Ubertini v Saeco

1 On 18 March 2014, I handed down my reasons for decision in this proceeding ("the Principal Judgment"),[1] determining that the 1st defendant, Saeco International Group SpA Societa A Unico ("Saeco International"), as the majority shareholder, had engaged in oppressive conduct in the affairs of the 2nd defendant, Saeco Australia Pty Ltd ("Saeco Australia"). The court held that Giorgio Massimo Ubertini ("Ubertini") and Ubertini Investments Pty Ltd (together, "the Plaintiffs") were entitled to an order that their shares in Saeco Australia ("the Shares") be purchased by Saeco International. Ubertini was the managing director of Saeco Australia and the Plaintiffs were the largest minority shareholders of Saeco Australia.

2 In the Principal Judgment, I made the following observation:[2]

I have not been asked to consider the position of the minority shareholders of Saeco Australia beyond the position of the Plaintiffs. The remaining minority shareholders are not parties to the proceeding.[3]

3 By summons filed 16 May 2014, the remaining minority shareholders in Saeco Australia, Wayne White ("White"), James Kremmer and Andrew Kremmer (together, the "Applicants") sought to be joined as plaintiffs to the proceeding. The Applicants stated to the court on 12 May 2014 that they did not wish to be heard in relation to the issues then before the court concerning the method of ascertaining a price for the Shares, and that they would abide by any decision of the court on that issue.

4 On 20 May 2014, I invited the parties to prepare minutes of order to reflect the reasons contained in a judgment I delivered concerning the process for valuation and fixing of the purchase price of the Shares.[4]

5 On 23 May 2014, orders were made which included the following:

1. An independent valuer ("the Valuer") be appointed to express an opinion as to the value of the Plaintiffs' shares in Saeco Australia as at 31 October 2006, such valuation to include the value of the assets, including goodwill, of Saeco Australia.

1. Any submissions which any party wishes to make to the Valuer be in writing and provided to the Valuer and to the other parties by 4.00 pm on 4 July 2014.

1. The Valuer shall complete the valuation and provide a copy to the parties and the court by 4.00 pm on 15 August 2014.

The Plaintiffs and Saeco International were also ordered to pay the costs of the Valuer in equal shares in the first instance.

6 This is the first occasion upon which the Applicants have sought to be joined to the proceeding. The Applicants indicated to the court that if leave were granted to them to be joined as plaintiffs, they would undertake to be bound by all findings of fact made by the court to date and would comply with the orders made on 23 May 2014.

7 The Applicants also stated they did not intend to be active participants in the proceeding. They submitted any additional costs would be negligible as they intended to adopt the submissions of the Plaintiffs in relation to the fixing of the price for the purchase of the Shares and their shares.[5]

8 James Kremmer holds 22,245 shares in Saeco Australia, which represents approximately 2 percent of the issued shares. He is now 78 years old. He is the father of Andrew Kremmer. Andrew Kremmer holds 11,122 shares in Saeco Australia, representing approximately 1 percent of the issued shares in Saeco Australia. White is the son in law of James Kremmer and has the equivalent shareholding to Andrew Kremmer. No dividends have ever been paid to any of the Applicants.

9 Each of the Applicants is a director of Saeco Australia and a permanent resident in New South Wales.

10 Affidavit evidence has been filed in support of the application by the Applicants. Saeco International has chosen to file no affidavit in opposition. Further, Saeco International informed the court it had no desire to cross-examine any of the Applicants in relation to this application.

11 Accordingly, the uncontested evidence discloses that the Applicants went into business with Ubertini in around July 1998. This was as a result of discussions between Ubertini and James Kremmer. Essentially, James Kremmer was invited to conduct the business of Saeco Australia in New South Wales. As a result of these discussions a new company, Coffee Machine Services (NSW) Pty Ltd ("the NSW Company") was incorporated. James Kremmer was allocated 40 percent of the share capital, with Ubertini holding 60 percent.

12 Initially, Andrew Kremmer conducted the business; he was joined some months later by White. Andrew Kremmer engaged in sales, marketing and accounts, while White concerned himself with operational and servicing matters. James Kremmer was never an employee of the NSW Company, but provided unpaid advisory services.

13 In 2002, Ubertini sold his controlling interest in Saeco Australia to Saeco International. Ubertini retained a 40 percent shareholding in Saeco Australia.

14 In 2003, it was decided that the business conducted by the NSW Company should be brought back into the main business of Saeco Australia. As a result, the NSW Company ceased trading and Ubertini agreed to transfer 4 percent of his shareholding in Saeco Australia to James Kremmer. Of this 4 percent shareholding, James Kremmer decided that approximately 1 percent should go to each of Andrew Kremmer and White. This is reflected in the Shareholders' Agreement that was executed on 28 November 2003.[7] The Shareholders' Agreement contained certain restrictions on the ability of the Applicants to sell their shares.

15 Ubertini, as managing director, ran the business of Saeco Australia. He was the ultimate decision maker. While in the employ of Saeco Australia, both Andrew Kremmer and White, at all times, until Ubertini was terminated on 21 February 2007,[8] acted at Ubertini's direction in carrying out their respective roles.

16 As to the events leading up to the issues in dispute in this proceeding, the Applicants were aware that Ubertini and Saeco International were involved in discussions in mid 2005 about the Plaintiffs selling the Shares. Andrew Kremmer was in Italy when these discussions occurred. However, neither he nor the other 2 applicants participated in any of the discussions. At no time did anyone from Saeco International speak to the Applicants about the possible sale of their shares to Saeco International.

17 By the second half of 2005, the Applicants were aware that serious differences had arisen between Ubertini and Saeco International concerning the conduct of Saeco Australia's business. In late January 2006, Andrew Kremmer was approached by Aldo Taddeo of Saeco International, who stated that Andrew Kremmer, James Kremmer and White would be asked to take sides in a looming intervention by Saeco International.

18 On 26 October 2006, this proceeding was commenced by the Plaintiffs.[9]

19 On 13 February 2007, a board meeting was held. Prior to this meeting, the Saeco International nominee directors, Nicholas De Gregorio and Chris Egan ("Egan"), had never met with Andrew Kremmer or White.[10] At the meeting, a motion was passed appointing administrators to Saeco Australia. This occurred by a contracted majority vote held by Saeco International. Ubertini and James Kremmer (also holding the proxy for Andrew Kremmer[11]), voted against the resolution. White abstained.[12]

20 On 24 April 2007, Saeco Australia entered into a deed of company arrangement ("the DOCA"), by which Saeco International (through the New Subsidiary[13]) acquired the business of Saeco Australia. As noted in the Principal Judgment,[14] save for any relief that might be obtained from a court by reason of being a shareholder, after 24 April 2007 the shares of Saeco Australia were worthless.

21 Egan was appointed managing director of the New Subsidiary on 29 March 2007.[15] Andrew Kremmer and White continued to be employed by Saeco Australia.[16]

22 White's employment after the Administrators were appointed involved restructuring the business and assisting with the outsourcing of distribution, logistics and closing down of the satellite service centres, as well as sourcing new third party repairers. In May 2007, White was advised that his position was no longer required. He was asked by Saeco Australia to consider taking on the service and repair part of the business of the New Subsidiary, by means of a new company. White accepted that invitation and used his termination entitlements to purchase equipment and stock and establish the new company. He operated that business until July 2010, when he sold it at a loss.

23 White has never been asked by Saeco International to give evidence or provide any documents relevant to the proceeding. White's affidavit evidence states that he would have complied with any reasonable request in this regard. He was not served with a subpoena by any party.

24 Andrew Kremmer continued to be employed with Saeco Australia until the end of June 2008. He reported directly to Egan. Before he left his employment, he was asked by Egan whether or not he would speak to the lawyers for Saeco International for the purposes of this proceeding. He agreed to do so and met with 2 lawyers from Allens.

25 As a result of that discussion, a witness statement was prepared for the purposes of the proceeding, which was signed by Andrew Kremmer. Andrew Kremmer kept a draft of that witness statement, which is dated 1 July 2008. The heading of the witness statement includes a reference to Allens and the solicitor involved in the conduct of this proceeding on behalf of Saeco International.

26 Andrew Kremmer was not subpoenaed to give evidence. At no time was he ever asked by Saeco International to give evidence or to provide any documents relevant to the proceeding. Andrew Kremmer has affirmed that he would have complied with any reasonable request from Saeco International to give evidence or provide documents.

27 As the facts set out in the Principal Judgment demonstrate, this proceeding effectively concerned a dispute between the majority shareholder, Saeco International, and the substantial minority shareholders, the Plaintiffs, to which the Applicants were largely bystanders. The Applicants had limited voting rights,[17] and the effective control of the affairs of Saeco Australia was entirely beyond their reach.

28 Saeco International has never offered to purchase the shares held by the Applicants or to offer any compensation for their loss of value. The Applicants have lost the entire value of their shares in Saeco Australia by reason of a dispute they did not cause, and over which they had no control and no ability to resolve.

29 Each of the Applicants has deposed as to why it was that he did not previously seek to be joined as a plaintiff in this proceeding. Their explanations are as follows:

James Kremmer: When I learned [of the proceeding] I considered joining Ubertini's court action. I ultimately decided not to for financial reasons, although I did offer to assist in any other way and on one occasion travelled to Melbourne and attended a court hearing to show my support. I knew that the value of my 2% of shares was not high. My guesstimate was around $340,000 based on 5 times [Saeco Australia]'s normalised earnings as at the end of the financial year on 31 March 2005. Against this was the expense of a long-running court proceeding that I knew would take place interstate. By this time, I was largely retired and recently divorced. I was managing some personal investments, primarily a hotel managed by my daughter and her husband, so all of my money was tied up. I understood that if I participated in Ubertini's court proceeding, I risked a costs order against me if I lost. Losing what I had worked for all my life and leaving my daughter and her family with no future was not something I could contemplate.

Andrew Kremmer: When I learned [of the proceeding] I considered joining Ubertini's court action. I ultimately decided not to for financial reasons. I knew that the value of my 1% of shares was not high, around $174,000 based on 5 times [Saeco Australia]'s normalised earnings at the end of the 2005 financial year. Even when added to my father and White's shares, our combined 4% was not worth a lot. Against this was the expense of a long-running court proceeding that I knew would take place interstate. At the time, my only source of income was my employment as state sales manager [at Saeco Australia], for which I was being paid $105,000 per annum. I had a partner and two children to support. I was also aware that if I lost the court proceeding, I would be personally liable for Saeco International's legal costs. If that happened, I expected to be bankrupted.

White: When I learned [of this proceeding] I considered joining Ubertini's court action. I ultimately decided not to for financial and personal reasons. I believed that Saeco International would spare no expense in fighting any claim and I was aware that if any legal action was unsuccessful we would be liable for costs. In addition at the time my wife was undergoing treatment for cancer. I had a mortgage and 2 teenage children to support. I was not in a position to risk the financial future of my family. At the time my only source of income was with Saeco Australia and I thought that if I was involved in legal action against it I may be sacked.

30 Time has shown that the Applicants' decision not to seek joinder before now was soundly based. The proceeding has been on foot for more than 7½ years. Based on the evidence available, it would be expected that, if the Applicants had chosen to take an active role from the outset, their financial resources would have been exhausted before the trial commenced. Certainly, the costs the Applicants would have had to incur would have been entirely disproportionate to the value of their shares, however they might be valued.

31 Counsel for Saeco International, quite properly, conceded that the evidence indicated that there were understandable financial reasons why the Applicants chose not to be joined before now. It was accepted by Saeco International that costs for commercial litigation are prohibitive, but it was submitted they did not, of themselves, provide a proper basis for a party escaping the requirement to put its case by way of a pleading and then proving that case in order to obtain relief against a defendant. When I inquired of her how it was that the Applicants were supposed to get access to justice in these circumstances if they are not able to be joined presently, counsel for Saeco International said she did "not seek to defend the system of commercial litigation".

32 However, counsel for Saeco International, again quite properly, acknowledged that, as set out above,[18] the Applicants had been bystanders in a dispute between the substantial shareholders. Notwithstanding this, it was submitted that, at a "level of doctrine", the court was effectively precluded from permitting shareholders such as those in the position of the Applicants a means for obtaining relief other than conducting a full scale commercial case.

33 The following findings made in the Principal Judgment are relevant to the present application:

(1) "The ultimate outcome of Saeco Australia being placed into administration was that, when the administration came to an end, the Plaintiffs and Saeco International (among others) were left holding valueless shares in Saeco Australia. A further consequence of the administration, and the DOCA, was that Saeco International obtained ownership of the entire business of Saeco Australia without having to pay anything to the Plaintiffs for the business."[19]

(2) "... there was little, if anything, in the conduct of Saeco International which objectively suggests it was willing to pay anything for the shares of the minority shareholders, including the Plaintiffs."[20]

(3) "Saeco International set about getting the best outcome for itself, regardless of the consequences that might result for the remaining shareholders, including the Plaintiffs. In so doing, Saeco International achieved, by design, an outcome which deprived the minority shareholders, including the Plaintiffs, of receiving any value for their shares."[21]

(4) "... Saeco International wished to continue conducting business in Australia without the burden of dealing with Ubertini and the other minority shareholders."[22]

(5) "[Saeco International's] strategy, which was to be implemented to allow Saeco International to gain outright control and ownership of the Australian business, was concealed from Ubertini and the independent directors."[23]

34 As may be seen, findings already have been made in relation to all of the minority shareholders, including the Applicants. There is no question that the findings as made may provide a basis for the exercise of the court's discretion in relation to granting relief in favour of the Applicants if they were joined as plaintiffs.

35 There was no formal agenda provided to the Applicants before the meeting of the board on 13 February 2007. Although at least some of the Applicants were aware of the email sent by Egan on 22 January 2007,[24] the Applicants did not appreciate before the meeting on 13 February 2007 that they would be asked to vote on a motion to place Saeco Australia into administration. The Applicants believed the board meeting had been called in order for everyone to work out a resolution of the dispute between Ubertini and Saeco International.

36 The Applicants did not consider that it was necessary or appropriate to appoint administrators to Saeco Australia. White said he considered the meeting held on 13 February 2007 was an ambush. He said he believed the meeting was an opportunity to put together a proposal for Saeco International and was angry to find out that Saeco International directors had already decided to appoint administrators and had gone so far as to obtain consents from two Deloitte partners prior to the meeting.

37 The further evidence also addressed findings made in the Principal Judgment.

38 In relation to section D.2.1 of the Principal Judgment, concerning Ubertini's prevention of board meetings of Saeco Australia, [25] each of the Applicants said that he was aware in late 2006 and early 2007 that Ubertini did not want to hold a board meeting because Ubertini thought he would be removed as managing director at any such meeting. This is not something over which any of the Applicants had any control. The Applicants each knew that for a board meeting to take place with a quorum, Ubertini and both Saeco International nominee directors had to attend. Each of the Applicants considered it was a matter for Ubertini and the Saeco International nominee directors to agree a time for a board meeting if they could. Further, each of the Applicants understood it was his obligation to attend any board meeting, but none of them could force the other directors to do so.

39 In relation to section D.2.4 of the Principal Judgment, concerning advisor fees,[26] each of the Applicants stated they were not aware that payments in question were being made. The Applicants were generally aware that Saeco Australia engaged lawyers and accountants and that those professionals were paid. However, the Applicants were not aware what work Saeco Australia's lawyers and accountants had done for Ubertini personally. None of the Applicants were aware that, shortly before the February 2007 board meeting, Saeco International had alleged that some of the work Saeco Australia had paid for was for the benefit of Ubertini.

40 In relation to section D.2.5 of the Principal Judgment, concerning debts owed to Saeco International and related entities,[27] the Applicants knew that Ubertini had sent the Returned Stock[28] back to Saeco International for credit. The Applicants were also aware that Saeco International had not accepted the return of the Returned Stock. None of the Applicants were aware that Saeco Australia's credit terms with Saeco International were ever put in question until correspondence was sent by Saeco International's chief financial officer in late 2006.[29] Once this was known, the issue was raised with Ubertini. The Applicants believed that, as managing director, it was a matter for Ubertini alone as to when and how Saeco Australia made payments to Saeco International.

41 The Applicants apply pursuant to r 9.06(b)(ii) of the Supreme Court (General Civil Procedure) Rules 2005, which provides:

At any stage of a proceeding the Court may order that -

...

(b) any of the following persons be added as a party, namely -

...

(ii) a person between whom and any party to the proceeding there may exist a question arising out of, or relating to, or connected with, any claim in the proceeding which it is just and convenient to determine as between that person and that party as well as between the parties to the proceeding;

...

42 Further, s 29(2) of the Supreme Court Act 1986 (Vic) provides:

(2) Every court ... must give the same effect as before the commencement of this Act -

(a) to all equitable estates, titles, rights, reliefs, defences and counter-claims, and to all equitable duties and liabilities; and

(b) subject thereto, to all legal claims and demands and all estates, titles, rights, duties, obligations and liabilities existing by the common law or created by any Act -

and, subject to the provisions of this or any other Act, must so exercise its jurisdiction in every proceeding before it as to secure that, as far as possible, all matters in dispute between the parties are completely and finally determined, and all multiplicity of proceedings concerning any of those matters is avoided.

43 There is no need to identify a test beyond that expressed in the Supreme Court Rules.[30] In Construction, Forestry, Mining and Energy Union v Boral Resources (Vic) Pty Ltd,[31] it was observed that r 9.06 is designed to enhance the efficient and economic resolution of proceedings heard in the civil jurisdiction, and was not to be given some narrow construction which would exclude from its operation any particular class of cases. A cardinal object of the rule is to avoid multiplicity of proceedings.[32] This is reinforced by the terms of s 29(2) of the Supreme Court Act.

44 Saeco International accepted in its written submissions that, as between it and the Applicants, there may exist a question arising out of, or relating to, or connected with the Plaintiffs' claims in the proceeding, namely whether the Applicants are entitled to orders for the purchase of their shares in Saeco Australia by Saeco International pursuant to s 233 of the Corporations Act 2001 (Cth). Accordingly, the issue is whether it is "just and convenient" to determine that question in this proceeding.[33]

G. Saeco International's submissions for resisting the joinder

45 Saeco International effectively submitted the application was too late. It contended that that situation gave rise to 3 propositions, namely:

(1) None of the findings in the reasons of the Principal Judgment are binding as between the Applicants and Saeco International.

(2) The addition of a party may be refused where the application for joinder was not made promptly and the addition would prejudice an existing party in a way that could not be fairly met by an adjournment, an award of costs or otherwise.[34]

(3) Where joinder is sought after the publication for reasons for judgment or formal orders (such as on appeal), joinder may be refused where the Applicants' absence at an earlier stage was to the disadvantage of one of the parties, eg by denying to it the opportunity of having discovery, interrogatories or evidence.[35]

46 In relation to the third proposition, Saeco International submitted that the particular evidence that may have been relevant to matters determined adversely to Saeco International included:

(1) Discussions surrounding the 30 June 2005 meeting.[36]

(2) Discussions concerning the Returned Stock.[37]

(3) The position adopted by Saeco International in negotiations with Ubertini.[38]

(4) Ubertini's conduct in frustrating the holding of board meetings.[39]

(5) Ubertini's decision to withhold payment to Saeco International.[40]

(6) Discussions at the time of agreement of, and later performance of, the Brand Management Agreement.[41]

47 In response to the first proposition, the Applicants have informed the court that they are willing to provide an undertaking to the court, as a condition for any order for joinder, that they will be bound by any findings of fact as found in the Principal Judgment. As already indicated, they also agree to be bound by the orders made subsequent to the Principal Judgment. Of course, that leaves the position of Saeco International, to which I will return.

48 In relation to the second proposition, the reasons for the lack of promptness of the application have been clearly set out, and not challenged, in the affidavits in support of the application. As already stated, the reasons were entirely justifiable. The real issue is whether or not Saeco International has suffered any prejudice by reason of the late application. Saeco International has chosen not to put any evidence before the court to substantiate a suggestion of prejudice. In these circumstances, coupled with the matters set out in paragraphs 49 to 51 below, it is difficult, presently at least, to give much, if any, weight to this submission.

49 Finally, as to the third proposition, the complaint about the absence of discovery, interrogatories[42] or evidence is surprising given the evidence before the court. At the commencement of the oral submissions made on behalf of Saeco International, it was stated that Saeco International opposed the joinder for the reasons set out in its written submissions (ie, including this proposition).

50 However, as set out above,[43] the affidavits filed by the Applicants disclosed that Saeco International had every opportunity to obtain witness statements and discovery from the key potential witnesses of Applicants, namely Andrew Kremmer and White.[44] As already noted, Saeco International actually obtained a signed witness statement from Andrew Kremmer. Furthermore, the evidence disclosed that none of the Applicants had any documents which were relevant to the material issues in the case that were not already in the possession of Saeco International.

51 When I sought clarification during the course of oral argument as to whether this proposition was pursued in light of the further evidence, Saeco International stated that it did not press the submissions underlying the proposition.

52 This position ultimately adopted effectively undermines any submission that the findings already made on the substantive issues may have been substantively different if the joinder had occurred earlier. The key potential witnesses, Andrew Kremmer and White, were available and would have acceded to any reasonable request to give evidence. Not only did the fact that they were not parties not preclude Saeco International accessing any relevant evidence, but there is nothing before the court to suggest any of the Applicants had any material evidence to give.

53 However, Saeco International persisted with a submission that evidence was not led or sought to be led from the Applicants because they had not brought oppression proceedings against Saeco International. In these circumstances, Saeco International submitted the Applicants' conduct had not been relevant to the proceeding in the same way as the conduct of Ubertini was relevant at trial.

54 It was observed by counsel for the Applicants that, notwithstanding that Saeco International had access to all the documentation in the proceeding, including the material located at the email addresses of Andrew Kremmer and White when they left the employment of Saeco Australia, Saeco International had not put forward any evidence to support a suggestion that there might be conduct relevant to whether or not the Applicants should receive relief in relation to the oppressive conduct of Saeco International. It was also noted that there was no submission made by Saeco International as to what that conduct (not already the subject of evidence at trial) might be. When I raised these matters directly with counsel for Saeco International, the response was that Saeco International could not assist the court any further than it already had.

55 In short, even though this case has been on foot for years and has been conducted thoroughly and carefully on behalf of Saeco International, Saeco International was not able to meaningfully substantiate a basis upon which it might advance a case that the conduct of the Applicants ought to, or even might, found a basis for depriving them of relief under s 233 of the Corporations Act. Given that Saeco International has had ample opportunity to put at least some evidence on this topic before the court in support of this submission, I do not accept that the proposition contended for is a proper basis for a suggestion that the joinder is not presently just and convenient.

56 However, to ensure the joinder of the Applicants is not unfair to Saeco international, Saeco International will be given the opportunity to put a case that the Applicants ought not be entitled to the relief sought. If so advised, Saeco International will be able to state the grounds upon which it relies to deny the Applicants the right to an order to sell their shares to Saeco International. A directions hearing will be held promptly, and any further hearing will be conducted in the near future, so as to not delay the valuation process currently underway.

57 To deny the Applicants the ability to be joined as plaintiffs to this proceeding would be effectively to deny them access to any ability to obtain relief in relation to what the court has found was oppressive conduct on the part of Saeco International. It is difficult to conceive a basis upon which the procedures of the court could be just in their operation if such an outcome were mandated.

58 In any event, for the reasons outlined above, it is just and convenient that the Applicants be joined as plaintiffs now. The fact there have already been substantive findings on issues of liability is not, of itself, a bar to an order being made.[45] Further, in my view, such an outcome is entirely consistent with the overarching purpose[46] to facilitate the just, efficient, timely and cost effective resolution of the real issues in dispute.

FOOTNOTE: On 2 July 2014 the following orders were made by consent:

1. The shares in Saeco Australia Pty Ltd owned by the 3rd, 4th and 5th plaintiffs be included in the shares to be valued by the Valuer appointed pursuant to the order of 23 May 2014.

Saeco International elected not to require a further hearing on the issue of whether or not the Applicants ought to be entitled to the relief sought.

[1] Ubertini v Saeco International Group SpA (No 4) (2014) 98 ACSR 138. In the judgment of the court, defined terms are capitalised. The editors of the Australian Corporations and Securities Reports have removed the capitalisation. Capitalised terms used in this judgment are a reference to defined terms in the Principal Judgment.

[3] Cf Morgan v 45 Flers Avenue Pty Ltd (1986) 10 ACLR 692, 704.1 (Young J).

[4] Ubertini v Saeco International Group SpA (No 5) [2014] VSC 234.

[5] There was a minor exception to this, because of the differing rights that attached to the Applicant's shares. The Applicants accepted they may be liable for costs in relation to any additional costs incurred.

[6] For a more extensive background of the issues in the proceeding, see the Principal Judgment, 140-158 [1]-[113].

[7] Principal Judgment, 144 [20]. The Queensland distributor, Pennidan Pty Ltd, was also allocated 1 percent. This company sold its shares, as recorded in the Shareholders' Agreement.

[9] For a history of the procedural steps in proceeding, see Ubertini v Saeco International Group SpA [2013] VSC 468.

[10] James Kremmer gave no evidence on the issue of whether he had met the Saeco International nominee directors before 13 February 2007.

[11] Andrew Kremmer was overseas at the time.

[12] Principal Judgment, 142 [9], 193 [308].

[15] Principal Judgment, 149 [57], fn 34.

[16] The evidence did not make plain when, or even if, Andrew Kremmer or White became employees of the New Subsidiary. Nothing turns on this. I will simply refer to the employer as "Saeco Australia".

[17] Principal Judgment, 144 [23]-[24].

[24] Principal Judgment, 189 [283]. This email foreshadowed that "options available to address the situation, including whether to place [Saeco Australia] into voluntary administration" would be raised at the upcoming meeting of directors.

[28] See Principal Judgment, 152 [74].

[29] See Principal Judgment, 152-153 [78]-[79], 180 [237].

[30] Boral Resources (Vic) Pty Ltd v Robak Engineering and Construction Pty Ltd [1999] VSCA 66; [1999] 2 VR 507, 509 [3] (Tadgell JA).

[31] [2013] VSCA 378, [13] (Beach JA, with whom Osborn JA agreed).

[32] Boral Resources (Vic) Pty Ltd v Robak Engineering and Construction Pty Ltd [1999] VSCA 66; [1999] 2 VR 507, 509 [5] (Tadgell JA).

[33] The Plaintiffs did not appear to be heard on this application. Though separate counsel has been retained, the solicitors for the Plaintiffs are also acting for the Applicants.

[34] Reliance was placed upon Carborundum Realty Pty Ltd v RAIA Archicentre Pty Ltd (unreported, Victorian Supreme Court, Harper J, 2 June 1992).

[35] Reference was made to Mulcahy v Curramore Pty Ltd [1974] 2 NSWLR 464, 468-469 (Moffit P).

[36] As to which, see par 16 above.

[37] As to which, see par 40 above.

[38] As to which, see par 16 above.

[39] As to which, see par 38 above.

[40] As to which, see par 40 above.

[41] As to which, see Principal Judgment, 143-144 [14]-[19], 160-161 [124]-[126], 221-222 [463]-[471]. Saeco International led no evidence to contradict the account given by the Plaintiffs. Further, on this application, Saeco International led no evidence to suggest any of the Applicants were meaningfully involved in any relevant discussions.

[42] Interrogatories are almost never ordered in commercial matters.

[44] By stating this, I am not suggesting any of the Applicants would have been key witnesses in the case. I refer to them as the key potential witnesses, as they were both executive directors, and to distinguish them from James Kremmer. James Kremmer was a non-executive director. Further, the meeting he attended on 13 February 2007, being the only board meeting held during the relevant period, was the subject of a transcript for nearly the entire meeting.

[45] See, eg, Mulcahy v Curramore Pty Ltd [1974] 2 NSWLR 464, 468.8 (Moffit P, with whom Hope JA and Bowen CJ in Eq agreed); Harmer v Armstrong [1934] Ch 65, 84.5 (Lord Hanworth MR).

[46] Civil Procedure Act 2010 (Vic), s 7(1).