Court of Appeal
Supreme Court
New South Wales
- Summary available
Medium Neutral Citation: First Pacific Advisors LLC v Boart Longyear Ltd [2017] NSWCA 116 Hearing dates: 23 May 2017 Date of orders: 26 May 2017 Decision date: 26 May 2017 Before: Bathurst CJ at [1]; Beazley P at [106]; Leeming JA at [107] Decision: 1. Grant the applicant leave to appeal.
2. Direct the applicant to file a Notice of Appeal in the form of the draft notice of appeal contained at tab 2 in volume 1 of the white book within 7 days.
3. Dismiss the appeal.
4. Order that the appellant pay the respondents’ costs of the appeal.Catchwords: CORPORATIONS – arrangements and reconstructions – schemes of arrangement or compromise – applications under s 411 of the Corporations Act 2001 (Cth) for orders convening meetings of members to consider and if thought fit to agree to proposed schemes of arrangement – whether primary judge erred in finding that the secured creditors could be placed in the same class for the purposes of voting on proposed scheme of arrangement – whether primary judge misapplied the authorities relating to the composition of separate classes in respect of schemes of arrangement – whether primary judge erred in failing to hold that the differences in rights between the secured creditors made it impossible for them to consult together with a view to their common interest Legislation Cited: Corporations Act 2001 (Cth) ss 249N, 411. Cases Cited: Australian Securities Commission v Marlborough Gold Mines Ltd (1993) 177 CLR 485; [1993] HCA 15
Centro Properties Ltd v PricewaterhouseCoopers (2011) 86 ACSR 584; [2011] NSWSC 1465
F T Eastment & Sons Pty Ltd v Metal Roof Decking Supplies Pty Ltd (1977) 3 ACLR 69
Re APCOA Parking Holdings GmbH and others (No 2) [2015] 4 All ER 572; [2014] EWHC 3849 (Ch)
Re Chevron (Sydney) Ltd [1963] VR 249
Re Cortefiel SA [2012] EWHC 2998 (Ch)
Re Hellenic & General Trust Ltd [1976] 1 WLR 123
Re HIH Casualty and General Insurance Ltd (2006) 200 FLR 243; [2006] NSWSC 485
Re Hills Motorway Ltd (2002) 43 ACSR 101; [2002] NSWSC 897
Re Jax Marine Pty Ltd [1967] 1 NSWR 145
Re Kumarina Resources Ltd [2013] FCA 549
Re MAC Services Group Ltd (2010) 80 ACSR 390; [2010] NSWSC 1316
Re Nine Entertainment Group Ltd (No 1) (2012) 211 FCR 439; [2012] FCA 1464,
Re NRMA Insurance Ltd (2000) 156 FLR 349; [2000] NSWSC 82
Re Opes Prime Stockbroking Ltd (No 2) (2009) 179 FCR 20; [2009] FCA 813
Re Orica Ltd [2010] VSC 231
Re T & N Ltd (No 4) [2007] 1 All ER 851; [2006] EWHC 1447 (Ch)
Re Telewest Communications PLC [2004] BCC 342; [2004] EWHC 924 (Ch)
Re United Medical Protection Ltd [2007] FCA 631
Sovereign Life Assurance Company v Dodd [1892] 2 QB 573
UDL Argos Engineering & Heavy Industries Co Ltd v Li Oi Lin [2001] 3 HKLRD 634Category:
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Details
- Case
- [2017] NSWCA 116
- Decision Date
CaseChat Overview and Summary
First Pacific Advisors LLC (the applicant) appealed to the Court of Appeal of New South Wales against orders made by the primary judge convening meetings of creditors and members of Boart Longyear Ltd (the company) to consider proposed schemes of arrangement. The dispute concerned whether certain secured creditors of the company could be placed in the same class for the purposes of voting on the proposed schemes.
The central legal issues before the Court of Appeal were whether the primary judge erred in finding that the secured creditors could be placed in the same class, whether the primary judge misapplied the authorities concerning the composition of separate classes in schemes of arrangement, and whether the primary judge erred in failing to hold that the differences in rights between the secured creditors made it impossible for them to consult together with a view to their common interest.
The Court of Appeal affirmed the primary judge's decision, holding that the secured creditors were correctly placed in the same class. The Court reasoned that while the secured creditors had different security interests, these differences did not prevent them from consulting together with a view to their common interest in the success of the scheme. The Court applied the principle that the test for determining separate classes is whether the creditors have a sufficient commonality of interest to enable them to consult together with a view to their common interest, and that differences in the precise nature of their security do not necessarily mandate separate classes.
The Court of Appeal granted the applicant leave to appeal but ultimately dismissed the appeal, ordering the appellant to pay the respondents’ costs.
The central legal issues before the Court of Appeal were whether the primary judge erred in finding that the secured creditors could be placed in the same class, whether the primary judge misapplied the authorities concerning the composition of separate classes in schemes of arrangement, and whether the primary judge erred in failing to hold that the differences in rights between the secured creditors made it impossible for them to consult together with a view to their common interest.
The Court of Appeal affirmed the primary judge's decision, holding that the secured creditors were correctly placed in the same class. The Court reasoned that while the secured creditors had different security interests, these differences did not prevent them from consulting together with a view to their common interest in the success of the scheme. The Court applied the principle that the test for determining separate classes is whether the creditors have a sufficient commonality of interest to enable them to consult together with a view to their common interest, and that differences in the precise nature of their security do not necessarily mandate separate classes.
The Court of Appeal granted the applicant leave to appeal but ultimately dismissed the appeal, ordering the appellant to pay the respondents’ costs.
Orders
Orders of the court
1. Grant the applicant leave to appeal.
2. Direct the applicant to file a Notice of Appeal in the form of the draft notice of appeal contained at tab 2 in volume 1 of the white book within 7 days.
3. Dismiss the appeal.
4. Order that the appellant pay the respondents’ costs of the appeal.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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