Page 154 - Be Reasonable – Do It My Way , Peter E. Daly AM, My Story

CHAPTER 14 – AUSTRALIAN ASSOCIATED MOTOR INSURERS (AAMI)
AAMI pool for 13 May 1988 to coincide with the AGM. It would be a special resolution giving Sun Alliance and Royal control of AAMI. They would also reconstitute the membership of the Board excluding NW. This would deny myself the Chair due to return to me by way of rotation and that would give them the casting vote in order to control AAMI.
Obviously I was outraged. It was my view all Shareholders should be given the opportunity in an open shareholder forum to increase their holdings in the event a Shareholder wished to withdraw. In such a case they were required in terms of the agreement to offer the share to the remaining Shareholders in a direct portion to their shareholding. Following this I went to see Bill Mansfield (Commercial Union) who until then knew nothing of the activities of Sun Alliance and Royal. With the support of other key minor shareholders, Harold Levick (Guardian Royal Insurance), we resolved to fight the action.
Subsequently Mr Simon Smith wrote a book on the history of AAMI under the heading of “Motor Insurance and the Rise of Australian Associated Motor Insurers Limited (AAMI) 1933-1990” and in that book there is a paragraph on page 204 which refers to the grab for control of AAMI. I am quoting verbatim from the book and it reads:
“Following the events of John Mallick’s discussion with Peter Daly, things moved swiftly. The minority shareholders commenced proceedings in the Victorian Supreme Court against AAMI, Sun Alliance, Royal and the seven vendor companies. It was issued on 12 May 1988, the day before the scheduled AGM and Extraordinary Pool Meeting.
This effectively adjourned both and at the expected hearing Justice Brooking agreed with the plaintiffs that there had been, amongst other things, a breach of duciary duty by Sun Alliance and Royal. The seven acquisition agreements would be set aside and the cost awarded. In delivering his judgement, Brooking J made it clear what his view was of correct Board behaviour.”
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