HNA Irish Nominees Ltd v Kinghorn (No 2)

The case of HNA Irish Nominees Ltd v Kinghorn (No 2) involved several parties, including HNA Irish Nominees Ltd, KV Aviation, and various other entities and individuals involved in the special purpose vehicle companies. The dispute primarily revolved around the redemption of preference shares held by HNA Irish, the alleged misleading and deceptive conduct of certain defendants, and the oppression of preference shareholders. The case was heard in the Federal Court of Australia.

The legal issues before the court included determining whether the preference shares could be redeemed under ambiguous constitutional provisions, whether the defendants engaged in misleading and deceptive conduct, whether the affairs of the special purpose vehicle companies were conducted oppressively, and whether relief for oppression was appropriate. The court also had to consider the joinder of non-party investors in the proceedings.

The court found that the constitutions of the defendant companies were ambiguous regarding the redemption of preference shares. It held that the preference shares could not be redeemed based on a revaluation of the leased aircraft prior to the expiration of the lease term. The court further found that the defendants did not engage in misleading and deceptive conduct as there was no evidence that any non-party investors were misled or deceived. Regarding oppression, the court determined that the affairs of the companies were not conducted oppressively but acknowledged the potential for future oppressive conduct if certain steps were not taken. The court was also concerned about the joinder of non-party investors in the proceedings, particularly in relation to the relief for oppression.

The court ordered that KV Aviation be given a final opportunity to establish the value of the ordinary shares in the special purpose vehicle companies, potentially through the appointment of a referee. The court was disposed to order the transfer of the ordinary shares to a charitable trust but required evidence on the identity and standing of any proposed transferee or director. The court also required that other shareholders be notified and given an opportunity to be heard before making any such orders. The court further directed that the proposed minutes of orders be exchanged between the parties, and the proceeding be listed for further directions.