Sign up to save your podcasts
Or
Share Sara Stockham Pty Ltd v WLD [2021] NSWCA 51
Share to email
Share to Facebook
Share to X
Share to email
Share to Facebook
Share to X
Or
Sara Stockham Pty Ltd v WLD [2021] NSWCA 51
“Get me out, and value my units properly!”
___
Two dentists worked together using a unit trust in which D1’s and D2’s entities held units. The relationship between all was governed by an agreement.
The agreement contemplated a unitholder exit for “fair market value”.
D1 sought to exit. The T'ee sought judicial advice regarding a valuer. D1 applied for a stay and failed. The T'ee got the advice that instructing a valuer would be OK and did so: [5]
D1 commenced further proceedings, and the parties asked the Court to separately determine the meaning of Cl 7.8 of the agreement: [5]
D1 appealed the determination that Cl 7.8 did not apply to the valuation.
Cl 7.8 prevented the T'ee from effecting decisions on “Major Policy” issues (like dealing with assets worth >$50K) without unanimous unitholder approval: [16], [17]
D1 said that a Major Policy decision made without unanimous approval was void pursuant to Cl 7.8, and so should not be part of a valuation: [19] - [21]
The Court disagreed, finding Cl 7.8 renders void the T'ee’s decision but not the resulting transaction: [26]
There may be a later dispute about the valuation, or breach of the T'ee's duties, but those issues were not raised in this litigation: [32], [33]
Appeal dismissed: [1], [10], [44]
View all episodes
By James d'Apice
5
22 ratings
“Get me out, and value my units properly!”
___
Two dentists worked together using a unit trust in which D1’s and D2’s entities held units. The relationship between all was governed by an agreement.
The agreement contemplated a unitholder exit for “fair market value”.
D1 sought to exit. The T'ee sought judicial advice regarding a valuer. D1 applied for a stay and failed. The T'ee got the advice that instructing a valuer would be OK and did so: [5]
D1 commenced further proceedings, and the parties asked the Court to separately determine the meaning of Cl 7.8 of the agreement: [5]
D1 appealed the determination that Cl 7.8 did not apply to the valuation.
Cl 7.8 prevented the T'ee from effecting decisions on “Major Policy” issues (like dealing with assets worth >$50K) without unanimous unitholder approval: [16], [17]
D1 said that a Major Policy decision made without unanimous approval was void pursuant to Cl 7.8, and so should not be part of a valuation: [19] - [21]
The Court disagreed, finding Cl 7.8 renders void the T'ee’s decision but not the resulting transaction: [26]
There may be a later dispute about the valuation, or breach of the T'ee's duties, but those issues were not raised in this litigation: [32], [33]
Appeal dismissed: [1], [10], [44]
More shows like Coffee and a Case Note
View all
Background Briefing
68 Listeners
All In The Mind
756 Listeners
Law Report
23 Listeners
Conversations
862 Listeners
Rear Vision — How History Shaped Today
69 Listeners
The Economy, Stupid
18 Listeners
Australian Politics
51 Listeners
Betoota Talks
32 Listeners
If You're Listening
314 Listeners
7am
143 Listeners
What's That Rash?
243 Listeners
The Briefing
51 Listeners
The Front
40 Listeners
Chanticleer
18 Listeners
The Fin
19 Listeners