A defacto couple owned multiple properties through multiple companies. When they split the man notified ASIC that the woman had ceased as director and secretary of various companies and had transferred her shares to him and the register was altered accordingly.
The woman sought, a declaration that she was still a director and shareholder of the companies, and rectification of the register. In the meantime, sought an injunction preventing the man from dealing with the properties (selling, encumbering or refinancing them).
The court granted an injunction under section 1324 Corporations Act 2001 to restrain the man from changing the company registers of the four companies or effecting a transfer of shares or effecting a refinancing of mortgages over properties owned by them without leave of the court, but permitted negotiations as to refinancing.
The man had argued the woman had no standing to bring the application, but the court rejected this because if she is ultimately successful in demonstrating she is a shareholder, her interest in the shares will confer an interest in the companies. The court found that the woman had made out a prima facie case by showing a sufficient likelihood of success (a “serious question”) justifying preservation of the status quo until trial and so the balance of convenience lay in her favour.
However the court noted that the order needed to allow things to be done by the entities to preserve that status quo. The court also refused to order the woman to provide security for costs owing to her impecuniosity being caused by the conduct which was the question of the litigation.