Henderson v Amadio Pty Ltd (1996) 140 ALR 596

Kimberley Downs Pty Ltd v Western Australia, unreported; SCt of WA; Library No 6414, 25 August 1986

1. MASTER BREDMEYER:  This is an application by the plaintiffs to strike out par 23(d) of the consolidated defence of 30 November 2000 which reads:

   "23.Further, or in the alternative, to the matters pleaded hereto the Defendant pleads as follows:

   (a)the Defendant is, and was at all material times to this action, a public company listed for quotation on the Australian Stock Exchange;

   (b)the First Plaintiff is, and was at all material times to this action, a company which is controlled by the Second Plaintiff;

   (c)between 6 May 1987 and 20 April 1999, the Second Plaintiff was a director of both the First Plaintiff and the Defendant;

   (d)by reason of the matters pleaded at paragraph 23(as), (b) and (c) hereof, and in consequence of sections 243H (as it existed prior to 13 March 2000) and 1470 of the Corporations Law of Western Australia, the Defendant is not permitted to give a financial benefit to the First and Second Plaintiffs on the basis being claimed by the First and Second Plaintiffs in this action."

2. This plea is in relation to those parts of the consolidated statement of claim whereby the plaintiffs claim sums of money from the defendant as management fees.  The second plaintiff, Mr Remta, is a director of the first plaintiff, and up to 20 April 1999 he was a director of the defendant which is a public company.  By written agreement made on 14 October 1997 between the first plaintiff and the defendant, the defendant agreed to pay the first plaintiff a fee of $13,500 per month for certain management services.  Mr Remta also had an agreement with the defendant to pay management fees.  His agreement was an oral one made in February 1996 whereby the defendant agreed to pay him a salary of $120,000…