Streeterlaw wins significant Supreme Court of NSW decision

A recent Supreme Court of NSW case has found that internal fraud litigation proceedings within an Australian company must be heard in an Australian court, even though the parent company is from New Zealand.

The decision is now one of only two recent case law decisions to decide what happens with litigation proceedings in Australia and New Zealand as a result of the Trans-Tasman Proceedings Act 2010 (Cth).

Case background – Douglas Webber Events Pty Ltd [2014] NSWSC 1544

The plaintiff (our client) and the defendant were both residents of New Zealand and were both directors of the same Australian company, which was a subsidiary of a New Zealand company.

Our client had discovered that the defendant, whom he had known for several years and had worked with as a partner of a successful business, had diverted company money to a personal bank account. He immediately contacted Streeterlaw fraud and commercial dispute resolution to provide urgent instructions on how to proceed.

Our client alleged that:

1. The defendant had diverted company funds to a personal bank account; and

2. The defendant had breached his director’s duties allegedly owed to the Australian company, including:

      a. Breaching the duty of good faith;

      b. Breaching the duty not to make improper use of the position;

      c. Breaching the duty not to make improper use of information

3. Compensation was owed for damages suffered as a result of breaching the limited partnership agreement.

Streeterlaw commenced proceedings in the Supreme Court of NSW, with our client’s application seeking to bring the proceedings in the name of the Australian company to recover the funds.

The defendant’s legal representative raised the issue of jurisdiction, asserting that:

1. The High Court of New Zealand would have jurisdiction to determine the matters; and
2. That the High Court of New Zealand would be the most appropriate court to determine the matters in issue.

The Decision

Justice Brereton made orders in favour of our client, finding that:

• the New Zealand courts did not have jurisdiction to grant the relief claimed; and made an order that the defendant pay our client’s costs.

After the successful outcome for his client, Streeterlaw Principal, Mr Mark Streeter said:
“The speed, efficiency and ultimate success in this matter is testimony to our firm’s commitment to continuous improvement.”

Written by Mark Streeter

The Director of Streeterlaw, Mark has been practicing Law since 1994. He has attained his Masters of Law in 1999 and in 2006 was awarded his Specialist Accreditation in Commercial Litigation. Mark is a member of ARITA, a graduate of the AICD and a member of AICM. A member of STEP, Mark enjoys working in the area of Wills and Estates. In 2020 Mark is the Chair of STEP NSW.

Call us on 02 8197 0105 to book an appointment with Mark Streeter!