In the matter of Love D&V XOXO Pty Ltd and D&V Vlahos Pty Ltd

1. [1]

   These proceedings concern the affairs of Love D&V XOXO Pty Ltd (Company) and D&V Vlahos Pty Ltd in its own capacity and as trustee for the D&V Unit Trust (Trustee). In very broad terms, the Company was once in the business of designing and selling women’s clothing. The Trustee owned certain intellectual property in relation to the Company. The Company was run by its directors, Ms Vicki Vlahos (the plaintiff) and Ms Danielle Vlahos (the first defendant), who are first cousins (and will be referred to in these reasons by their first names for ease). They also each own 50% of the Company.

The breakdown in the relationship and the fall out

1. [2]

   From some time in 2022, the Company was in negotiations with an American company, called Allure Bridals, to sell the Company’s business. Those negotiations led to an in-principle agreement in March 2023 and a further in-principle agreement in June 2023. Under the June 2023 in-principle agreement, Allure Bridals was to acquire the business for amounts including: (a) AUD$22m upfront; (b) conditional further payments of up to USD$13.24m; (c) approximately AUD$2-3m for inventory; and (d) payments to Vicki and Danielle personally. That proposed consideration was less than what had been contemplated by the March 2023 in-principle agreement.

2. [3]

   Over the course of 2023, the relationship between Vicki and Danielle irretrievably broke down. It appears on the evidence that Danielle terminated the negotiations with Allure Bridals in September 2023.

3. [4]

   Vicki commenced proceedings by way of originating process filed on 6 October 2023. She sought orders that the Company and the Trustee be wound up on the ground that it was just and equitable. The matter was listed for hearing on an expedited basis. It was scheduled to be heard by Williams J on 26 October 2023. Shortly before the hearing, the parties agreed to compromise the application by appointing a receiver and manager to sell the business conducted by the Company and to finalise the accounts of the Company and the Trustee. Orders to that effect were made by consent on 26 October 2023. Mr Desmond Teng was appointed as the receiver and manager of the Company and the Trustee.

4. [5]

   Mr Teng sold the business to Allure Bridals on 11 December 2023 for $12,127,000 ($11,828,432 payable to the Company and $298,568 payable to the Trustee).

5. [6]

   Mr Teng subsequently filed an interlocutory process in these proceedings, seeking directions in relation to various accounts of the Company and the Trustee. Those matters were strongly contested by Vicki and Danielle. Nixon J delivered reasons on 19 March 2025: see In the matter of Love D&V XOXO Pty Ltd (Receiver and Manager Appointed) and D & V Vlahos Pty Ltd (Receiver and Manager Appointed) – Desmond Wei Liang Teng in his capacity as Receiver and Manager of Love D&V XOXO Pty Ltd (Receiver and Manager Appointed) and D & V Vlahos Pty Ltd (Receiver and Manager Appointed) v Vlahos; Vlahos v Vlahos; Vlahos v Vlahos [2025] NSWSC 230.

Vicki’s new claim

1. [7]

   On 15 September 2025, Vicki filed an interlocutory process in the winding up proceedings, by which she seeks relief under s 233 of the Corporations Act 2001 (Cth) and the general law on the basis of alleged oppression and other wrongdoing by Danielle. Vicki has also served (but not yet filed) a proposed statement of claim that pleads her claim for relief under s 233 and equitable compensation. She seeks leave to file that statement of claim. The claim as pleaded is long and has some complexity. In very broad terms, Vicki wishes to sue Danielle in respect of loss or damage said to have been incurred by the Company, the Trustee and Vicki as a result of Danielle’s conduct, which is said to have caused the loss of the commercial opportunities that were afforded by the March and June 2023 in-principle agreements.

2. [8]

   Pursuant to her interlocutory process filed on 15 September 2025, Vicki seeks interlocutory relief that the matter is to proceed on pleadings and that she be granted leave to file and serve the statement of claim. That is the application that is now before the Court.

Danielle contends that the new claim is an abuse of process

1. [9]

   Danielle contends that Vicki should not have leave to file the proposed statement of claim, or the opportunity to pursue her interlocutory process, because her application for relief under s 233 of the Corporations Act and for equitable compensation is an abuse of process. She contends that the abuse arises because the claims Vicki now makes were not advanced in the earlier winding up proceedings. Danielle contends that the current matters could and should have been advanced in the winding up proceedings in 2023. Danielle contends that the new claim is vexatious.

2. [10]

   Danielle does not contend that Vicki cannot bring the new claim on the basis that the resolution achieved on or just before 26 October 2023 meant that there was a binding compromise of the dispute now sought to be agitated by Vicki in the statement of claim. Nor does Danielle contend that Vicki is barred in any way because of delay. Danielle does not take procedural points about the precise way in which the oppression proceedings have been instituted, that is, by way of an interlocutory process in the winding up proceedings rather than as fresh proceedings. While Danielle is critical of the claim advanced by Vicki, she does not seek some kind of summary disposal on the grounds that the case as framed is hopeless and doomed to fail. She accepts that the claim is arguable.

The relevant principles

1. [11]

   There was no real debate between the parties about the relevant principles. The dispute lay in the application of principle. The relevant principles emerge from decisions of the High Court, including Walton v Gardiner; Walton v Herron; Walton v Gill (1993) 177 CLR 378; [1993] HCA 77, Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR 507; [2015] HCA 28 and UBS AG v Tyne (as trustee of the Argot Trust) (2018) 265 CLR 77; [2018] HCA 45.

2. [12]

   Vicki’s counsel placed particular emphasis on the recent decision of Shao v Crown Global Capital Pty Ltd (in prov liq) [2025] HCA 43; 99 ALJR 1547. The Court observed (footnotes omitted):

3. [13]

   Counsel for Danielle also relied on the decision in Robinson v Deep Investments Pty Ltd [2018] FCAFC 232; 364 ALR 305. The Court in that case applied the principles discussed in Tomlinson and UBS AG v Tyne. It usefully illustrates the application of those principles. There was an abuse of process in Robinson in circumstances where a conscious decision was made for forensic reasons to confine claims made in the Supreme Court in a particular way. Jagot and Colvin JJ observed that if claims arising from the same subject matter were to be held back for later resolution, then it was incumbent upon the party in that case to raise the matters and seek case management directions to ensure the cost effective, efficient and fair resolution of the dispute (at [118]).

4. [14]

   The decisions to which I have referred make it clear that a decision about whether proceedings amount to an abuse of process requires the Court to consider the particular circumstances of the case and then make a broad, merits-based judgment of whether the proceedings constitute an abuse of process. The judgment is to be made having regard to the relevant public and private interests.

There is no abuse of process

1. [15]

   I have come to the conclusion that the new claims that Vicki wishes to maintain against Danielle do not amount to an abuse of process. The conclusion is based on the following considerations.

2. [16]

   The new claims, if permitted to be advanced, will likely impose a heavy burden on Danielle. There is evidence that Danielle has financial issues and that she and her family have suffered considerable stress as a consequence of various proceedings between Danielle and Vicki. However, it is often the nature of litigation that persons involved in litigation face a heavy burden, which may be exacerbated by their personal circumstances. That there is a serious burden placed on the Danielle is not, by itself, a sufficient basis to conclude that proceedings are abusive. Danielle has to be able to demonstrate that the proceedings are unfairly burdensome, prejudicial or damaging: CBRE (V) Pty Ltd v Trilogy Funds Management Ltd (2021) 107 NSWLR 202; [2021] NSWCA 316 at [10] (Bell P; Basten JA agreeing).

3. [17]

   I accept that there were good reasons to explain why Vicki did not advance her claims about oppression and associated alleged wrongdoing in the winding up proceedings commenced on 6 October 2023. The winding up proceedings were commenced and relevantly resolved in circumstances of considerable commercial urgency. There had been a breakdown of the relationship between Vicki and Danielle which meant that the Company could not function. There was a possibility of the Company’s business being sold but Vicki and Danielle could not work together to achieve that end. From Vicki’s perspective, immediate steps had to be taken to seek to preserve the possibility of a sale of the business on commercially attractive terms. The obvious urgency explains why the Court made orders for an early final hearing in the winding up proceedings.

4. [18]

   While it may well be the case that most of the conduct of Danielle about which Vicki now complains was known to her at the time the proceedings were commenced in October 2023, Vicki did not then know what the consequences of the alleged misconduct would be. That could not be known unless and until the business was sold or the deadlock was resolved. In the context of an application for urgent orders to address an immediate problem, it is not realistic to think that a complex oppression suit could have been accommodated as part of the case.

5. [19]

   A matter relied on by Danielle is that the prospect of a claim by Vicki alleging that Danielle had been conducting herself in a way that gave rise to a right to relief under s 233 of the Corporations Act had been raised between the parties before Vicki commenced these proceedings on 6 October 2023. On 12 May 2023, solicitors for Vicki sent a detailed letter to Danielle, alleging that she was engaging in oppressive conduct and acting in breach of her duties as a director of the Company. The letter threatened legal action if Danielle failed to provide various undertakings. It cannot be said that Vicki was unaware on 6 October 2023 of the potential to pursue a claim that Danielle had engaged in conduct that could found a claim for oppression.

6. [20]

   I do not consider that this is a matter that points strongly in favour of Danielle’s contention that the new claims are an abuse of process. As I have stated, the tangible consequences of the alleged oppressive conduct, including the loss or damage that the Company, the Trustee and Vicki claims to have suffered, was not known when she applied to the Court to have the Company wound up. It was possible that the outcome of the winding up proceedings would eliminate the need or utility of pursuing proceedings alleging oppressive or other wrongful conduct. There was an immediate need to resolve the dysfunction in the management of the Company. It was not realistic to resolve that issue at the same time as dealing with the complexity of oppression proceedings.

7. [21]

   Moreover, when the winding up proceedings were resolved by an agreement for a receiver to be appointed, Danielle was on notice that Vicki had previously alleged that Danielle had engaged in oppressive and wrongful conduct. When the compromise was reached shortly before the hearing scheduled for 26 October 2023, the parties did not agree to compromise the claims now sought to be advanced by Vicki. There were, for instance, no releases or covenants not to sue. If Danielle wished to guard against a claim for oppression, she could have sought to negotiate an outcome to achieve that end in October 2023.

8. [22]

   Danielle gave some evidence about her state of mind in October 2023 concerning the prospect of the claims now advanced. The evidence suffered from some ambiguity. The thrust of her evidence, fairly read, is as follows:

9. [23]

   I do not understand Danielle’s evidence to go so far as to say that she agreed to the appointment of a receiver on the understanding that Vicki had forever abandoned any right she might otherwise have to sue Danielle for oppressive conduct or any of the other wrongs that she now wishes to advance.

10. [24]

    Counsel for Danielle also relies on an exchange between Williams J and counsel for Vicki at the time her Honour made orders on 26 October 2023. Her Honour asked Vicki’s then counsel about the contemplated appointment of a receiver on an interlocutory basis. Her Honour asked whether there was any reason why it should not be formally noted that Vicki no longer pressed for the winding up orders on the grounds set out in her evidence. Her Honour’s remarks indicate a concern that orders appointing a receiver would be made, only for Vicki to come back in the near term and seek winding up orders on the basis that she did not like what the receiver was doing. Her Honour was given some assurance that Vicki did not intend to take that course but that a winding up order might be appropriate at the end of the period of receivership. There was an exchange as follows:

11. [25]

    When the transcript is read as a whole and in context, it is apparent that her Honour was seeking to guard against the possibility that the compromise achieved by the appointment of a receiver was not going to be unwound by Vicki taking some step to renew the application to wind up the Company and Trustee if she was unhappy with what the receiver was doing. Her Honour was given some assurances from counsel. Those assurances have been honoured because Vicki has been seeing the receivership through.

12. [26]

    With the full benefit of hindsight, it could be suggested that it would have been helpful for counsel for Vicki to have qualified the answer set out above by expressly indicating that Vicki was not giving an assurance that she would not sue Danielle for oppressive or other wrongful conduct. However, given the context, I do not think that anything stated by counsel for Vicki supports an argument that the proceedings now sought to be advanced are an abuse of process. Counsel for Vicki was not asked in clear terms whether his client was abandoning any rights she might have to seek relief against Danielle for oppressive or other wrongful conduct. Nothing was stated by counsel that now supports a submission that it is an abuse for Vicki to pursue her claim.

13. [27]

    In written submissions dated 23 October 2023, which were to be relied upon at the hearing scheduled for 26 October 2023 (but which did not proceed because the matter was compromised), Vicki’s then counsel submitted that “neither party alleges oppression or seeks a share buy-out order”. That was true at the time. Once again, with the benefit of hindsight, it may have been helpful to expressly reserve any right to do so in any subsequent application. However, I do not consider this to be a matter that weighs heavily in favour of a stay on the basis of an abuse of process. It was not an unequivocal statement from which Vicki now resiles.

14. [28]

    The parties attended a mediation on 11 April 2024. In Danielle’s position paper for that mediation, Danielle alleged that she was the victim of oppressive conduct at the hands of Vicki and asserted that the Court had power to grant her significant relief, including damages, under s 233 of the Corporations Act. In Vicki’s responsive position paper, Vicki asserted that she had “similar thoughts” about actions available to her against Danielle. These position papers are evidence that neither Danielle nor Vicki ever considered that the orders made on 26 October 2023 foreclosed the possibility of claims based on alleged oppressive conduct. They show that both parties were on notice that the other party was contemplating taking steps to seek relief against the other for alleged oppressive conduct.

15. [29]

    The matter also came before Black J on 11 June 2024 concerning an application for matters to be referred to a referee. His Honour noted: “as far as I can tell there is nothing that remains in issue to be determined in these proceedings” and that “no-one has sought to file any application that seeks to have anything else determined”. Counsel for Vicki at the time did not foreshadow the possibility of the claims she now advances. I do not consider that it was necessary for counsel to do so, particularly if no firm decision had been made to pursue the claims.

16. [30]

    Weighing up the merits, I am satisfied that there is no abuse of process of the kind alleged by Danielle for the following reasons:

17. [31]

    The application for interlocutory relief has been opposed. The opposition has been unsuccessful. There was no suggestion that costs should not follow the event.

Orders

1. [32]

   I make the following orders:

   1. (1)

      The matter is to proceed on pleadings.

   2. (2)

      The plaintiff is granted leave to file and serve a statement of claim substantially in the form exhibited to the affidavit of Daniel Georges dated 15 September 2025.

   3. (3)

      The first defendant it to pay the plaintiff’s costs of the application for interlocutory relief, being the relief sought by orders 7 and 8 of the interlocutory process filed on 15 September 2025.