Crow Inn Pty Limited (No 2) [2020] NSWSC 1749

“Wind up the company that runs this pub!”

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An uncle, and his Co, (“P” or “the Ps”) sued a nephew and his Co (“D” or “the Ds”) to wind up a Co that operated a pub and the T’ee that owned the land it was on: [1]

Uncle and nephew were the directors of both the Co and the T’ee: [2]

All parties accepted the relationship had broken down. Each blamed the other: [3]

The grandfather - P’s dad - assisted P and D in setting up the business. Later, grandad would swear an affidavit supporting D: [4]

In 2010 grandad and P identified a site in Wagga on which to construct a pub for and P and D to operate: [31]

In 2013 the pub opened with D as general manager. D had never managed a hotel: [79]

From 2015 grandad, a guiding figure in the family, started to recede and a shareholders agreement between the Ds and Ps was discussed: [88], [89]

Pursuant to the shareholders agreement, P would transfer 10% of his shares and pay $1m in consideration for D managing the pub for 5 years: [103]

In 2017, D bought a nearby block to develop a hotel. D did not tell P: [128]

P issued a buy out notice. D resisted: [137] - [140], [246]

D cut the pub’s CCTV cable preventing P from inspecting the pub via remote means: [159] - [161]

D relied on data from the pub to progress his new venture: [165]

D used his pub email address to further his new venture: [167]

D allowed a consultant helping with his new venture to stay at the pub for free, and was then evasive about it in XX: [169], [170]

D stopped keeping P informed of the pub’s business. P often stayed in other nearby hotels due to the pair’s animosity: [180]

In April 2020 P came to the pub, logged into D’s computer, and took photographs of the screen. An “undignified struggle” over the computer mouse ensued: [203]

Despite P and D still being directors, they were unable to conduct a conversation or agree on management arrangements: [215]

In buying the new property and concealing it from P, using his role as general manager to lend credibility to his new venture, using information about the pub - D put his own interests and the pubs and T’ee’s in conflict and was oppressive: [243]

D obstructed P’s means of seeing what was happening at the pub, and obstructed attempts to sell the land and business - all while furthering his own project: [246]

P pressed for just and equitable wind-up but the Court had to firstly consider whether alternative relief was appropriate: [265]

There was no valuation evidence before the Court that might found a buyout order: [271]

D, when pressed, was only prepared to buy out the shares in the pub, not the T’ee. A sale of the pub shares only would not cure the oppression: [272]

The Court found it would be just and equitable wind up the pub and the T’ee: long standing deadlock, broken relationships and oppressive conduct - and D will likely frustrate any action he does not agree with: [287], [288]

A receiver was also appointed to the trust’s assets: [302]