De Kun Holding (Aust) Pty Ltd v Yuan [2017] NSWSC 106

Supreme Court New South Wales

Medium Neutral Citation: De Kun Holding (Aust) Pty Ltd v Yuan [2017] NSWSC 106 Hearing dates: 16 and 17 February 2017 Date of orders: 20 February 2017 Decision date: 20 February 2017 Jurisdiction: Equity Before: Pembroke J Decision: See paragraph [23] Catchwords: EMPLOYER AND EMPLOYEE – breach of trust and confidence – whether summary dismissal of defendant justified MEETING – informal – no notice – 95% of shareholders agreed – court's discretion under Section 1322(4)(a) of the Corporations Act (Cth) RESTITUTION – whether payments paid by mistake to the defendant – no adequate evidence of decision maker's state of mind Legislation Cited: The Corporations Act 2001 (Cth) Cases Cited: Bell v Burton (1993) 12 ASCR 325 Blythe Chemicals Ltd v Bushnell (1933) 49 CLR 66 David Securities Pty Ltd v Commonwealth Bank of Australia (1992) 175 CLR 353 Magnacrete Ltd v Hill (1988) 15 ACLR 325 Nenna v ASIC [2011] FCA 1193 Category: Principal judgment Parties: De Kun Holding (Aust) Pty Ltd – plaintiff Charles Chang-Dong Yuan – defendant Representation: Counsel: L V Gyles SC with J C Lee – for the plaintiff D A Allen – for the defendant

Solicitors: SHL & Associates Lawyers – for the plaintiff Wisdom Lawyers – for the defendant File Number(s): 2015/223367

Judgment

Introduction 1. The primary issue in this case is whether the plaintiff was entitled to summarily dismiss the defendant from his employment in April 2015. Notwithstanding the very capable submissions on the defendant's behalf, I have reached the conclusion that the plaintiff was so entitled. That will then require consideration of the validity of a shareholders meeting on 17 April 2015 at which it was resolved to terminate the defendant's employment and his roles as a director and secretary of the plaintiff.