Two partners of the former Aulich Civil Law firm engaged in “oppressive” conduct towards a colleague during a bitter dispute over a guaranteed $500,000 share buyback, the ACT Supreme Court has found.
Benjamin Aulich and Peter Woodhouse, partners in the now-liquidated firm, were sued by Erin Taylor after she sought the $500,000 buyout for her shares. The court heard she had been told she should leave the practice.
In a judgment delivered on September 11, the court found the two men had stonewalled Ms Taylor for months, taken steps that reduced the funds available to the business and placed the firm into voluntary administration partly to gain a litigation advantage and frustrate her claim.
Ms Taylor joined Aulich Civil Law as an associate solicitor in October 2015 before becoming a partner in July 2019.
She and Mr Aulich also began a romantic relationship in March 2018.
When she became a partner, Ms Taylor paid $500,000 for a 25 per cent stake in the firm, joining three other shareholders.
Her letter of offer provided that, if she left within the first five years, the company or its shareholders would buy back her shares.
The relationship between Ms Taylor and Mr Aulich ended in September 2023. Their professional relationship subsequently deteriorated, the court heard.
Erin Taylor paid $500,000 for a 25 per cent stake in the company when she became a partner, making her one of four shareholders
Erin Taylor’s relationship with Ben Aulich broke down in September 2023
Tensions intensified in early February when, according to evidence accepted by the court, a meeting at a café ended with Mr Aulich telling Ms Taylor to “get f**ked and f**k off” before leaving with his middle finger raised.
During cross-examination, Mr Aulich admitted he had publicly humiliated Ms Taylor in front of a client.
On February 13, Ms Taylor emailed Mr Woodhouse to ask about her shares and entitlements if she left the firm. “It isn’t the firm who would have to pay me – it’s the shareholders, as in you and Ben,” she wrote.
Mr Woodhouse responded: “Whilst I can’t speak for Ben, I will not be buying you out personally”.
He then forwarded the message to Mr Aulich, saying: “I felt it important that she knows I will not be buying her out. She may well implode (or explode) once she realises that.”
A month later, the court found that Mr Woodhouse and Mr Aulich had decided Ms Taylor should leave the firm. Mr Woodhouse delivered the news to her at home the following day.
Ms Taylor resigned and sought written confirmation that she would be paid in accordance with what she said was her entitlement under the 2019 offer letter.
Ms Taylor and Mr Woodhouse gave differing accounts of what was said during their meeting about the share buyback. However, a file note prepared by the company’s office manager and submitted to the court recorded Mr Woodhouse saying he “didn’t want to f**k [Ms Taylor] over” and intended to “do what was right” by her.
Mr Woodhouse said he would not personally buy out Ms Taylor’s 25 per cent stake in the company
The Supreme Court ruled entirely in Ms Taylor’s favour
Under cross-examination, Mr Woodhouse admitted making this remark, but maintained he always viewed the buyout as conditional on the firm’s financial survival.
After repeated stonewalling, Ms Taylor emailed Mr Woodhouse stating she felt she was being treated like ‘a piece of rubbish that [he] wanted to get rid of’.
She also complained that Mr Woodhouse, who did not respond, was ‘pushing her out of the nest’ instead of trying to help.
About the same time, internal correspondence tendered in court showed Mr Woodhouse suggested to Mr Aulich that they might need to ‘kill’ the civil practice to avoid its financial liabilities jeopardising the criminal firm.
On March 26, Ms Taylor emailed again seeking clarification about the buyout and her exit terms, describing the lack of answers as ‘sitting in purgatory’.
The following day, Ms Taylor wrote that she was in a vulnerable position, suggesting that a staged buyout might be possible if the firm could not pay in full upfront.
Mr Woodhouse did not reply, but forwarded Ms Taylor a client’s email seeking assistance with a business purchase, writing: ‘You can have this one.’
In an email on April 2, Ms Taylor raised concerns about possible ways Mr Woodhouse and Mr Aulich might seek to avoid paying her, such as serving her an injunction or ‘draining the life out of’ Aulich Civil Law.
Mr Woodhouse responded that Ms Taylor would receive her entitlements once the required cash flow became available.
The parties have been given 28 days to agree on the final financial settlement and legal costs, after which the Supreme Court will step in to finalise the figures
In an internal SMS tendered as evidence, Mr Woodhouse wrote that Ms Taylor was ‘not sending anything productive. Just being a c**t.’ (A mock-up of the messages is shown here)
On April 9, Ms Taylor sent a formal letter demanding the partners honour the buyout.
In response, Mr Woodhouse and Mr Aulich suggested Ms Taylor had improperly authorised $73,000 in disbursements before moving to a rival practice, with the judge later finding the allegation was part of a broader campaign to pressure her and deter her claim.
After further exchanges, the court found Mr Aulich and Mr Woodhouse agreed that instead of negotiating, it would be easier simply to ignore Ms Taylor and block her emails.
In an internal SMS tendered as evidence, Mr Woodhouse wrote that Ms Taylor was ‘not sending anything productive. Just being a c**t’.
He later added: ‘I think we’d all be better off if she just f**ks off and leaves us alone.’
The court found both partners deliberately pursued this strategy to deter Ms Taylor from commencing litigation over the buyout.
On July 12, Mr Woodhouse received a formal letter of demand from Ms Taylor’s lawyers, giving the business one final chance to buy back her shares before facing action in the Supreme Court.
Immediately after receiving the demand, Mr Woodhouse caused the criminal practice to issue more than $440,000 in invoices to the civil firm that the court found had no legal basis – a move the judge ruled was intended to deplete funds that could otherwise have been available to satisfy Ms Taylor’s claim.
The following month, after his practising certificate was cancelled by the ACT Law Society, Mr Aulich was committed to stand trial for conspiring to deal with the proceeds of crime and recruiting for criminal activity.
A trial date is yet to be set, and the matters are still before the court.
In September, Mr Woodhouse placed the civil firm into voluntary administration, a move the court found had the effect of staying proceedings against it and further depleting funds available to meet Ms Taylor’s claim.
The court found this was partly motivated by a desire to have proceedings against the firm stayed.
Acting Justice Balla ruled entirely in Ms Taylor’s favour, finding both men had engaged in oppressive conduct and committed multiple breaches of duty.
