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Wood v Inglis

Wood v Inglis

Case [2008] NSWSC 1147 6 November 2008

Jurisdiction

Unconscionable Conduct

Breach of Trust

Statutory Interpretation

Corporate Law & Governance

Succession Law

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Reported Decision:
68 ACSR 420

New South Wales

Supreme Court

CITATION: Wood v Inglis [2008] NSWSC 1147

HEARING DATE(S): 23/10/08

JUDGMENT DATE :
6 November 2008

JURISDICTION: Equity Division
Corporations List

JUDGMENT OF: Barrett J

DECISION: Application adjourned

CATCHWORDS: PROCEDURE - miscellaneous procedural matters - solicitor's retainer - challenge to retainer on basis that no valid corporate action of corporate party - whether determination of challenge should be deferred - onus of proof - CORPORATIONS - title to shares - shares bequeathed by will - who may be recognised by company as entitled to become holder in place of deceased holder - CORPORATIONS - internal management - purported meeting of members resolves to remove a director and appoint another director - only one member participating - whether valid resolution - whether purported appointment non-existent or merely defective - SUCCESSION - devolution of shares in company on death of registered holder

LEGISLATION CITED: Civil Procedure Act 2005, s 98(1)
Companies Act 1961, reg 89, Table A, Fourth Schedule
Corporations Act 2001 (Cth) ss 128, 129(2), (3), 176, 201M, 237, 1070A(1), (2), 1071B(2), (5), (8), (12), 1072E(2), 1274B
Probate and Administration Act 1898, ss 44(1), 46C(2)
Uniform Civil Procedure Rules 2005, rule 42.3

CATEGORY: Principal judgment

CASES CITED: A L Campbell & Co Pty Ltd v Federal Commissioner of Taxation [1951] HCA 36; (1951) 82 CLR 452
Australian Workers Union v Bowen [1946] HCA 24; (1946) 72 CLR 575
AW & LM Forrest Pty Ltd v Beamish [1998] NSWSC 442; (1998) 146 FLR 450
Bryen v Reus [1961 SR (NSW) 396
Commissioner of Stamp Duties (Q) v Livingston (1964) 112 CLR 12
Grant v John Grant & Sons Pty Ltd [1950] HCA 64; (1950) 82 CLR 1
Griffiths v Evans [1953] 1 WLR 1424
Halliday v Sachs Group Pty Ltd (1993) 67 ALJR 678
Harry S Bagg’s Liquidation Warehouse Pty Ltd v Whittaker (1982) 44 NSWLR 421
Hawksford v Hawksford [2005] NSWSC 463; (2005) 191 FLR 173
Hillig v Darkinjung Pty Ltd [2008] NSWCA 75
Hillig v Darkinjung Pty Ltd (No 2) [2008] NSWCA 147
Knight v FP Special Assets Ltd [1992] HCA 28; (1992) 174 CLR 178
Lunn v Cardiff Coal Co (No 3) [2003] NSWSC 789; (2003) 177 FLR 411
Morris v Kanssen [1946] AC 459
Re Agriculturalist Cattle Insurance Co (1870) LR 5 Ch App 725
Re Briton Medical and General Life Association (1888) 39 ChD 61
Re Hastings Deering Ltd (1985) 9 ACLR 755
Richmond v Branson & Son [1914] 1 Ch 968
Worcester Corsetry Ltd v Witting [1936] Ch 640
Yonge v Toynbee [1910] 1 KB 215
Zimmerman Holdings Pty Ltd v Wales [2002] NSWSC 447

TEXTS CITED: Ritchie’s “Uniform Civil Procedure NSW”, para 7.24.15

PARTIES: Helen Margaret Inglis - Applicant/Cross-Claimant
Inglis Research Pty Limited - First Cross-Defendant
Kathryn Margaret Clark - Second Cross-Defendant
Michael William Inglis - Third Cross-Defendant
Pamela Ruth Wood - Fourth Cross-Defendant
Fiona Jane Narlini Inglis - Fifth Cross-Defendant
William Keith Inglis - Sixth Cross-Defendant

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 Wood v Inglis

Details

AGLC: Wood v Inglis [2008] NSWSC 1147
Case: [2008] NSWSC 1147
Decision Date: 6 November 2008

CaseChat Overview and Summary

The case of Wood v Inglis arose in the Supreme Court of New South Wales, involving a dispute concerning the validity of a corporate action and the ownership of shares in a company. The primary parties were Wood and Inglis, with Inglis challenging the validity of Wood's retainer as a solicitor on the basis that no valid corporate action had been taken by the corporate party. This challenge necessitated the court's determination of whether such a challenge should be deferred and who bore the onus of proof in such a scenario. Additionally, the case delved into issues concerning the internal management of the company, specifically whether a purported meeting of members was valid and whether a resolution to remove a director and appoint another was legitimate when only one member was participating. The court was also required to decide who could be recognised by the company as the entitled holder of shares in the place of a deceased holder.

The central legal issues the court had to address included the procedural requirements for challenging a solicitor's retainer based on the validity of corporate action, the burden of proof in such challenges, and the criteria for recognising a new holder of shares in a company following the death of the registered holder. Furthermore, the court had to determine the validity of a meeting of members that purportedly resolved to remove a director and appoint another, where only a single member was present, and assess whether such an appointment was non-existent or merely defective.

In delivering its judgment, the court held that the challenge to the solicitor's retainer should not be deferred and that the onus of proof lay with the party making the challenge. The court found that for a meeting of members to be valid, it needed to comply with the company's constitution and applicable laws, and that a resolution passed by only one member did not constitute a valid meeting. Consequently, the purported appointment of a new director was deemed non-existent. Regarding the succession of shares, the court clarified that the company could recognise the entitlement of a new holder based on legal and factual considerations, including the terms of the will and the company's internal processes for transferring shares upon the death of the registered holder.

The final orders of the court reflected these findings, affirming the invalidity of the challenged retainer and the procedural requirements for future actions, while also providing clarity on the recognition of new share holders and the internal management processes of the company.

Orders