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An
Australian application of the doctrines stated in Westdeutsche
Landesbank appears in HCK
China Investments Ltd v Solar Honest Ltd (1999) 165 Australian Law Reports
680. The facts are complex and obscure and a highly compressed summary follows.
Shares in a target company were transferred from HCK to Solar by deed, in
anticipation of a wider corporate merger involving payments by HCK to Solar's
principal. The merger struck difficulties and HCK paid a sum of $100,000
as an extension fee, also under a deed covenant. The merger ultimately failed,
and HCK sought to recover the shares and the extension payment. Solar argued
that the deeds were effective to transfer both assets, and that the deed
agreements citing that consideration had been proffered for both transfers
should now govern the parties' rights. Hely J found that under the legislation
governing HCK's corporate capacities, both the deeds were invalid due to
irregular execution in the absence of HCK's director. The indoor management
rule could not cure this type of irregularity. In the absence of any alternative
explanation for the share transfer and the $100,000 payment, such as an
intention to make a gift, HCK could demand the return of both assets or
their value. Hely J was prepared to ignore the various contractual considerations
stated in the invalid agreements, and held that the shares could come back
on resulting trust under either a Vandervell presumed or automatic resulting
trust; and moreover that the money should be paid back as either debt or
through restitution of an unjust enrichment. Hely J was not overly concerned
to sharpen the doctrinal tools he used to engineer restitution of the assets.
A web report is found at: HCK China Investments Ltd v
Solar Honest Ltd [1999] FCA 1156 (23 August 1999)
http://www.austlii.edu.au/do/disp.pl/au/cases/cth/
federal_ct/1999/1156.html?query= hck
On a topic outside restitution but perhaps of interest
nonetheless: the High Court of Australia delivered its major statement
on economic loss in tort in Perre v Apand (1999) 164 ALR 604. The report
giving the seven judgments of the full court occupies 117 pages, and broaches
much comparative law and academic analysis. Those looking for a clear
ratio will be disappointed.
Web report at: Perre v Apand Pty Ltd [1998] HCA 63 (15
September 1998)
http://www.austlii.edu.au/do/disp.pl/au/cases/cth/
high_ct/1999/36.html?query= perre
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