"SI (THO TER EME COURT oP THE MUSTESETAN CAPTTS LL TREE LTOE 7 y VENERSL OIVTSTON Tit THE MATTER AF INTRENZTLTONal PACTFIC COPPOFATION CHOLMINGE: ST CUMITEr AND iN TRF MATTER OF THR comMeantee scT LSEL PECPERN : VELCENE PTY LIMITER Plaintiff WID- MM. FOTHECHTLD & SONS LIMITED MM. POTHSCHILD & CONE «CT. LIMITFH YTEMISEY PTY. LIMITED Third Defendant HAPPTS PANFCOPP. INC. Fourth Defendant ' IMTFPNATTIONAL PACIFIC capespation } (HOLDINGS) PTY. LIMITED Pifth Defendant EVELYN DE POTHECHILD Sixth Cerendanr TOHM LOUDAN Seventh Detendant FUSSELL PHTLLIP ERE E,4tnth Deteraant FORFPT VANDEM BOSCH Ninth Defenaant CHP TS TOPHRE SITCOM Tentn Defeaniaant HELETIAaM PUSSREL Mc TUMOM 13 September 1985 PRASANS FOP THOGMENT LOCKHAPT I This .u uw a dispute between the shareholders of a compan, International Pacific Corporation Holdings Pty. Limited 'f"the Tompany")., which 1¢ the holding company for a group of companies jTarrying on merchant banking business. The three interests may be Prietly aescribed as, first, the Pothschild interests which contecl =4 rercent or the company; tne Harris interests based in Canada which contrtl 20 percent; and the interests of Velorne Pt. Limited, a comrany controlled be a Mr. Graham, which holds a 29 percont interest. Farlier this afternoon, on the application of the plaintitf "Taloens Ptr. Limited, I granted an ex parte anjunction ta subsist sup £2 and incluaing Weanesday of nezt week restraining the defendarntcr -ho, aim the main. are thot shareholding interests apart from the Velorne interest tH . (jche company itself, ana the var1ous directors ia} nimipited by the intersetz not cinder tne control of the rlaintiff from taking xzteps ta remove Mr Graham a3 director, managing director or thier amecutivte ef Ehe cemranz ac of FPoathechild Australia Limited 'ehien, af Tounderstand it, 1s one crt the cpaerating mibsinarar1es 71 the company anid from taking steps tea preeure the compant™ sr wreselt ovhich us feparately represented by fenior counsel, fougnt amm tydor? ceecinaing these injunctions primarily on three grou Frurdt. rb was said that the evidence which was adauce before me in support ar the application for the ex parte injunction was nor surficient to support those injunctions. Second,;1t was said that there had been material non-disclosure of evidence fa the Court. Third, 1t was submitted that, in the light of further evidence adduced on the application to rescind the injunctions, the injunction? should he continued no longer. The plaintiff's case ais based i1f not solely, at least primarily, upon 3. 220 of the Companies Act 1981 of the Australian oLtal Territory. Its predecessor wae s. 186 of tne uniform cempanies legislation, which was couched in somewhat narrower language thar ¢. 2290, In briet, vhat the plaintiff says 15 that the affairs of the company are being conducted ina manner that 15 oppressive or untairly preqyudicial to or untairly discriminatory against the claintiff as a 20 percent tharcholder, or in a manner that 1s contrary bo the interests of the members ac avwnels. I was reminied bv countel for the plaintitf that the cenduct charact2zrised by the section as Tv Db3 y ") ao x mM wo n"1 1D ie) rs cit wl Hi a fan NS a) Lay 1D ms ra H n P o Han nD Ny fasrt, w ian Ln] fan "4 a yw iD) nN nt r = tH ss wy it Lag) 'y 13) a member, whether in hi¢ caracity az amember or in anv other Tne detendants which seek Ec havo Ehe intunttrisonse rescindad in s¢7ence that Mr. Granam 1? nor ana never has neen the manading directce we chisf executive of the comoanr, although he has and azee hold that orfice ain relation to at least one of Che operating subsidiariss. There is no dispute that he 12 a director or the compan. The defendants also assert that anv aprointment of Mr. Graham as managing director or chief executive of at least Rothschild Lustralia Limited, is in no way linked with the 20 p D rceent shareholding of the plaintift in the company and, in effect, that Mr. Graham 14 liable to be dismissed from any office he holds save that of divcector, on grounds in addition to those which constitute misconduct. Tt 1s also asserted br the deraendants that there 1s ne evidence, or at Least no reliable evidence, that there 1= anv conduct on the part of any of the detendants which could prejudice the interacts of the plaintiff as a 20 percent shareholder in the tompan:. Te le imeertant mer me Eo state that thie matter 1z bein heart late in fhe afterncen and the rett the Court can deo is te determine tne aprlication ain the Tight of the material betcre it, catch Leonor xt course completes. It voula be quite vrerd of the Oruct tc form any firm views an tne racts at this itaye of the matter. Ioac avidence, that Ener 12 an arquable case to suprert the inguncticné vhicth have been grantea in favour of the plaintiff at this staqe. Tea take steps tc remove Mr. Graham as 2 managing directcr or 'thier executive, 1f he be that, or the company cr ot Rothscnild Australia Limited, certainly in the practical world in which we live would aprear tome to ke likely to have adverse cansequences upon the unterests of the plairtitf as a shareholder in the compan, if the- are in anv way in jeopardy, and there is some evidence to support that conclusion, I emphasise that I have no concluded or firm visw on any of ct co these matters. Qn the question of balance of cenvenience, although counsel for the defendants and the solicitor for the Harris interests have drawn my attention to certain possible matters of orejudice that "21L be sustained by them 1£ the injunction 13 continued, T am tatLet1ed that the balance of convenienco lies in favour of f ' retention of the injunctions which, as I said, operate until Wednesday The ¢esliciror foe the fourth defendant, Harris Eankcorp Incerrorated, ana for the ninth ana twelfth defendantt, Mc. Vanden Posch and Mr. Hutchison, who are directors ot the companz nominated cv the Harris uinterests, swuonitted that the anjunctions ehtuld te rescinded as against Mr. VYanaen Bosch and Mr. Hutchisen as there is no evidence alleging stfending conauct in relation to them. I thinks the au ensible and preferable course to fallow is not £9 distinguish between + he various defendants at this stage of the case, Fut ta alloy che wn rc er an as they presently etand to cantinue until Wednesday against all the jerendants. -~ am 'onsclaus of the fact that certain tindertakings have been proffered by thea company and br the Pothschild interests, which if they went as far as I think they should I would not hesitate to accept; but they do not caver all the matters which I think ars properly the matters of injunctive relief at this stage, so I will net accept then. The application to rescind the injunctions granted earlier this atternoon 12 dismissed. | certify that this and the five (s) preceding pages are & truo copy of the aed Judgment herein of his Honour Reasons for Mr. Justice Lockhart. S KowanDacket Associate Dated. / 34h Septenber, [9 "eo