FEDERAL COURT OF AUSTRALIA The University of Western Australia v Gray (No 6) [2006] FCA 1825 INCORPORATED ASSOCIATIONS – respondent to proceedings – membership uncertain – validity of appointment of board members questioned – intractable conflict of interest in board members – charitable objects – assets only applicable for relevant charitable objects – power of court to make interlocutory appointment of receiver – receiver to conduct litigation or resolve it – whether power should be exercised – receiver appointed Federal Court of Australia Act 1976 (Cth s 57, s 23 Corporations Act 2001 (Cth) Associations Incorporations Act 1987 (WA) s 27 Martyniuk v King [2000] VSC 319 cited Manchester and Liverpool District Banking Co v Parkinson (1888) 22 QBD 173 cited Vouros as Liquidator of Cadima Express Pty Ltd v Deputy Commissioner of Taxation (1933) 33 ACSR 527 cited THE UNIVERSITY OF WESTERN AUSTRALIA v BRUCE NATHANIEL GRAY, SIRTEX MEDICAL LIMITED (ACN 078 166 122), CANCER RESEARCH INSTITUTE INCORPORATED (REG NO 1001005) BRUCE NATHANIEL GRAY v THE UNIVERSITY OF WESTERN AUSTRALIA, YAN CHEN SIRTEX MEDICAL LIMITED (ACN 078 166 122) v THE UNIVERSITY OF WESTERN AUSTRALIA WAD 292 OF 2004 FRENCH J 22 DECEMBER 2006 PERTH IN THE FEDERAL COURT OF AUSTRALIA WESTERN AUSTRALIA DISTRICT REGISTRY WAD 292OF 2004 BETWEEN: THE UNIVERSITY OF WESTERN AUSTRALIA Applicant AND: BRUCE NATHANIEL GRAY First Respondent SIRTEX MEDICAL LIMITED (ACN 078 166 122) Second Respondent CANCER RESEARCH INSTITUTE INCORPORATED (REG NO 1001005) Third Respondent BRUCE NATHANIEL GRAY First Cross-Claimant THE UNIVERSITY OF WESTERN AUSTRALIA First Cross-Respondent to First Cross-Claim YAN CHEN Second Cross-Respondent to First Cross-Claim SIRTEX MEDICAL LIMITED (ACN 078 166 122) Second Cross-Claimant THE UNIVERSITY OF WESTERN AUSTRALIA Cross-Respondent to Second Cross-Claim JUDGE: FRENCH J DATE OF ORDER: 22 DECEMBER 2006 WHERE MADE: PERTH THE COURT ORDERS THAT: 1. The orders made on 5 October 2006 as amended by the orders of 25 October 2006 apply to the date of this order and thereafter are substituted with the orders following. 2. Mr Mark Conlan of RSM Bird Cameron Partners be appointed until further order of this Court as receiver of the assets of the third respondent. 3. Without limiting the other powers conferred on the receiver by these orders, the receiver have the power to: (a) determine the position that the third respondent should take in these proceedings; (b) have the conduct of these proceedings on behalf of the third respondent; (c) instruct solicitors to appear and to file and serve any documents in the proceedings; and (d) subject to the approval of the Court, enter into and give effect to any agreement for the resolution of all or part of these proceedings so far as they affect the third respondent. 4. For the purposes of orders 2 and 3 of these orders the receiver have all of the rights and powers: (a) of a member of the third respondent; (b) of the third respondent as a shareholder in the second respondent; (c) of the board of management of the third respondent including, without limitation, the power to manage any and all of the assets and undertakings of the third respondent in such manner as he considers appropriate, consistent with the objectives of the third respondent, and for the purposes of the conduct or resolution of these proceedings; (d) as may be reasonably incidental to the pursuit of any of those purposes or the exercise of any of the powers conferred by these orders. 5. In order to enable him properly to discharge his functions and exercise his powers under these orders, the receiver may obtain independent commercial and legal advice as he deems appropriate, including without limitation the advice of senior counsel. 6. The receiver is not required to file security pursuant to Order 26 Rule 3. 7. The receiver will be entitled to: (a) remuneration for work done pursuant to the receivership orders by him and his partners and the staff of the firm acting under his supervision as the Court may fix from time to time on application of the receiver to be calculated, unless the Court orders otherwise, in accordance with the usual hourly rates charged by the firm as set out in Exhibit 'MAC1' to the receiver's affidavit of 8 December 2006 and as varied by the Court from time to time (Remuneration); (b) the reasonable costs and expenses (including without limitation legal expenses) properly incurred by him in the performance of his duties and the exercise of his powers and any matters arising from, relating to, incidental to and in connection with the performance of his duties and the exercise of his powers under the receivership orders (Costs and Expenses); and (c) an indemnity out of the property, including without limitation any shares in the second respondent held by the third respondent (Shares), in respect of the Remuneration and Costs and Expenses, any claim under such indemnity to be given priority to any claim of any other party including the applicant against the property. 8. The receiver may pay the reasonable legal fees and expenses incurred up to the date of these orders by Tottle Partners and Fairweather & Lemonis in relation to legal services provided to the third respondent or to past or present officers or purported officers of the third respondent in connection with these proceedings. 9. The receiver may from time to time after the date of these orders draw against the property as required for reimbursement of his Costs and Expenses. 10. The receiver may from time to time after the date of these orders draw for his Remuneration on the footing that he will account for his drawings when his accounts are prepared and presented to the Court from time to time. 11. If upon the passing of accounts as referred to in order 9 of these orders the amount fixed for the Remuneration of the receiver is less than the amount drawn by him for his Remuneration pursuant to that order, the receiver must within 14 days of the fixing of his Remuneration (or such longer time as the Court may allow) pay to the credit of the third respondent the amount by which the Remuneration allowed is less than the amount drawn on account of Remuneration. 12. The receiver may from time to time sell such number of Shares as may be necessary to pay any amount he is entitled to be paid or empowered to pay or draw pursuant to these orders or the receivership orders, and to apply the net proceeds to make that payment. 13. No later than 28 days from the expiry of each complete period of 3 months from 5 October 2006, and thereafter monthly until the completion of his receivership under the receivership orders, the receiver must: (a) report to the Court as to the progress of his receivership; and (b) submit to the Registrar for assessment a bill of costs in a form acceptable to the Court for his Remuneration and Costs and Expenses (including any payment made pursuant to Order 7) for the preceding completed period covered by the report. 14. The orders of the Court made on 2 June 2006 and 7 July 2006 be varied to the extent necessary to give effect to these orders. 15. The receiver or any other party have liberty to apply to the Court to vary or discharge these orders or for other directions. 16. Costs to be reserved. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA WESTERN AUSTRALIA DISTRICT REGISTRY WAD 292 OF 2004 BETWEEN: THE UNIVERSITY OF WESTERN AUSTRALIA Applicant AND: BRUCE NATHANIEL GRAY First Respondent SIRTEX MEDICAL LIMITED (ACN 078 166 122) Second Respondent CANCER RESEARCH INSTITUTE INCORPORATED (REG NO 1001005) Third Respondent BRUCE NATHANIEL GRAY First Cross-Claimant THE UNIVERSITY OF WESTERN AUSTRALIA First Cross-Respondent to First Cross-Claim YAN CHEN Second Cross-Respondent to First Cross-Claim SIRTEX MEDICAL LIMITED (ACN 078 166 122) Second Cross-Claimant THE UNIVERSITY OF WESTERN AUSTRALIA Cross-Respondent to Second Cross-Claim JUDGE: FRENCH J DATE: 22 DECEMBER 2006 PLACE: PERTH REASONS FOR JUDGMENT ON PROPOSED EXPANSION OF POWERS OF RECEIVER APPOINTED TO THIRD RESPONDENT AND RECEIVER'S REMUNERATION Introduction 1 The Cancer Research Institute Incorporated (CRI) is an incorporated association established to support cancer research and education in general and in particular activities recommended by the Medical and Scientific Advisory Committee of the Lions Cancer Institute. The principal asset of the association is shares in Sirtex Medical Ltd (Sirtex). Sirtex is a public company which holds intellectual property rights said to have been developed, inter alia, by Dr Bruce Gray, formerly Professor of Medicine and Head of the Department of Surgery at the University of Western Australia (the University). 2 CRI has become involved in litigation brought by the University against Dr Gray and Sirtex. The University asserts its entitlement to the shares in Sirtex held by CRI on the basis that the intellectual property rights held by Sirtex in truth belong to the University. 3 A difficulty has arisen with the participation of CRI as a respondent in this litigation. The difficulty arises because of uncertainties about its membership and the recent purported election to its board of Dr Gray, one of his solicitors and his sister. Concern about these issues have led to the appointment of a receiver of the shares in Sirtex held by CRI. Directions have previously been made requiring the receiver to call a meeting of members to consider, inter alia, a settlement agreement said to have been reached between CRI and the University in the course of mediation in these proceedings when the purported board of management was differently composed. 4 Because of the governance issues affecting CRI and the uncertainty of its membership the receiver has now applied to the Court to expand his powers. For the reasons that follow I propose to accede to that application and to give the receiver the power to conduct these proceedings on behalf of CRI and, if appropriate, to settle them on terms approved by the Court. I will also make orders relating to the remuneration of the receiver and CRI's former solicitors. Factual and procedural background 5 The University is suing a former Professor of Medicine and Head of the Department of Surgery at the University, Dr Bruce Gray. It is also suing two organisations with which he is associated, a listed public company Sirtex, and an incorporated association, CRI. At the heart of the University's action is its allegation that Dr Gray developed new technologies for treating cancer whist a member of the University's staff and that he subsequently obtained intellectual property rights and benefits flowing from those technologies in breach of his contractual and fiduciary duties to the University. The technologies, one of which is described as the "DOX-Sphere Invention", involve the use of ceramic microspheres to deliver localised treatment for cancer to specific organs. The acquisition of the intellectual property rights by Sirtex including, in the case of the DOX-Sphere Invention, by assignment of the rights from CRI, and the issue of shares in Sirtex to Dr Gray and to CRI have brought both of those entities into the dispute. 6 The proceedings between the University and CRI are said to turn on: (a) the circumstances in which CRI obtained rights in respect of the DOX-Sphere Invention; and (b) the rights of the University with respect to shares in Sirtex which CRI obtained in consideration of the assignment of its rights and entitlement in respect of the DOX-Sphere Invention to Sirtex. The University claims a declaration against CRI that it holds, on trust for the University, such of the shares and options in Sirtex as are found by the Court to be impressed with the trust. It also seeks an order that CRI transfer the shares and options to the University. 7 On 2 June 2006 I made an order that CRI be restrained until further order from dealing in any shares held by it in Sirtex and from exercising any options held by it in relation to Sirtex. 8 On 31 July 2006 a mediation conference was conducted before Deputy Registrar Stanley in which the University was represented by its solicitors, as was CRI. At that meeting the University agreed to settle its action against CRI on the basis that CRI transfer the Sirtex shares held by it into a trust to be called The Cancer Research Trust. The Cancer Research Trust was to be managed by a Board of Management comprising: (a) a Chairman appointed by the University, CRI and the Western Australian Institute for Medical Research (WAIMR), jointly; (b) two nominees appointed by the WAIMR; (c) a nominee appointed by CRI; (d) a nominee appointed by the University. Instructions were given to an independent solicitor to prepare documentation necessary to give effect to the settlement agreement. However on 19 September 2006, at a directions hearing, Mr Tottle representing CRI, informed the Court that a question had arisen about the legal capacity of the CRI board from whom he had been receiving his instructions. Since then a new board has purportedly been appointed by resolution of a meeting of CRI held on 27 September 2006. It is said to comprise the first respondent, Dr Gray, Mr David Sanders, a partner in Lavan Legal which is Dr Gray's solicitor of record in these proceedings and Dr Gray's sister, Ms Bethwyn Daebritz. This development gave rise to obvious concerns, which I expressed in Court, about the extent to which the affairs of CRI may be conducted in the pursuit of interests other than those related to its objects which are public charitable purposes and, in particular, purposes related to cancer research and education. 9 Dr Gray questioned the validity of the settlement agreement relied upon by the University which in turn filed a motion, on 29 September 2006, seeking its enforcement. On 3 October 2006, on the return of that motion, I raised the possibility that because of the obvious governance difficulties affecting CRI it might be necessary to consider the appointment of a receiver. The matter was adjourned to 5 October 2006 and further debate took place. 10 On 5 October 2006 I decided, acting under s 57 of the Federal Court of Australia Act 1976 (Cth) (Federal Court Act), to appoint Mr Mark Conlan as the receiver of the shares in Sirtex held by CRI. As receiver, he would have power to exercise all of CRI's rights as a shareholder in Sirtex and would be entitled to investigate the enforceability of the agreement said to have been made with the University. I also required that a meeting of CRI be convened by the receiver who would have all the powers of the board and a member of CRI for that purpose in order to enable the meeting to consider and determine whether the agreement which had been made should be ratified or whether some alternative course should be taken in relation to the resolution of the litigation. I authorised the receiver so appointed to obtain independent legal advice to enable him to properly discharge his functions in that regard. The receiver was to be entitled to reasonable remuneration and costs and to an indemnity out of the assets of CRI in respect of those costs. Freezing orders previously made on 2 June 2006 and 7 July 2006 were varied to the extent necessary to give effect to the orders made on 5 October 2006. 11 On 27 November 2006 the matter came back to Court with submissions filed on behalf of the receiver seeking an expansion of his powers. At that time the issue as to the membership of CRI and who comprises its board of management remained unresolved. The receiver had formed the view that there appeared to be no current members of CRI. Mr Tottle, of Tottle Partners who had conduct of the proceedings on behalf of CRI on instructions from the purported members of the previous board, said in an affidavit sworn 20 November 2006, that in August 2006 he considered it necessary that the persons who were instructing his firm on behalf of CRI as members of the board of management seek independent advice in relation to the implementation of the agreed settlement terms and that that advice be paid for by CRI. The persons concerned, Ms Mirmikidis, Ms Oakley, Ms Ainsley and Mr Jones, had acted in a voluntary capacity in respect of the work undertaken by them in connection with the management of CRI's affairs. 12 The receiver asked that his powers be widened by appointing him as receiver and manager "… of all the assets and undertaking of the third respondent, including without limitation the shares in the second respondent held by the third respondent". The orders sought extended to the power to conduct the proceedings on behalf of CRI, to determine the position that it should take in the proceedings, to instruct solicitors to appear and to file and serve any documents in the proceedings, and, subject to the approval of the Court, to enter into and give effect to any agreement for the resolution of all or part of the proceedings so far as they affect CRI. Other orders relating to the receiver's remuneration were also sought. 13 At the hearing on 27 November 2006 Mr Bennett, who acts for Dr Gray in his capacity as first respondent, pointed out that no notice had been given to the persons claiming to constitute the current board (including Dr Gray) of the application to expand the receiver's powers. Orders were then made that the receiver for CRI file and serve on Dr Gray any affidavits in support of his proposed expanded powers on or before 1 December 2006. Any claim for privilege in relation to any aspect of the receiver's affidavit or exhibits were to be notified to the receiver by Dr Gray by 5 December 2006 and to the University by that time. There was then a further direction that any party seeking to file any affidavit in reply to the receiver's affidavit do so by 7 December 2006. The matter was stood over to 8 December 2006. On 30 November 2006 the orders were varied by consent to require the receiver to serve the affidavits on CRI. 14 On 8 December 2006 the matter came on for hearing on the question of the receiver's powers. Mr Vaughan sought leave to appear for Dr Gray, for Ms Daebritz and for Mr Sanders claiming to be the CRI board. He had only been instructed the previous day. He sought an adjournment. Considerable debate ensued. I then ordered: '1. Dr Gray, Ms Daebritz and Mr Sanders have leave to file submissions and affidavits relevant to the question of the expansion of the receiver's powers on or before 14 December 2006. 2. The question of the expansion of the receiver's powers be stood over for further oral argument and decision on 19 December 2006 at 2.15pm WDST. 3. The current powers of the receiver are extended to the extent necessary to enable them to investigate the possibility of a resolution of the third respondent's involvement in these proceedings so far as it affects the ownership of the shares held by the third respondent in the second respondent.' There was liberty to apply and costs were reserved. 15 Since that time a number of affidavits have been filed. I heard further argument on 19 December 2006 and reserved judgment on the question of the receiver's powers until today. The receiver also sought orders relating to his remuneration. The evidence 16 There is now a significant number of affidavits before the Court relevant to the question whether the receiver's powers should be expanded. They are summarised below. 1. Affidavit of Marjorie Frances Hodgson sworn 29 September 2006 17 Ms Hodgson is a solicitor employed by Jackson McDonald, the solicitors acting for the University. Her affidavit was sworn in support of the University's motion filed 29 September 2006 for specific performance of the settlement agreement which it said was made between it and CRI on 31 July 2006. A copy of the Agreed Settlement Terms, signed by legal representatives for the parties, was exhibited to her affidavit. Ms Hodgson referred to consent orders, made on 2 August 2006, in order to give effect to the Agreed Settlement Terms, that timetabled directions relating to the proceedings against CRI be suspended until the first directions hearing after 30 September 2006 and that CRI be excused from attending any directions hearing scheduled between the date of that order and 30 September 2006. 18 The solicitors for CRI and the University jointly instructed Mrs Elizabeth Heenan of Marks & Sands Lawyers to prepare a trust deed to give effect to the Agreed Settlement Terms. However by a letter dated 28 September 2006 from Tottle Partners to Mrs Heenan which was exhibited to Ms Hodgson's affidavit, Tottle Partners advised Mrs Heenan that issues had arisen as to the authority of the board of CRI to settle the proceedings with the University and also whether the Agreed Settlement Terms were enforceable against CRI. Tottle Partners then said: 'In light of the matters raised above, CRI is unable to instruct you jointly with the University to proceed with the preparation of the documents required to constitute the Cancer Research Trust.' 2. Affidavit of Annabelle Helen Hughes sworn 3 October 2006 19 Ms Hughes is a solicitor employed by Lavan Legal, Dr Gray's solicitors. Her affidavit of 3 October 2006 was by way of response to the University's motion of 29 September 2006. She said she was informed by Dr Gray, and believes, that he is a member of CRI. On 27 September 2006 she attended the annual general meeting of CRI which, according to Dr Gray, was convened by him in his capacity as a member of CRI. He informed her that before the meeting there had not been any directors' meeting or annual general meeting convened for the purpose of electing directors since 2001 and that there had been no valid directors since 2004. At the meeting, according to Ms Hughes, David Sanders, a partner in the law firm Lavan Legal, Dr Bruce Gray and his sister, Bethwyn Daebritz were appointed directors. A motion was put to "members" that CRI agree to establish a new trust to be managed by a board comprising members of CRI, the University and WAIMR. That motion was "unanimously defeated". According to Ms Hughes, no other meeting of members has been held since July 2006. Following the meeting of members, a meeting of the purported board of CRI was convened. Mr Sanders was appointed chairman. Dr Gray was appointed treasurer and his sister was appointed secretary. Ms Hughes said that neither Dr Gray nor Mr Sanders had seen or executed any formal deed of settlement. 3. Affidavit of Marjorie Frances Hodgson sworn 5 October 2006 20 Ms Hodgson exhibited a consent by Mr Conlan to act as receiver for CRI if appointed by the Court. A consent was also filed by Mr GF Totterdell. 4. Affidavit of Timothy Randolph Price sworn 5 October 2006 21 Mr Price is a partner in the firm Phillips Fox and is acting for Sirtex. He deposed that the conduct of the proceedings on behalf of Sirtex is managed by a litigation committee comprising three non-executive directors of Sirtex. They are: (a) Richard James Hill; (b) John Alan Eady; and (c) Grant Desmond Boyce The only other directors of Sirtex are Dr Gray and the Chief Executive Officer, Gilman Wong. Mr Price receives his instructions from the litigation committee. 22 On 22 August 2006 the litigation committee determined that Sirtex should apply for leave to file a cross-claim against Dr Gray and CRI. On the same day Dr Gray stood down as chairman of Sirtex and Mr Hill was elected as his successor. On 10 September 2006 Dr Gray wrote to the company secretary of Sirtex requesting that a motion for the removal of Mr Hill as a director of Sirtex be considered at the 2006 annual general meeting of Sirtex which was scheduled for 24 October 2006. He also requisitioned, in conjunction with other shareholders, a meeting for 6 October 2006 to consider the same motion. 23 Dr Gray wrote to the shareholders of Sirtex on or about 11 September 2006 attaching a notice of the requisitioned meeting fixed for 6 October 2006. The meeting was said to have been convened pursuant to s 249F of the Corporations Act 2001 (Cth) by Dr Gray, Ms Daebritz, a company called Pine Ridge Holdings Pty Ltd, a Mr Wark and Westwood Properties. 24 In his letter to shareholders Dr Gray listed various complaints against Mr Hill. He referred to the proposed cross-claims by Sirtex against himself and CRI. In the course of the letter Dr Gray said: 'As your board has sufficient directors the shareholders convening this meeting choose not to nominate a replacement director at this time. The right candidates to represent you on the board of directors can be selected over time. In the meantime, as shareholders I urge you to send an emphatic message to the board to rethink the disastrous lack of strategy in Sirtex's defence to this monstrous action by the University of Western Australia. The strategy should marshal the collective resources of me, the Cancer Research Institute and your company against this avaricious, opportunistic claim by Professor Alan Robson representing the University of WA.' This passage was of some significance to the present issue as it was said to demonstrate Dr Gray's determination to align CRI's position in the proceedings with his own and that of Sirtex. 25 Subsequently a letter was sent by the non-executive directors of Sirtex to shareholders responding to Dr Gray's letter. That letter was dated 18 September 2006. It led to the issue of a writ in the Supreme Court of Western Australia by Dr Gray against the directors Hill, Boyce and Eady claiming damages for defamation and misleading and deceptive conduct contrary to the Fair Trading Act 1987 (WA). 5. Affidavit of Paul Allan Tottle sworn 20 November 2006 26 Mr Tottle is a partner of Tottle Partners who has had the conduct of the proceedings on behalf of CRI. He referred to the sale of the 100,000 Sirtex shares held by CRI and their payment into his firm's trust account and the payment out of legal fees incurred up to and including 31 July 2006. 27 Mr Tottle said in his affidavit that on 2 August 2006 he formed the view that the persons who were instructing his firm on behalf of CRI as members of its board of management should seek advice from a law firm other than Tottle Partners in relation to certain aspects of the implementation of the Agreed Settlement Terms and that that advice be paid for by CRI. He knew that those persons, Ms Mirmikidis, Ms Oakley, Ms Ainsley and Mr Jones had acted in a voluntary capacity in respect of the work undertaken by them in relation to the management of CRI's affairs. He referred them to Mr Lemonis of the firm Fairweather & Lemonis. A sum of $5,000 was paid into that firm's trust account on account of its anticipated fees and disbursements. 28 On 21 August 2006 an issue was raised about the legal capacity of those who had been instructing Tottle Partners on behalf of CRI. Mr Tottle said that the issues as to who are members of CRI and who comprise its Board of Management remain unresolved. He was unable to obtain instructions on any substantive aspect of the conduct of the litigation. His firm had been prepared to remain on the record on behalf of CRI because he considered that they could provide some ongoing assistance to CRI and to the Court, albeit there were limitations as to the nature of the assistance that could be provided. His firm was prepared to continue on the record for CRI provided that some provision be made for payment of legal costs. 29 Mr Tottle's affidavit evidence was supported by that of a solicitor working in his firm, Yin Chieh Fang sworn 24 October 2006. 6. Affidavit of Timothy Randolph Price sworn 1 December 2006 30 Mr Price referred to his earlier affidavit of 5 October 2006 and to the meeting of members of Sirtex convened by requisition from Dr Gray and his associates for the purpose of considering a motion to remove Mr Hill, the chairman of Sirtex, as a director of that company. A resolution in identical terms was proposed by Dr Gray for consideration at the annual general meeting of 24 October 2006. Mr Price attended the meeting of 6 October 2006 as did Mr Bennett who is counsel for Dr Gray in these proceedings. Mr Conlan, the receiver of the Sirtex shares held by CRI, was not represented at the meeting. The meeting was chaired by Dr John Eady, the deputy chairman of Sirtex and was ultimately adjourned to the same time, date and place as the annual general meeting of 24 October 2006. Mr Price referred in his affidavit to claims that Mr Bennett had said after the adjournment that Dr Gray had been given a proxy by CRI to vote its Sirtex shares at the meeting and that, notwithstanding the appointment of the receiver, he could still vote on those proxies as he saw fit. These claims were based upon an article allegedly quoting Mr Bennett which appeared in the Australian Financial Review of 9 October 2006 and a statement made by a Professor Jeremy Davis, a shareholder of Sirtex, which was exhibited to Mr Price's affidavit. There was also evidently some dispute as to whether the Sirtex meeting had been validly adjourned. Sirtex sought from Dr Gray a copy of the proxies which he had for the purposes of the meeting but these proxies were not provided. 7. Affidavit of Mark Anthony Conlan sworn 26 November 2006 31 In this affidavit Mr Colan, who is the receiver appointed to CRI, said that shortly after his appointment he became aware of considerable uncertainty and dispute about the identity of the members and the board of CRI. He decided that, in order to carry out his duties under the orders of the Cour, and particularly in order to call a meeting of members, he would need to attempt to resolve who were the members of CRI. He had a series of meetings with various parties on dates between 10 October 2006 and 21 November 2006. He also sent out letters to interested parties requesting information which might assist him in determining membership. 32 A member of Mr Conlan's staff, Mr Felton, contacted the bookkeeper to CRI, Mr Ben Saracini, and inquired whether he had financial records of the association and any membership mailing lists. Mr Saracini informed Mr Felton that he held no membership list or mailing list of CRI members. At the request of Dr Gray he had on one occasion forwarded notices of a CRI annual general meeting to members but was unsure when that had occurred. 33 On 6 October 2006 two members of Mr Conlan's staff visited the offices of Tottle Partners to assess what books and records of CRI were held and available for inspection, particularly in respect of membership. On 17 November 2006 with Mr Felton he attended at the offices of Tottle Partners and inspected the CRI discovered documents. He obtained copies of those he considered relevant to the issue of membership and board membership of CRI. 34 Among the documents which Mr Conlan exhibited to his affidavit were a copy of the CRI Constitution and a copy of each of the pages in its minute book relating to annual general meetings from 18 October 1994 to 6 December 2004. Copies of selected pages from a cashbook kept by CRI recording membership fees received between 1 July 1991 and 28 June 1996 were included along with copies of various applications for membership of CRI. Audited financial statements for the financial years ended 1995 to 2005 were exhibited. A document entitled "Membership List" dated 12 October 1995 was also exhibited. 35 From his analysis of CRI board minute meetings, it appeared to Mr Conlan that the CRI board met monthly during the period July 1994 to November 1998 and three or four times annually from November 1998 to December 2003. It met seven times in 2004. 36 Mr Conlan referred to relevant parts of rule 5 of the CRI Constitution relating to membership. It appears that membership is open to all persons subject to approval by the board (5.1). The board is empowered to establish criteria for membership including a schedule of membership fees (5.2). All resolutions or rules relating to members are to be affixed to the Rules (5.3). Any person is eligible to be a member by payment of the required annual subscription as determined by the board and as prescribed in the schedule of membership fees (5.5). Each member is to pay to the treasurer annually on or before 1 July or such other date as the board determines, the amount of the subscriptions determined by the board and prescribed in the schedule of membership fees (5.6). 37 Clause 5.7 provides: 'A member whose subscription is not paid within three months after the relevant date fixed by the board ceases on the expiry of that period to be a Member, unless the board decides otherwise.' A member is said to be a financial member for the purposes of the Rules if the person's subscription is paid on or before the relevant date fixed by the board or within three months thereafter (5.8). Clause 5.9 provides for the cessation of membership upon delivery of notice in writing of resignation or resolution by the board to expel the member from the association. 38 The secretary of the association is required to keep and maintain a register of members in accordance with s 27 of the Associations Incorporation Act 1987 (WA) (5.10). 39 None of the board minutes or annual general meeting minutes which Mr Conlan has inspected and which are all the CRI minutes in his possession, recorded any information as to: (a) whom the board resolved to grant membership other than P Jones and G Anderson; (b) criteria for membership; (c) a schedule of membership fees; (d) a date by which membership fees must be paid; (e) a date by which, if membership fees were not paid, a member would cease to be a member; (f) life membership other than for Dominic O'Neil. 40 Mr Conlan identified all ten year memberships received and recorded in the cashbook. On the basis of that exercise he expressed his belief that the latest payment of $80 for a 10 year membership was entered in the cashbook on 18 July 1995 and that all ten year memberships had expired at the latest by 18 July 2005. Audited financial statements for the year ended 30 June 1997 recorded membership fees for that year totalling $50. Mr Conlan was not provided with CRI's 1996/1997 financial year cashbook records. He was unable to identify which members paid those membership fees. Neither was he able to see any resolution in the minutes, other than that dealing with Mr O'Neil, which dealt with any changes to the Constitution to provide for life membership. 41 The most recent CRI board minutes in Mr Conlan's possession were those for a meeting held on 25 October 2004. They were actually dated 25 October with no reference to a particular year, but they referred to minutes of a meeting held on 1 September 2004. Business conducted at the meeting held on that date suggested that the 25 October board minutes were for a meeting held on 25 October 2004. The board then comprised, according to those minutes, Dr Gray as chairman, Ms Mirmikidis as vice chairperson, P Jones, S Oakley, R Ainsley and G Anderson as treasurer. G Anderson was an apology. The minutes record that the board purported to resolve that an annual general meeting be called for Monday, 6 December to formulate a proposal to dispose of the remaining CRI assets. Further, the board resolved to support a resolution to gift the assets of CRI to the Walter and Eliza Hall Institute of Medical Research. 42 Mr Conlan inspected unsigned minutes purporting to be of an annual general meeting held on 6 December 2004 recording that a resolution was passed to donate all the assets of CRI to the Walter and Eliza Hall Institute to be used for purposes associated with cancer research. In his affidavit he questioned the validity of that resolution as all persons present at the meeting were apparently expired members of CRI. 43 At the annual general meeting held on 23 December 2002 at which, according to its minutes, Dr Gray, Ms Mirmikidis, D Gorn, D O'Neil, S Oakley and R Ainsley were present, the following resolution was purportedly passed: 'That all current members of the CRI not be required to pay any annual fees.' Mr Conlan questioned the validity of that resolution because the Rules of CRI state that a minimum number of eight financial members constitutes a quorum at an annual general meeting and that in any event, based on his investigations, he believed that Mr O'Neil was the only financial member in attendance at that meeting. 44 Mr Conlan then referred to the meeting held on 27 September 2006 at which David Sanders, Bruce Gray and Bethwyn Daebritz were purportedly appointed as directors of CRI. Mr Conlan has not been provided with minutes of the annual general meeting at which those three people were elected, nor of the board meeting. He has not been provided with a list of people in attendance or with notices of the meeting or with a list of those to whom a notice of the meeting was sent. Based on those facts he was not in a position to call a meeting of the members of CRI as it did not appear to him that there were any members. 8. Affidavit of Bruce Nathaniel Gray sworn 8 December 2006 45 Dr Gray swore this affidavit in response to Mr Conlan's affidavit. He said he was a founding member of CRI. In or about 1994 he completed a document entitled "Will You Join Us and Make Payment in the sum of $200.00 to the Association". CRI was then called "Friends of the Cancer Institute". He made the payment of $200 in order to become a life member. He said he was on the board of CRI at the time and recalled discussing that they would introduce a category of life member. He referred to a copy of his application form which appeared in Mr Conlan's affidavit. 46 Dr Gray exhibited what he said was a list of the members of the association as at November 2001. He said it was a list of members kept as required by the Associations Incorporation Act. He drew attention to the fact that his registration as a member was jointly with his wife and was said to expire in 2004. He produced copies of proof of payment of his membership fees for the years 1992, 1995 and 1996. He claimed also to have made numerous other donations to the Institute which could have been attributed to membership fees. 47 Dr Gray said that at the annual general meeting held on 23 December 2002 Ms Mirmikidis, Mr Gorn, Mr O'Neil, Ms Oakley and Ms Ainsley were present in addition to himself. He did not know whether he held proxies. It appears, however, that he chaired the meeting. This may be inferred from the fact that he signed the minutes. He referred to Mr Conlan's contention that that meeting was not valid because of want of a quorum. He said, however, that at the time he was a financial member of CRI. He was a continuing member of the board of CRI and the board did not resolve under r 5.5 for the payment of any annual subscription fee. Accordingly, he said there was no relevant date fixed by the board for the purpose of r 5.7. On that basis he contended that he was a continuing member of CRI as were each of the persons who paid for life membership. 48 Dr Gray said that on 3 September 2006 he sent to each of the persons whom he believed were members of the association a notice convening an annual general meeting. He exhibited to his affidavit copies of the documents sent by him to the members. He sent the notice to each of the persons appearing on the register of members whose membership expired after December 2002. He attended the meeting. His wife attended by telephone. His sister attended the meeting and so did Mr David Sanders and Ms Anna Hughes of Lavan Legal. He said that he held proxies from six persons to whom he had given notice of the meeting. On that basis he contended that a quorum was present. 49 The notice which Dr Gray sent to people he regarded as members was in the following terms: 'Dear Members ANNUAL GENERAL MEETING I enclose a notice convening the annual general meeting of CRI. I am sending this in my capacity as a member of the Institute because a review of the administration of the Institute revealed; (a) That the term of the Directors had expired (b) You remain a life member of CRI and (c) Your family membership allowed both adult family members to membership of CRI. Therefore, a Proxy Form is enclosed for each family member. If you cannot attend the meeting then please sign and return the Proxy Forms in the enclosed self addressed envelope. Kind regards Bruce N Gray Immediate Past Chairman Board of Directors Life Member' 9. Affidavit of David Grant Sanders sworn 15 December 2006 50 Mr Sanders began his affidavit by stating that he is the chairman of CRI. He said that after the appointment of the receiver he convened a meeting of the board of CRI for Tuesday, 24 October 2006. He exhibited to his affidavit a copy of the minutes of that meeting. The persons in attendance were himself, Dr Gray and Ms Daebritz. The minutes record his advice, which the board accepted, that because control of the shares had been placed in the hands of the receiver it would be inappropriate for any new member to be accepted into the association until after the authority of CRI had been returned to "the membership". The minutes recorded that the board considered its previously expressed desire and that of the membership at the annual general meeting to extend an invitation of membership to Ms Mirmikidis, Ms Oakley and Ms Ainsley and agreed that it would be appropriate to accept their membership "… due to the extenuating circumstances in their case". 51 There were changes to the Constitution which were said to have been adopted at the annual general meeting. These changes, as appeared from Dr Gray's affidavit of 8 December 2006, would have reduced the size of the board from a minimum of eight persons to a minimum of three. They would also have reduced the quorum for a general meeting to five members "present in person or by proxy". As appears below however, they do not seem to have been passed by a special resolution as is evidently required by the Associations Incorporation Act. 52 On 3 November 2006 Mr Sanders, Dr Gray and Ms Daebritz met the receiver. Ms Daebritz produced what she claimed was a copy of the current members' register. A further meeting was held on 8 November 2006 between Mr Sanders, the receiver, Mr Conlan, and Mr Tottle. The membership list produced by Ms Daebritz was discussed. It was said that Mr Tottle was of the view that all the people on the list, which was dated 2 November 2001, were members. He proposed that the receiver proceed on that basis and convene a meeting of members required by the Court order. Mr Sanders confirmed that the CRI board was "currently of the view that all people on that register were still members except those whose membership was shown as having been due for renewal prior to the date of the register". 53 In the event, the receiver formed the opinion, which he communicated to Mr Sanders, that there were no members of CRI. 54 A meeting of the purported new board was held on 24 November 2006. Those present were Mr Sanders, Ms Daebritz and Dr Gray who attended by telephone. It was agreed that: . Mr Sanders would prepare a draft letter for approval by the board setting out the basis upon which the board had ascertained the membership of CRI . Dr Gray would review his records and provide copies of any documents he had, the originals of which were part of the records of CRI . Ms Daebritz would provide Mr Sanders with the documents she had as secretary of CRI. Mr Sanders changed his mind about writing to the receiver setting out the board's views on the membership of CRI as the receiver had decided to seek expanded powers. 55 Correspondence ensued between Mr Vaughan, who was instructed to act on behalf of the three purported board members, and Mr Lemonis, the solicitor acting for those who had formerly acted as members of the board. One of the items of correspondence exhibited to Mr Sanders' affidavit was a letter to him from Mr Tottle dated 9 October 2005. That letter referred, inter alia, to a resolution purportedly passed at the annual general meeting of CRI held on 23 December 2002 in the following terms: 'That all current members of the CRI not be required to pay any further annual fees.' The minutes record that those present at the meeting of 23 December 2002 were Dr Gray, Ms Mirmikidis, Mr Gorn, Mr O'Neil, Ms Oakley and Ms Ainsley. Mr Tottle's view was that the 2002 resolution had the effect of continuing the membership of those persons recorded as financial members as at November 2001 in the membership list and waiving the requirement for the payment of membership fees for those members and other members whose membership expired in 2002, 2003 and 2004. 10, Affidavit of Bruce Nathaniel Gray sworn 18 December 2006 56 In his further affidavit Dr Gray said that he was a founding member of CRI. He produced a copy of the minutes of the board meeting of 27 July 2004 in which the following resolution was passed (proposed by P Jones and seconded by Dr Gray) that: 'The Board resolve to dispose of all the assets of the CRI by way of a donation to an existing entity involved in cancer research. The Cancer Research Institute Inc should then call a Special General Meeting to dissolve the Institute. The Walter and Eliza Hall Institute and Peter MacCallum Cancer Centre will be approached to ascertain how those entities might use the donation from the Cancer Research Institute Inc. The beneficiary of the donation would have total control over the donation.' The motion was carried. 57 Dr Gray also exhibited minutes of the annual general meeting of CRI said to have been held on 6 December 2004 in which it was resolved to donate all assets of CRI to the Walter and Eliza Hall Institute to be used for purposes associated with cancer research. It was also resolved to dissolve the Institute as soon as all contingent obligations had been met. According to Dr Gray's affidavit, this decision was made because he was no longer involved in cancer research and the research team who had been working with him at CRI had been dissolved. 58 Dr Gray also exhibited minutes of what was said to be the annual general meeting of CRI held on 27 September 2006. Those present were himself, Julie Anne Gray (by telephone), his sister, Ms Daebritz, his solicitor, Mr Sanders, and another solicitor, Anna Hughes, working in Mr Sanders' firm. The minutes also recorded that signed and dated proxies had been received from certain life members, including Julie Anne Gray. It discussed a proposal that a new trust be established and that the assets of CRI be vested in that trust for use in cancer research. Dr Gray then proposed, according to the minutes: 'that CRI agree to the establishment of a new trust constituted by UWA and Western Australian Medical Research Institute (WAMRI) and CRI and that CRI transfer its assets to the new trust.' According to the minutes this resolution was put and unanimously defeated. This was not a motion which Dr Gray himself supported. A resolution was then passed that: 'subject to the resolution of the current litigation in the Federal Court, that the CRI donate all its residual assets to the Walter and Eliza Hall Institute and the Cancer Research Institute Inc then immediately be disestablished.' The meeting then purported to make the appointments to the board referred to earlier, namely Messrs Gray, Sanders and Ms Daebritz. 11. Affidavit of Mark Anthony Conlan sworn 19 December 2006 59 Mr Conlan referred to Dr Gray's affidavit of 8 December 2006 and to examinations which he had undertaken of documents exhibited to his affidavit relating to membership. He referred to two different styles of membership application documents. He had found no records in the documents of any discussion by the board of directors of CRI of the introduction of a category of life membership. The Rules do not contain provisions for such a category. The objects of the association 60 The objects of CRI as set out in its Constitution which was exhibited to Mr Conlan's affidavit of 1 December 2006 are: (a) to support the work of the Lions Cancer Institute and cancer research and education in general but in particular activities recommended by the Medical and Scientific Advisory Committee of the Lions Cancer Institute; (b) to establish, maintain and administer a public fund or funds for any charitable purpose as the Association may decide in relation to cancer research and education but in particular for the purposes recommended by the Medical and Scientific Advisory Committee of the Lions Cancer Institute; (c) to otherwise assist aims of the Lions Cancer Institute and to promote cancer research and education in general but in particular activities recommended by the Medical and Scientific Advisory Committee of the Lions Cancer Institute. 61 Clause 3.2 provides: 'The property and income of the Association shall be applied solely towards the promotion of the objects of the Association and no part of the property or income may be paid or otherwise distributed directly or indirectly, to members, except in good faith in the promotion of those objects." 62 Clause 7 provides for the duties of the board of management, the first of which is to: 'conduct activities that will further the objects of the Association". 63 Clause 23 provides, inter alia: 'Distribution of surplus property on winding up of Association. If, on the winding up of the Association, any property of the Association remains after satisfaction of the debts and liabilities of the Association and the cost, charges and expenses of that winding up, that property shall be distributed: (a) to another incorporated association having objects similar to those of the Association; or (b) for charitable or benevolent purposes which incorporated association or purposes, as the case requires, shall be determined by resolution of the members when authorising and directing the Board under section 33(3) of the Act to prepare a distribution plan for the distribution of the surplus property of the Association.' Statutory framework 64 Section 57 of the Federal Court Act confers a power on the Court to appoint a receiver by way of interlocutory order: '(1) The Court may, at any stage of a proceeding on such terms and conditions as the Court thinks fit, appoint a receiver by interlocutory order in any case in which it appears to the Court to be just or convenient so to do. (2) A receiver of any property appointed by the Court may, without the previous leave of the Court, be sued in respect of an act or transaction done or entered into by him or her in carrying on the business connected with the property. (3) When in any cause pending in the Court a receiver appointed by the Court is in possession of property, the receiver shall manage and deal with the property according to the requirements of the laws of the State or Territory in which the property is situated, in the same manner as that in which the owner or possessor of the property would be bound to do if in possession of the property.' 65 This should be read in conjunction with s 23 of the Act, which provides: 'The Court has power, in relation to matters in which it has jurisdiction, to make orders of such kinds, including interlocutory orders, and to issue, or direct the issue of, writs of such kinds, as the Court thinks appropriate.' 66 Order 26 r 7 of the Federal Court Rules provides: '(1) The Court may authorize a receiver to do (either in his own name or in the name of the parties or any of them and either generally or in any particular instance) any act or thing which the parties or any of them might do if of full age and capacity. (2) Sub-rule (1) has effect notwithstanding that the parties or any of them are not of full age and capacity. (3) This rule does not limit the powers of the Court apart from this rule to authorize a receiver to do any act or thing.' 67 Reference should also be made to the Associations Incorporation Act 1987 (WA). By virtue of its transitional provisions set out in schedule 2 and given effect by s 48, that Act applies to associations in existence at the time of its commencement. 68 An incorporated association under the Act may alter its rules by special resolution but not otherwise (s 17(1)). A special resolution requires a majority of not less than three fourths of the members of the association who are entitled, under the Rules of the association to vote (s 24(1)). The resolutions passed at the purported annual general meeting of 27 September 2006 to amend Rules 6 and 14.7 of CRI relating to the size of the board and the quorum at a general meeting were said to have been carried unanimously. However there is no evidence that they were passed by a special resolution. Indeed the minutes do not suggest that that question was even addressed. 69 Section 27 of the Associations Incorporations Act requires the maintenance of a register of members thus: 'An incorporated association shall keep and maintain in an up to date condition a register of the members of the association and their postal or residential addresses and, upon the request of a member of the association, shall make the register available for the inspection of the member and the member may make a copy of or take an extract from the register but shall have no right to remove the register for that purpose.' A similar provision applies to the record of office holders in the association (s 29). 70 Section 31 of the Act provides for the winding up of an incorporated association by the Supreme Court on a variety of grounds. One of those is that the incorporated association has fewer than six members or that it has been inoperative for not less than 12 months. An association may also be wound up by the Supreme Court if it has, by special resolution, resolved that it be wound up or if the Supreme Court is of the opinion that it is just and equitable that it should be wound up (s 31). The surplus property of an incorporated association cannot be distributed to its members or former members or otherwise than to an incorporated association or for charitable purposes. There is provision for the lodgment of a distribution plan with the Commissioner by the association's committee (s 33). The powers of the Court 71 The power of the Court to appoint a receiver is statutory. It has its origins, however, as an equitable remedy. An order in the nature of an equitable remedy can be made under s 23 of the Act. The class of circumstances in which such power may be exercised is not closed. Nor are the purposes for which a receiver may be appointed and the powers and conditions attaching to such an appointment. There may be many circumstances of considerable diversity which would warrant such an order and it is important that the discretion not be unnecessarily confined by any particular line of cases to which it has been applied. 72 Examples of cases in which receivers have been appointed on an interlocutory basis can be multiplied. Relevantly, a court may appoint a receiver to a trust in order to protect trust property. Such an appointment may be made where the trust is "in a state of disarray" – Martyniuk v King [2000] VSC 319 at [14] (Warren J). Her Honour there observed, citing Halsburys Laws of England (4th ed, Vol 39, par 827), that the general ground upon which a court appoints a receiver is ultimately in every case the protection or preservation of property for the benefit of persons who have an interest in it. She went on to say (at [15]): 'The basis upon which a receiver may be appointed has been regarded by the courts on even as wide a basis as when the circumstances render it just and convenient.' See Manchester and Liverpool District Banking Co v Parkinson (1888) 22 QBD 173. And further (at [16]): 'The court may appoint a receiver of trust property where that it necessary for the wellbeing of the trust." See Ford & Lee The Principles of the Law of Trusts (2nd edition) at [1739]. 73 A receiver may be appointed to a body to conduct litigation on its behalf. In Vouros as Liquidator of Cadima Express Pty Ltd v Deputy Commissioner of Taxation (1993) 33 ACSR 527, Austin J dismissed an application for the appointment of a receiver to a company in liquidation to conduct litigation on its behalf. Nevertheless his Honour accepted that there was a power to make such an appointment (at [56]): 'These cases demonstrate that the court has the power to appoint a receiver in cases where it decides to permit proceedings to be commenced and prosecuted in the name of a company in liquidation by a person other than the liquidator.' 74 In my opinion the Court, in an appropriate case, may appoint a person as a receiver to an incorporated body to conduct or defend litigation on its behalf. The power may be exercised where the body is effectively paralysed by internal dissension or where for one reason or another those charged with its management are unable to be identified or, if identified, are unable to act for one reason or another. Whether the power of the receiver should be extended 75 The present case should not be approached as one simply concerned with the protection of private property. To the extent that CRI holds its Sirtex shares free of any trust in favour of the University, it holds them for the purposes set out in its Constitution. The assets so held cannot be applied to the private benefit of the members. The circumstances may be seen as somewhat analogous to a charitable trust. The public interest served by the association's objects is protected by its own rules relating to the disposition of its assets on a winding up. These are reinforced by like provisions in the Associations Incorporation Act. 76 It is apparent from the evidence that there is considerable room for debate about the membership of CRI, whether it has any members and, if so, who they are. I do not consider, given the apparently incomplete and somewhat conflicting nature of the CRI membership records, that it is possible to determine its membership within any reasonable certainty and within a reasonable time. 77 Whatever their legal status in the association the persons presently claiming to be the board of CRI are not appropriate persons to make decisions about its conduct in relation to the present litigation. One of them, Dr Gray, is being sued by the University in his personal capacity. The chairman is his solicitor. The other member of the board is his sister. Dr Gray's letter to Sirtex shareholders about the alignment of the interests of CRI with those of himself and Sirtex is suggestive of an inability to distinguish between his interests and that of CRI. 78 CRI is a respondent in a complex piece of litigation brought against it by the University. The trial of the action is set down for hearing for six to eight weeks commencing on 12 March 2007. CRI must either resolve its dispute with the University or contest the case. The decision about what it should do should be consistent with its objects. The decision cannot be taken by the present purported board who are inescapably affected by conflict of interest. 79 In my opinion the only reasonable course, given the difficulties in identifying the membership and the governance difficulties, is to invest in the receiver the wider powers which he seeks. 80 Clothed with those powers the receiver can appoint a solicitor of record who can be confident of his authority to act. The receiver should not, on that account, require two sets of solicitors, one to represent CRI and one for himself. His concerns in exercising the powers conferred upon him must be aligned to those of CRI. There should be no need for two sets of lawyers' fees to be incurred in such a case. Remuneration 81 The receiver also seeks an order that he be entitled to reasonable remuneration and reasonable costs and expenses properly incurred by him in the performance of his duties and the exercise of his powers. He seeks an indemnity out of the assets of CRI, including without limitation, the shares in Sirtex held by CRI. 82 In my opinion, the receiver should be remunerated at a reasonable rate calculated by reference to the hourly rates exhibited to his affidavit of 8 December 2006. His remuneration should be assessed by a Registrar of the Court on a periodic basis to ensure that the work being done and the time taken to do it is reasonable and that it is being done at an appropriate level within the receiver's firm. The orders he proposes in his minute are appropriate subject to a more frequent periodic report than he proposes. I am also prepared to make the order he proposes to enable Tottle Partners and Fairweather & Lemonis to be paid for their services to date. I certify that the preceding eighty-two (82) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice French . Associate: Dated: 22 December 2006 Counsel for the Applicant: Mr M Green Solicitor for the Applicant: Jackson McDonald Counsel for the First Respondent: Mr M Bennett and Mr Freeman Solicitor for the First Respondent: Lavan Legal Counsel for the Second Respondent: Mr J Elliott SC and Mr E Heerey Solicitor for the Second Respondent: Phillip Fox Counsel for the Third Respondent: Ms YC Fang Solicitor for the Third Respondent: Tottle Partners Counsel for the Receiver of the Sirtex Shares of the Third Respondent: Mr Price and Mr RLM McKenzie Solicitor for the Receiver of the Sirtex Shares of the Third Respondent: McKenzie Moncrieff Counsel for Dr Gray, Mr Sanders and Ms Daebritz as the Purported Board of CRI: Mr Vaughan Solicitor for Dr Gray, Mr Sanders and Ms Daebritz as the Purported Board of CRI: Christensen Vaughan Date of Hearing: 19 December 2006 Date of Judgment: 22 December 2006