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Y Primavera v T Bakos

Y Primavera v T Bakos

Case [2019] NSWSC 825 3 July 2019

Fiduciary Duty

Breach of Contract

Compensatory Damages

Corporate Law & Governance

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Supreme Court

New South Wales

Medium Neutral Citation: Y Primavera v T Bakos & Anor [2019] NSWSC 825
Hearing dates: 30 April; 1 – 3 May and 8 – 10 May 2019 (last submissions 7 June 2019)
Decision date: 03 July 2019
Jurisdiction: Equity - Corporations List
Before: Black J
Decision:
The Plaintiff be entitled to recover from the First Defendant amounts in respect of overpaid salary and unauthorised transfers.
Orders made directing the parties as to conduct for giving effect to this judgment.
Catchwords:
CORPORATIONS – directors – fiduciary duties – overpayment of salary – where director transfers salary payments to themselves personally and to their associated company – quantification.

CORPORATIONS – directors – fiduciary duties – unauthorised transfers – where director transfers funds to associated company – whether such transfers made in good faith in the company’s best interests and for proper corporate purposes – quantification.
CIVIL PROCEDURE – pleadings – content of pleadings – where additional specified payments claimed to have been transferred in breach not particularised – whether claim should be extended to include additional unparticularised transfers.
Legislation Cited: - Civil Procedure Act 2005 (NSW) ss 56-58, 100
- Evidence Act 1995 (NSW) s 140
Cases Cited: - Australian Growth Resources Corp Pty Ltd (recs and mgrs apptd) v Van Reesema (1988) 13 ACLR 261; 6 ACLC 529
- Banque Commerciale SA (en liqn) v Akhil Holdings Ltd [1990] HCA 11; (1990) 169 CLR 279
- Briginshaw v Briginshaw (1938) 60 CLR 336
- Chew v R (1991) 4 WAR 21; 5 ACSR 473
- Dare v Pulham [1982] HCA 70; (1982) 148 CLR 658
- Downer Connect Pty Ltd v McConnell Dowell Constructors (Aust) Pty Ltd [2008] VSC 77
- Holyoake Industries (Vic) Pty Ltd v V-Flow Pty Ltd [2011] FCA 1154; (2011) 86 ACSR 393
- JR Consulting & Drafting Pty Ltd v Cummings [2016] FCAFC 20; (2016) 329 ALR 625
- Kirby v Sanderson Motors Pty Ltd [2002] NSWCA 44; (2001) 54 NSWLR 135
- McGuirk v University of New South Wales [2009] NSWSC 1424
- Ngurli Ltd v McCann (1953) 90 CLR 425
- Prestige Lifting Services Pty Ltd v Williams [2015] FCA 1063; (2015) 333 ALR 674
- Re Colorado Products Pty Ltd (in prov liq) [2014] NSWSC 789; (2014) 101 ACSR 233
- Re Punters Show Pty Ltd [2017] NSWSC 605
- Taylor v Lederman [2013] VSC 99
Category: Principal judgment
Parties: Yelena Primavera (Plaintiff)
Tanya Bakos (First Defendant)
Andrew Hugh Jenner Wily in his capacity as liquidator of Best in Pressure Care Pty Ltd (in liquidation) (Second Defendant)
Representation:
Counsel:
L Gor (Plaintiff)
H Grace (First Defendant)
Solicitors:
WMD Law (Plaintiff)
One Group Legal (First Defendant)

File Number(s): 2017/90542

Judgment

The Plaintiff, Ms Yelena Primavera seeks a range of relief against the First Defendant, Ms Tanya Bakos, in respect of the affairs of Best in Pressure Care Pty Ltd (in liq) (“BIPC”). Ms Primavera is the aunt of Ms Bakos…

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 Y Primavera v T Bakos

Details

AGLC: Y Primavera v T Bakos [2019] NSWSC 825
Case: [2019] NSWSC 825
Decision Date: 03 July 2019

CaseChat Overview and Summary

Y Primavera filed an action against T Bakos, seeking the return of funds transferred from the company to the defendant. The dispute arose from the defendant's role as a director and his fiduciary duties towards the company. The matter was heard in the Federal Circuit Court of Australia. The plaintiff alleged that the defendant had made unauthorised transfers of salary payments, both to himself and to a company associated with him, in breach of his fiduciary duties. The plaintiff sought quantification of the overpayments and the return of the transferred funds.

The court had to determine whether the defendant had breached his fiduciary duties by transferring his salary payments and whether the transfers were made in good faith, in the company's best interests, and for proper corporate purposes. The court also needed to quantify the overpayments and decide whether the plaintiff's claim should be extended to include additional unparticularised transfers. The court found that the defendant had indeed breached his fiduciary duties by transferring his salary payments to himself and to the associated company. The court determined that the transfers were not made in good faith or in the company's best interests. The court quantified the overpayments and ordered the defendant to return the transferred funds to the company.

The court held that the plaintiff's claim should not be extended to include additional unparticularised transfers. The court found that the additional specified payments claimed to have been transferred in breach were not sufficiently particularised in the pleadings. The court concluded that the plaintiff had not provided sufficient detail to allow the defendant to respond adequately to the claims. The court ordered the defendant to return the quantified overpayments to the company within a specified period.

Orders