Ensurance Limited [No 2] - [2023] WASC 431

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   ENSURANCE LIMITED [No 2] [2023] WASC 431
CORAM:   LUNDBERG J
HEARD:   7 NOVEMBER 2023
DELIVERED          :   7 NOVEMBER 2023
PUBLISHED           :   10 NOVEMBER 2023
FILE NO/S:   COR 129 of 2023
MATTER:   IN THE MATTER OF ENSURANCE LIMITED

EX PARTE
ENSURANCE LIMITED
Plaintiff

Catchwords:

Corporations Law - Scheme of arrangement under s 411 of the Corporations Act 2001 (Cth) - Plaintiff insurance company to be wholly acquired by another insurance company - Second court hearing - Whether orders should be made to approve scheme - No issue of principle arising - Turns on own facts

Legislation:

Corporations Act 2001 (Cth), s 411, s 1319
Consolidated Practice Direction 9.5.2

Result:

Scheme approved

Category: B

Representation:

Counsel:

Plaintiff	:	Mr J M Healy
Interested Party	:	Mr A J Papamatheos

Solicitors:

Plaintiff	:	Steinepreis Paganin
Interested Party	:	Maddocks

Case(s) referred to in decision(s):

Bombardier Transportation Australia Pty Ltd v Alstom Transport Australia Pty Limited (No 2)[2022] FCA 880
CSR Limited, in the matter of CSR Limited [2010] FCAFC 34; (2010) 183 FCR 358
Ensurance Limited [2023] WASC 371
Fowler v Lindholm, in the matter of Opes Prime Stockbroking Limited [2009] FCAFC 125 (2009); 178 FCR 563
In the matter of Foundation Healthcare Limited (No 2) [2002] FCA 973; (2002) 43 ACSR 680
NRMA Insurance Limited [2000] NSWSC 408; (2000) 34 ACSR 261
Permanent Trustee Company [2002] NSWSC 1177; (2002) 43 ACSR 601
Re International Goldfields Ltd [2004] WASC 112
Re Ozgrowth Ltd; Ex parte Ozgrowth Ltd [No 2] [2022] WASC 167
Re Ranger Minerals Ltd; Ex parte Ranger Minerals Ltd [2002] WASC 207; (2002) 42 ACSR 582
Re Seven Network Ltd (No 3) [2010] FCA 400; (2010) 267 ALR 583
Re Wesfarmers Ltd; Ex Parte Wesfarmers Ltd [No 2] [2018] WASC 308

LUNDBERG J

(This judgment was delivered ex temporaneously on 7 November 2023 and has been edited from the transcript to correct matters of grammar, add headings, and include complete footnotes and references.)

A. Introduction

These reasons relate to the second hearing of the plaintiff's application brought under s 411(1) and s 1319 of the Corporations Act 2001 (Cth)[1] for approval in respect of a scheme of arrangement (which I will refer to as the Share Scheme).[2]
[1] References to statutory provisions in these reasons are to the Corporations Act 2001 (Cth) unless stated otherwise.
[2] Originating Process dated 25 August 2023, proposed orders 6 - 9.
The Share Scheme involves the acquisition of all of the fully paid ordinary shares in the plaintiff by PSC Insurance Group Limited (PSC).
These reasons should be read together with my earlier reasons delivered on 28 September 2023,[3] in which orders were made to convene a virtual scheme meeting. Associated orders were also made for the dispatch of the scheme booklet (Scheme Booklet).[4] The Share Scheme itself is conveniently found as Annexure B to the Scheme Booklet.[5]
[3] Ensurance Limited [2023] WASC…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Ensurance Limited [No 2]

Details

AGLC: Ensurance Limited [No 2] [2023] WASC 431
Case: [2023] WASC 431
Decision Date: 10 NOVEMBER 2023

CaseChat Overview and Summary

Ensurance Limited [No 2] was a case in the Federal Court of Australia, which examined the application for orders to approve a scheme of arrangement under section 411 of the Corporations Act 2001. The plaintiff, Ensurance Limited, an insurance company, was to be wholly acquired by another insurance company. The court was required to decide whether the orders should be made to approve the scheme, as proposed. The primary consideration was whether the scheme was in the best interests of the creditors and shareholders of the plaintiff company.

The central legal issue before the court was whether the proposed scheme of arrangement should be approved. The court considered the fairness and appropriateness of the scheme, including the terms and conditions, the process of approval, and whether the scheme offered the best outcome for the creditors and shareholders. The court needed to ensure that the scheme did not unfairly prejudice any party and was fair and reasonable in all the circumstances. The case did not raise any novel or complex issues of principle but turned on its own unique facts.

The court found that the proposed scheme was fair and reasonable, and there was no evidence of unfairness to any party. The court approved the scheme, taking into account the benefits of the acquisition for the creditors and shareholders, as well as the process and terms of the arrangement. The court concluded that the scheme offered the best outcome for all parties involved and was in the best interests of the company. The court emphasised that its decision was based on the specific facts of the case and did not establish any new legal principles.

The court made orders approving the scheme of arrangement, allowing the acquisition of Ensurance Limited by the other insurance company to proceed. The court's decision was based on the merits of the case, considering the fairness and reasonableness of the scheme and the interests of the creditors and shareholders. The court's approval of the scheme was subject to the terms and conditions set out in the order.

Orders