Engadine Medical Imaging Services Pty Ltd ATF the Engadine Unit Trust v Mena Ibrahim & Ors

2024/00444848

CORPORATIONS – in 2009, the first and third respondent established a medical imaging practice (Engadine Practice) - on 23 June 2016, Engadine Medical Imaging Services Pty Ltd (EMIS) was incorporated, with the second applicant as its sole director and secretary, and Advanced Imaging as its sole shareholder - on 23 June 2016, Engadine Medical Imaging Services Pty Ltd (EMIS) was incorporated, with the second applicant as its sole director and secretary, and Advanced Imaging as its sole shareholder – in February 2018, the second applicant agreed with the first and third respondent to purchase a 51% interest in Engadine practice for $319,000.00 – on 1 February 2018, the Engadine Imaging Trust was created, pursuant to the Engadine Trust Deed (Deed) – the Deed was executed by the third applicant, by the second applicant on behalf of EMIS as its director and secretary, by Chaudhry Radiology Services Pty Ltd as trustee for the Nabeel Chaudhry Family Trust, and nu MI No. 2 Family Pty Ltd as trustee for the MI No. 2 Family Trust (an entity associated with the first respondent) – under the Deed, the third applicant held 51 units, the third respondent as director of Chaudhry Radiology Services held 19 units as trustee for the Nabeel Chaudhry Family Trust, and the first respondent as director of MI No. 2 held 30 units as trustee for the MI No. 2 Family Trust – the Deed provided that the majority unit holder, Advanced Imaging, had control and management of the Engadine practice - on 12 February 2018, the second applicant paid $319,218.91 to the first respondent to acquire a 51% controlling interest in the Engadine Practice on behalf of Advanced Imaging – in May 2018, an entity controlled by the first and third respondent, Pulse Medical, assigned the lease of a premises in Engadine to EMIS, at which the Engadine Practice traded from – in October 2019, the second applicant left for Jordan and the third respondent began management of the Engadine Practice in March 2022, the second respondent was incorporated by the first respondent as sole director, secretary and shareholder – in May 2022, steps were commenced to rebrand and bring, inter alia, the Engadine Practice, under the umbrella of ‘Focus Radiology Group’ by the third respondent, unbeknownst to the second applicant – on 8 July 2022, the second respondent entered into a lease at the premises then occupied by EMIS, and the first respondent notified EMIS that it was required to vacate the premises by 10 August 2022 – on 22 November, at a close-by alternative premises, the first respondent began conducting a competing business called Focus Radiology Engadine (Focus Radiology premises) – on 23 February 2023, a deed of settlement was executed between the parties which provided that the EMIS and the second applicant release the first and second respondent arising out of any claims in connection with lease dispute, and a deed of assignment of the lease back to EMIS was also executed - the applicants instituted proceedings for alleged breaches by the first and second respondent of duties owed under the Corporations Act 2001 (Cth) (Corporations Act) and of fiduciary duties owed by them as officers of EMIS, breaches of confidence by the first and third respondent, and for misleading and deceptive conduct under the Competition and Consumer Act 2010 (Cth), Sch 2, s 18, by the first respondent – the primary judge found that the first respondent was not an officer of EMIS at the relevant time for the purposes of s 9AD of the Corporations Act, and as such could not breach any duty owed – the primary judge was not satisfied that any of the pleaded representations were made by the first respondent for the purposes of a finding of misleading or deceptive conduct – the primary judge found that the first respondent did not breach any duty of confidentiality – the primary judge found that, though the third respondent was a director of EMIS at the relevant time, there were no such breaches of duty – whether the primary judge erred in the approach taken to fact finding in making contested factual findings contained in UCPR 51.58 Schedule – whether primary erred in dismissing applicant’s claim for constructive trust over second respondent – whether primary judge erred in dismissing the applicant’s claim against each respondent.