EQUITY - Equitable Assignment - Preliminary determination of
separate questions - Whether either of two deeds were
effective to assign
claimed rights of the purported assignor against the Defendants - Issues
Quick Take
1A person who signs a deed on behalf of a company without being a director, without a power of attorney, without a board resolution authorising execution, and without indicating any capacity in which they sign, has not been shown to have authority to bind the company; the onus of proving effective assignment lies on the party asserting it.
2The indoor management rule (Turquand's case) and s 129(3) of the Corporations Act 2001 may protect a party dealing with a company from the company's denial of authority, but cannot be used by that party to establish the validity of an assignment as against third parties who challenge its effectiveness.
3A contractual prohibition on assignment of rights without prior written consent of all parties is valid and effective where it serves a legitimate collateral purpose, such as protecting the interests of joint venture participants, applying Linden Gardens Trust Ltd v Lenesta Sludge Disposals Ltd [1994] 1 AC 85.
Case Details
Citation[2018] NSWSC 690
CourtNSWSC
JurisdictionNew South Wales
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