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Fraser v NRMA Holdings Ltd

Fraser v NRMA Holdings Ltd

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Case Copied 27 January 1995 74 min read

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CATCHWORDS

TRADE PRACTICES - misleading or deceptive conduct - proposal for corporate reorganisation - "demutualiz.tionn and issue of "free" shares or cash - prospectus - reasonable expectation of members of full and fair disclosure for the making of properly informed judgment on the proposal.

CORPORATIONS - "controln of corporation - meaning thereof.

Broadcasting & Television Act 1942 (Cth) s.90G(1), 92D(1)

Companies Act

1 899 (NSW)

Corporations Law s.172(1) & (5), s.176, s.199(1) & (2), s.995, s.1005, s.1022, s.1323,

S. 1324, S. 1325

Trade Practices Act

1974 s .514 s.52

Baillie v Oriental Telephone and Electric Company Ltd [l9151 1 Ch 503 (CA)

Beach Petroleum NL v Johmon (1993) 43 FCR 1

Book of the Month Club v Federal Trade Commission 202 F 2d 486, 488 (2nd Cir. 1953)

Bulfin v Bebarfalds Ltd (1938) 38 SR NSW 423

Chequepoint Securities Ltd v Ckaremonl Petroleum NL (1986) 11 ACLR 94

Cumbrian Newspapers Group Ltd. v Cumberland and Westmorland Herald Newspapers

and Printing Co. Lld [l9871 1 Ch 1

Demagogue Piy Ltd v Ramensky (1992) 39 FCR 3 1

Devereaux Holdings Ply Ltd v Pelsart Resources NL (No. 2) (1985) 9 ACLR 956

Federal Commissioner of Taxation v Commomvealth Aluminium Corporation Lid (1980)

143 CLR 646

Federal Trade Commission v Standard Education Society 302 US 112, 1 16-1 17 (1937)

Garvie v Axmith (1962) 3 1 DLR (2d) 65

Goldex Mines Ltd v Revill (1974) 54 DLR (3d) 672 (Ont CA)

Gramophone & Typewriter Ltd v Stanley [l9081 2 KB 89

Jackson v Zhe Munster Bank Ltd (1884) 13 LR Ir 118

Kolotex Hosiery (Australia) Piy Ltdv Federal Commissioner of Taxation (1973) 130

CLR 64

Mendes v Commissioner of Probate Duties (Victoria) (1967) 122 CLR 152

National Roa& & Motorists ' Association v Parker (1986) 4 ACLC 609

PaciJc Coast Coal Mines Ltd v Arbuthnot [l9171 AC 607 (PC)

Parkdale Custom Built Furniture Ply Ltd v Puxu Ply Ltd (1982) 149 CLR 191

Peel v London & North Western Raihvay [l9071 1 Ch S (CA)

Peters ' American Delicacy Co. Lid v Heath (1939) 61 CLR 457

Re Application of The News Corporation Ltd (1987) 15 FCR 227

Re Dorman Long & Company Lld [l9341 1 Ch 635

Re ~n~leburn

Horse and Pony Club Ltd [l9731 1 NSWLR 641

Re National Grocers Co. Lld [l9381 3 DLR 106

Re NFU Devebpmenl Trurf [l9721 1 WLR 1548

Re N Slater Co. Lfd [l9471 2 DLR 3 11

Rhone Poulenc Agrochimie SA v UIM Chemical Services P v Lfd (1986) 12 FCR 477

Taco Co. of Au.s&afia v Taco BeN Pfy L d (1982) 42 ALR l77 at 202

Tiessen v Henderson [l8991 l Ch 861

Warner v Ekiers Rural Finance Ltd (1993) 41 FCR 399

Wentworfh v N W B a r Association (1992) 176 CLR 239

DAWN FRASER and RTCHARD JAMES TALBOT v NRMA HOLDINGS

LIMITED, NRMA LIMITED and NRMA INSURANCE LIMlTED

No. NG3479 of 1994

BEFORE:	BLACK CJ, VON DOUSSA & COOPER JJ
PLACE:	SYDNEY
DATE:	27 JANUARY 1995

IN TEtE

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.

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Details

Case: [1995] FCA 9
Decision Date: 27 Jan 1995

CaseChat Overview and Summary

The case of Fraser v NRMA Holdings Ltd was an appeal concerning the legality of a corporate reorganisation proposal by NRMA Holdings Limited, NRMA Limited, and NRMA Insurance Limited. The applicants, Dawn Fraser and Richard James Talbot, directors and members of NRMA Limited, challenged the contents of a prospectus distributed to members. They argued that the prospectus did not adequately inform members about the implications of the proposed "demutualization" and the issuing of "free shares" or cash in exchange for their membership. The Federal Court of Australia, presided over by Black CJ, von Doussa, and Cooper JJ, granted leave to appeal and relisted the case for further submissions on the orders to be made. The court found that the prospectus contravened s.52 of the Trade Practices Act 1974 by not providing a full and fair disclosure of material information to enable members to make an informed decision on the proposal. The court concluded that the prospectus was likely to mislead or deceive members regarding the relinquishment of their rights and the true nature of the "free shares" offered.

Orders