Commercial disputes
Lotus Amity provides valuations and loss of profit calculations in commercial disputes. The types of disputes where business valuations and loss calculations are required include:
- Shareholder disputes, for example, in relation to allegations of minority oppression or how the business is being run.
- Transaction disputes, for example, allegations of misleading representations in relation to an acquisition or a disputed contract terms such as an earn-out provisions.
- Breaches of contract, for example, breach of a non-compete clause leading to the loss of business value
Valuations and loss of profit calculations are provided for internal consulting purposes, mediation, as an expert determination or as an expert witness report for Court. Critiques (shadow expert reports) are also provided of other expert reports.
Experience
Examples of previous commercial dispute matters involving valuations and loss of profits include the following :
- Breach of an employment and sale of business agreement, passing off and injurious falsehood. The respondent sold a facilities management business to the applicant. Allegedly, the respondent subsequently set up a competition in breach of the non-compete clause of both the business sale and employment agreement and made representations that were misleading. Lotus Amity prepared an expert report which analysed the potential lost clients, suppliers, employees and referrers and the expected lost gross profit and avoided overheads on historic and future work. The expert report was prepared for the Supreme Court of Queensland GBAR (Australia) Pty Ltd v Brown [2020] QSC 14.
- Breach of a management rights contract. The applicant held the rights to carry out the management role for the body corporate. The body corporate allegedly terminated the contract without cause. Lotus Amity prepared an expert report which quantified the loss of profit suffered by the applicant as a result of the breach. The expert report addresses issues such as the risk profile of the cash flows, the damage period, the profitability of the contract and the costs associated with the contract. The report was prepared for the Queensland Civil Administrative Tribunal. The expert report addresses issues such as the risk profile of the cash flows, the damage period, the profitability of the contract and the costs associated with the contract. The Sands Gold Coast Pty Ltd v The Body Corporate for the Sands QCAT 2019,
- Breach of a business lease agreement. The respondent breached a restaurant and coffee shop business lease, by denying the applicant access to the property. Lotus Amity prepared a report that critiqued the two previous expert valuation reports and further analysed the data on which the other two expert reports were based and reassessed lost earnings after a forensic analysis of the books and records. The report was prepared for the Supreme Court of Queensland.
- Exiting minority shareholder dispute in relation to a company manufacturing electrical components. An expert was appointed by the company to value the shares. Lotus Amity was engaged by the minority shareholder to critique the expert’s valuation report. The Lotus Amity report included opinions on the valuer’s non-compliance with valuations standards, the limitations on the information gathered, relied upon and analysed, the inconsistencies in the valuation approach and the unsupported assumptions.
- Exiting shareholder dispute in relation to a company in the allied health industry. The parties jointly appointed Lotus Amity to prepare a final and binding Expert Determination valuation.