Shareholder Successfully Claims For Loss In Share Value

In the Margaretic case, a shareholder successfully argued his case against the administrators of a company for his claim of losses suffered by him as a result of depreciation of the value of his shares.

In the recent case of Sons of Gwalia Ltd v Margaretic (2005), Luka Margaretic brought a claim against the Sons of Gwalia Ltd ( the "Company") for loss and damage that he alleged he had suffered by conduct of the Company. The alleged loss and damage occurred in relation to his acquisition of 20,000 shares in the capital of the Company which subsequently became worthless.

Mr Margaretic bought the shares on 18 August 2004 on the market conducted by Australian Stock Exchange Limited, and his name was entered in the register of members of the Company on 23 August 2004 as the holder of 20,000 shares. On 29 August 2004, administrators of the Company were appointed. It later emerged that the shares in the Company were worthless at the moment of the appointment of the administrators.