The proper plaintiff rule (Foss v Harbottle) applies to owners corporations under the Strata Schemes Management Act 1996 (NSW). Where lot owners who are the targets of the owners corporation's potential claims control the owners corporation's voting and use that control to prevent the corporation from suing, the fifth 'justice' exception to the rule permits a lot owner to pursue a derivative claim in the name of the owners corporation. The Supreme Court may exercise auxiliary equitable jurisdiction to make orders enabling such a derivative claim to be pursued in the District Court, subject to the lot owner indemnifying the owners corporation for costs.
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