Grant-Taylor v Babcock & Brown Ltd (in liq)

Grant-Taylor v Babcock & Brown Ltd (in liq) is an appeal against a decision of the primary judge that found Babcock & Brown Limited (BBL) and its directors breached their continuous disclosure obligations under the Corporations Act 2001 (Cth). The dispute centred on the alleged failure to disclose the payment of dividends from capital, unauthorised capital reductions, and that the financial statements did not give a true and fair view, as well as the alleged failure to disclose insolvency. The Full Court was tasked with determining the legal issues surrounding the application of s 674 of the Corporations Act and the Listing Rules, specifically whether the information had a material effect on the price or value of BBL shares and whether such information was generally available. Additionally, the court had to ascertain whether BBL was or became aware of its insolvency.

The Full Court concluded that the appeal should be dismissed, affirming the primary judge’s findings. The court held that the unauthorised reductions of capital were technical and of no economic significance, and that the payment of dividends from capital did not have a material effect on the price or value of BBL shares. Furthermore, the court found that the financial information was not generally available and that the directors were not aware of the company's insolvency at the relevant time. The appeal was dismissed, and the appellants were ordered to pay the respondents' costs of and incidental to the appeal.

In summary, the Full Court upheld the primary judge's decision, affirming that BBL and its directors failed to meet their continuous disclosure obligations. The court ruled that the alleged non-disclosures did not have a material effect on the price or value of BBL shares and that the directors were not aware of the company's insolvency. The appeal was dismissed, and the appellants were ordered to pay the respondents' costs.