WLD Practice Holdings Pty Ltd, in respect of the WLD Practice Holdings Trust v Sara Stockham and Anor

1. [1]

   In this matter, I gave judgment on 15 April 2020 (see [2020] NSWSC 395). I decided that cl 17 of the parties’ Unitholders Agreement did not apply to the plaintiff’s application for judicial advice and refused the defendants’ stay application. I also decided that the questions posed by the plaintiff in paragraph 3 of the Amended Summons filed on 13 March 2020 were appropriate for the giving of judicial advice under s 63(1) of the Trustee Act 1925 (NSW).

2. [2]

   The plaintiff seeks advice as to whether:

Background facts

1. [3]

   The plaintiff is the corporate trustee for the WLD Practice Holding Trust, which is a unit trust (Trust). The plaintiff and the Trust are governed by the Constitution of the Trustee Company, the Unit Trust Deed of the Trust and the Unitholders Agreement dated 28 October 2016.

2. [4]

   Under the Unitholders Agreement, the two unitholders of the Trust are Oorang (whose directing mind and will is Dr Williams) and the second defendant, Sarstock (whose directing mind and will is Dr Stockham, the first defendant). Oorang and Sarstock are also the two shareholders of the Trustee Company. The parties to the Unitholders Agreement are Oorang, Sarstock, the Trustee Company, Dr Williams and Dr Stockham.

3. [5]

   On 6 May 2019, Dr Stockham issued a Notice of Resignation as director of the Trustee Company (Dr Williams is now the sole director) and Sarstock issued a Notice of Sale in relation to its shares in the Trustee Company and its units in the Trust. This triggered a procedure for the sale of Sarstock’s units to Oorang under the Unitholders Agreement.

4. [6]

   Clauses 11.3(a) and 13.2(a) require the Trustee Company to procure a determination of the Fair Market Value of Sarstock’s units from the Company Accountant, defined as “FMA Partners, or such other person nominated by the Unitholders by Unanimous Resolution” (cl 1.1(o)).

5. [7]

   In a letter dated 13 May 2019, the defendants (through their solicitor) objected to FMA Partners carrying out the valuation and FMA Partners subsequently declined to undertake the work. The plaintiff says that it proposed three alternative methods for selecting another independent valuer in May 2019. However, none of those proposals have been accepted by the defendants.

6. [8]

   The relevant clauses of the Unitholders Agreement include:

Submissions

1. [9]

   The plaintiff provided written submissions on the construction issues to the Court on 30 March 2020 and made further submissions during the hearing on 3 April 2020. The plaintiff also provided a response to the defendants’ submissions on the construction issues on 21 April 2020.

2. [10]

   The plaintiff submits that the four questions it poses are all narrow questions of construction.

3. [11]

   In relation to the first question, the plaintiff submits that the power cl 19.1(a)(i) confers on the Trustee Company to “do such things” as it considers desirable is very broad. It also submits that the two preconditions to its exercise, namely, that the Trustee “considers” the action in question “desirable” to give effect to clauses 10, 11 and 12, and that the thing to be done is one that the party in question “fails, refuses to or cannot do”, are satisfied in the present case.

4. [12]

   The plaintiff further submits that the power in cl 19(1)(a)(i) can be readily seen to extend to the present circumstances as the primary reason that power exists appears to be to enable the Trustee to step in in circumstances where one Unitholder seeks to prevent the valuation process from proceeding. That it was the intention of the Unitholders Agreement to ensure that such processes are carried through to completion is said to be evidenced by the mandatory language in which the key provisions prescribing the procedure are framed (see e.g. cl 11.3(a) above). The plaintiff also points to cl 10.2(c) which provides that “[t]he Trustee Company and the Unitholders must do all things necessary to give effect to a transfer made in accordance with this clause 10.”

5. [13]

   Finally, the plaintiff notes that cl 7.3(a) of the Unitholders Agreement expressly contemplates that a Unitholder may attend a meeting of Unitholders “by proxy” and therefore submits that there is nothing sui generis about the nature of a Unitholder’s entitlement to vote that requires it to be exercised personally.

6. [14]

   In relation to the second question, the plaintiff submits that it is open to the Trustee Company to engage one of the valuers proposed in paragraph 3(b) of the Amended Summons on the basis that cl 1.1(o), and cl 11.3(a) to the extent that it refers to the Company Accountant, are non-essential terms that simply set up a mechanism for the valuation of a Defaulting Unitholder’s Units, which, in the event that the mechanism fails, can be replaced with another one (relying in particular on Sudbrook Trading Estate Ltd v Eggleton [1983] 1 AC 444 (‘Sudbrook’); Booker Industries Pty Ltd v Wilson Parking (Qld) Pty Ltd (1982) 149 CLR 600 (‘Booker Industries’); Sino Iron Pty Ltd v Mineralogy Pty Ltd [2019] WASCA 80 (‘Sino Iron’).

7. [15]

   In relation to the third question, the plaintiff submits that the question is easily resolved by reference to the relevant clauses of the Unitholders Agreement. It submits that the mechanics of the exercise are as follows:

8. [16]

   In relation to the fourth question, the plaintiff submits that cll 10.4(b), 11.4(a), 11.4(c) and 19.1(a)(i) of the Unitholders Agreement provide ample and specific power for the Trustee Company to undertake the course of action it proposes in paragraph 3(d) of the Amended Summons. The plaintiff submits that these clauses demonstrate that the parties to the Unitholders Agreement turned their minds to the question of what would happen if a Unitholder refused to transfer its Units and Shares, and decided that the issue would be resolved by the Trustee executing and delivering the necessary transfer forms on that Unitholder’s behalf.

9. [17]

   The defendants provided written submissions to the Court on 20 April 2020. At the outset, the defendants dispute the continuing urgency of the plaintiff’s application and submit that the remainder of their submissions should be read in that context.

10. [18]

    In relation to the first question, the defendants submit that there is a difference between the question, “Have circumstances occurred which enliven the Plaintiff’s power to act under clause 19(1)(a) of the unit holders’ agreement?”, which is a question of construction, and the question, “Have circumstances occurred which justify the Plaintiff exercising or entitle the Plaintiff to exercise its power to act under clause 19(1)(a) of the unit holders’ agreement?”, which is a value judgment as to the exercise of a fiduciary power.

11. [19]

    The defendants submit that, while the plaintiff understands the first question as being one of construction, the plaintiff has in fact asked the Court’s advice as to whether it would be “justified” in exercising a fiduciary power. They further submit that the answer to that question depends on whether it is in the best interests of the beneficiaries considered collectively for the trustee to exercise that power (assuming that the circumstances have occurred enlivening the power and considering impartially the terms of the trust instrument and the interests of the beneficiaries of the trust).

12. [20]

    The defendants submit that the plaintiff is in default of its duties under cl 7.2 of the Unit Trust Deed to prepare the accounts and financial statements for the year ended 30 June 2019 and that it would not be in the best interest of the beneficiaries for the accountant to be appointed until those accounts and statements are available. Therefore, the defendants submit that the advice sought by the plaintiff in relation to the first question should not be given by the Court at all when the plaintiff is in default of its duties under cl 7.2 and before the Unitholders have had a reasonable opportunity to decide whether or not the financial statements for the year ended 30 June 2019 should be audited. Alternatively, the defendants submit that the advice should be given subject to the condition that the plaintiff instructs the accountant ultimately appointed not to conduct the valuation until the accounts and financial statements are prepared and the Unitholders have had reasonable opportunity to decide whether they should be audited.

13. [21]

    In response, the plaintiff submits that the defendants’ reading strains the words of paragraph 3(a) of the Amended Summons beyond repair. It submits that the Court will be advising the Trustee as to whether the relevant contractual power exists and need not say anything about whether exercising that power would be in the best interests of the beneficiaries.

14. [22]

    The plaintiff submits that the defendants’ submissions in relation to the first question re-agitate the defendants’ Third Defence dated 20 March 2020. It also submits that the questions of which accounts and other documents should go before the valuer, and whether the accounts should be audited, are questions for the valuer, not the Court (referring to cl 13.2(d)(i)), and the defendants are at liberty to submit to the valuer that the draft accounts for FY19 are unreliable. However, the plaintiff submits that the reason the FY19 are still in draft form rather than final form is because they are not yet due to be lodged.

15. [23]

    The plaintiff further submits that the defendants’ submission that the plaintiff ought to be obliged to instruct the valuer not to undertake any determination until the Trustee Company has finalised its FY19 accounts is untenable as that would place the plaintiff in jeopardy of breaching cl 11.3, and because there is no textual basis for the defendants’ submission in the Unitholders Agreement.

16. [24]

    In relation to the second question, the defendants submit that it would be inconsistent with the Unitholders Agreement for the plaintiff to engage Mr Graham Middleton of Synstrat or Mr Matthew Gwynne of PKF Australia to make a determination of the Fair Market Value of the Units held by Sarstock, and that the Court cannot under s 63 advise or direct the plaintiff to commit a deliberate breach of trust. In response, the plaintiff submits that this submission does not go to the validity of the action proposed to be taken by the trustee. The plaintiff also submits that this submission again re-agitates the defendants’ Third and Fourth Defences dated 20 March 2020.

17. [25]

    In relation to the third and fourth questions, the defendants submit that “the Court has indicated that… [it] will not give any advice or direction in relation to orders 3(c) and 3(d) [questions three and four] as those orders are premised upon factual matters which are in dispute between the parties and which cannot be resolved at this stage of these proceedings.”

Evidence

1. [26]

   At the delivery of my previous judgment, I asked the plaintiff to indicate what material it relies upon in support of this application for judicial advice on the construction issues. In addition to its submissions, the plaintiff relies upon its Statement of Facts, the affidavit of Mr Walter MacCullum filed and served on 12 March 2020, and Counsel’s advice exhibited to the confidential affidavit of Joe Denina filed on 5 March 2020.

Consideration

1. [27]

   There seems to be some misconception about what has previously been determined in this matter and what I am about to determine. First, the defendants made submissions disputing the plaintiff’s claim of “continuing urgency”. I dealt with the issue of urgency in my previous judgment (see [2020] NSWSC 395 [72]) and it is not open to the defendants to re-agitate that issue now.

2. [28]

   Secondly, the defendants submit that the Court has indicated that it will not give any advice or direction in relation to questions three and four. They have also sought to construe the words “justified” and “entitled” in the plaintiff’s Amended Summons as meaning factually justified or entitled to exercise a fiduciary power. They then submit that the advice in question one should not be given, or should only be given on conditions, because the plaintiff is or would be in breach of the Unitholders Agreement and/or Unit Trust Deed.

3. [29]

   I have not indicated anywhere that I will not give advice in relation to questions three and four. On the contrary, I previously determined that on their face all of the questions posed by the plaintiff are appropriate for judicial advice, each respecting the interpretation of the Unitholders Agreement (see [2020] NSWSC 395 [73]). Further, this case was conducted and entertained by the Court on the basis that the questions posed by the plaintiff are all narrow questions of construction and I read the word “justified” in paragraphs 3(a), (b) and (d) of the plaintiff’s Amended Summons as a synonym for “empowered under the Unitholders Agreement”. I take the same view in relation to the word “entitled” in paragraph 3(c) of the Amended Summons. There has been no trial of the merits of any disputes about who may or may not be in breach of the Unitholders Agreement or Trust Deed or whether the plaintiff is in breach of trust and I do not propose to determine those issues now. In addition, it is worth noting again that, as the High Court made clear in Macedonian Orthodox Community Church St Petka Incorporated v His Eminence Petar the Diocesan Bishop of the Macedonian Orthodox Church of Australia and New Zealand (2008) 237 CLR 66 at [59], the mere fact that a trustee is in dispute with a beneficiary or is being sued for breach of trust does not preclude the giving of judicial advice.

4. [30]

   However, the mechanisms which would be invoked under the Unitholders Agreement and would provide complete answers to questions three and four in particular turn upon Sarstock being a “Bad Leaver” within the meaning of cl 1.1(f)(i) of the Unitholders Agreement and therefore a “Defaulting Unitholder” for the purposes of cll 11.3 and 11.4. While the term “Bad Leaver” may have pejorative connotations, the definition of Bad Leaver under cl 1.1(f)(i) of the Unitholders Agreement does not depend on Sarstock having committed any wrongdoing or being in default. The only consideration is whether Sarstock issued the Notice of Sale at a time “prior to the period expiring three (3) years from the Commencement Date”. The plaintiff filed a Statement of Facts dated 6 March 2020 which states that Sarstock provided a Notice of Sale and Dr Stockham provided a notice of “Resignation of Director” to the plaintiff on 6 May 2019. The defendants did not dispute those facts (Tcpt, 3 April 2020, pp 2 (14-16)) and during argument both parties agreed that the Notice of Sale was issued within three years of the commencement of the Unitholders Agreement (see below). Prima facie it appears that Sarstock is a Bad Leaver. However, during argument counsel for the defendants indicated that there may be a dispute as to whether Sarstock is properly characterised as a Bad Leaver and counsel for the plaintiff informed me that I was not required to determine that issue. The exchange was as follows:

5. [31]

   I therefore intend to determine whether the Trustee Company would have power under the Unitholders Agreement to take the actions it proposes in questions three and four if Sarstock was properly characterised as a Bad Leaver but without determining that issue now.

6. [32]

   I agree with the plaintiff’s submission that cl 19.1(a)(i) of the Unitholders Agreement confers a very broad power on the Trustee Company that extends to the present circumstances. As the objectives set out in cll 3.1 and 3.2 make clear, the Trustee Company was intended to play an important role in overseeing the parties’ dental practice Business and regulating their business relationship. Clause 19.1(a)(i) is concerned with the Trustee Company’s ability to give effect to cll 10, 11 and 12 of the Unitholders Agreement which deal amongst other things with the disposal of units and shares following an event of default, the death or total permanent disability of one of the Unitholders or Unitholders’ principals, or otherwise. That the Trustee Company was intended to play an important role in officiating these processes is evidenced in my view by clauses such as cl 10.2(c) which provides that “The Trustee Company and the Unitholders must do all things necessary to give effect to a transfer made in accordance with this clause 10”; cl 10.4(b) which provides that “The Notice of Sale will constitute authority to the Trustee Company to act as the agent of the Vendor to sell the Sale Units”; cl 10.4(e) which sets out other actions that the Trustee Company must take upon receipt of a Notice of Sale; and cl 11.3(a) which provides that “the Trustee Company must procure that the Trustee Company Accountant makes a determination of the Fair Market Value of the Defaulting Unitholder’s Units” following an event of default.

7. [33]

   By cl 19.1(a)(i) each party (other than the Trustee Company) to the Unitholders Agreement:

8. [34]

   (a) irrevocably appoints the Trustee Company as its agent and attorney to:

9. [35]

   (i) exercise such rights, execute (under hand or under seal) such instruments and do such things which are required or which the Trustee Company considers desirable to give effect to clauses 10 11 and 12 if and to the extent the party fails, refuses to or cannot do so;

10. [36]

    Those parts of the clause I have italicised are important here. First, that the appointment of the Trustee Company is irrevocable means that the Trustee Company can invoke this clause even in the face of opposition of one of the Unitholders. Second, by permitting the Trustee Company to “do such things… which the Trustee Company considers desirable”, the clause confers a wide discretion on the Trustee Company to take actions beyond those that are mandated by cll 10, 11 and 12. The words “if and to the extent the party fails, refuses to or cannot do so” also give the clause a wide operation. It seems clear that the parties to the Unitholders Agreement contemplated what should occur if one of them was to obstruct the unit valuation and disposition processes set up by cll 10, 11, 12, and intended that the Trustee Company, as officiator of those processes, ought to be able to step in and complete them to the extent that one of the parties fails or refuses to do so. In my view, that power would enable the Trustee Company to exercise a Unitholders’ entitlement to vote to appoint a new Company Accountant in circumstances where that Unitholder refuses to participate in the appointment process and the Trustee Company views that course as desirable. I accept the plaintiff’s submission that there is nothing sui generis about the nature of a Unitholder’s entitlement to vote that requires it to be exercised personally.

11. [37]

    The defendants, by issuing the Notice of Sale, triggered the valuation and disposition process which requires the Trustee Company to procure a valuation of Sarstock’s units, and objected to FMA Partners conducting that valuation, but have refused to participate in the process of nominating another accountant to do the work. For these reasons, I would answer the first question in the affirmative. In my view, the Trustee Company has ample power under cl 19.1(a)(i) of the Unitholders Agreement to vote on behalf of Sarstock in favour of a Unitholders resolution nominating another person as Company Accountant for the purposes of cl 1.1(o).

12. [38]

    It is worth noting that I consider this to be so regardless of whether or not Sarstock is properly characterised as a Bad Leaver. While the plaintiff has indicated that it intends to act under cl 11.3(a) of the Unitholders Agreement in procuring the determination of Fair Market Value, which is enlivened by an Event of Default, cl 10.4(e)(i) also requires the Trustee Company “to obtain a valuation of the Fair Market Value of Sale Units in accordance with cl 13” upon receipt of a Notice of Sale. Clause 13.2(a) provides that the “Fair Market Value must be determined by the Trustee Company Accountant…” As I have already noted, Sarstock issued a Notice of Sale to the plaintiff on 6 May 2019. Having the Fair Market Value of Sarstock’s units determined is an important first step in resolving this matter even if the parties must go on to debate whether Sarstock is properly described as a Bad Leaver and whether the discounted purchase price is to apply (under cl 11.2(a)(i)(A)).

13. [39]

    Question two is expressed to be “further or in the alternative” to question one and proposes an alternate route to engaging another accountant to determine the Fair Market Value of Sarstock’s units that does not depend on the Trustee Company exercising Sarstock’s voting powers to nominate a new Company Accountant for the purposes of cl 1.1(o). It asks whether the trustee would be justified in engaging any of Mr Middleton of Synstrat or Mr Gwynne of PKF to perform that task and whether such a determination would constitute a valid determination pursuant to cl 11.3(a).

14. [40]

    I agree that this course of action could be adopted as an alternative to that proposed in question one. In my view, the Trustee Company would be justified in engaging another accountant to perform the discreet task of determining the Fair Market Value of Sarstock’s units given that FMA Partners has declined to undertake that work. (This is different to appointing a new Company Accountant for the purposes of cl 1.1(o) who would perform all tasks intended to be performed by the Company Accountant under the Unitholders Agreement). I take this view on the basis that it is arguable that cl 11.3(a), and cll 10.4(e)(i) and 13.2, to the extent that they refer to the Company Accountant, are non-essential terms.

15. [41]

    In its submissions, the plaintiff referred to Sudbrook and Brooker Industries. In Sudbrook, the House of Lords relevantly determined that the standard for determining the price at which a contractual option to purchase a reversion could be exercised – a “fair and reasonable price” - was an essential term, while the mechanism by which that price was to be ascertained – namely, by agreement between valuers chosen by each of the parties – was non-essential, and in circumstances where that machinery broke down, the Court could substitute other machinery in its place. In Brooker Industries, Brennan J applied Sudbrook, holding (at 614-615) that the principle that “the court will not substitute machinery of its own or machinery provided by the parties, however defective that machinery may prove to be” has:

16. [42]

    In my view, what is essential is that, upon receipt of a Notice of Sale or following an Event of Default, the Trustee Company must procure a determination of the Fair Market Value of the Selling/Defaulting Unitholder’s units (as defined in cl 13.1). However, in my view the mechanism by which Fair Market Value is to be determined under cll 11.3(a) and 13.2(a) is best characterised as non-essential. That mechanism will fail whenever the Company Accountant is not willing or able to perform the valuation. The Company Accountant is not a party to the Unitholders Agreement and cannot be required to undertake the valuation pursuant to cl 11.3(a) or cl 13.2. In my view, the parties to the Unitholders Agreement would not have intended the whole valuation and disposition procedure to break down where the Company Accountant decides unilaterally not to undertake the valuation. That would render the Notice of Sale nugatory. Therefore, I am of the view that an alternate means of procuring the Fair Market Valuation determination can be used where, as here, the Company Accountant is unwilling or unable to perform the valuation, and that the determination will constitute a valid determination pursuant to either cl 11.3(a) or cll 10.4(e)(i) and 13.2(a).

17. [43]

    In saying this, I do not wish to express a view as to whether the Trustee Company ought to engage Mr Middleton or Mr Gwynne. During argument, the counsel for the plaintiff noted that Mr Middleton’s quotation was cheaper than Mr Gwynne’s. Counsel for the defendants contended that Mr Gwynne’s firm was better resourced. Whether Mr Middleton, Mr Gwynne or some other accountant is engaged to complete the valuation is entirely a matter of discretion for the Trustee Company.

18. [44]

    Who is to pay the costs of the Fair Market Value determination depends on the context in which that determination takes place. Clause 11.3(a) makes it clear that a “Defaulting Unitholder” “must bear one hundred per cent (100%) of the costs of the determination of the Fair Market Value”. Clause 14.1 then provides that:

19. [45]

    However, where a Non-Defaulting Unitholder issues a Notice of Sale pursuant to cl 10.4(a) and the determination is conducted pursuant to cl 10.4(e)(i), “[t]he costs of the Trustee Company Accountant will be borne by the Trust” (cl 13.2(e)).

20. [46]

    The plaintiff’s third question implies that Sarstock is a Defaulting Shareholder. However, it does not directly ask me to determine that issue and, as I have already stated, the plaintiff’s counsel informed me during argument that I was not invited to determine it.

21. [47]

    Nevertheless, the provisions are clear. If Sarstock is a Defaulting Unitholder, it must pay 100% of the costs of the determination of the Fair Market Value. In my view, cll 11.3(a) and 14.1 would then provide the Trustee Company with ample power to deduct the costs of the determination of the Fair Market Value from the purchase funds calculated to be payable to Sarstock in the event that the Trustee pays, in the first instance, the costs of that determination. However, if Sarstock is not properly characterised as a Bad Leaver and Defaulting Unitholder, and the determination is procured pursuant to cl 10.4(e)(i) rather than cl 11.3(a), the Trustee Company must pay the costs of the determination.

22. [48]

    As a matter of practical reality, given the deadlock the parties now find themselves in, it is likely that the Trustee Company will be required to pay the costs of the Fair Market Valuation up front regardless of whether or not Sarstock is properly characterised as a Defaulting Unitholder. That dispute, and the issue as to whether the costs of the determination ought to be ultimately borne by Sarstock or the Trustee Company, can be left for another day.

23. [49]

    The plaintiff’s fourth question is also predicated on the assumption that Sarstock is a Bad Leaver and Defaulting Unitholder and therefore that cll 11.3, 11.4(a) and (c) are applicable. I agree with the plaintiff’s submission that clauses 11.4(a) and 11.4(c) would provide the Trustee Company with ample and specific power to execute and deliver on Sarstock’s behalf the transfer forms necessary to effect a transfer of Sarstock’s units and shares to Oorang, and to cause Oorang to be registered as the holder of Sarstock’s units and shares, following the valuation process if Sarstock is properly characterised as a Defaulting Unitholder, and Sarstock refused to complete the unit and share transfer in accordance with cl 11.3(b) itself. I also consider cl 19.1(a)(i) broad enough to enable the Trustee Company to execute and deliver the transfer forms on Sarstock’s behalf in order to give effect to cl 11.3(b) in such circumstances.

24. [50]

    On the other hand, if Sarstock is not properly characterised as a Bad Leaver and Defaulting Unitholder, cll 11.3(b), 11.4(a) and 11.4(c), do not apply. However, I am of the view that cll 10.9 and 19.1(a)(i) would apply to provide the Trustee Company with ample power to execute and deliver the transfer forms of on Sarstock’s behalf, and to cause Oorang to be registered as the holder of Sarstock’s units and shares, following the valuation process if Sarstock refused to complete the transfer. That is on the basis that Sarstock issued the Notice of Sale on 6 May 2019, triggering the process of sale. In my view, if Sarstock is not a Bad Leaver, the mechanism under the Unitholders Agreement would operate as follows:

Conclusion

1. [51]

   I would answer the first question posed by the plaintiff affirmatively.

2. [52]

   I would answer the second question by stating that the Trustee Company has power under cll 11.3(a) and 13.2(a) of the Unitholders Agreement to engage another accountant to perform the discreet task of determining the Fair Market Value of Sarstock’s given that the Company Accountant has declined to undertake that work. I note that this course of action would be taken as an alternative to that proposed in question one.

3. [53]

   I would answer the third question by stating that the Trustee Company would have power under cll 11.3(a) and 14.1 of the Unitholders Agreement to deduct the costs of the determination of the Fair Market Value from the purchase funds calculated to be payable to Sarstock in the event that the Trustee pays, in the first instance, the costs of that determination if Sarstock is properly characterised as a Bad Leaver and Defaulting Unitholder.

4. [54]

   Finally, I would answer the fourth question by stating that the Trustee Company would have ample power to execute and deliver on Sarstock’s behalf the transfer forms necessary to effect a transfer of Sarstock’s units, and its shares in the plaintiff, to Oorang if Sarstock refused to complete the transfer:

5. [55]

   In addition, the Trustee Company would have ample power to cause Oorang to be registered as the holder of Sarstock’s units and shares: