In the matter of Calabria Community Club Ltd [2013] NSWSC 998

The witnesses Mr Carbone 39Mr Carbone was a less than satisfactory witness. Despite frequent warnings, he was determined to advocate his case from the witness box, and to volunteer material that was not called for by the question to support his case. He frequently avoided giving a direct answer to a question, responding with a remotely related proposition that supported his case. In particular, whereas he initially gave evidence of what he "would have" done in connection with tendering apologies for meetings, this suddenly and improbably became an actual recollection of what he did in two particular instances. However, that recollection was itself internally inconsistent, as he first attributed a conversation about Mr Arduca's resignation to his tendering his apologies for 20 January 2011, but later to the business of the meeting of 22 February. He adamantly maintained that a meeting of 7 February 2002 was a general meeting, until compelled by force of other objective evidence to admit that it was not. He made gratuitous references to Mr Gilio having taken action "because he was so advised by Mr Tripodi", yet when pressed as to whether he recalled Mr Gilio saying what was alleged professed no recollection of it: the reference to Mr Tripodi can only have been gratuitous in a misconceived attempt to colour the atmosphere. 40Mr Carbone variously asserted that on 2 August 2011 the Board resolved to accept funding from Provident, but when confronted with the minutes acknowledged that there was no such resolution on that date. As to whether any offer of funding by Provident had ever been formally accepted he said, first, that the instruction of Mr Marra to act as broker amounted to such acceptance; secondly that he was "100% sure" that there had been a resolution accepting such funding prior to February 2011, though he could not say when; and thirdly that the minutes of 24 August 2011, which do not record any such resolution, were incorrect. He sought to justify his insistence that the allegation in his points of claim that there was no resolution to accept any finance proposal was not incorrect, because the (indisputable) resolution to accept the CDT heads of agreement was allegedly subject to his seeing the legal advice. 41These are but instances of the difficulties with his evidence. Mr Leonello 42Mr Leonello initially appeared to be an accurate and careful witness, but as his cross-examination proceeded, he became combative and argumentative. His recollection was shown to be less than perfect: for example, he said that the church issued the s 57(2)(b) notices in September, not March, 2011, whereas it was shown he was aware in March that they had been issued in March; he originally said he first met with TK in July 2011, when he in fact first established contact in April. 43Mr Leonello denied that security guards were in attendance at the meeting of 4 October 2011 in order to exclude Mr Carbone. However, this was the first meeting after Mr Carbone's purported removal; security guards were not normally present; and there was no other plausible explanation. 44Mr Leonello denied that he locked the gates preventing access to the EGM convened for 13 November 2011, but later agreed that he was involved in orchestrating the locking of the gates. He quibbled that his initial answer was because he was not personally involved in locking the gates physically, but it was less than frank. 45Mr Leonello sought to convey the impression that the removal of Mr Carbone for non-attendance was something that emerged as a result of legal advice sought from counsel, and was not initiated by himself. However, it became manifest that the initiative was his, and that he gave the Club's solicitors, Maclarens, the requisite instructions to seek advice from counsel on the topic, and that it was the predominant issue on which advice was sought (not, as he suggested, the propriety of governance in connection with the proposed refinancing proposals). 46Mr Leonello wrongly claimed that the directors had had to guarantee the Provident loan. He wrongly maintained to the other directors, after April 2011, that the Provident loan was not available, when he knew that it was and that the only impediment was rezoning. 47Again, these are but instances of the difficulties with his evidence.

Conclusion 48Ultimately, I regard both as very partial witnesses, whose perceptions and evidence were coloured by their interest and allegiances. On contentious issues, I cannot safely rely on the evidence of either, and I cannot generally prefer the evidence of one of them to the other. I have, however, found the handwritten contemporaneous minutes the most useful guide to what transpired at meetings. Otherwise, resolution of the significant factual issues - whether Mr Carbone was present at the 22 February 2011 meeting, and whether Mr Leonello admitted having a personal interest in the Panbic transaction -depends on other factors.

Did Mr Carbone cease to be a director? 49Clause 29 of the Constitution of the Club relevantly provides: A director ceases to be a director if: (a) ... (b) ... (c) ... (d) The director is absent without the consent of the directors, from all directors' meetings over any six month period; (e) ... 50Prior to his re-election as a director at the Annual General Meeting on 20 December 2010, Mr Carbone had attended a directors' meeting on 6 September 2010. He admittedly did not attend a meeting held on 22 November 2010; nor the Annual General Meeting at which he was re-elected on 20 December 2010. Thereafter, he did not attend a special meeting on 20 January 2011. There is a factual dispute as to whether (as he alleges and the defendants deny) he attended a directors' meeting on 22 February 2011. He admittedly did not attend a directors' meeting on 20 June 2011. The period of six months from the meeting of 20 January 2011 expired on 20 July 2011. He thereafter, without objection, attended and participated in meetings on 31 July, 2 August, 4 August and 24 August 2011, before the notice that he had ceased to be a director was lodged with ASIC on 12 September 2011. 51The defendants contend that Mr Carbone ceased to be a director not later than 21 July 2011, by when he had been absent from every meeting over the preceding six months. The first issue in this respect is whether Mr Carbone was in fact absent from all directors' meetings over a six month period. 52As Mr Carbone was, albeit in his absence, elected a director and vice-president of the Club for a two-year term at the AGM on 20 December 2010, his absences from that meeting (and from the preceding directors' meeting of 22 November 2010) are irrelevant: the six-month period is effectively "reset" from the date of his re-election, and prior periods of absence do not count. Further, time commences to run, not from the date he took office, but only from the first meeting from which he was absent [In re London and Northern Bank; McConnell's Claim [1901] 1 Ch 728, 732]. 53While a number of cases in this context have held that similar articles contemplate "voluntary" absence [In re London and Northern Bank; Mack's Claim [1900] WN (Eng) 114, 115; In re London and Northern Bank; McConnell's Claim [1901] 1 Ch 728, 731], those cases were concerned with an article that spoke of a director who "absents himself", which was said to mean "something more than the expression 'is absent'", whereas the latter expression - 'is absent' - is used in clause 29(d) of the Club's Constitution. 54Meeting of 20 January 2011. The first relevant directors' meeting at which Mr Carbone was not present was therefore that held on 20 January 2011. Mr Carbone provided his apology to the Secretary, Mr Pezzano by telephone, and the apology was recorded in the minutes of the meeting in the list of apologies. 55Meeting of 22 February 2011. The second relevant meeting was held on 22 February 2011. Contrary to what appears to have been his invariable practice, if he was present, Mr Carbone did not sign the Attendance Book for 22 February 2011. 56The original handwritten minutes, from which the typed version was later prepared, record Mr Carbone as "absent". The typed version initially listed Mr Carbone amongst those "in attendance". These minutes were confirmed on 20 June 2011, apparently without dissent. However, at a meeting on 4 October 2011, the directors resolved: Amendment to minutes of the 22/2/11 to indicate written minutes show P Carbone as absent as opposed to printed minutes of 22/2/11 which show P Carbone as an apology. 57(In fact, the typewritten minutes showed Mr Carbone as present, not as an apology). Mr Pezzano thereafter amended the typewritten minutes, in hand, to delete Mr Carbone from those "in attendance" and to list him under "apologies". 58Mr Carbone claims to recall being at the meeting. He says that the meaning started relatively late, and that the business discussed included the resignation of Mr Arduca. However, these matters could be derived from a reading of the minutes. His evidence concerning the resignation of Mr Arduca was inconsistent, as he first said that he recalled it being mentioned in a conversation with Mr Pezzano in the course of tendering his apologies for the earlier 20 January meeting; if it was mentioned in the course of tendering apologies, it must have been in connection with the 22 February meeting, at which Mr Arduca's resignation was received; this supports the view that Mr Carbone indeed tendered his apology for the 22 February 2011 meeting, and was not present at it. 59Although Mr Leonello claimed to recall that Mr Carbone had not attended any meetings during the relevant six-month period, he was largely reliant on contemporaneous records - the minutes and attendance book - for that belief; in particular, he did not have an independent recollection of who else was present at or absent from the 20 February 2011 meeting. Mr Leonardo Pezzano said that he did not think Mr Carbone was at the 22 February 2011 meeting, but he was not at that meeting himself! Mr Nicola Romano's affidavit suggests that he did not attend the 22 February 2011 meeting. When shown the attendance register, which he had signed, he said that he was there, but he has no recollection of the business of that meeting, and is not otherwise recorded as present; I conclude that he accidentally signed the incorrect page at a later meeting. Mr Giglio said that he could recall Mr Carbone being absent from the 22 February 2011 meeting, but he could not recall who else was absent. He said (of Mr Carbone) "He missed several of them [meetings] while I was there. 60While the evidence of these witnesses as to Mr Carbone's absence is of little value, there is no corroboration of his claim to be present. I have referred elsewhere to the general difficulties with Mr Carbone's evidence. In my view the absence of his signature in the Attendance Book for 22 February 2011, the circumstance that the original handwritten minutes record him as absent, the absence of any reference to him in the body of the minutes, and his evidence about discussion with Mr Pezzano of the resignation of Mr Arduca, tilt the balance of the evidence in favour of the view that Mr Carbone was not present at that meeting, as the amended and approved typewritten minutes now record. 61Meeting of 20 June 2011. The third relevant meeting was held on 20 June 2011. Mr Carbone provided his apology to Mr Pezzano by telephone. 62It follows that Mr Carbone was absent from all directors' meetings over the six month period ending on 20 July 2012. 63The plaintiffs submitted that, even if Mr Carbone was absent from all the relevant meetings, there is no evidence that he was absent without the consent of the directors. Insofar as this implies that it was for the defendants to prove an absence of consent, I do not agree; Mr Carbone bore the onus of proving the case that he had been wrongly excluded. Even if proof of his election had the effect of shifting an evidentiary onus to the defendants to establish that he had been absent from meetings over a period of three months, the onus of proving consent remained with Mr Carbone. 64The plaintiffs submitted that the directors consented to his absence by accepting his apologies, or alternatively by allowing him to attend and participate in meetings after 21 June 2011. 65The apologies are recorded in the minutes as a list of names under the heading "Apologies". There is no evidence of any resolution to the effect that the apologies be accepted, let alone that leave of absence be granted. The mere noting of an apology tendered does not amount to consent in the relevant sense. In Ryan v Heiler (NSWSC, Young J, 26 February 1990, unreported, BC9002695), the plaintiff was an elected alderman. (NSW) Local Government Act 1990, s 35(e), provided that the office was vacated if the elected person "is absent without leave of the council from three consecutive ordinary meetings of the council". The plaintiff tendered an apology for his absence from a meeting, which was announced by the Mayor. No motion was moved, nor resolution passed, in respect of that announcement; the minutes, which recorded the Mayor's announcement and no more, were confirmed at a subsequent meeting. At the subsequent meeting, the Mayor again advised the Council that the plaintiff had tendered an apology for his inability to attend due to business commitments. Two members of the council moved that the apology be accepted and leave of absence granted; another two moved as an amendment that the apology be noted. Although the proceedings were somewhat confused, and it was possible to say that a majority was not unhappy with the proposition that the plaintiff have leave of absence from the particular meeting, the motion that the apology be accepted and leave of absence granted was never put. Young J, as he then was, said that it was quite clear that there is a difference between leave of absence and an apology, the former requiring a resolution of the body at a previous meeting or the meeting in question (his Honour left open whether leave of absence could be given retrospectively). Where all that could be established was that an apology was proffered and noted (albeit without discussion or dissent), with no indication that it had been accepted, there was no positive grant of leave, although a formal acceptance of the apology might well have amounted to a grant of leave. I respectfully entirely agree with his Honour's analysis, and consider that it applies with equal force to a requirement for "consent" as to "leave", subject to the qualification that consent might be more easily implied than a positive grant of leave. 66In Willsmore v Willsmore-Tibbenham Ltd (1965) 109 Sol Jo 699, there is a suggestion that leave could be given by an informal expression of opinion by various members of the board that they would be content if the director did not attend the meeting in view of the circumstances; but it was mentioned as no more than a possibility and, as Young J pointed out in Ryan, on an application for an interlocutory injunction where the plaintiff held half the shares. 67Thus the mere noting of Mr Carbone's apology does not amount to consent. However, in this case there is more: there is the acceptance of his presence at and participation in meetings after the six month period had expired. 68In Cheerine Group (International) Pty Ltd v Yeung [2006] NSWSC 1047, the relevant article provided that a director's office became vacant if the director were absent without the consent of the directors from meetings of the directors held during a period of six months. Young CJ in Eq, as he had by then become, said (at [23]): Now, it would seem that Mr Wong who is resident in Hong Kong did not physically attend any meeting of directors and there was provision for meetings to be held by telephone at which he could have been involved. However, the evidence clearly shows that Mr Yeung treated Mr Wong as still a director on 11 September. Indeed, he endeavoured to make contact with him because he wanted him to attend the meetings as a director so that it is impossible to say on the evidence before me that the absence of Mr Wong from meetings of directors for six months, if that indeed in fact occurred, was without the consent of the directors. 69Consistent with his Honour's approach, Mr Carbone's participation without objection in the meetings of meetings on 31 July, 2 August, 4 August and 24 August 2011, is strong evidence that his absences during the period of six months up to 20 July 2012 were not "without consent". The Club had no established mechanism for seeking and obtaining "consent", or leave of absence. While entirely accepting that even in that context the mere tender and noting of an apology does not amount to consent, the proper inference to be drawn from the combination of the noting of his apologies, the fact that the meetings were called at short notice, and that Mr Carbone was subsequently permitted to participate in directors' meetings without objection, is that the directors had in fact consented, albeit informally, to his absence. Although it is unnecessary to my decision, this conclusion is fortified by the circumstance that the Club never asserted that three other directors who appear to have been absent from all meetings over a six month period - Ms MacPherson, Mr Marrapodi and Mr Romano - had ceased to hold office on that account. 70I therefore find that the directors consented to Mr Carbone's absence during the six month period in question, and accordingly conclude that Mr Carbone did not cease to be a director on 21 June 2011. It follows that Mr Carbone was, from 4 October 2011, wrongly excluded from directors' meetings and the role of a director. However, that wrongful exclusion came to an end when he was not re-elected as a director at the Annual General Meeting on 26 December 2012.

Should the Club be wound up? 71The plaintiffs contend that the Club should be wound up on the grounds that the conduct of its affairs, or a resolution or resolutions, are contrary to the interests of the members as a whole [s 232, 233(1)(a), 461(1)(f), (g)]; or that the directors have acted in their own interests rather than in the interests of the members as a whole or in any other manner whatsoever that appears to be unfair or unjust to other members [s 461(1)(e)]; or that it is just and equitable that the company be wound up [s 461(1)(k)]. In particular, they contend: (1)that Mr Leonello (and the majority directors) caused (or allowed) the Club to enter into the Panbic transaction, contrary to the interests of the members as a whole (but in the interests of Mr Leonello), and without the approval of the Board; (2)that Mr Leonello (and the majority directors) have refused to provide information to directors and members about the Club's financial affairs that was reasonably requested, and failed to call meetings as required by the Club's constitution; (3)that meetings of the directors were convened to discuss serious matters without adequate notice or information to the directors, and without allowing adequate time for discussion; and (4)that the directors have caused the Club to act in a manner entirely outside the general intention and common understanding of the members when they became members, such that it could be said that the substratum of the Club had failed.

The Panbic transaction - contrary to interests of the Club? 72At the core of the plaintiffs' case was the contention that, in causing or allowing the Club to enter into the Panbic transaction, Mr Leonello and the other majority directors had not acted in the best interests of the Club and its members. In addition, it was contended that the transaction was in the separate personal interest of Mr Leonello, and was entered into without the approval of the Board. 73The contention that the Panbic transaction was not in the best interests of the Club was advanced on the basis that there were alternative - and presumably superior - re-financing options available to the Club, and in particular (a) an offer of a loan of $1.3 million for a term of two years from Provident Capital, (b) an offer of a loan of $1.2 million for a term of two years from Mr Carbone and associated members of the Club; and (c) a proposal from the Stockland Shopping Centre Group, which could have resulted in Stockland purchasing the land for $10 million. This requires some comparison of the available options, in the context that the Club was under considerable pressure to discharge the church mortgage (which required in excess of $900,000 as at August 2011), and otherwise stood to lose the land, and was also indebted to Mr Carbone/Potentia (for about $140,000). 74The Panbic loan, as ultimately documented in the Loan Facility Agreement of 8 November 2011, involved (1) an advance of up to $3,000,000 - $1,400,000 to refinance, and $1,600,000 to provide working capital for the project; (2) a maximum term of 10 years, provided that if construction works were not commenced within five years, the "Money Outstanding" was repayable by 1 November 2016 (a five year term), and if the Club wished to terminate the agreement prior to 1 November 2013 (2 years) it was required to repay the "Agreed Early Repayment Amount" for 2 years, and if it wished to terminate the agreement after 2 November 2013 but prior to 1 November 2016 (5 years) it was required to repay the "Agreed Early Repayment Amount" up to the date of repayment. The "Agreed Early Repayment Amount" was the Principal Sum (the aggregate amount of the Advances made) plus the Prescribed Interest (interest on the Principal Sum at the rate of 22% per annum calculated daily, compounded annually). Otherwise, the Club was obliged to repay: (1)in repayment of the Principal Sum, when stage 1 of the project is completed, by transfer of residential unit lots in the project selected by Panbic at the Cost Price to the maximum value of Principal Sum. For this purpose, Cost Price means the cost price of constructing the relevant units (including but not limited to all associated common areas, buildings, facilities, conduits, designs, works, approvals, consents, section 94 contributions and other registration fees), including the then current value of the relevant proportion of the land (as determined by agreement or failing agreement a quantity surveyor). There was speculation, falling far short of proof, that the cost price might be half of the market value, implying that the market value of the units so transferred might be $6 million. However, this implies a profit margin of 50% on the development, which seems highly optimistic; (2)in lieu of interest, within 4 years from commencement of construction, residential unit lots at Market Value to the value of $3.5 million. 75Broadly, the effect of this is that if the Club proceeded with the development and drew down the $3,000,000, it would have to repay, within ten years, units to the value of $3,000,000 at cost price, plus units to the value of $3,500,000 at market Value. Making the very generous assumption in favour of the plaintiff that this would amount to $9,500,000 in all over ten years, that equates to interest of approximately 22% per annum ($650,000 per annum for ten years on principal of $3,000,000). If the Club drew down only the first tranche ($1.4 million) to refinance and did not proceed with redevelopment, it would have to repay $1.4 million plus interest at 22% for two years or until termination (not longer than five years), whichever was the longer. 76The terms of the Provident Capital proposal included (1) an advance of $1.3 million or 40% of the value of the land (whichever was the lesser), (2) interest at a rate of 17% per annum (reducible to 11% for prompt payment), to be prepaid; (3) loan term of two years; (4) application fee of $28,600. 77The terms of the "private" loan offered by Mr Carbone and associated supporters of the Club included: (1) an advance of $1.2 million, (2) interest at 15% plus 4% in the case of default, capitalised; (3) loan term of two years; (4) application fee of $13,000, capitalised, and (5) funds to be available within the next 48 hours (after it was communicated by Mr Marra to the Board on 1 August 2011). 78The Stockland proposal had been made long before the rezoning, and had been withdrawn on 2 March 2010, on the basis that there was too much uncertainty about the rezoning at that stage. There was nothing to suggest that it was still available in August 2011. 79Thus it can be seen that, in the short term, the Panbic proposal offered a higher initial advance, giving more comfort that the refinance could be achieved, and for a longer term if required, but at a significantly higher interest rate. In the long term, Panbic offered what the others did not - an additional tranche of finance, which could provide the initial finance for the redevelopment project. It had the attraction that it would not require another refinancing after a relatively short period, but would enable the redevelopment to proceed. It was available for immediate acceptance. It did not require the Club to give the financier equity in the land, other than a number of units on completion. 80The Provident offer would have been marginal in terms of discharging the existing debt to the church and Mr Carbone, once provision was made for capitalised interest. Out of it would come capitalised interest of 11% for 2 years, amounting to $286,000. That would leave only $1.04 million to repay the church ($907,000) and Mr Carbone/Potentia ($140,000). It would itself have had to be refinanced after two years; in that sense, it simply substituted one debt for another. It did not enable the redevelopment to proceed. 81The private loan would have been less adequate even than the Provident offer to discharge the existing debt. Again, it would itself have had to be refinanced after two years, and simply substituted one debt for another. It would not have enabled the redevelopment to proceed. 82Several directors explained their rationale for preferring the CDT/Panbic transaction. Admittedly, some were influenced by and relied on the arguments advanced by Mr Leonello, and their understanding of the transaction (in particular, that the value of the repayment to CDT/Panbic was potentially well in excess of $6.5 million) was imperfect. But generally they appreciated that the Club was under pressure to repay the church loans, in respect of which it was in default (a situation which they attributed, perhaps unfairly, to Mr Carbone); they considered that the CDT/Panbic offer more adequately provided comfort that the church loans and other liabilities could be discharged, there being at least some doubt as to the sufficiency of the others to do so; they thought that the CDT/Panbic transaction offered the potential for a long term solution, unlike the others which would have required refinancing again after two years, leaving the Club once again in the position in which it then found itself; and they believed that the CDT/Panbic transaction offered the opportunity to proceed with the next stage of the redevelopment, which the others did not. Some were attracted by the circumstance that CDT/Panbic would be only a financier, and not a joint venturer, so that the Club would retain control of the redevelopment. Another factor was that it was considered that there was no time to go to a conventional lender, so that CDT/Panbic was basically the only available option. 83Some aspects of this reasoning are questionable. In particular, the view that CDT/Panbic was essentially the only immediately available option was tenuous, and appears to have been promoted by Mr Leonello. It is clear that in February 2011 and April 2011 Mr Leonello was of the view that the Provident loan was available, subject to rezoning, and its availability was being relied upon. It was still available in August; the only impediment was that the rezoning, which was imminent, had to take place first. 84The private loan was also immediately available, but the directors distrusted Mr Carbone, because the non-payment of the April and May mortgage instalments had jeopardised the Club's land, and suspected he had ulterior personal interests in seeking to obtain security over the land. 85In any event, the amounts of the Provident loan and the private loan were inadequate to discharge existing debts, whereas the CDT/Panbic transaction was adequate to do so. And the CDT/Panbic transaction was not subject to rezoning, and as at 4 August the rezoning, though believed to be imminent, had not yet occurred. 86The plaintiffs submitted that CDT/Panbic was - as the Club's solicitor Mr Maley of Maclarens Lawyers had advised - a "lender of last resort", to which it was unnecessary and imprudent to resort when "conventional" finance was available; that Panbic had paid up capital of only $6, beneficially held by one of its directors Mr Huy Minh Tran; that no steps were taken to establish its capacity to perform; and that the Panbic Heads of Agreement were entered into in circumstances where the Club did not obtain a formal valuation of the land, and only a matter of days prior to its rezoning. 87Even if it was correct to describe Panbic as a 'lender of last resort', it was not correct to described Provident or the private loan as "conventional finance". There was no "conventional finance" on the table - no bank, building society or credit union. In circumstances where the Club had no income with which to service a loan, this is unsurprising. Mr Maley did not suggest verifying the financial capacity of CDT/Panbic. It is uncommon for a borrower to undertake inquiries to establish the substance of a proposed lender. This is because the borrower has the relatively straightforward remedy of terminating and looking elsewhere for the funds if the lender does not perform. If Panbic proved unable to perform (by advancing the funds), the Club could terminate the transaction. It is normally the prudent lender, not the borrower, who requires a valuation before lending. There is nothing disadvantageous, from the perspective of the Club, in these matters; they do not indicate any failure to act in the best interests of the Club. 88The Club was not in a position to do nothing, lest the church exercise its power of sale. It is not the role of the Court to second-guess the judgments of directors as to which of several commercial opportunities is to be preferred. While the CDT/Panbic transaction had some comparative disadvantages - principally, the interest rate applicable in the event of early repayment - it also had some advantages, including the longer term, the larger initial advance, and the additional tranche of $1.6 million. Viewed objectively, it cannot be said that the CDT/Panbic transaction was not in the best interests of the Club, or contrary to the interests of the members as a whole. 89However, the plaintiffs submitted that Mr Leonello had a personal stake in the transaction. If established, this could well support a conclusion that the transaction was nonetheless motivated by a collateral purpose and not by the interests of the Club, and bring it within s 461(1)(e). The submission relied on an alleged admission said to have been made by Mr Leonello to Mr Carbone, in the presence of Mr Tripodi, on 3 August 2011, supported perhaps by inference from Mr Leonello's enthusiastic prosecution of the CDT/Panbic transaction and the unusual steps he took to secure it. Whether he made the alleged admission arose late in the litigation but became a major issue, although the evidence on it was in narrow scope, and it is necessary to refer to the relevant evidence in some detail. 90There was no mention of this allegation in the pleadings, the affidavits, or the openings. The first reference to it emerged towards the end of Mr Carbone's cross-examination, on Day 3 of the trial, when he was being questioned about the meeting of 4 August 2011. He agreed that Mr Leonello had left the meeting for a time, and said that he (Mr Carbone) went outside to speak with him. Mr Carbone denied the version of that conversation that was put to him, but in answer to a question from the Bench as to what did happen, said: I went outside your Honour, and I said, "Rocco, we have been friends for so long". I said, "You know that Provident Capital is there, they are just waiting for the rezoning to be approved". I said, "Yesterday why did you walk out of Joe Tripodi's house and you told me this is your last chance in life? In front of Maria, Rocco, and you know that". And he says, "Pat, I don't want to talk about it, we are just going to vote on it now". And he went back inside your Honour. 91Then, in re-examination, he was asked, over objection, questions about the conversation, which he had said took place at Joe Tripodi's house on 3 August, as follows: I said, "Roy, please let's sit down at the table, two minutes". And Roy is here. I said, "Roy, we have been friends for a very long time. You've helped me in life and I've helped you a lot of times". I said, "You know this deal is crap". I said, "What's TK got to do with the Calabria Community Club? TK Ly, you know who TK Ly is, Roy", I said. I said, "Please, Roy, we've got Provident Capital there. You know that. Okay? We can go to the members if we have to". It was very short, the meeting, it didn't go for too long. We were sitting down at the table. Ray got up out of disgust and he took off - before he took off, he said to me, "Pat, this is my last chance in life to make money", and he took off in his car. Q. What, if anything, did Mr Tripodi say? A. He just looked at me and shrugged his shoulders, and I said, "Joe, I can't believe what's going on". 92In chief, Mr Leonello agreed that a meeting occurred on around 3 August at Mr Tripodi's home, following a phone call from Mr Tripodi who had asked if he would agree to meet with Mr Carbone. According to Mr Leonello: I said, "Pat, this proposal is something that is good for the Club and it can allow us to go forward with a development application". Then Tripodi said words to the effect, "Pat, the majority of the board is in favour of this proposal, by the look of it. Why don't you just agree to go with the majority of the board?" And, at that stage, Carbone said, "Yes, I agree to do that". And we shook hands, "If the majority of the board decide to go with this deal, I will agree". And that was the end of conversation. 93Mr Leonello agreed that he and Mr Tripodi had been friends for 15 or 20 years, and that they had gone together to the movies the weekend before he gave evidence. Mr Leonello also agreed that, if he wanted Mr Tripodi to come to court to give evidence about the conversation, he would expect him to be more than happy to do so, but he saw no reason to call him. 94Later, Mr Leonello was asked: Q. Didn't you tell Mr Carbone in front of Mr Tripodi on about 3 August that this is your last chance to make some money in life -- A. No, that's a lie, I take offence. Q. No doubt Mr Tripodi will come to Court -- A. I hope he does -- Q. -- and tell his version of events-- A. I really do hope he does. Q. Have you asked him to? A. Yes I have in fact. Q. And what has he said? A. He said if we want him to come to Court he will come to Court. Q. So can we expect him on the next occasion? A. It is up to my barrister. Q. When did you have that conversation with him? A. On Sunday. 95There is no doubt that the meeting at Mr Tripodi's home took place - Mr Leonello and Mr Carbone agree that that is so. The only issue is whether Mr Leonello in effect admitted to a personal interest in the transaction. 96In evaluating this evidence, it is striking that Mr Carbone first referred to it - in the less sinister form "this is your last chance in life" - in cross-examination, and in the more elaborate form "this is my last chance in life to make money" in re-examination. In the first version, it was emphasised that the admission was made allegedly in the presence of Mr Tripodi's wife Maria, as distinct from Mr Tripodi. Moreover, such a distinct admission by Mr Leonello of having some personal stake in the transaction would surely have been at the forefront of Mr Carbone's case from the outset; yet it was not mentioned in his (detailed) affidavit evidence, nor in evidence-in-chief. The first mention of the words "to make money" emerged only in re-examination. This elaboration itself casts doubt on it. Moreover, Mr Carbone's insistence that the Club had resolved to accept the Provident proposal, referred to above, manifests his ability to interpret events in his favour; and his evidence of what happened at the meeting of 22 February 2011, from which he was absent, demonstrates his ability to reconstruct events from some foundations known to him (in that case, the minutes). 97Had Mr Leonello made such a statement, one would have expected to see some reference to it in Mr Carbone's 4 August letter to the Board; yet there is none. Nor is there any suggestion that it was mentioned in the course of the 4 August meeting, when one would have expected it to be deployed in support of Mr Carbone's opposition to the CDT proposal; yet it was only outside the meeting, where corroboration is not possible, that he claims to have referred to it. Not once in the course of Mr Carbone's subsequent campaign against the CDT/Panbic proposal was it mentioned, though it would have been a very relevant and powerful consideration in that debate. 98Accordingly, I treat Mr Carbone's convenient evidence of the disputed 3 August conversation with even greater circumspection than the remainder of his evidence. That it was not the subject of cross-examination is of little significance, as it was only given in re-examination, over objection. 99However, Mr Tripodi was not called, and Mr Weinberger, unsurprisingly, founded on that for a powerful submission that I should infer that his evidence would not have corroborated Mr Leonello's version. 100Mr Tripodi was not a party, nor a director. But from early in the plaintiff's opening, his name was mentioned, for reasons the relevance of which never really became apparent, including in the context of his having (allegedly) bought and sole land with various of the directors over the years, with being an associate of Tan Kien Ly (who brokered the Panbic transaction), and as being "a shadow director". Mr Carbone made gratuitous, non-responsive and irrelevant reference to him in cross-examination, when he answered that Mr Gilio had taken action "because he was so advised by Mr Tripodi", yet when pressed as to whether he recalled Mr Gilio saying what was alleged professed no recollection of it. It seemed to me that an attempt was being made to paint Mr Tripodi as some kind of puppeteer who manipulated the affairs of the Club. No more was established than that Mr Tripodi - who by the time of these events had left Parliament - was a respected figure in the relevant community, to whom many - on both sides - resorted for advice. It is only fair to Mr Tripodi to say that there was not the slightest evidence of any impropriety on his part. 101Nonetheless, there is undoubted force in Mr Weinberger's Jones v Dunkel submission, and I have given close consideration to whether it is sufficient to overcome the reservations I entertain about Mr Carbone's evidence. I accept that for relevant purposes Mr Tripodi was shown to be "in the camp" of Mr Leonello, notwithstanding that he has also had some association with Mr Carbone. But while I acknowledge the force of the Jones v Dunkel submission, ultimately I am unpersuaded that it overcomes my reservations about this aspect of Mr Carbone's evidence. First, Mr Carbone has himself given inconsistent versions, as to whether the disputed statement was made in the presence of Mr Tripodi (implicitly, in the second version), or his wife Maria (explicitly, in the first version). Secondly, the case was conducted on affidavit evidence, in respect of which directions were made and cross-examination permitted. It is true that the Club would no doubt have been permitted leave to serve an affidavit of Mr Tripodi, or to call him, to address this late allegation, had it been sought; but in the context of a case which had already been once adjourned part-heard it is not surprising that no such application was made. Thirdly, there is a high degree of improbability that, had the alleged statement been made, it would have been overlooked until it emerged. Fourthly, for reasons already explained, I treat Mr Carbone's evidence generally with considerable circumspection. 102There are curious, even suspicious, features of the Panbic transaction, not least the secretive manner in which it was pursued by Mr Leonello at the outset, the urgency with which it was then presented to the Board, the confidentiality that was imposed on its details, the limited amount of information that was provided about it and the identity of the lender and its principals, and the misinformation provided as to the availability of the Provident loan. However, just how Mr Leonello might have a personal stake in the Panbic transaction was not elaborated. He said that, so far as he was aware, Tan Kien Ly had no personal stake in the transaction, though he was representing the Panbic interests. He denied that he and Tan Kien Ly ever sought to embark on business together. The contrary was not established. 103I am, therefore, not persuaded that Mr Leonello had a personal interest in the Panbic transaction, or acted in his own interests as distinct from those of the members as a whole. 104An ancillary complaint of the plaintiffs is that when Mr Leonello and Mr Pezzano signed the Heads of Agreement with Panbic on behalf of the Club on 10 August 2011, they did so without the authority of a resolution of the Board of Directors. However, on 4 August 2011, the directors resolved (Mr Carbone dissenting) to accept and proceed with the CDT heads of agreement and to authorise Mr Leonello and Mr Pezzano to sign and execute on behalf of the Club any associated documentation, including mortgages. Notably, that part of the minutes was omitted from the version exhibited to Mr Carbone's affidavit, which comprised only the first page. 105The Panbic heads of agreement signed on 10 August 2011 admittedly differed in some respects from the CDT Heads of Agreement referred to in the board resolution. In particular, (1) the parties to the CDT heads of agreement were the Club and 'CDT Group Pty Ltd' whereas the parties to the Panbic heads of agreement were the Club and 'Panbic Pty Ltd, ATF Tran Brother Family Trust'; (2) the CDT heads of agreement provided for three stages of funding: $100,000 on execution, $1,300,000 on provision of a first mortgage, and $1,600,000 from rezoning; in the Panbic heads of agreement the first stage was increased to $270,000 and the second stage reduced to $1,130,000; (3) the Panbic heads of agreement contained a provision permitting the Club to pay $3 million to Panbic and for Panbic to purchase $3 million value of residential units at cost price, as an alternative to the Club transferring units to that value; and similarly a clause permitting the Club to pay $3.5 million to Panbic and for Panbic to buy units to the market value, as an alternative to the Club transferring such units. 106However, the alterations in the staged funding merely advanced $170,000 from the second stage to the first. The additional repayment options made no difference in substance at all. These were plainly within the authority conferred by the resolution of 4 August. As to the identity of the investor, it is true that only CDT, not Panbic, was in contemplation on 4 August. Mr Leonello agrees that in an extract of the resolution of 4 August 2011 that he included in a letter of 20 August 2011 to Kevin Munro, solicitor, providing evidence of authority to sign, he inserted "or nominee" after CDT into the resolution, which it had not originally contained. He said that the minutes were incorrect in omitting those words, and were later corrected, as indeed they were at the meeting of 4 October 2011. However, he reconstructed another version of the 20 August 2011 letter, by omitting "CDT Group or nominee" and substituting "Panbic" in the extract of the resolution of 4 August 2011. This is likely to have been in response to requisitions by solicitors acting for Panbic to produce sufficient evidence of authority. 107It is true that, even when "corrected" at the meeting of 4 October 2011, the 4 August resolution did not refer specifically to Panbic. Moreover, Panbic had not been in contemplation of the Club before 10 August, so it could not have been referred to in a resolution of 4 August. Mr Leonello also accepted that the motion and resolution of 4 August did not contain the words "or nominee" when it was moved or adopted: he said that he did not think of them at the time, but should have done so. Subsequently, he also accepted that no one other than CDT was in contemplation as at 4 August. However, he said that he thought Panbic and CDT were effectively the same entity, or at least had the same beneficial ownership, a belief which appears to be correct. Although the contrary was put to him, I do not accept that this was discreditably dishonest conduct. In this respect, Mr Leonello was endeavouring to give effect to what he understood to be the true underlying intention of the Board, if somewhat elaborated by hindsight. 108I am unpersuaded that entry into heads of agreement with Panbic was outside the terms of the authority conferred by the 4 August 2011 resolution. If it was, it was ratified by the amendment of the minutes on 4 October 2011. In any event, it was within the general intent of what the directors contemplated on 4 August 2011. Even if there were some defect in the authority, what happened is far removed from the type of conduct that was held to be oppressive in Supercar International Holdings Ltd v Sommers (2011) 84 ACSR 466 (at [85] and [226]), where a managing director purported without authority of or disclosure to his board to make a contract conferring substantial benefits on himself. 109Accordingly, it is not established that in causing the Club to enter into the Panbic heads of agreement on 10 August 2011, Mr Leonello and Mr Pezzano engaged in conduct that was oppressive.

110The plaintiffs contended that Mr Leonello improperly denied information to the directors and the members about the Club's financial affairs that was reasonably requested, and failed to call meetings as required by the Club's constitution. In Shum Yip Properties Developments Ltd v Chatswood Investment and Development Co Pty Ltd (2002) 40 ACSR 619, Austin J held that the conduct of the majority directors in failing to convene directors' and shareholders' meetings as required by the company's constitution and the Corporations Law, and in persistently failing to respond to the plaintiff's reasonable demands for information, together with their causing the company to pay excessive directors' fees and to meet certain private expenses, constituted an overwhelming case of oppression. However, such conclusions are necessarily dependent on the particular facts. 111As to denial of information, it was said that Mr Leonello pressed the directors to make decisions on the refinancing without prior notice or proper documentation; that he refused to allow the directors to see legal advice received by the Club in relation to the proposed transactions; and that he failed or refused to provide any documentation in relation to the Panbic transaction to some directors and members of the Club unless they signed confidentiality agreements via their solicitors. 112The decisions about refinancing necessarily occurred under pressure of time, as the church mortgages had expired, s 57(2)(b) notices had been served, and the ongoing indulgence of the church could not be assumed. It may well have been preferable had the heads of agreement been placed before all the directors, but they were read out, in English and Italian; and Mr Carbone himself was provided with a copy after the meeting. Mr Giglio read out the legal advice of Mr Maley on the CDT heads of agreement, at the meeting of 4 August 2011. The requirement for a confidentiality undertaking in respect of the loan documentation was stated by Mr Leonello at the Information Meeting on 27 November 2011: when asked by members about the heads of agreement, Mr Leonello said that they could view the documents upon execution of a confidentiality agreement; his version is corroborated by the terms of a letter dated 1 December 2011 from Gillis Delaney, solicitors, on behalf of nine members, to Maclarens on behalf of the Club, conveying a request to view the loan documentation and advising that they had agreed to sign a confidentiality agreement, if provided. On 9 December, Maclarens forwarded a draft "Mutual Non-disclosure Agreement" and confirmed that upon approval and execution they would forward the loan documentation. In a letter of 16 December, Gillis Delaney pointed out - pending their clients' approval of the "Mutual Non-disclosure Agreement" - that the mortgage and registered charge were in the public domain and sought clarification as to what documents were claimed to be confidential. On 20 December 2011, Maclarens specified only the Loan Facility Agreement, agreeing that the other documents were in the public domain. On 21 December, Gillis Delaney - contrary to the position expressed in their 1 December letter - objected to the requirement to execute the "Mutual Non-disclosure Agreement". The Club waived that requirement by letter dated 18 April 2012. This course of events, as a whole, does not establish any such denial of information to directors or members as to amount to oppression. 113As to failing to call meetings, reliance was placed on Mr Leonello causing the Extraordinary General Meeting, convened by a number of members to consider the Panbic transaction for 13 November 2011, to be cancelled. On 13 October 2011, a group of directors and members of the Club convened an Extraordinary General Meeting, to be held on 13 November 2011, for the purpose of "re-affirming" the status of Mr Carbone as a director, electing three other directors, and considering the re-financing of the Club's debts and the redevelopment of its land. On 10 November 2011, Mr Leonello caused a notice to be sent all members of the Club cancelling the "purported" EGM, and instead convening a special "Information Meeting" on 27 November 2011. At that Information Meeting, when asked by members about the Panbic transaction, Mr Leonello said that they could view the documents upon execution of a confidentiality agreement; his version tends to be corroborated by the terms of the original request from Gillis Delaney, referred to above. Mr Leonello also said that the EGM had been cancelled on legal advice, consistently with what the notice of cancellation itself said - although contrary to the claim in the notice, such advice does not appear to have been attached to it. However, the Club did receive advice from Maclarens, dated 7 November 2011, to the effect that one basis on which the EGM was purportedly called was not valid, and the other questionable. This issue was not explored in any detail in the litigation, and in those circumstances I do not consider it appropriate or necessary to resolve whether or not the EGM was validly convened. Even if it were validly convened, the cancellation of a single EGM, on legal advice, in the context that an information meeting was convened to replace it, did not amount to an act of oppression.

Misconduct of meetings 114The plaintiffs contend that meetings of the directors were convened to discuss the serious and complicated issue of refinancing without adequate notice or information to the directors, and without allowing adequate time for discussion. In John J Starr (Real Estate) Pty Ltd v Robert R Andrew (A'asia) Pty Ltd (1991) 6 ACSR 63, Young J (as he then was) held that where the rights of the minority were adversely affected by the persistent conduct of meetings in a manner that prevented their full participation - including receipt of proper notice and allowing proper time for discussion - there would be oppression. 115Relevant meetings of the directors were called with very little notice, including on one occasion less than 24 hours' notice. The July 2011 Meeting was called with two days' notice; the 2 August Meeting was called with two days' notice; the 4 August Meeting was called with 1 day's notice; and the 24 August Meeting was called at about 11.49am that day, to be held at 7.30pm that evening. The time of the meetings was sometimes changed with very little notice, including in respect of the July meeting with less than 24 hours' notice. However, as already mentioned, decisions about refinancing necessarily occurred under pressure of time. While these meetings were called on short notice, there does not appear to have been any contemporary objection to notice of the meetings. The only real and relevant objection was in respect of the consideration of the CDT heads of agreement on 31 July 2011. Though there was no prior circulation of the Heads of Agreement before the meeting - in respect of which Mr Carbone articulated his objection in his 4 August 2011 letter - he was provided with a copy of the CDT heads of agreement that evening, and afforded an opportunity to address the issues at the meetings on 2 August and 4 August. At least by 4 August, the directors were able to come to a decision, in respect of which the difference between Mr Carbone and the others was not the result of lack of opportunity for consideration and discussion, but differing views of the merits of the proposal. 116It was also submitted that a failure to obtain legal advice concerning the CDT heads of agreement, or to facilitate the directors to seek their own separate advice, was indicative of oppression. However, legal advice - albeit in the form of an eight-point email - was obtained from Maclarens, and read out at the 4 August 2011 meeting, before the directors agreed to proceed with the heads of agreement. In any event, it is not necessarily standard practice to obtain legal advice in respect of preliminary heads of agreement. While it may have been prudent to do so, imprudent conduct is not the same as oppressive conduct. Legal advice and assistance was sought and obtained in respect of the formal loan facility agreement and associated security documentation before it was executed. Having negotiated the deletion of the requirement for independent advice, it was not oppressive that copies of the loan facility agreement were not provided to each director to enable them to obtain their own (separate) advice, when they did not seek it. At the 26 October 2011 meeting, the directors present (which excluded Mr Carbone) unanimously resolved to authorise execution of the loan facility agreement, mortgage, charges and associated documentation, and none required further legal advice, or a personal copy of the documentation, before doing so. 117Other than by the exclusion of Mr Carbone after 4 October 2011, I do not accept that the conduct of directors' meetings was such as to amount to oppression by preventing full participation.

Failure of the substratum 118The plaintiffs contend that, in entering into the Panbic transaction, Mr Leonello and the majority directors have caused the Club to act outside the general intention and common understanding of the members when they became members, such that it can be said that the substratum has failed, so that the Club should be wound up on the just and equitable ground. 119When the Club was incorporated, clause 2 of its original Memorandum of Association stated as its first object: (a) To promote social intercourse amongst members and for that purpose to conduct a Club for the accommodation of members and their permitted visitors; maintain libraries, restaurants and sporting facilities; promote literary, artistic and scientific culture and conduct any sports (particularly the sports of soccer, tennis and bocce), entertainments and amusements for same. 120There were many additional objects, but they were expressed to be "solely for the purpose of carrying out the aforesaid objects and not otherwise". 121The Club adopted a Constitution on 13 December 2005. It repeated the objects of the original Memorandum, but the additional objects are no longer expressed to be solely for the purpose of carrying out the first object. Additional relevant objects include: (i) To construct, improve, maintain, develop, work, manage, carry out, alter or control any houses, buildings, grounds, works or conveniences which may seem calculated directly or indirectly to advance the Club's interests, and to contribute to subsidise or otherwise assist and take part in the construction, improvement, maintenance, development, working, management, carrying out, alteration or control thereof. ... (m) In furtherance of the objects of the Company to sell, improve, manage, develop, exchange, lease, dispose of, turn to account otherwise deal with all or any part of the property and rights of the Club. 122The plaintiffs' contention is that the Club, having through the Panbic transaction committed itself to act as a property developer by causing the Club's land - currently a soccer field - to be developed into residential units and to provide some of those units provided to Panbic, is no longer pursuing its main object, and that its undertaking has changed so dramatically from that which it was formed to conduct, that it should be wound up on the just and equitable ground. It is well established that it will be just and equitable that a company be wound up if it acts in a manner entirely outside the general intention and common understanding of the members when they became members [Re Tivoli Freeholds Ltd [1972] VR 445]. 123At least since 7 February 2002, it has been envisaged that the Club would ultimately pursue its objects through the development of the land, which would realise the funds to enable achievement of the main object. The concept of the proposed development, discussed and adopted in principle unanimously at the directors meeting of 7 February 2002, was that it would incorporate a clubhouse and community and sporting facilities, as well as retail shops and residential units. It was envisaged that, in this way, the development would both itself deliver facilities that would serve the main object, and also realise funds that would enable their pursuit. Redevelopment was in fact central to the Club's pursuit of its main object. Without redevelopment, it has no business, no poker machines, no bars, no source of income, and no premises to which members can resort for the purpose of social intercourse or entertainment. If ever it is going to pursue its main object, it has to somehow convert what assets it has - the land - towards the pursuit of those objects. There is nothing in its decision to pursue a large scale and potentially profitable if risky redevelopment that bespeaks an abandonment of its main object. To the contrary, the proposed redevelopment of the land, and the raising of finance for it, is incidental to the Club's main object. 124There has been no abandonment of the main object of the Club, nor any failure of the substratum.

Relief for oppression 125The plaintiffs have established oppression through the improper exclusion of Mr Carbone from the management of the Club after 4 October 2011, but not otherwise. 126The only remedy sought by the plaintiff was the winding up of the Club. While appointment of a provisional liquidator was sought in the alternative, that is an interlocutory not a final remedy, and only granted where the assets are in jeopardy pending determination of a winding-up application. 127The purpose of relief for oppression is to relieve from the consequences of the oppression. In a company limited by shares, in which the oppressed minority has an economic stake, providing a means for the plaintiff to exit the company and realise its investment is often the focus. Thus, in that context, winding-up orders and compulsory purchase orders are commonplace. While s 232 no doubt applies to a company limited by guarantee as well as to one limited by shares [Re Ingleburn Horse & Pony Club [1973] 1 NSWLR 641; ASC v Multiple Sclerosis Society of Tasmania (1993) 10 ACSR 489], the fact that in the former the plaintiff does not have an economic interest at stake necessarily affects the manner of its application, and the appropriate remedy. In a company limited by guarantee, where the plaintiff has no economic stake, the rationale that supports compulsory purchase orders and winding-up orders in companies limited by shares is often, if not usually, absent. In such cases, other remedies for oppression - such as an order regulating the conduct of the affairs of the company - will often be more apt to relieve from the consequences of oppression. 128The remedy of winding-up is a drastic, and discretionary, one. While the plaintiff was entitled to participate in management as a director until 26 December 2012, he was not re-elected at the AGM on that date. The oppression that he established - namely exclusion from management from 4 October 2011 until 26 December 2012 - is not continuing, and would not be remediated by a winding up order made now. It is not apparent how the relevant interests of the members, in the light of the objects of the Club, would be advanced by a winding up, upon which the net assets of the Club would be transferred to another institution with like objects, if one could be found. Nor is it apparent how Mr Carbone's legitimate interests would be advanced, by way of relieving him from any proved oppression. A winding-up order would be an inappropriate and disproportionate remedy. As the oppression established is not continuing - because Mr Carbone is, after the AGM of 26 December 2012, no longer as director - no other relief would be called for, and none was sought. 129Even had oppression been established in other respects, the same conclusion would have followed. Indeed, had I concluded that the Panbic transaction was oppressive, that would not render it liable to be set aside, and it is not apparent how the members' interests, or Mr Carbone's, would be advanced by winding -up the Club. This is because the present is not a case in which the plaintiffs are, so to speak, "locked in" to the company; they have no equity at risk, and if their disagreement with the manner in which the majority wishes to pursue the Club's objects is so fundamental that they cannot abide it, they can leave. 130For those reasons, it would be entirely inappropriate to make a winding-up order, in respect of the oppression established, or even if the other oppression alleged had been established.

Conclusion 131For the foregoing reasons, I have reached the following conclusions. 132Mr Carbone was absent from all directors' meetings over the six month period ending on 20 July 2012. However, his attendance and participation without objection in subsequent meetings in July and August establishes that his absences during that six month period were not "without consent". Accordingly, Mr Carbone did not cease to be a director and was, from 4 October 2011 until 26 December 2012, wrongly excluded from directors' meetings and the role of a director. The improper exclusion of Mr Carbone from the management of the Club was oppressive, unfairly prejudicial or unfairly discriminatory to Mr Carbone, a member of the Club, in his capacity as a member and director of the Club. 133Viewed objectively, it cannot be concluded that the Panbic transaction was not in the best interests of the Club, or contrary to the interests of the members as a whole. Nor has it been established that Mr Leonello had a personal interest in the Panbic transaction, or acted in his own interests as distinct from those of the members as a whole. Entry into the Panbic Heads of Agreement was not unauthorised, but if it was, it was subsequently ratified, and in any event was within the general intent of what the directors contemplated on 4 August 2011. In causing the Club to enter into the Panbic heads of agreement on 10 August 2011, Mr Leonello, Mr Pezzano and the other majority directors did not engage in conduct that was oppressive. 134There was no such denial of information to directors or members on the part of Mr Leonello (and the majority directors) as to amount to oppression. Even if the EGM of 17 November 2011 were validly convened, its cancellation does not amount to oppression. Other than by the exclusion of Mr Carbone after 4 October 2011, the conduct of directors' meetings did not amount to oppression by preventing proper participation. 135There has been no abandonment of the primary objects of the Club, nor any failure of the substratum. 136It would be entirely inappropriate to make a winding-up order, in respect of the oppression established, or even if the other oppression alleged had been established. 137I order that the proceedings be dismissed, with costs. I reserve leave to the parties to apply for any different or special costs order, any such application to be made by 19 August 2012.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 08 August 2013