Catley v Herbert - [1988] 1 NZLR 606

Contract — Specific performance of agreement to dissolve parties' association in kiwifruit business — Directors agreed to dissolve their business association on 1 April 1981 by one director purchasing assets from the company which he then exchanged for the other director's shares — Some assets were sold in December 1980 and plaintiff received proceeds less $19,000 which had been used to pay defendant's salary and other expenses — On 1 April defendant tendered the shortfall — Whether the company had breached s 62 of the Companies Act by providing financial assistance for the purchase of its shares — Whether there was a breach of contract entitling the plaintiff to cancel the agreement — Whether defendant was ready and willing to perform his own obligations under the contract — Whether the agreement should be validated — Whether defendant was entitled to a decree of specific performance — Illegal Contracts Act 1970, s 7 - Companies Act 1955, s 62.