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Court in favour of PwC partner forced to retire amid tax scandal
The NSW Supreme Court has blocked PwC from booting one of its partners due to his alleged involvement in the firm’s tax scandal.
Naomi Neilson
Research and development partner Richard Gregg, a partner since July 2013, can remain at the firm after the court found the consultancy giant had failed to identify its reasons and the method it arrived at them in a notice requesting his retirement.
This finding could open the firm up to further proceedings from other ousted partners.
In May this year, Mr Gregg was asked to go on special leave pending an internal review and told not to contact partners or staff, visit the premises, access the computers or communicate with media.
A day later, a statement was issued announcing that nine unnamed partners, including Mr Gregg, had been stood down.
On 3 July, the same day Mr Gregg received the recommendation, PwC issued another statement announcing the partners had either been exited or were in the process of being removed.
Supreme Court Justice David Hammerschlag found the recommendation, made under the firm’s partnership agreement, was invalid.
“The recommendation does not identify, or sufficiently identify, the basal facts constituting the conduct of Mr Gregg upon which management’s view is based,” Justice Hammerschlag said.
“Additionally, it also fails to expose the actual path of reasoning by which management arrived at its view in that the conduct identified meets one or more of the thresholds and how it arrived at its view.”
The court was of the view that while the recommendation did not need to be “perfect”, it should have enabled the partner to have a “just opportunity” to respond, and the board of partners needed to act “faithfully and in good faith” to make a determination.
Justice Hammerschlag clarified the current proceedings “do not concern the merit, or lack of merit, as the case may be, of any complaint against Mr Gregg”.
Mr Gregg also does not assert management did not act in good faith.
Naomi Neilson
Naomi Neilson is a senior journalist with a focus on court reporting for Lawyers Weekly.
You can email Naomi at:
