NT Power Generation Pty Ltd v Trevor

[2000] WASC 254

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   NT POWER GENERATION PTY LTD -v- TREVOR & ORS [2000] WASC 254

CORAM:   IPP J

HEARD:   18 SEPTEMBER 2000

DELIVERED          :   19 SEPTEMBER 2000

FILE NO/S:   COR 240 of 2000

BETWEEN:   NT POWER GENERATION PTY LTD (ACN 061 314 921)

Plaintiff

AND

GARRY JOHN TREVOR
MARTIN BRUCE JONES
First Defendants

GENERAL GOLD OPERATIONS PTY LTD (ADMINISTRATOR APPOINTED) (ACN 086 085 878)

Second Defendant

FILE NO/S              :COR 241 of 2000

BETWEEN              :ZOE BOWEN

JOHN D'AMBROSIO
ROD JOHNSTON
MURRAY LORENSEN
JUSTIN MORSE
JODIE LEE
NICK BURN
MURRAY KANE
JENNY ORTON
MERVYN WELSH
DEBORAH JOHINKE
DOUG KELLY
ABDUL REEBECK
BRIAN FLETCHER
MARK GLASSOCK
MIRRELLE HARDI-TJONG
JACK MARTIN
KAYLEEN SMITH
JOHN MCGARRY
GREG CARSON
FIONA PINKNEY
WAYNE GAITER
ROBERT GRAY
ROD USHER
COLIN FORSCUTT
BRAD MURPHY
GLEN PERKINS
TIM WILLMOT
CHRIS BOLGER
ROB FRIEL
FRED HIGGINS
PETER LANDELLS
NATHAN GOSS
BRENDON DOWSE
PAUL RICHARDSON
SIMON MORO
JAMIE LANGERAK
TOM PFENNIG
WES JAWAL
TRACEY GANE
JAMIE DOBSON
MARK BUNCH
EDWIN SHARPLES
JOHN RICKETTS
First Plaintiffs

MULTIPLEX CONSTRUCTION PTY LTD (ACN 008 687 063)
Second Plaintiff

AND

GARRY JOHN TREVOR
MARTIN BRUCE JONES
First Defendants

GENERAL GOLD OPERATIONS PTY LTD (ADMINISTRATOR APPOINTED) (ACN 086 085 878)
Second Defendant

Catchwords:

Corporations - Proof of debt - Creditors include those who have claims for debts that become due and payable after the deed of arrangement

Corporations - Proxy forms - Whether proxies genuine proxies - Proxies are genuine when the proxy holder is the true agent of the shareholder and is not empowered to advance his or her own interests alone

Equity - Assignments in equity - No equitable assignment of a debt where the intention is not to transfer the interest in the debt immediately but only after demand therefor is made

Legislation:

Property Law Act 1969, s 20(1)

Corporations Law, s 436A, s 429C, s 444D(1), s 553, s 1321

Result:

COR 240 of 2000 - Appeal allowed
COR 241 of 2000 - Appeal dismissed

Representation:

COR 240 of 2000

Counsel:

Plaintiff:     Ms C J McLure QC & Mr R L McKenzie

First Defendants           :     Mr N P Gentilli

Second Defendant         :     Mr N P Gentilli

Solicitors:

Plaintiff:     Clayton Utz

First Defendants           :     Jackson McDonald

Second Defendant         :     Jackson McDonald

COR 241 of 2000

Counsel:

First Plaintiffs               :     Ms C J McLure QC & Mr R L McKenzie

Second Plaintiff            :     Ms C J McLure QC & Mr R L McKenzie

First Defendants           :     Mr N P Gentilli

Second Defendant         :     Mr N P Gentilli

Solicitors:

First Plaintiffs               :     Clayton Utz

Second Plaintiff            :     Clayton Utz

First Defendants           :     Jackson McDonald

Second Defendant         :     Jackson McDonald

Case(s) referred to in judgment(s):

Anning v Anning (1907) 4 CLR 1049

Brash Holdings Ltd v Katile Pty Ltd [1996] 1 VR 24

Coachcraft Ltd v SVP Fruit Co Ltd (1980) 28 ALR 319

Comptroller of Stamps (Vic) v Howard-Smith (1936) 54 CLR 614

Cousins v International Brick Company [1931] All ER Rep 229

International Leasing Corporation (Vic) Ltd v Aiken [1967] 2 NSWR 427

Lam Soon Australia Pty Ltd v Molit (No 55) Pty Ltd (1996) 22 ACSR 169

Norman v Federal Commissioner of Taxation (Cth) (1963) 109 CLR 9

Wood v Laser Holdings Ltd (1996) 14 ACLC 801

Case(s) also cited:

Nil

1. IPP J:  These reasons relate to two matters, COR 240 of 2000 and COR 241 of 2000, both of which come before me by way of originating process.  Both matters concern voting rights to be exercised at an adjourned meeting of the creditors of General Gold Operations Pty Ltd (Administrator Appointed) to which I shall refer as GGO, which meeting is to take place at 11.30 am WST on Wednesday 20 September 2000.  Argument on the matter took place yesterday and in view of the urgency of the matter I am delivering judgment today.

2. By way of background, GGO was the operator of a gold mine in the Northern Territory. The company experienced financial problems and on 5 July 2000 administrators were appointed to it pursuant to s 436A of the Corporations Law.

3. On 31 August 2000 the second meeting of creditors of GGO was held for purposes that included the consideration of a resolution by creditors, in terms of s 429C of the Corporations Law, that GGO execute a deed of company arrangement, or that the administration should end, or that the company be wound up.  That meeting was adjourned to 20 September 2000, as I have mentioned.

4. At the meeting, the chairman, Mr Trevor, (one of the administrators of GGO) accepted a proof of debt filed by NT Power Generation Pty Ltd ("NT Power") in an amount not exceeding $1,458,215. An additional amount of $13,886,035 claimed by NT Power and reflected in its proof of debt was not accepted by Mr Trevor. In matter COR 240 of 2000 NT Power appeals, pursuant to s 1321 of the Corporations Law, against Mr Trevor's decision disallowing the additional amount of $13,886,035.

5. In July 2000, GGO failed to make a payment of $1,475,552 which was due to NT Power pursuant to the terms of the agreement.  This amount remains due and owing by GGO.  On that basis, NT Power claims that the amount owing by GGO as at 8 July 2000 should be accepted as being that sum and not $1,458,215.  There is no evidence that controverts this assertion by NT Power and I accept it.  But the main issue in this part of the appeal concerns NT Power's claim for future debts which represents the balance claimed by NT Power and to which I now refer.

6. By written agreement dated 1 September 1999, NT Power agreed to supply electricity to GGO at the Mount Todd Gold Mine near Katherine in the Northern Territory.  GGO was the operator of a joint venture that owned the mine.  Clause 6.1 of the agreement stipulated that the period during which electricity was to be sold would commence on 2 September 1999 and would continue for three years from that date, provided that, after the expiration of the first 18 months' of the agreement, the parties to the agreement could terminate it on six months' written notice.  It is not disputed that the earliest date on which the agreement could so be terminated was 30 September 2001.

7. The agreement provided that, should the electricity consumed by GGO in any month be less than a total of 12 GWh, GGO would nonetheless pay NT Power the amount that would have been payable if, during that month, GGO had consumed electricity totalling 12 GWh.  On this basis, the aggregate sum of the payments required to be made by GGO to NT Power pursuant to the agreement, during the period 5 July 2000 to 30 September 2001, is $14,695,579.  NT Power has reduced this sum to take into account amounts paid by the administrators for the supply of electricity for the period 5 July 2000 to 31 August 2000.  NT Power has also allowed for a discount so as to arrive at the discounted net present value of the amount payable by GGO under the agreement.

8. In support of its contention that the full amount of its claim for electricity to be supplied in the future, calculated as aforesaid, should be admitted, NT Power draws attention to the following.  The total potential customer base for the sale of the electricity able to be serviced by NT Power's power station which was to supply the electricity to GGO is limited in number and is at present completely serviced by supplies of electricity.  NT Power has no opportunity to increase that customer base or its share thereof.  No reasonable grounds exist which give rise to any expectation that the customer base might be increased.  Nor is NT Power aware of any potential customers within its customer base who would be able to increase their electricity requirements to any relevant extent before 30 September 2001.

9. The matters which I have set out were not disputed by the administrators.  Mr Trevor, in an affidavit filed by him, referred to the "hope" that the Mount Todd Gold Mine might be sold and should that happen the purchaser was likely to require power to be supplied by NT Power.  This is an entirely speculative prospect and, in any event, the fact that, during the relevant period, someone else may require power to be supplied by NT Power, does not detract from the fact that GGO will remain indebted to NT Power under the agreement until it terminates not earlier than September 2001.

10. Mr Trevor also complained that he had been informed that NT Power may have entered into an agreement which may have affected the amount payable by GGO to it.  Mr Gentilli, counsel for GGO, invited me to require NT Power to produce that agreement.  I declined that invitation.  Firstly, the basis on which it was called for was vague and speculative.  Secondly, there is machinery under the Corporations Laws to enable the administrators to investigate this issue themselves.  In my view that is the appropriate way for this issue to be dealt with, and not on appeal to this Court from a decision of the chairman of the second meeting of creditors, which was made without any of the facts now said to be relevant having been ventilated.

11. In the circumstances, I approach the issue before me on the basis that there is, in effect, uncontradicted evidence that the present value of the aggregate amount payable by GGO to NT Power under the agreement is the aggregate of $1,475,552  (the amount due and owing as at 5 July 2000 as I have explained) and $14,695,579 (being the amount of GGO's obligations under the agreement for the period 5 July 2000 to 30 September 2001), subject to the latter sum being reduced by two further amounts.  The first of these is an amount that takes into account payments made by the administrators for the supply of electricity from 5 July 2000 to 31 August 2000, and the second is $886,144, being the discounted net present value of the aggregate claims.

12. There is ample authority that claims covered by a proposed deed of arrangement includes claims for sums becoming due and payable after the day specified in the deed.  In Brash Holdings Ltd v Katile Pty Ltd [1996] 1 VR 24 the Court of Appeal of the Supreme Court of Victoria rejected a submission that the words "all creditors" in s 444D(1) of the Corporations Law are limited to those who have claims for sums becoming due or payable on or before the day specified in the deed of company arrangement. The Court held that the expression "claims arising on or before the day specified in the deed", in s 444D(1), should be read as having the same content as the expression "debts or claims the circumstances giving rise to which occurred before the relevant date" in s 553 of the Corporations Law and thus as comprehending future or contingent debts or claims (see at 516).  This decision was followed by the Full Court of the Federal Court of Australia in Lam Soon Australia Pty Ltd v Molit(No 55) Pty Ltd (1996) 22 ACSR 169.

13. In the circumstances, as regards matter COR 240 of 2000, I would uphold the appeal and order that Mr Trevor's decision to reject that part of NT Power's claim that exceeded $1,458,215 be set aside and that NT Power's proof of debt be admitted in full.  I shall hear counsel as to the appropriate amount that should be admitted.

14. I now turn to the originating summons in matter COR 241 of 2000.

15. This matter concerns the proof of debt and proxy forms lodged on behalf of 44 employees of GGO.  These employees are the first plaintiffs in COR 241 of 2000 and I shall refer to them as "the employees".  The aggregate amount of the employees' claims was $651,644.  On 31 August 2000, at the second meeting of creditors of GGO, Mr Trevor ruled that the second plaintiff in COR 241 of 2000 ("Multiplex") would be entitled "to vote for a single vote in the amount of $651,644".  In other words he ruled that the aggregate of the employees' claims should be added to Multiplex's claims against GGO and Multiplex would be entitled to vote, as a single vote, for the entire quantum of its claims, including the aggregate of $651,644.  By the originating summons the employees and Multiplex in effect appeal against Mr Trevor's decision and claim an order that it be set aside and the employees be admitted to vote individually in the amounts owing to each.

16. The claims of the employees were all lodged in standard form.  For example, the particulars of debt for the first named employee are in the following terms:

    "  PARTICULARS OF DEBT
      (INFORMAL CLAIM)

    The Chairman of the Meeting
    of Creditors, or the Administrators

    Zoe Elizabeth Bowen .......................... (Full name of employee)
    PO Box 1578, Katherine NT 0851 ...........(address of employee)

    HEREBY MAKES it known that the abovementioned company is indebted to

    Multiplex Constructions Pty Limited [for Zoe Bowen .... (name of employee)] in the sum of $15,129.50 ......... as at 5 July 2000."

17. A curious aspect of each particulars of debt lodged by each employee is the statement therein that Multiplex, and not the employee concerned, is the creditor of GGO.

18. Accompanying each particulars of debt lodged by an employee, was a proxy form whereby each employee appointed Multiplex "as my general proxy to vote at the meeting on creditors to be held on the 31st day of August 2000, or at any adjournment of that meeting, and to vote:  generally as he/she determines on my/our behalf".  Also accompanying each particulars of debt was a document headed "Acknowledgment Release & Assignment".  I shall refer to this document as the "Release".  This document was in the following terms:

    "ACKNOWLEDGMENT
    RELEASE & ASSIGNMENT

    WHEREAS:

    A.I am an employee of General Gold Operations Pty Limited (Administrator Appointed) ('GGO'), the operator of the Yimuyn Manjerr gold mine in the Northern Territory ('the mine').

    B.As at the date of this document, GGO is indebted to me in the sum detailed in Annexure 'A' ('my GGO claim').

    C.The mine is an asset of a joint venture which includes Yimuyn Manjerr (Investments) Pty Limited (Controller Appointed) (Subject to a Deed of Company/Arrangement) ('YMI').

    D.I am not, and never have been, an employee or creditor of YMI.  Nor do I have any legal relationship with YMI by which I could require or oblige it to pay to me any sum in respect of my GGO claim or my employment by, or dealings with, GGO.

    E.On 4 August 2000 a deed of company arrangement ('DoCA') was entered into in respect of YMI.

    F.Notwithstanding that I am not an employee or creditor of YMI, the DoCA makes provision for payment to me of a sum in the amount of my GGO claim subject to certain terms ('the YMI payment').

    G.I have agreed to accept the YMI payment on the terms and conditions set out in this document.

    1.ACKNOWLEDGMENT

    By executing this document, I acknowledge and confirm:

    1.1each of the facts and matters recited above; and

    1.2receipt of the YMI payment.

    2.RELEASE

    By executing this document, I release and forever discharge YMI, Multiplex Constructions Pty Limited (('MXC') and all companies related to them under the provisions of the Corporations Law, from all actions, suits, claims and demands both at law or in equity and/or arising under any statute which I now have or could, would or might but for this release at any time or times after the date of this document have or have had against those companies by reason of or arising out of:

    2.1my GGO claim; or

    2.2the balance of the matters recited above.

    3.ASSIGNMENT

    In consideration of the YMI payment, I agree on demand sent to my address shown in this document to assign to MXC the whole of my GGO claim.

    4.POWER OF ATTORNEY

    4.1On the date of this document, I grant to MXC an immediate, irrevocable power of attorney:

    4.1.1to exercise in its absolute discretion all of the rights, powers and entitlements as I have in respect of my GGO claim, including, without limitation insofar as they relate to the insolvency of GGO; and

    4.1.2to do all acts which ought to be done by me under this document, including to perfect an assignment of my GGO claim at any time after demand by MXC under clause 3; and

    4.1.3to appoint (and remove at will) at any time any person as a substitute for an attorney.

    4.2I ratify and confirm now and for the future all actions lawfully undertaken by or on behalf of any attorney under this power of attorney.

    4.3I declare that this power of attorney will continue in force until all actions taken under it have been completed, notwithstanding the discharge of this document.

    5.PROXY AND PROOF OF DEBT

    5.1I also agree to execute on demand by MXC:

    5.1.1a proxy in favour of MXC or its nominee in relation to any meeting of creditors of GGO; and

    5.1.2a proof of debt in respect of my GGO claim.

    EXECUTED this 28th day August, 2000   )
    by Zoe Bowen
    In the presence of:  Jodi Lee  ) (signed Zoe Bowen)
    
    (signed J Lee)
    WITNESS
    Name:          Jodi Lee
    Address:       7/21 Grevillea Rd
      Katherine  NT  0850"

19. The deed of company arrangement referred to in preamble E of the Release contained the following cl 6.7:

    "Each person to be paid under clauses 6.3.3 and 6.3.4 of this document shall in exchange for such payment sign a release in favour of the Company and its related entities in respect of the debt for which they are to receive payment and shall at that time also assign to [Multiplex] that debt and any other rights in relation to it which that person may have."

20. I should explain that YMI, the company referred to in the preamble to the Release, was a joint venture partner with GGO in the mine to which NT Power undertook to supply electricity as I have explained in dealing with matter COR 240 of 2000.  On 4 August 2000, after GGO had been placed under administration, a deed of company arrangement was entered into in respect of YMI. By the YMI deed of arrangement, Multiplex agreed to pay the money needed to enable the employees to receive the amounts owing to them by GGO.  On receipt of the money the employees signed the Releases and executed the proxies. As I have set out above, cl 6.7 of the YMI deed of company arrangement provided for payment of the debts owing to the employees; the employees undertook thereby to sign the Releases and to assign to Multiplex the debts for which they so received payment.

21. Mr Gentilli submitted that, in the circumstances I have outlined, there had been a legal assignment by each employee of his or her claim against GGO. Critical to this submission was the proposition that the particulars of debt, in each case, constituted the express notice in writing of the assignment required by s 20(1) of the Property Law Act 1969.  That submission, however, cannot be sustained.  As Ms McLure, senior counsel for the plaintiffs pointed out, the notice must call the recipient's attention specifically to the fact of the assignment (Anning v Anning (1907) 4 CLR 1049 (at 1060)) and state the date of the assignment (International Leasing Corporation (Vic) Ltd v Aiken [1967] 2 NSWR 427 (at 449 ‑ 50)). The particulars of debt did neither of these things.

22. But there is a more fundamental obstacle to the submission that a legal assignment had been effected.  It is plain from cl 3 of the Release that no assignment is to take place unless and until Multiplex has made a demand therefor.  It is common cause that no demand has been sent to any of the employees.  Therefore, no absolute assignment and, hence, no legal assignment could have been effected.

23. Mr Gentilli then argued that the employees had effected an equitable assignment to Multiplex of the debts owing to them by GGO.  On that basis he submitted Mr Trevor correctly ruled that Multiplex was the creditor in respect of the debts concerned.

24. Ms McLure submitted that cl 3 reflected an intention, upon the part of Multiplex and each employee, that no assignment at all should take place until Multiplex sent the demand contemplated thereby.  She accepted that on the demand being sent an equitable assignment would be effected.  But, she submitted, the intention of the parties as reflected by cl 3 constituted an effective block against the assignment occurring until then.  That is because it revealed an intention on the part of the parties that there be no transfer of the debts from the employees to Multiplex until the demand was sent.  Ms McLure referred to the observation by Windeyer J in Norman v Federal Commissioner of Taxation (Cth) (1963) 109 CLR 9 (at 26) that: "Assignment means the immediate transfer of an existing proprietary right, vested or contingent, from the assignor to the assignee" [my emphasis].  She submitted that as cl 3, in effect, prevented such transfer from taking place, until Multiplex sent the demand contemplated thereby, no assignment of the employees' claims could occur until the demand was sent.

1. It seems to me that in these circumstances the test whether an equitable assignment has effected is whether, in signing the Release upon payment of the amounts owing to them, there was an intention on the part of the employees to impart an interest in the debts to Multiplex: Comptroller of Stamps (Vic) v Howard-Smith (1936) 54 CLR 614 (at 623 to 624). In this regard, the further remarks of Windeyer J in  Norman v Federal Commissioner of Taxation (Cth) (at 28 - 29) are enlightening:

   "But the weight of authority is, I think in favour of the view that in equity there is a valid gift of property transferable at law if the donor, intending to make, then and there, a complete disposition and transfer to the donee, does all that on his part is necessary to give effect to his intention and arms the donee with the means of completing the gift according to the requirements of the law."

   The issue is whether the employee intended, by signing the acknowledgment, release and assignment, to make then and there a "complete disposition and transfer" to Multiplex.

2. In my opinion, it is apparent from cl 3 that the employees intended that the actual disposition of the debts would only occur upon the demand being made. Therefore, although the employees have done everything necessary on their part to give effect to that intention, an equitable assignment can not take place until the demand is made.  That being the paramount intention of the parties, equity would not give effect to any different result.  I therefore uphold Ms  McLure's submissions in this respect.

3. Nevertheless, although I accept that there was no legal or equitable assignment of the debts concerned by the employees to Multiplex, I am not persuaded that Mr Trevor was wrong in the rulings that are challenged in this appeal. My conclusion in this respect is based on the view to which I have come in regard to the genuineness of the proxies in the sense explained by Lord Hanworth MR in Cousins v International Brick Company [1931] All ER Rep 229 (at 23) namely:

   "What, then is meant by a proxy?  I mean a person representative of the shareholder who may be described as his agent to carry out a course which the shareholder himself has decided upon."

4. In my opinion, for reasons which I give below, the proxies which the employees were required to sign were not intended to authorise Multiplex to carry out a course on behalf of the employees.  Of course, a proxy giver may authorise the proxy holder to carry out a course in his or her absolute discretion.  But that must be in the context of the proxy holder representing the interests of the person giving the proxy.  It is of the essence of an agency relationship that the agent act on the principal's behalf and in the principal's interests.  Where A is authorised to act in the name of B, but is entitled at all times to ignore B's interests, act entirely on his own behalf and advance his own interests, a true relationship of  agency is not created.  I think this is the effect of the decision of the Privy Council in Coachcraft Ltd v SVP Fruit Co Ltd (1980) 28 ALR 319.

5. In Coachcraft Ltd the articles of association of a company provided that the shares held or capable of being held by or by and on behalf of any one member should not exceed 10,000 in number.  The appellant attempted to avoid the effects of this article by acquiring beneficially shares in excess of 10,000.  An extraordinary general meeting of the company was held at which the Board of Directors submitted a resolution for its voluntary winding up.  The appellant cast 10,000 votes against the resolution, those being shares of which it was the legal holder.  Some 97,000 other shares were cast by one Mr Craig, a person associated with the appellant.  The validity of the proxies in favour of Mr Craig was called in question.  Lord Wilberforce, who delivered the judgment of the Board, said (at 328):

   "As to the argument that the votes attempted to be cast were proxy votes cast on behalf of the registered vendors, the answer is that this is contrary to the facts.  The documents associated with the sales by the vendors to the appellant … make it perfectly apparent that, as part of the contracts of sale, the vendors were assigning their rights to vote to Mr Craig on behalf of the appellant:  he was not to vote in their interests, or on their behalf, but was to vote as representative of the appellant qua purchasers, and in their interests.  Indeed the terms of the take‑over offer … make no secret of the fact that the shares to be acquired by the appellant under it were only left in the sellers' names, with a power of attorney, because of the prohibition contained in art 6.  The clear implication of this was that the shares were to be voted thenceforth in the appellant's interest and theirs alone.  The fact is that the so‑called proxies were not proxies at all, in the proper sense of that word (see Cousins v International Brick Company (1931) 2 Ch 90, 100 per Lord Hanworth MR) but irrevocable authorisations by the vendors to a representative of the purchasers to use the voting power of the shares sold in the interest of the purchasers."

6. In the present case, the intention of the Release was to allow Multiplex to control absolutely and to exercise the votes in respect of the employees' claims without it being an assignee in law or equity of those claims.  Hence, actual assignment depended solely on Multiplex making demand.  The only reason for postponing the assignment was to prevent an argument being raised to the effect that Multiplex was the creditor of GGO by equitable assignment, and therefore, at meetings of creditors of GGO, only one vote should be allowed in respect of the debts to the employees. The intention was to allow Multiplex to exercise the voting rights attached to each debt as if each employee was exercising that vote independently and separately so that the vote of each would count severally. 

7. By cl 4 of the Release, the employees gave Multiplex an immediate irrevocable power of attorney to exercise in its absolute discretion all of their rights, powers and entitlements in regard to their GGO claims. Further, by cl 4.2, the employee concerned ratified and confirmed "now and for the future" all actions lawfully undertaken by Multiplex under the power of attorney.  In effect, the proxy signed by each employee was a manifestation of the irrevocable power of attorney.  The need for the proxy was merely to allow Multiplex to vote in the employees' name at the second meeting of creditors (that being a requirement of the Corporation Law regulations).  In effect, the proxy was governed by cl 4.

8. The power of attorney so granted by cl 4 has to be seen against the fact that, as payment had been made to the employees, they had no further interest in the affairs of GGO and, therefore, had no interest in the way in which Multiplex would exercise the votes which it was thereby authorised to cast.  In truth, the only reason the employees had for giving the power of attorney to Multiplex, and signing the proxy in favour of Multiplex, was that this was a stipulated condition of the payment to each of the amounts owing by GGO.

9. The employees had done everything in their power, necessary to effect an assignment and had no interest in the way any votes purportedly exercised on their behalf by Multiplex were cast. There was no intention on their part to authorise Multiplex to act in their interests.  By the proxies, Multiplex was not to represent the employees at all but was merely to exercise votes in its own interest.  That in reality is the true purpose underlying the device inherent in cl 3.

10. Accordingly, in my view, the proxies were not proxies at all in the sense explained by Lord Hanworth in Cousins v International Brick Co and adopted in Coachcraft Ltd.  In my view, there are striking similarities, in principle, between this case and Coachcraft Ltd.

11. Ms McLure attempted to distinguish this case from Coachcraft Ltd on the basis that no assignment had been effected in this case whereas there had been a sale of shares in Coachcraft Ltd.  In my opinion, however, that distinction does not bear significantly on the rationale of Coachcraft Ltd.  The principle on which that case rests is that the proxies in that case were not genuine.  Whether a transfer of rights has taken place may be a relevant factor in this inquiry, but it is not conclusive. This is apparent from Wood v Laser Holdings Ltd (1996) 14 ACLC 801 where a similar situation to the present arose.

12. In Wood v Laser Holdings Ltd one Cookes purchased debts that were small in number, which in the words of Hansen J (at 817) procured: "[f]or him a number of proxies for a low outlay." His Honour proceeded (at 818):

    "As a matter of substance the 11 creditors had sold their debts and, having done so, were not in a position to give a proxy on their behalf as a present creditor.  It is unnecessary to consider whether the assignment was effective in equity or in law at the time of the meeting or when the proxy was given.  The proxy was not to be exercised in the interest, or on behalf, of the assignor of the debt but by Cookes on behalf of Sencom Pty. Ltd. or, perhaps more correctly, the Sencom Group.  In reality, these were not proxies at all but instruments given as a condition of sale to be exercised by the purchaser of the debt in his own interest.  Cf Coachcraft Ltd v SVP Fruit Company Ltd (1980) 28 ALR 319, 328 ‑ 329. The assignors could hardly have revoked the proxy and attended the meeting and voted as they wished. … In substance if not in law there were not then 11 separate creditors, but one creditor in respect of the 11 debts."

    The significance of his Honour's remark that "[i]t is unnecessary to consider whether the assignment was effective in equity or in law at the time of the meeting or when the proxy was given" is that the effectiveness of the assignment was unnecessary to the decision as to whether the proxies under examination in that case were genuine.  In the same way, the fact that there was no assignment in this case does not detract from the conclusion that the proxies were not genuine.

13. Like in Wood v Laser Holdings Ltd, the employees could not revoke the proxies.  That is because the proxies were given pursuant to the irrevocable power of attorney contained in cl 4 of the Release.  In my view, on a construction of the Release as a whole, the employees could not attend the second meeting and vote as they wished.  It was implicit in the Release that the employees had granted to Multiplex the right to vote in respect of their claims and they had given up the right to exercise their votes personally. To paraphrase Hansen J, in reality, the employees' proxies were not proxies at all but instruments given as a condition of the agreements whereby the employees were paid the amounts owing to them by GGO.

14. In the circumstances I consider that the proxies given by the employees have no legal effect. In coming to this conclusion I wish to acknowledge the assistance afforded to me by Ms McLure, who put her submissions with care and clarity and who very properly drew my attention to several authorities which were contrary to submissions she made.

15. Finally, and as an additional reason for dismissing this appeal, I regard it as significant that the particulars of debt form lodged by each employee asserted that GGO was indebted to Multiplex in respect of the employees claim and not to the employee himself or herself.  Those particulars of debt forms have never been substituted or withdrawn.  That being so, Mr Trevor was entitled to regard each particulars of debt so lodged as a claim being made by Multiplex and not a claim by the employee personally.  Further, on that basis, Mr Trevor was justified in ruling that Multiplex was to be entitled to vote for a single vote in the aggregate amount of those particulars of debt, namely $651,644.

16. In the circumstances, I would dismiss the appeal in respect of matter COR 241 of 2000.