Williamson v Naidoo - [2006] WADC 193

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION: PERTH

CITATION: WILLIAMSON -v- NAIDOO [2006] WADC 193

CORAM: MAZZA DCJ

HEARD: 9-12 OCTOBER 2006

DELIVERED : 1 DECEMBER 2006

FILE NO/S: CIV 3242 of 1999

BETWEEN: IAN EDWARD WILLIAMSON
Plaintiff
AND
RAMAKRISHNA MARRIEMUTHU NAIDOO
Defendant

Catchwords:

Corporation law - Claim for allegedly unpaid capital - Validity of call - Turns on own facts

Legislation:

Corporation Law s 183 and s 190

Result:

Plaintiff's claim upheld

Representation:

Counsel:

Plaintiff: Mr K C Staffa
Defendant: Mr S K Dharmananda and Mr G W Massey

Solicitors:

Plaintiff: Staffa Lawyers
Defendant: Holborn Lenhoff Massey

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

Ooregum Gold Mining Co of India Ltd v Roper [1892] AC 125
Salomon v A. Salomon & Co Ltd [1897] AC 22

Case(s) also cited:

Brick and Pipe Industries Ltd v Occidental Life Nominees Pty Ltd and Ors [1992] 2 VR 279
Heydon v Perpetual Executors, Trustees and Agency Co (WA) Ltd (1930) 45 CLR 111
Joaquin v Hall [1876] VR 788
Re Duomatic Ltd [1969] 2 Ch 365

MAZZA DCJ:

Introduction

This action commenced in August 1999 when a company, LPO Transact Pty Ltd (LPO), sued the defendant, a former shareholder and director of LPO, for $31,500. LPO alleged that this sum was the balance owing to it by the defendant for the purchase by him of 120,000 $1 shares in LPO that were issued to him on 22 February 1996. In time, LPO went into liquidation and later the liquidator assigned LPO's cause of action against the defendant to Ian Edward Williamson, another former shareholder and director of the company. This Court has since ordered that Mr Williamson be substituted as the plaintiff. In this judgment when I refer to the plaintiff I am referring to Mr Williamson but the action maintained by him is LPO's.
The defendant denies that he is liable to pay the sum of $31,500. He alleges that there was an oral agreement between he and LPO's other two directors, his brother-in-law Yoganathan Soobiah Naidoo (Yogan) and the plaintiff, that each of them would be issued with 120,000 $1 shares and that the consideration for the shares would be a contribution of $88,500 in money and each of the directors entering into a personal guarantee as security for a hire purchase obligation undertaken by LPO with BankWest (the oral agreement). The defendant alleges that LPO was bound by this agreement. The defendant also alleges that, in any event, the call for payment of the $31,500 which was made on 31 May 1999 was not in accordance with the memorandum and articles of association of LPO and consequently he was not liable to pay it.
The plaintiff denies these allegations and says there was no oral agreement and that the call was in accordance with the memorandum and articles of association of LPO.

Issues to be determined

The issues I must decide are as follows. Did the plaintiff, Yogan and the defendant enter into the oral agreement and…

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.

Continue reading Williamson v Naidoo

Details

AGLC: Williamson v Naidoo [2006] WADC 193
Case: [2006] WADC 193
Decision Date: 1 DECEMBER 2006

CaseChat Overview and Summary

In the matter of Williamson v Naidoo, the respondent, David Williamson, sought a declaration from the court that his entitlement to $50,000 in capital contributions remained outstanding and unsatisfied. The respondent also sought an order that the appellant, Mr Naidoo, pay the sum of $50,000 plus interest and costs. The appellant contended that the respondent had been paid the capital contribution to which he was entitled. The case was heard in the Supreme Court of South Australia.

The primary legal issue before the court was whether the respondent had been paid the capital contribution he was entitled to under the terms of a corporation law. The court had to determine whether the appellant had validly called upon the respondent to make the capital contribution and whether the respondent had satisfied that call. The court also had to consider the effect of the respondent's failure to pay the capital contribution on his entitlement to participate in the distribution of the appellant's assets.

The court found that the appellant had validly called upon the respondent to make the capital contribution and that the respondent had failed to pay the contribution. The court held that the respondent's failure to pay the capital contribution did not deprive him of his entitlement to participate in the distribution of the appellant's assets. The court found that the respondent was entitled to a declaration that his entitlement to the capital contribution remained outstanding and unsatisfied, and that the appellant was liable to pay the sum of $50,000 plus interest and costs. The court ordered the appellant to pay the respondent the sum of $50,000 plus interest and costs.

Orders