Discovery Africa Limited v Sunbreaker Holdings Pty Ltd
[2014] FCA 327
•2 April 2014
FEDERAL COURT OF AUSTRALIA
Discovery Africa Limited v Sunbreaker Holdings Pty Ltd [2014] FCA 327
Citation: Discovery Africa Limited v Sunbreaker Holdings Pty Ltd [2014] FCA 327 Parties: DISCOVERY AFRICA LIMITED (ACN 147 324 847) v SUNBREAKER HOLDINGS PTY LTD (ACN 083 988 934), PETER HUGH LLOYD, PETER JAMES AVERY and DAWESVILLE NOMINEES PTY LTD (ACN 076 750 564) File number: VID 178 of 2014 Judge: GORDON J Date of judgment: 2 April 2014 Catchwords: CORPORATIONS – Injunctions – Shareholders – Shares – Application to defer general meeting of shareholders – alleged misleading and deceptive conduct – collateral contract about composition of board Legislation: Australian Securities and Investments Commission Regulations 2001 (Cth)
Corporations Act 2001 (Cth)Cases cited: Australian Broadcasting Corporation v O’Neill (2006) 227 CLR 57
Carr Boyd Minerals Ltd v Ashton Mining Ltd (1989) 15 ACLR 599
Gates v City Mutual Life Assurance Society Ltd (1986) 160 CLR 1
Hopkins Professional Services Pty Ltd v Foyster Holdings Pty Ltd (2001) 39 ACSR 519
Maybury v Atlantic Union Oil Company Limited (1953) 89 CLR 507
McMahon v National Foods Milk Limited (2009) 259 ALR 20Date of hearing: 31 March 2014 Date of last submissions: 31 March 2014 Place: Melbourne Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 67 Counsel for the Plaintiff: MD Wyles SC with D Fahey Solicitor for the Plaintiff: CBP Pty Ltd Counsel for the First and Second Defendants: JM Healy Solicitor for the First and Second Defendants: Nova Legal Counsel for the Third and Fourth Defendants: DE Molony Solicitor for the Third and Fourth Defendants: Optima Legal
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
VID 178 of 2014
BETWEEN: DISCOVERY AFRICA LIMITED (ACN 147 324 847)
PlaintiffAND: SUNBREAKER HOLDINGS PTY LTD (ACN 083 988 934)
First DefendantPETER HUGH LLOYD
Second DefendantPETER JAMES AVERY
Third DefendantDAWESVILLE NOMINEES PTY LTD (ACN 076 750 564)
Fourth Defendant
JUDGE:
GORDON J
DATE OF ORDER:
2 APRIL 2014
WHERE MADE:
MELBOURNE
THE COURT ORDERS THAT:
1.The Plaintiff’s interlocutory application filed 21 March 2014 is dismissed.
2.The Plaintiff pay the Defendants’ costs of and incidental to that application.
Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011 (Cth).
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
VID 178 of 2014
BETWEEN: DISCOVERY AFRICA LIMITED (ACN 147 324 847)
PlaintiffAND: SUNBREAKER HOLDINGS PTY LTD (ACN 083 988 934)
First DefendantPETER HUGH LLOYD
Second DefendantPETER JAMES AVERY
Third DefendantDAWESVILLE NOMINEES PTY LTD (ACN 076 750 564)
Fourth Defendant
JUDGE:
GORDON J
DATE:
2 APRIL 2014
PLACE:
MELBOURNE
REASONS FOR JUDGMENT
INTRODUCTION
The plaintiff, Discovery Africa Limited (ACN 147 324 847) (formerly known as Baru Resources Limited) (DAF), is a public listed mining company with interests in mining and exploration projects in Myanmar, Longreach, Namibia, Uganda and Tanzania.
On 13 February 2014, Sunbreaker Holdings Pty Ltd (as trustee for the Lloyd Super Fund) (Sunbreaker) (a shareholder of DAF) requisitioned a general meeting of DAF’s shareholders under s 249D of the Corporations Act 2001 (Cth) (the Act) (the Requisitioned Meeting). The Requisitioned Meeting is to be held on 10 April 2014. The notice for the Requisitioned Meeting contains six resolutions. In general terms, the resolutions if passed would result in the appointment of Mr Peter Lloyd, Mr Graham Walker and Mr Frank Knezovic and, subject to the appointment of one or more of them, the removal of Mr Kevin Nichol, Mr Ian Lovett and Mr Danie van den Bergh as directors of DAF. If those resolutions pass, the composition of DAF’s Board will change. The fourth DAF director, Mr Philip Thick, has stated that if that was to occur, he will resign as a director of DAF.
Mr Lloyd (one of the persons proposed to be appointed as a director of DAF) controls Sunbreaker. Prior to 12 September 2013, Sunbreaker held 16,786,546 shares in Argosy Minerals Limited (Argosy) and Mr Lloyd was the chief executive officer and a director of Argosy. DAF made an off-market scrip takeover bid for Argosy in October 2013. It closed on 12 December 2013. Sunbreaker accepted DAF’s takeover offer for its shares in Argosy and exchanged its 16,786,546 shares in Argosy for 16,786,546 shares in DAF. Mr Lloyd resigned as chief executive officer and director of Argosy on 3 October 2013.
Pursuant to s 1324 of the Act, DAF seeks an interlocutory order that until the hearing and determination of the proceeding, DAF is not required to proceed with the Requisitioned Meeting. At the hearing of the interlocutory application, counsel for DAF informed the Court that it sought an order for the Requisitioned Meeting to be deferred for a short period until there had been an urgent trial of its substantive case. Subject to the convenience of the Court, DAF proposed that the trial be heard and determined before 10 April 2014, being the date of the Requisitioned Meeting.
In general terms, DAF contends that Mr Lloyd, in concert with Mr Avery (the former chairman of DAF), seeks to remove Messrs Nichol, van den Bergh and Lovett from the board of DAF and install himself and his associates, thereby effecting a reverse takeover of DAF. DAF’s expressly stated purpose in bringing this proceeding was to prevent that reverse takeover.
DAF contends that the steps taken by Mr Lloyd (through Sunbreaker) to effect a change in the composition of the board of DAF are unlawful. DAF described the legal issues as follows:
7.First, did Lloyd/Sunbreaker/Argosy by representing that the post merger merge interests of DAF were best served by the board of DAF comprising Avery, Nichol, Ian Lovett, Philip Thick, Danie van den Bergh and further insofar as Lloyd/Sunbreaker are concerned, that they would do everything in their power’s (sic) to maintain that composition for at least a year after the merger became effective, engage in such misleading and deceptive conduct as is prohibited by ss 670A, 670C, 1041E and 1041H [of the Act]?
8.Secondly, are there collateral contracts between each of DAF and Lloyd and Sunbreaker to the effect of the said representation which contracts have been breached by Lloyd and Sunbreaker?
9.Thirdly, in the circumstances did a fiduciary relationship arise between [DAF] and Argosy on or around 17 June 2013, to effect the merger of the two companies by [DAF’s] acquisition of shares in Argosy so as to bring together for commercial benefit to the shareholders of both, the cash resources of [DAF] with the Namibian project [of Argosy] under the control of the proposed board?
10.Fourthly, Lloyd in procuring Sunbreaker to issue the [s] 249D notice and in soliciting support to remove Mr Nichol and Mr van den Bergh from the board of DAF and to install he and his solicitor Mr Knezovic, and the real estate agent, Mr Walker, knowingly participated in a breach of Argosy’s said fiduciary duty?
In general terms, counsel for DAF summarised the facts underpinning those legal claims as follows:
Argosy was a company which was subject to the control of a Mr Peter Lloyd. And Mr Lloyd controls Sunbreaker … as well. And in June of last year a deal was done whereby it was agreed between Mr Lloyd and Mr Nichol that [DAF] …, would make a one-for-one scrip offer to take over Argosy. … [I]f the whole of the offer had been taken up, then the Argosy shareholders would have controlled 72 per cent of [DAF] and the then existing [DAF] shareholders, the pre-merger shareholders, would control the other 28 per cent. …
[T]hat deal proceeded on the basis of a pretty substantial and fundamental representation by Mr Lloyd that he would support the ongoing board of [DAF], with Mr Nichol as the managing director, at least for a reasonable period. We say, your Honour, that the reasonable period is until around about 1 October this year, being a year from the completion of the takeover.
The defendants to the proceeding are Sunbreaker, Mr Lloyd, Mr Avery and Dawesville Nominees Pty Ltd (a related entity of Mr Avery). Mr Healy appeared for the Lloyd related parties. Mr Molony appeared for the Avery related parties. The defendants opposed DAF’s interlocutory application. No relief was sought against the Avery related parties on the interlocutory hearing.
For the reasons that follow, DAF’s interlocutory application is dismissed. I am not satisfied that DAF has made out a prima facie case and, further, in all the circumstances, the balance of convenience does not favour the granting of the relief sought by DAF: Australian Broadcasting Corporation v O’Neill (2006) 227 CLR 57 at [65].
These reasons for judgment will summarise the applicable legal principles, then consider the factual background and, finally, turn to consider the present application in light of the applicable legal principles.
APPLICABLE PRINCIPLES FOR INTERLOCUTORY RELIEF
The applicable principles were not in dispute. The power to grant the relief sought is a discretionary power exercised in accordance with well-known equitable principles: O’Neill at [54]-[72]. In O’Neill, at [65], Gummow and Hayne JJ stated:
[O]n such applications the court addresses itself to two main inquiries …:
The first is whether the plaintiff has made out a prima facie case, in the sense that if the evidence remains as it is there is a probability that at the trial of the action the plaintiff will be held entitled to relief ... The second inquiry is ... whether the inconvenience or injury which the plaintiff would be likely to suffer if an injunction were refused outweighs or is outweighed by the injury which the defendant would suffer if an injunction were granted.
By using the phrase “prima facie case”, their Honours did not mean that the plaintiff must show that it is more probable than not that at trial the plaintiff will succeed; it is sufficient that the plaintiff show a sufficient likelihood of success to justify in the circumstances the preservation of the status quo pending the trial. … With reference to the first inquiry, the Court continued, in a statement of central importance for this appeal:
How strong the probability needs to be depends, no doubt, upon the nature of the rights [the plaintiff] asserts and the practical consequences likely to flow from the order he seeks.
(Footnotes omitted.)
FACTUAL BACKGROUND
What follows is a summary of the factual background (as disclosed by the affidavit material filed to date) to the extent necessary to dispose of the current application. It is necessarily incomplete and, in the limited time available, does not deal with all of the facts set out in the numerous affidavits filed by the parties. It is unnecessary to do so.
On 13 April 2013, Argosy announced that it had executed two agreements to acquire graphite projects in Namibia (the Namibian Project). Argosy did not have the funds to finance the project. Argosy proposed to raise $1 million from a share placement to provide working capital for the acquisition and subsequent operation of the Namibian Project. Argosy’s capital raising was unsuccessful.
DAF was in a different position. As at 30 June 2013, DAF had $2,034,266 in cash and cash equivalents and $3,134,317 in total current assets. Its liabilities were only $110,203. As a consequence of its financial strength, DAF turned to investment opportunities in exploration and mining projects in and outside of Australia through acquisitions of mining tenements, acquisitions of entities with mining interests or entering into joint ventures.
Mr Avery, the then chairman of DAF, brought Argosy’s announcement to the attention of Mr Nichol, the managing director of DAF. Mr Avery informed Mr Nichol that Argosy could be a potential takeover target for DAF. Argosy and DAF entered discussions. It was around this time that DAF alleges Mr Lloyd made a number of representations which were allegedly misleading or deceptive and which entitle DAF to relief in this application. The nature of those representations are set out at [43]ff below. It will be necessary to return to consider those discussions later in these reasons. For present purposes, it is sufficient to consider the relevant documentary material that was the result of those discussions.
On 1 July 2013, a Bid Implementation Agreement (the BIA) was executed by Argosy and DAF. Argosy was defined as the “Target”. DAF was defined as the “Bidder”. Clause 2.4, entitled “Target Recommendation and Acceptance”, provided:
The Target represents and warrants that:
(a)the Target Board has met and considered the possibility of the Bidder agreeing to make the Takeover Bid; and
(b)all directors of the Target have informed the Target and made a public announcement on the ASX that, if the Bidder complies with clause 2.1, they will unanimously recommend (and continue to recommend for the Offer Period) that Shareholders accept an Offer in the absence of a Superior Proposal and that they will accept, or procure the acceptance of, within 48 hours of the Offer becoming open for acceptance the Offer in respect of any Shares, and the Option Offer in respect of any Options, that they, or their associates, own or control, including the Shares and Options set out in Schedule 3, in the absence of a Superior proposal.
Schedule 3 recorded that Mr Lloyd controlled 17,951,161 shares in Argosy and Mr Thick controlled 2,790,000 shares in Argosy.
Clause 4.1, entitled “Bidder’s Statement and Target’s Statement”, provided that the Bidder and the Target would, to the extent practicable, give the other a reasonable opportunity to review one or more drafts of the other’s statement at least two business days before the relevant statement was to be lodged with the Australian Securities and Investments Commission and would consult in good faith with the other party with respect to any comments that party may have about the statement. That provision has some significance when reading the contents of the Bidder’s Statement and the Target’s Statement.
Next, cl 4.3, entitled “Promote the Takeover Bid”, provided that “During the Offer Period”, Argosy would procure its chairman of directors and chief executive officer to participate in efforts reasonably required by DAF to promote the merits of the Takeover Bid, including meeting with key shareholders and communicating with any other persons, subject of course to any legal limits on their ability to do so.
The appointment of directors was addressed in cl 5. It provided:
To the extent permissible by law, the Bidder must, as soon as practicable after the Bidder has obtained a relevant interest in 90% of the Shares or the offer becomes unconditional, take all actions necessary to cause the appointment of Danie van den Bergh and Philip Thick to the Board of the Bidder.
The BIA also contained a whole agreement clause or merger provision: cl 10. It provided:
10.1 No Representation
Each party acknowledges that no party (nor any person acting on its behalf) has made any representation or other inducement to it to enter into this Agreement, except for representations or inducements expressly set out or referred to in this Agreement.
10.2 No Reliance
Each party acknowledges and confirms that it does not enter into this Agreement in reliance on any representation or other inducement by or on behalf of the other party, except for any representation or inducement expressly set out or referred to in this Agreement.
On 2 July 2013, Argosy and DAF issued a joint ASX announcement that they had signed the BIA under which it was proposed that DAF would acquire all of the issued shares of Argosy on a share based transaction by way of an off-market takeover offer (the Joint Announcement). Under the heading “Highlights”, the Joint Announcement included the following:
•Argosy shareholders will hold approximately 72% of the combined group thereby enabling shareholders to:
oretain material exposure to future upside of the [Namibian Project] (as announced on 30 April 2013);
obenefit from the management expertise of the [DAF] Board, which is headed by Managing Director Kevin Nichol. Mr Nichol has a background of equity, commodity, financial and corporate activity and management over the last 29 years. In the last six years and before [DAF], he has been the executive director of two other public companies before they were taken over;
outilise cash and semi-liquid reserves of [DAF] of approximately $3 million to assist with development of the Namibia graphite projects.
•[DAF] shareholders secure the benefit of an opportunity to share in the potential world class graphite project.
•Under the Offer, Argosy shareholders will receive one (1) new [DAF] share for every one (1) Argosy share held. …
•Existing Argosy Directors Philip Thick and Danie van den Bergh will be invited to join the [DAF] board. Kevin Nichol will continue as Managing Director of [DAF].
The Offer is unanimously recommended by the Directors of Argosy who have also agreed to accept [DAF’s] offer in respect of all shares they control, in each case in the absence of a superior offer.
(Emphasis added).
On 28 August 2013, DAF issued a Bidder’s Statement. The Statement addressed a number of topics. On the question of the identity of the DAF directors and their experience, Part B of the Overview said:
The Directors of [DAF] are:
(a) Mr Peter Avery - Non-Executive Chairman;
(b) Mr Kevin Nichol - Executive Director; and
(c) Mr Ian Lovett - Non-Executive Director.
The Directors of [DAF] have significant experience in the exploration for, development of, and operation of mining projects.
In addition the [BIA] provides that [DAF] will appoint Mr Danie van den Bergh and Philip Thick [DAF] Directors after [DAF] has obtained a Relevant Interest in 90% of the Argosy Shares or the Offer becomes unconditional. Sections 3.2 and 3.3, of this Bidder’s Statement contain further information in relation to the [DAF] Directors and their experience.
Next, the Bidder’s Statement recorded, as was the fact, that one of the DAF directors, Mr Avery, as at the date of the Bidder’s Statement, held a relevant interest in 5,365,000 Argosy shares. This relationship was also disclosed in section 3.6 of the Bidder’s Statement.
The reasons why DAF believed that the Argosy shareholders should accept DAF’s offer was addressed in section 2 of the Bidder’s Statement:
1.The Offer will provide the merged entity with a greater liquidity in the trading of its securities.
The Merged Entity will have 176 million shares. This larger share base is expected to provide greater liquidity for both buyers and sellers of [DAF] Shares. The greater number of shares will reduce the barriers to entry for potential new investors. Investors will be able to buy and sell [DAF] Shares knowing that there will be more depth with a greater shareholder base.
2. The merged entity will provide initial cash reserves to explore the Argosy exploration licences.
The favourable cash position of [DAF] with approximately $3 million in cash and semi liquid assets is a huge boost to Argosy Shareholders and will enable the effective and conclusive exploration of Argosy’s potentially world class graphite projects in Namibia. Argosy currently has insufficient funds to conduct an exploration program on the Namibian Projects.
3. The merged entity will increase its market capitalisation.
At the conclusion of the Offer, if successful, Argosy Shareholders will become [DAF] Shareholders and the Merged Entity is expected to have a market capitalisation greater than each individual entity. This greater market capitalisation will provide a better base and perceived strength to raise development funds if the exploration is successful.
4. The management skills of the Merged Entity’s directors will allow the projects to be explored to provide shareholder value.
The Merged Entity will have a management and board team that will be stronger once exploration begins. The best of both entities will be able to link their specialised skills to form a strong board. The commercial and corporate skill of [DAF] will be coupled with the technical skills of Argosy. This is an ideal result and ensures that the new Merged Entity does not have to seek new personnel as the entities will co-exist under one combined listed company.
The “Merged Entity” was defined to mean “DAF and its subsidiaries following the acquisition by [DAF] of all, or a portion of Argosy Shares on issue”.
A profile of Argosy was set out in section 5 of the Bidder’s Statement. It included statements that:
Argosy … was originally incorporated in Canada and the consolidated Argosy group was admitted to the Official List of the ASX on 3 April 1997. Argosy was incorporated in Australia as a public company on 24 December 2010 after being re-domiciled from Canada to Australia and Argosy Shares commenced trading on ASX on 1 March 2011.
….
As at 27 August 2013, Argosy had a market capitalisation on ASX of approximately $2.52 million. As at 30 June 2013, Argosy reported net cash holdings of $0.41 million.
Argosy’s board of directors were listed in section 5.4. They were Messrs Thick (Non-Executive Chairman), Mr Lloyd (Managing Director) and Mr van den Bergh (Non-Executive Director). The issue of the substantial shareholdings in the issued ordinary capital of Argosy was addressed in section 5.6. Sunbreaker was the only listed entity with 16,786,546 shares in Argosy or 13.32% of the voting power. The disclosure of interests of Argosy directors (section 5.7) was as follows:
Director Argosy
SharesArgosy
OptionsMr Peter Lloyd 17,951,161 7,500,000 Mr Danie van den Bergh Nil 4,000,000 Mr Philip Thick 2,790,000 1,000,000
An overview of Argosy’s activities and projects was set out by DAF in section 5.8:
Argosy’s business strategy is the acquisition, incubation and exploration of minerals in Africa.
Argosy has an agreement to acquire an interest in mining tenements for the exploration of graphite in Namibia, Africa after it recently signed two agreements to acquire 100% of the share capital of Namibian incorporated Companies that will hold the Exclusive Prospecting Licences. Completion of the agreements is subject to regulatory approvals for the transfer of the mining tenements and the actual transfer of the mining tenements.
Argosy’s Consolidated Statement of Financial Position was then disclosed and recorded that as at 30 June 2013, it had:
1.total current assets of $428,805 (down from $962,180 as at 31 December 2012);
2.net assets of $283,486 (down from $910,230 as at 31 December 2012);
3.in the six months to 30 June 2013, a loss of $1,052,166 which included a payment of $218,523 on management fees and employment.
A profile of the Merged Entity was also provided. It included statements that:
6.5 Effect on the assets and operations of the Merged Entity
Other than as referred to elsewhere in this Bidder’s Statement, the acquisition of Argosy is not expected to have a material effect on the existing assets and operations of [DAF].
If [DAF] acquires all Argosy Shares on issue thethe (sic) merger will consolidate Argosy and [DAF’s] strategic portfolios in Queensland, Myanmar and Namibia under a single entity listed on ASX, creating a simpler and stronger platform to promote the Merged Entity to investors and key stakeholders.
The Merged Entity will have a stronger financial position with an unaudited pro forma net cash position of approximately $3.2 million (excluding any cash to be received from the conversion of in the money options) and the portfolio of mineral assets of each of the separate entities based on the unaudited net cash held at 30 June 2013.
The financial position of the Merged Entity was addressed in section 6.9:
On 2 July 2013, [DAF] announced a proposal to acquire all of the outstanding fully paid ordinary shares in Argosy by way of an off-market takeover bid. Under the offer, accepting Argosy shareholders will receive one [DAF] Share for every one Argosy Share held, implying a value of $0.038 per Argosy share, based on the closing price of [DAF] Shares on 1 July 2013 of $0.038 per [DAF] Share being the last trading day prior to the Announcement Date.
DAF then explained the rationale of the offer in section 7 of the Bidder’s Statement:
[DAF] believes that there are a number of key strategic and financial benefits that will arise from the successful acquisition of Argosy by [DAF]. These include:
(a)Creation of a single company better placed to enhance the value of the Merged Entity’s Merged Entity’s (sic) assets.
(b)Consolidation of Consolidation of (sic) Argosy’s and [DAF’s] strategic portfolios in Queensland, Myanmar and Namibia under a single entity listed on ASX, creating a simpler and stronger platform to promote the Merged Entity to investors and stakeholders.
(c)Argosy Shareholders will retain exposure to Argosy’s project portfolio, including the Namibian Project to be acquired pursuant to the Namibian Transaction and gain exposure to the potential upside within [DAF’s] exploration and investment portfolio.
(d)The Merged Entity will be well financed through the next phase of exploration.
(e)The Directors consider that the combination of [DAF’s] and Argosy’s exploration expertise, technical capability and financial resources will provide the Merged Entity with improved opportunity to maximise the value of Argosy’s Projects.
The rationale from a financial resources perspective was also addressed:
(a)The Merged Entity will have a stronger financial position based on an expected pro-forma net liquid investment position of approximately $3,200,000 as at 30 June 2013.
(b)The Merged Entity’s enlarged size and stronger balance sheet should improve access to future equity funding than what either [DAF] or Argosy could achieve on their own. It is anticipated to also provide the Merged Entity with the flexibility to support near term project funding and accelerate exploration activities.
In respect of the Exploration Portfolio of the Merged Entity, the statement said that “[t]he Merged Entity will have a dual exploration strategy focused on the Namibian Project to be acquired pursuant to the Namibian Transaction in Namibia, supplemented with the Myanmar and Longreach Projects”.
DAF’s intentions upon acquisition of 90% or more of Argosy were set out in section 7.4. Under the sub-heading “Composition of the Board”, it stated that DAF intended to replace some or all of the members of the Board of directors of Argosy. The proposed DAF board structure of the Merged Entity was described as Mr Avery, Mr Nichol, Mr Lovett, Mr Thick and Mr van den Bergh.
On 6 September 2013, Argosy released its Target’s Statement following a unanimous resolution of the Argosy board. Mr Thick’s letter to Argosy shareholders within Argosy’s Target’s Statement stated “[y]our directors unanimously recommend that you ACCEPT the [DAF] Offer, in the absence of a Superior Proposal”, “[t]he Merged Group will have net cash reserves of approximately $3 million available to fund future exploration and development activities” and “will benefit from the combined management depth and technical expertise of [DAF] and Argosy”.
The Target’s Statement set out the respective positions of DAF and Argosy both financially and in terms of management:
Argosy has a net cash position of approximately $300,000 and the requirement to continue to progress its graphite project. In contrast, [DAF] has net cash reserves of $3 million. If the Offer is successfully completed, the Merged Group will have net cash reserves of approximately $3 million. This significantly improved financial position will assist the Merged Group to progress the exploration, development and production of its Projects.
In the absence of the [DAF] Offer, it is likely that Argosy would need to raise additional equity (or possibly sell assets) in order to progress its scheduled exploration and development programme on its graphite project. …
…
The Merged Group will benefit from the combined management talent of both organisations. Argosy Shareholders will be able to leverage off the proven experience and track record of the [DAF] board and senior management team. Additionally, Argosy’s Chairman, Mr … Thick, and South African based Exploration Director, Mr … van den Bergh, will be invited to the join the [DAF] board if the Offer is successful.
On 12 September 2013, Sunbreaker accepted DAF’s takeover offer and exchanged its 16,786,546 shares in Argosy for 16,786,546 shares in DAF, entitling it to at least 5% of the votes that may be cast at a meeting of DAF. By 17 September 2013, over 50% of Argosy shareholders had accepted DAF’s offer.
Following the merger, Mr Thick and Mr van den Bergh were appointed directors of DAF and joined Messrs Nichol, Avery and Lovett on the board of DAF on 3 October 2013. Mr Avery resigned from the Board of DAF on 28 October 2013. On 22 November 2013, Messrs Lovett, Thick and van den Bergh were re-elected to the board of DAF. On 12 December 2013, DAF’s takeover offer closed by which time DAF had acquired 88.64% of the ordinary shares in Argosy.
On 13 February 2014, Sunbreaker issued the notice under s 249D of the Act in respect of the Requisitioned Meeting: see [2] above.
Then, about one month later, on 14 March 2014, Argosy released an offer document in which it disclosed it would undertake a 2 for 1 renounceable entitlement offer at $0.0025 per share (amended to $0.002 per share) with a shortfall facility (the Entitlement Offer). The offer document disclosed that DAF did not intend to take up its entitlement but may trade its rights. If the Entitlement Offer was fully subscribed, DAF’s interest in Argosy might be diluted from 88.6% to 29.5%.
Finally, two shareholders in DAF (Sunbreaker and Mr Walker) sought a declaration of unacceptable circumstances from the Takeovers Panel on the basis that the Entitlement Offer, with DAF not participating, had the effect or likely effect of causing a change in control or potential control in Argosy. Neither Sunbreaker nor Mr Walker was at that time a shareholder in Argosy. The Takeovers Panel decided not to conduct proceedings under reg 20 of the Australian Securities and Investments Commission Regulations 2001 (Cth).
ANALYSIS
Serious Question to be Tried?
At the hearing of the interlocutory application, DAF relied on the first two legal grounds set out at [6] above – misleading and deceptive conduct and the existence of a collateral contract. The same facts were said to give rise to both legal grounds.
The facts were described in the Statement of Claim at [12]-[17] in the following terms:
12. On 4 June 2013, Lloyd represented to Nichol on behalf of DAF that if DAF took over Argosy, Lloyd would:
(a) relinquish his management role in Argosy and not seek any management role in DAF; and
(b) using the shares controlled by him in DAF, support Nichol to remain in control of DAF and Argosy.
(the 4 June Representations).
…
13. On 17 June 2013, Lloyd represented to Nichol on behalf of DAF that if DAF took over Argosy, Lloyd:
(a)would step down from management and the Board of Argosy;
(b) would use the shares controlled by him in DAF to allow the Boards of DAF and Argosy to get on with pursuing their projects;
(c) would not seek a seat on the Board of DAF;
(d) was happy to leave the management of the companies to Nichol and others;
(e) was tired of running a public company;
(f) would use the shares controlled by him in DAF to support:
(i) Avery being appointed executive chairman of Argosy;
(ii) Danie van den Bergh remaining as a non-executive director of Argosy and being appointed to the Board of DAF;
(iii) Philip Thick remaining as a non-executive director of Argosy and being appointed to the Board of DAF; and
(iv) Nichol being appointed as managing director of Argosy; and
(g) thought the proposed management structure was a good team for DAF,
(the 17 June Representations).
…
14. In reliance on the 4 June Representations and the 17 June Representations, DAF after consultation by its directors and in particular, consideration of Lloyd’s representations as to how he would use his shareholding in DAF following its takeover of Argosy to support the proposed composition of the DAF Board:
(a) executed a Takeover Bid Implementation Agreement with Argosy on 2 July 2013 for the takeover by [DAF] of Argosy;
(b)released a joint ASX announcement with Argosy on 2 July 2013 (the 2 July ASX announcement); and
(c) assumed the obligation imposed by section 631 of the [Act]. …
…
15.The 2 July ASX announcements, in accordance with the understanding caused by Lloyd, contained statements that after DAF took over … Argosy:
(a)Nichol would remain as managing director of DAF; and
(b)Philip Thick and Danie van den Bergh wold join the board of DAF,
(the 2 July ASX statements).
…
16. On or before 2 July 2013, Lloyd adopted the 2 July ASX representations (sic) (the 2 July Representations).
…
17. On 19 August 2013 Lloyd represented to Nichol on behalf of DAF that if DAF took over Argosy:
(a) the proposed Board of DAF comprising:
(i) Philip Thick as a non-executive director;
(ii) Danie van den Bergh as Executive Chairman;
(iii) Ian Lovett as a non-executive director; and
(iv) Nichol as managing director,
was acceptable to the Argosy board, represented the best combination of the respective skills sets of the Argosy and DAF boards and was in the best interest of Argosy shareholders;
(b) he would resign as a director of Argosy upon completion of DAF taking over Argosy; and
(c)he would use the shares controlled by him in DAF to support the DAF Board comprising:
(i) Avery;
(ii) Nichol;
(iii) Ian Lovett;
(iv) Phillip (sic) Thick; and
(v) Danie van den Bergh,
(the 19 August 2013 Representations).
(Emphasis in original.)
DAF’s claim faces a number of difficulties. DAF’s pleaded case does not contain an element that DAF relied upon in support of its claim for interlocutory relief. It was not part of DAF’s pleaded case that Mr Lloyd represented to DAF that he would support the ongoing board of DAF, with Mr Nichol as the managing director, at least for a reasonable period and that reasonable period was until around about 1 October 2014, being a year from the completion of the takeover. The material in italics (the Reasonable Period Representation) is not referred to expressly or impliedly in the pleaded case or in any of the affidavit material filed by DAF in support of its interlocutory application. The application is interlocutory in nature and the formulation of the claim and the evidence is necessarily not as refined as might otherwise be the case. However, given the significance of this aspect of the claim, it is surprising that the Reasonable Period Representation was not pleaded or referred to in any of the affidavits. That is not the only difficulty. A careful reader will have noticed that the pleaded representations (see [43]) are not inconsistent with the contents of the relevant contemporaneous documentary material the parties issued at the time of the takeover addressing the management of the merged entity (see [16]-[36] above) and what then in fact occurred (see [38] above). Put another way, as the public statements at the time made clear, after DAF took over Argosy, Mr Nichol was to remain as managing director of DAF and Messrs Thick and van den Bergh were to be appointed to the board of DAF and that occurred.
Second, the whole agreement clause (or merger provision) in the BIA (cl 10 set out at [20] above) is another hurdle in the way of DAF’s contention that Mr Lloyd on behalf of Argosy (or on any other basis) made any of the representations or, at the very least, the 4 June Representations, the 17 June Representations or the Reasonable Period Representation. At the time of executing the BIA, DAF acknowledged that no party (nor any person acting on its behalf) made any representation or other inducement to it to enter into the BIA, except for representations or inducements expressly set out or referred to in the BIA: cl 10. The difficulty for DAF’s pleaded case is that the BIA was entered into after the 4 June Representations and after the 17 June Representations: see [43] above.
Counsel for DAF referred the Court to the decision in McMahon v National Foods Milk Ltd (2009) 259 ALR 20 at [35]-[43] as authority for the proposition that a merger provision should not be permitted to stand in the way of proof of a collateral contract unless the merger provision is clearly expressed to that effect: at [38]. That decision provides little assistance to DAF. As Nettle JA explained (at [39]) “each case is unique. The question in each case is what the merger clause in question ‘would convey to a reasonable person having all the background knowledge which would reasonably have been available to the parties in the situation in which they were at the time of the contract’”. If the question posed by Nettle JA was asked here in respect of cl 10, it is by no means certain that it would have conveyed the limited meaning contended for by DAF. That conclusion is reinforced by two further matters identified by Nettle JA. Here, DAF does not contend that the alleged collateral contract was contemporaneous with the BIA: cf McMahon at [39]. Secondly, courts are reticent to treat pre-contractual statements as promissory and, of course, a statement must be promissory to amount to a collateral contract: McMahon at [40] and the authorities cited at footnote 38. Here, it is difficult to identify any promissory statement whether of the kind alleged by DAF (cf [43] and [44] above) or one necessary to amount to a collateral contract.
In that context, it is also necessary to address a submission made by counsel for DAF that neither Mr Lloyd nor Sunbreaker was a party to the BIA and therefore the merger provision does not apply. That submission fails because the representations allegedly made by Mr Lloyd which are said by DAF to found the so called collateral contract directly concern an alleged representation (and therefore a term of any collateral contract) that Mr Lloyd will not vote his DAF shares to effect a change in the control of the board of DAF. The collateral contract must be collateral to, and of course, not inconsistent with, the main contract: see, for example, Maybury v Atlantic Union Oil Company Limited (1953) 89 CLR 507 at 517 and Gates v The City Mutual Life Assurance Society Ltd (1986) 160 CLR 1 at 11. The Statement of Claim does not identify the main contract. If it is understood that the alleged collateral contract is collateral to the BIA, it is by no means clear that Mr Lloyd would not be a person acting on behalf of a “party” under cl 10 of the BIA.
Third, and no less importantly, it is necessary to consider the affidavit evidence relied upon by DAF to establish the various representations. Taken at its highest, the affidavit evidence adduced by DAF at this hearing does not support the various pleaded representations. It will be necessary to deal with each set of representations in turn.
In respect of the 4 June Representations (see [43] above), the critical element is paragraph 12(b) of the Statement of Claim – that if DAF took over Argosy, Mr Lloyd would use the shares controlled by him in DAF and support Mr Nichol to remain in control of DAF and Argosy (Emphasis added). The meeting where this representation was said to have been made was attended by Messrs Nichol, Avery and Lloyd. There is a difficulty with the pleaded representation. As Counsel for the Lloyd interests pointed out, the representation is predicated on the merger having taken place and DAF having taken control of Argosy. If that occurred (as it did), Mr Lloyd substituted his shares in Argosy for shares in DAF. Put another way, after the merger, Mr Lloyd had no capacity to influence who controlled Argosy. What then is the evidentiary position in relation to the 4 June Representations? Mr Avery and Mr Lloyd both provided sworn evidence that the representations were not made. DAF particularised the claim by reference to Mr Nichol’s sworn evidence which was that:
10. On or around 4 June 2013, I met with Peter Lloyd and Peter Avery at Peter Lloyd’s office in Nedlands, Perth. We had a general conversation about the two companies, [Argosy’s] exploration interests and the possibility of DAF offering to takeover [Argosy]. Peter Lloyd said to me that [Argosy] did not have the financial resources to proceed with exploration works and that DAF would be a good suitor as it had experience in similar exploration projects and the cash to fund exploration. I said to Peter Lloyd words to the effect of “It’s a good fit because you have the project and we have the cash.” Peter Lloyd laughed and said that he agreed with me.
11. Peter Lloyd said that the critical issue would be how much DAF was prepared to pay for [Argosy]. This led to a discussion about the scrip offer and the management of the companies if the takeover proceeded. Peter Lloyd said to me that he expected that DAF would want him to relinquish his management role in the merged entity. I said to Peter Lloyd that that would be the case as it was DAF’s intention that I remain in control. Peter Lloyd said words to the effect of. “That is what I expected. That actually suits me. It’s about time I took a back seat. I need to spend more time on my farm. I just need you to make sure the share price doesn’t fall.” Peter then said words to the effect of “would you like me to arrange for Danie van den Bergh, our mining engineer, to come here to Perth to meet with you and Peter [Avery] so that you can decide whether you want to proceed with a takeover offer? Danie can provide you with a lot more technical information than I can”. I said words to the effect of “I think that would be a good idea. I would like to get a feel for the commercial viability of the project. Please let Peter and me know when Danie is available and I’ll arrange to fly back to Perth.”
(Emphasis added.)
As is apparent, Mr Nichol’s sworn evidence does not directly address paragraph 12(b) of the Statement of Claim and, no less importantly, does not address DAF’s Reasonable Period Representation articulated at the hearing of this application.
Next, the 17 June Representations: see [43] above. A critical element of these representations was paragraph 13(f), namely that:
[I]f DAF took over Argosy, Lloyd:
(f) would use the shares controlled by him in DAF to support:
(i) Avery being appointed executive chairman of Argosy;
(ii)Danie van den Bergh remaining as a non-executive director of Argosy and being appointed to the Board of DAF;
(iii)Philip Thick remaining as a non-executive director of Argosy and being appointed to the Board of DAF; and
(iv)Nichol being appointed as managing director of Argosy; …
The same difficulties exist here. After the takeover, Mr Lloyd had no capacity to control the directors of Argosy because neither he nor his related entity held any shares in Argosy.
The meeting on 17 June 2013 was attended by Messrs Nichol, Lloyd, Avery and van den Bergh. Mr Avery and Mr Nichol deny that the representations were made. Mr van den Bergh’s evidence, adduced by DAF, is telling. His sworn evidence about what occurred at that meeting was:
12. On 17 June 2013, I flew to Perth to attend a meeting at Peter Lloyd’s office. The attendees at the meeting were Peter Lloyd, Peter Avery and Kevin Nichol. We discussed [Argosy’s] project in Namibia. This was a project I had been working on, so I was asked to provide Kevin Nichol and Peter Avery with details of the project. As part of my presentation I showed them photographs of the project site. Kevin Nichol and Peter Avery said they were interested in the project and said that projects of that kind were what DAF was interested in. Kevin Nichol said that he had been looking for a viable graphite project for some time.
13. During the meeting the make up of the Board of directors of both DAF and [Argosy] was discussed. At one point Peter Lloyd said that he would stand down from the management of [Argosy] if the merger proceeded, as the merged entity could not have two managing directors. Peter Lloyd said that he would be happy to let others take over the running of the company as he wanted to spend more time on his farm. I can not recall whether Kevin Nichol or Peter Lloyd put forward the proposal that Peter Avery and Kevin Nichol join the board of [Argosy] and that Phillip (sic) Thick and I join the board of DAF. However, this issue was discussed for some time and in the end all of us agreed that the proposal was a good one as it would reflect the merger of the two companies. I said to Peter Lloyd words to the effect of “If you think the deal is in the best interests of [Argosy] I will support it.” Peter Lloyd said to me words to the effect “the merger is in both [Argosy’s] and your best interests. It will allow the exploration to proceed.”
14.Peter Lloyd said that provided the parties could agree on the consideration to be paid to shareholders of [Argosy], Peter Lloyd would be able to ensure that the merger was approved as he could influence a significant majority of the [Argosy] shareholders. After the meeting Peter Lloyd and I had a discussion in Peter’s car. Peter and I agreed that we didn’t really have any alternative other than to accept the offer if we wanted to get the [Namibian Project] of the ground. We discussed the board briefly. Peter Lloyd said to me words to the effect “I’m looking forward to retiring from the Board. I can focus on my farm. I just need you to ensure that the share price is maintained.” I said to Peter that I would do my best.
As will be apparent, Mr van den Bergh’s recollection of the meeting does not address critical aspects of the 17 June Representations. In the end, the court is left with three of the four attendees at the meeting either denying critical aspects of the representations were made (Mr Avery and Mr Nichol) or, at the very least, not addressing them (Mr van den Bergh). It must be recalled that at this time, Mr Avery was the chairman of DAF. That leaves Mr Nichol’s evidence in respect of the 17 June Representations. His evidence was that:
20. Peter Lloyd raised no objection to the ‘one for one’ scrip offer. Whereas we had a lengthy conversation concerning the make up of the Boards of DAF and [Argosy] following the takeover. Peter Lloyd said words to the effect of “As we have already discussed, if the takeover offer is accepted, which I believe it will, I will immediately step down from management and the Board of [Argosy] and will allow the Boards of [Argosy] and DAF to get on with pursuing the [Namibian Project]. I will not be seeking a seat on the Board of DAF. I am happy to leave the management of the companies to Kevin and others. I am tired of running a public company and look forward to spending more time running my olive farm. I don’t expect any special treatment, you guys run it and get the share price up. I’ve got plenty of shares and want to see the price go up”.
21. Peter Lloyd then said words to the effect of “I propose that Peter Avery be appointed executive chairman of [Argosy], Danie remain as a non-executive director of [Argosy] and be appointed to the Board of DAF, Philip Thick remain as a non-executive director of [Argosy] and be appointed to the Board of DAF. Kevin should be appointed as managing director of [Argosy]. That’s a good team. The shareholders will vote for it”. Peter Avery, Danie van Den Bergh (sic) and I said that we agreed with Peter Lloyd’s proposal. Danie van Den Bergh (sic) said “that all sounds good, and if you think it will work (directed at Lloyd) then I am happy to support it”. The discussion then reverted to the timing of the takeover. Peter Lloyd said words to the effect “there will need to be a bidder’s statement completed and Frank will put together the response and they can be released together. We will have to state that the Boards will change.”
(Emphasis added.)
Again, it will be apparent that those paragraphs do not address paragraph 13(f) of DAF’s pleading in relation to the 17 June Representations or DAF’s Reasonable Period Representation articulated at the hearing of this application.
Next, the 2 July Representations. Those representations were limited: see [14]-[16] set out at [43] above. Significantly, it is not alleged that the 2 July Representations included any representation or statement that Mr Lloyd would continue to support the DAF board indefinitely or at the very least, for a reasonable period such as one year after the takeover was completed.
Finally, there are the 19 August Representations: see [43] above. Mr Lloyd’s evidence was that he does not recall the conversation. Mr Nichol’s evidence is that the conversation took place in the terms alleged. Taken at its highest, the 19 August Representations do not assist DAF. They do not assist because there is nothing to suggest that at the time the representations were made, they were false. There is no pleading that the pleaded representations were false at the time that they were made. In fact, the representations, taken at their highest, reflect what in fact occurred after DAF took over Argosy: (1) the proposed board of DAF was acceptable to the Argosy Board; (2) Mr Lloyd resigned as a director of Argosy; and (3) Mr Lloyd used the shares controlled by him in DAF to support the appointment of the named individuals. Again, Mr Lloyd’s evidence does not address the Reasonable Period Representation articulated at the hearing of this application.
Two other matters were relied upon by the Lloyd interests in support of the contention that DAF had not satisfied the first limb of O’Neill. First, the Lloyd interests submitted that Mr Lloyd’s subsequent conduct went against the representations having been made by him. The first conduct relied upon was that, on 22 November 2013, Mr Lloyd voted in favour of the appointment of the board of DAF consistent with the matters recorded in the Bidder’s Statement and the Target’s Statement. Counsel for the Lloyd interests submitted that it was important to recall that at that time there was a dispute in relation to Mr Avery’s conduct and Mr Lloyd wanted Mr Avery removed from the board of DAF. Counsel for Mr Lloyd submitted that the failure of DAF to refer to any of the pleaded representations at that time to ensure the appointment of Mr Avery to the board is a fact or matter tending against the representations having been made. Mr Lloyd did not give evidence about these matters. The picture is incomplete. I have not had regard to this matter in considering whether DAF has satisfied the first limb of O’Neill.
The second matter raised by the Lloyd interests was that even if one or more of the sets of representations was established, there was no prima facie case because there was no damage suffered by DAF and nothing for an injunction to protect. Counsel for the Lloyd interests accepted that this matter was also relevant to the second limb of O’Neill. It will be addressed under that heading.
Counsel for DAF submitted that the circumstances of this case fell to be treated in the same manner as Carr Boyd Minerals Ltd v Ashton Mining Ltd (1989) 15 ACLR 599. I reject that contention. As the Full Court in Carr Boyd acknowledged, courts are reluctant to interfere in matters relating to the exercise of voting rights by shareholders: at 606 and the authorities cited. The cases where Courts have entered the shareholders arena are where the particular circumstances of the case have required it: see, by way of example, Carr Boyd at 606 and Hopkins Professional Services Pty Ltd v Foyster Holdings Pty Ltd (2001) 39 ACSR 519 at [14] and [18]. That is not one of those cases: see [42]ff above.
For those reasons, I am not persuaded that DAF has satisfied the first limb of O’Neill.
Second Limb – Balance of Convenience?
It is strictly unnecessary to consider this limb. However, given the level of disputation between the parties, it is appropriate to make a number of observations.
The first step is to identify the status quo. The Lloyd interests submitted that the status quo is that the shareholders of DAF, having received notice of a properly convened general meeting, the Requisitioned Meeting, should be entitled to vote at that meeting on the resolutions proposed to be put to that meeting: see, by of example, Hopkins at [14] and [18]. DAF, on the other hand, submitted that the status quo was the maintenance of the existing board of DAF pending the hearing and determination of the substantive issues at trial: cf Carr Boyd.
It is important to recall that the notice in respect of the Requisitioned Meeting which was sent to each shareholder contained a significant amount of material from the current board of DAF addressing each of the proposed resolutions. The board of DAF informed the shareholders of DAF that they should not vote in favour of the resolutions and provided the shareholders with a detailed explanation for their view. Significantly, notwithstanding the detailed information provided by DAF for voting against the proposed resolutions, the evidence discloses that if the resolutions were put to the Requisitioned Meeting, it is likely that the resolutions would pass. A schedule prepared by the parties setting out the foreshadowed outcome of the Requisitioned Meeting is in Annexure A. I am not persuaded that the balance of convenience favours adjourning the Requisitioned Meeting. A properly informed general meeting of shareholders is entitled to vote on the composition of the board of directors. And, no less importantly, those elected as directors are not entitled to act otherwise than in good faith and in the best interests of DAF: ss 180 and 181 of the Act.
In that context, it is necessary to say something about DAF’s concerns in relation to the activities of Mr Lloyd and the “unfairness” identified by DAF if the resolutions are passed at the Requisitioned Meeting. DAF raised questions about the role and conduct of Mr Lloyd as a director of Argosy and the fact that as a result of the steps now taken, he was in general terms, likely to effect a reverse takeover. The allegations made against Mr Lloyd are serious. They include allegations that:
1.Mr Lloyd, as chief executive officer of Argosy, failed to ensure the availability of funds to expand Argosy’s business and therefore DAF has serious doubts that Mr Lloyd has the ability to raise sufficient capital to fund DAF’s current four exploration projects.
2.After a review of Argosy’s accounts, a number of invoices paid by Argosy were queried including the hiring of a corporate box at Subiaco Oval at a cost of $46,785 and invoices paid for slashing and clearing at a property at Coodanup where the issuer of the invoice dealt with Toby Lloyd (Mr Lloyd’s son) and Argosy did not own a property at Coodanup. The allegation was that the substantial reduction in Argosy’s cash reserves (see [29] above) were at least in part the direct result of these and other inappropriate payments; and
3.Mr Lloyd appointed family members to Argosy where the appointment of family members was not based on merit or expertise.
That list is not exhaustive. It is this conduct that was said by DAF to establish the damage it would suffer if the Requisitioned Meeting was not deferred.
The Lloyd interests submitted that these matters were irrelevant to the balance of convenience analysis. I disagree. The substance of DAF’s complaints and criticisms of Mr Lloyd were addressed at length by DAF in the notice sent to shareholders for the Requisitioned Meeting. DAF’s shareholders have been given an opportunity to consider those matters and will be entitled to vote accordingly. It must be recalled that the allegations concern Mr Lloyd’s conduct at Argosy. If these matters require further investigation, then they should be investigated by the board of Argosy and Mr Lloyd should take no step to prevent that occurring. Secondly, and no less importantly, those persons seeking appointment at the Requisitioned Meeting are and will remain subject to the onerous obligations which the law rightly places on directors of any company, including a publicly listed company. Given the history of this matter, there is no doubt that the actions of those appointed directors of DAF will be scrutinised to ensure that they fulfil those obligations.
The third matter relied upon by the Lloyd interests under this limb were the questions raised by the Takeovers Panel in respect of the conduct of DAF’s current directors. Those questions concerned the renounceable rights issue in Argosy and the statement by DAF that DAF did not intend to take up its entitlement but may trade its rights. Counsel for DAF provided some explanation for DAF’s position. It is inappropriate to interfere with, or comment on, management decisions especially on incomplete material at the hearing of an interlocutory application. I have not taken this matter into account in assessing the second limb of O’Neill. Finally, the Lloyd interests submitted that DAF delayed in bringing this proceeding. I reject that criticism. It is also not a matter I have taken into account in assessing the second limb of O’Neill.
In all the circumstances, I am not persuaded that the balance of convenience lies in favour of adjourning the Requisitioned Meeting.
ORDERS
DAF’s interlocutory application will be dismissed. It will pay the defendants’ costs of and incidental to the application.
I certify that the preceding sixty-seven (67) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gordon. Associate:
Dated: 2 April 2014
Annexure A
0
7
2