NICHOLAS JOHN GEHRKE	First Plaintiff
and
LESTER BUCH	Second Plaintiff
v
NOUMI LIMITED (ACN 002 814 235)	First Defendant
and
DELOITTE TOUCHE TOHMATSU (A FIRM) (ABN 74 490 121 060)	Second Defendant

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JUDGE:	DELANY J
WHERE HELD:	Melbourne
DATE OF HEARING:	17 April 2025, further material 9 May 2025
DATE OF RULING:	25 June 2025
CASE MAY BE CITED AS:	Gehrke & Anor v Noumi Ltd & Anor
MEDIUM NEUTRAL CITATION:	[2025] VSC 373

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REPRESENTATIVE PROCEEDINGS — Part 4A Group proceeding — Application for approval of settlement — Whether settlement fair and reasonable as between the parties and as between group members — Shareholder class action — Alleged breach of continuous disclosure obligations over a 5.5 year period — Two defendants — The company and its auditors — Defences raised proportionate liability issues — Cross claims and third party claims between defendants — Financial circumstances of the company — Settlement involves all parties — Settlement approved — Supreme Court Act 1986 (Vic) Part 4A, ss 33V, 33ZF — Botsman v Bolitho [2018] VSCA 278, applied.

PRACTICE AND PROCEDURE — Part 4A Group proceeding — Application for approval of settlement —Soft class closure order — Proceeding settled at mediation —Applications for late registration to permit participation in the settlement — Andrianakis v Uber Technologies Inc and Others (Settlement Approval) [2024] VSC 733, applied.

PRACTICE AND PROCEDURE — Part 4A Group proceeding — Appointment of Scheme Administrator — Approval for payment of costs of administering settlement distribution scheme.

PRACTICE AND PROCEDURE — Part 4A Group proceeding — Approval for payment of legal costs from settlement sum — No reason to vary group costs order — Supreme Court Act 1986 (Vic) Part 4A, 33ZDA — Allen v G8 Education Ltd (No 4) [2024] VSC 487, applied.

CORPORATIONS — Earlier declarations and orders for the payment of a pecuniary penalty in Federal Court proceedings between ASIC and the first defendant — Contravening conduct occurred during part of the claim period in this proceeding and in respect of the same subject matter — Plaintiffs in this proceeding intervened in their representative capacity in the Federal Court proceeding — Pecuniary penalty ordered to be paid into the Federal Court subject to further order — Statement of agreed facts in this proceeding as between the plaintiffs and first defendant mirrors facts agreed in the Federal Court proceeding between ASIC and the first defendant — Declarations and orders made in this proceeding on the basis of the agreed facts to facilitate the potential payment of compensation by the Federal Court to group members whose claims relate to the same period as the contravening conduct — Corporations Act 2001 (Cth) ss 674, 1317HA, 1317QF — ASIC v Noumi Limited (No 3) [2024] FCA 862 referred to.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	E Levine	Slater and Gordon Phi Finney McDonald
For the First Defendant

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 Gehrke v Noumi Ltd

Details

AGLC: Gehrke v Noumi Ltd [2025] VSC 373
Case: [2025] VSC 373
Decision Date: 25 June 2025

CaseChat Overview and Summary

Gehrke v Noumi Ltd involved a shareholder class action against a company and its auditors for alleged breaches of continuous disclosure obligations over a period of 5.5 years. The case was heard in the Supreme Court of Victoria. The legal issues revolved around the approval of a settlement reached between the parties, with particular attention to whether the settlement was fair and reasonable both between the parties and among the group members. The settlement addressed the allegations of continuous disclosure breaches, and involved complex financial circumstances of the company, as well as proportionate liability issues between the defendants and cross-claims and third-party claims.

The court examined the settlement's fairness and reasonableness by considering various factors, including the terms of the settlement, the nature of the claims, and the financial circumstances of the company. It approved the settlement, referencing the case of Soft v Bolitho, which set a precedent for assessing the fairness of settlements in group proceedings. The court also addressed the procedural aspects, including the late registration of group members, the appointment of a Scheme Administrator, and the payment of legal costs. The court confirmed that there was no reason to vary the group costs order, in line with the principles established in Allen v G8 Education Ltd.

Additionally, the court dealt with the implications of prior Federal Court proceedings where the first defendant had been found to have contravened the Corporations Act. The court made declarations and orders to facilitate potential compensation payments by the Federal Court to group members, aligning with the agreed facts from the Federal Court proceedings. This ensured that the settlement in the Supreme Court did not conflict with the prior legal determinations and would facilitate the overall resolution of the claims.

The court made several orders, including the approval of the settlement, the appointment of a Scheme Administrator, and the payment of legal costs from the settlement sum. The orders ensured that the settlement process would proceed efficiently, with appropriate oversight and distribution of the settlement funds to the group members.

Orders