Fexuto Pty Limited v Bosnjak Holdings Pty Limited & Ors [2001] NSWCA 97

Reported Decision : (2001) 37 ACSR 672 (2001) 19 ACLC 856

New South Wales Court of Appeal

CITATION : Fexuto Pty Limited v Bosnjak Holdings Pty Limited & Ors [2001] NSWCA 97 FILE NUMBER(S) : CA 40898/98 HEARING DATE(S) : 28,29,30,31 August 2000 1 September 2000 JUDGMENT DATE : 12 April 2001

PARTIES : Fexuto Pty Limited v Bosnjak Holdings Pty Limited; Slavko James Joseph Bosnjak; Carol Lynette Bosnjak; Feyama Pty Limited; Fexule Pty Limited; National Bus Company Pty Limited; Torsby Pty Limited; Flaren Pty Limited; Bosnjak Property Developments Pty Limited; Westbus Pty Limited; Bosnjak Investments Pty Limited; Bosnjak Coach Lines Pty Limited; St Marys Bus Services Pty Limited; Parramatta Bus Company Pty Limited; Bosnjak Bros Pty Limited; Bosnjak Enterprises Pty Limited; Bosnjak International Sales Pty Limited; Smithfield Coach Imports Pty Limited; Westbus (UK) Limited (Cross appeal) Slavko James Joseph Bosnjak; Carol Lynette Bosnjak; Feyama Pty Limited; Fexule Pty Limited; National Bus Company Pty Limited; Torsby Pty Limited; Flaren Pty Limited v Fexuto Pty Limited; Bosnjak Group Pty Ltd JUDGMENT OF : Spigelman CJ at 1; Priestley JA at 218; Fitzgerald JA at 586

LOWER COURT JURISDICTION : Supreme Court - Equity Division LOWER COURT ED 3799/97 FILE NUMBER(S) : LOWER COURT Young J JUDICIAL OFFICER :

Appellant/Cross respondents - R.J. Ellicott QC / V.F. Kerr COUNSEL : Respondents (2-8)/Cross appellants - M. Pembroke SC / J. Stevenson / N. Beaumont Respondents (1 & 9-20) - G.C. Lindsay SC / G.O. Blake (Submitting except as to costs) Appellant/Cross respondents - Piper Alderman SOLICITORS : Respondents (2-8)/Cross appellants - Atanaskovic Hartnell Respondents (1 & 9-20) - Freehill, Hollingdale & Page CATCHWORDS : Corporations Law - oppression - exclusion from day to day management - "legitimate expectation" - Corporations Law, s260 - Corporations Law - oppression - remedies - Corporations Law - directors' duties - need for "fully informed consent" to absolve a breach of fiduciary duty Companies Act 1948 (UK) Company Law Review Act 1998 LEGISLATION CITED : Corporate Law Economic Reform Program Act 1999 Corporations Law Freedom of Information Act 1989 Uniform Companies Act 1961 Atwood v Maude (1868) LR 3 Ch App 369 Beach Petroleum NL v Kennedy (1999) 48 NSWLR 1 Belgiorno-Zegna v Exben Pty Ltd (2000) 35 ACSR 305 Blisset v Daniel (1853) 10 Hare 493; 68 ER 1022 Bosnjak's Bus Service Pty Ltd v Commissioner for Motor Transport (1970) 92 WN(NSW) 1003 Brickenden v London Loan & Savings Co [1934] 3 DLR 465 Calabro Bros Pty Ltd v Commissioner of Motor Transport (Mahoney J, 6 April 1973, unreported) Commonwealth Bank of Australia v Smith (1991) 42 FCR 390 Drinan v Drinan (1908) SR (NSW) 109 Ebrahimi v Westbourne Galleries Ltd [1973] AC 360 Foss v Harbottle (1843) 2 Hare 461; 67 ER 109 Furs Ltd v Tomkies (1936) 54 CLR 583 Guerinoni v Argyle Concrete & Quarry Supplies Pty Ltd (2000) 34 ACSR 469 In re a Company (No 002567 of 1982) [1983] 1 WLR 927 In re Astec (VSR) plc [1998] 2 BCLC 556 In re Pauling's Settlement Trusts [1962] 1 WLR 86 In re Smith & Fawcett Ltd [1942] Ch 304 In re Wondoflex Textiles Pty Ltd [1951] VLR 458 In re Yenidge Tobacco Company Ltd [1916] 2 Ch 426 Knight v Bell (1887) 13 VLR 878 Latec Investments Ltd v Hotel Terrigal Pty Ltd (in liq) (1965) 113 CLR 265 Lyle & Scott Ltd v Scott's Trustee [1959] AC 763 CASES CITED: McMillan v Toledo Enterprises Pty Ltd (1995) 18 ACSR 603 Maguire v Makaronis (1996) 188 CLR 459 Morgan v 45 Flers Avenue Pty Ltd (1996) 10 ACLR 692 O'Halloran v R.T. Thomas & Family Pty Ltd (1998) 45 NSWLR 262 O'Neill v Phillips [1999] 1 WLR 1092 Phipps v Boardman [1965] Ch 992 Phipps v Boardman [1967] 2 AC 46 Queensland Mines Ltd v Hudson (1978) 53 ALJR 399 R & H Electric Ltd v Haden Bill Electrical Ltd [1995] 2 BCLC 280 Re a Company (No 00789 of 1987); ex parte Shooter [1990] BCLC 384 Re Blue Arrow plc [1987] BCLC 585 Re Brenfield Squash Rackets Club Ltd [1996] 2 BCLC 184 Re M Dalley & Co Pty Ltd (1968) 1 ACLR 489 Re Posgate and Denby (Agencies) Ltd [1987] BCLC 8 Re Saul D. Harrison & Sons plc [1995] 1 BCLC 14 Redwood v Redwood (1909) 28 NZLR 260 at 261 Regal (Hastings) Ltd v Gulliver [1967] 2 AC 134n Scottish Co-operative Wholesale Society Ltd v Meyer [1959] AC 324 Spellson v George (1992) 26 NSWLR 666 Tay Bok Choon v Tahansan SDN BHD [1987] 1 WLR 413 Vadasz v Pioneer Concrete (SA) Pty Ltd (1995) 184 CLR 102 Walden Properties Ltd v Beaver Properties Pty Ltd [1973] 2 NSWLR 815 Warman International Ltd v Dwyer (1994-1995) 182 CLR 544 DECISION : 1. Appeal allowed.; 2. Cross-appeal dismissed.; 3. Orders of trial judge dated 4 November 1998 varied as follows:; (a) Substitute the date 42 days from the date of formal entry of these orders for the date 18 November 1998 wherever it appears in Orders. 2 and 3.; (b) Substitute the date 28 August, 1997 for the date 10 January 1994 in Order 8(b).; 4. Orders of trial judge of 26 November 1998 varied by substituting 2/3 for 50 percent in Order 1.; 5. Order the Respondents to pay 2/3 of the Appellant's costs of the appeal and cross-appeal.