Whitehouse v Capital Radio Network Pty Ltd

[2004] TASSC 12

Supreme Court of Tasmania

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Interrogate

Catchwords

1. Corporations
2. › Management and administration
3. › Directors and other officers
4. › Meetings of directors
5. › Validity of proceedings
6. › Absence of quorum
7. › Whether absence of quorum constitutes procedural irregularity under s 1322 where meeting convened with knowledge quorum unlikely
8. › Whether deliberate convening excludes characterisation as procedural irregularity
9. › Corporations Act 2001 (Cth), s 1322
1. Corporations
2. › Management and administration
3. › Directors and other officers
4. › Meetings of directors
5. › Validation of proceedings
6. › Substantial injustice
7. › Whether validation of inquorate meeting would cause substantial injustice
8. › Nexus between procedural irregularity and prejudice
9. › Preservation of status quo under consent orders
10. › Corporations Act 2001 (Cth), s 1322(2), (4)(a), (6)(c)

Quick Take

The absence of a quorum at a directors' meeting constitutes a 'procedural irregularity' under s 1322 of the Corporations Act 2001 (Cth) even where the meeting was deliberately convened with knowledge that a quorum was unlikely, following Re Pembury and declining to follow Re Saddington. However, validation will be refused where the inquorate meeting would disturb a status quo preserved by agreement and court orders, and the absent director's non-attendance was itself a control mechanism integral to that arrangement. The fact that the chairman's casting vote would have produced the same result does not preclude a finding of substantial injustice.