"I didn't agree to sell you shares. I agreed to sell you other stuff!"

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A successful Co was founded by D and their spouse in the 1970s. At all relevant times, they were its sole shareholders.

Two Ps worked for the Co, and were later appointed directors with D.

In 2005 there was an oral agreement between D and the Ps. Each had a different version what it meant.

The Ps said they paid $150K to each take an 8.33% share in the Co: [5]

D said the Ps paid for 8.33% of the Co’s “plant and equipment” and that, after 10 years, D would make the Ps shareholders in the Co: [6]

(The Court acknowledged the conceptual difficulty of owning a proportion of a Co’s plant and equipment: [45])

There were some failed attempts to negotiate a shareholders agreement over a number of years: [36] - [62]

Later, there were increasingly formal meetings to finalise and record the arrangement: [63] - [81]

(This included a tense meeting where the parties could not agree on the use of a tape recorder: [70])

One of the Ps commenced proceedings in 2014: [11]

In 2015 a big entity offered D $80m for their shares in the Co. D did not disclose this offer to the Ps: [85] - [88]

After negotiations, the parties agreed to settle all the Ps’ claims in exchange for D and the Co paying ~$2m to each to the Ps: [89] - [92]

The D went ahead with the sale of their (and their spouse’s) shares to the big entity for $90m: [95]

The P’s said that D (i) owed them a duty to disclose the offer, and (ii) held their 8.33% stakes on trust and breached trust by buying their shares at an undervalue: [18]

In addition to paying their money, the Ps gave personal guarantees for the Co’s benefit, served as directors, and undertook the Co’s work for some years away from their home state: [80], [100]

The Court found that *if* the Ps were shareholders, then an inference arises that $2m was an undervalue: [97]

The Court considered the well-known principle that where a party seeks to rely on spoken words to found their claim, the Court must feel actual persuasion of those words having been spoken: [108]

The Court felt actual persuasion of D’s version: [112], [113]

The Court considered the Ps’ evidence was plainly coloured by resentment at being excluded from knowledge of the sale: [114]

The value of 8.33% of the plant and equipment as at 2005 was about $150K. The Court found D was too shrewd to have given away a full equity stake for just the plant and equipment cost, ignoring goodwill: [115]

The Ps failed to establish the agreement they contended for, meaning the proceedings were dismissed: [133]