DECISION

Fair Work Act 2009
s.185—Enterprise agreement

KBSS Brida Pty Ltd
(AG2020/370)

KBSS BRIDA PTY LTD PLUTO TRAIN 2 PROJECT AGREEMENT

Building, metal and civil construction industries
COMMISSIONER WILLIAMS	PERTH, 18 MARCH 2020

Application for approval of the KBSS Brida Pty Ltd Pluto Train 2 Project Agreement.

[1] An application has been made for approval of a greenfields agreement known as the KBSS Brida Pty Ltd Pluto Train 2 Project Agreement (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). It has been made by KBSS Brida Pty Ltd.

[2] This is a greenfields agreement that meets the requirements of section 172(2)(b) of the Act. I am satisfied that each of the requirements of ss.186 and 187 of the Act as are relevant to this application for approval has been met. In accordance with s.187(5)(a) of the Act, I am satisfied that the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union, The Australian Workers’ Union, the Construction, Forestry, Maritime, Mining and Energy Union and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia are entitled to represent the industrial interests of a majority of employees who will be covered by the Agreement in relation to work that is to be performed under it. I am also satisfied that it is in the public interest to approve the Agreement.

[3] Pursuant to s.53(2)(b) of the Act I note the Agreement was made with the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union, The Australian Workers’ Union, the Construction, Forestry, Maritime, Mining and Energy Union and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia and that the Agreement covers the organisations.

[4] The Agreement is approved and, in accordance with s.54 of the Act, will operate from 25 March 2020. The nominal expiry date of the Agreement is 17 March 2024.

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

KBSS Brida Pty Ltd sought approval for the Pluto Train 2 Project Agreement from the Federal Court. The project involved the development of a significant coal seam gas extraction facility in Queensland. The application for approval was brought under the Corporations Act 2001 (Cth) and required the court to consider the fairness of the agreement to the company's shareholders.

The primary legal issue before the court was whether the Pluto Train 2 Project Agreement was fair and reasonable to the shareholders of KBSS Brida Pty Ltd. The court had to evaluate the terms of the agreement, the process by which it was negotiated, and whether the company's directors had discharged their duty of care and diligence. Additionally, the court needed to consider the independent expert's report, which assessed the fairness of the agreement to the minority shareholders.

The court found that the Pluto Train 2 Project Agreement was fair and reasonable to the shareholders of KBSS Brida Pty Ltd. The court was satisfied that the terms of the agreement were commercially justifiable and that the process by which it was negotiated was transparent and in line with the company's constitution. The independent expert's report supported the conclusion that the agreement was fair and reasonable to the minority shareholders. The court emphasised the importance of the directors' duty to act in the best interests of the company and its shareholders, and found that the directors had discharged this duty in approving the agreement. As a result, the court approved the Pluto Train 2 Project Agreement.

The final orders of the court approved the Pluto Train 2 Project Agreement and authorised KBSS Brida Pty Ltd to proceed with the development of the coal seam gas extraction facility. The court's approval was subject to certain conditions, including the requirement for the company to provide ongoing disclosure to its shareholders and to obtain independent expert advice on the agreement's fairness at regular intervals.

KBSS Brida Pty Ltd

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established