PAYCE Consolidated Limited; In the Matter of PAYCE Consolidated Limited (No 2)
[2016] FCA 1413
•3 November 2016
FEDERAL COURT OF AUSTRALIA
PAYCE Consolidated Limited; In the Matter of PAYCE Consolidated Limited (No 2) [2016] FCA 1413
File number: NSD 1575 of 2016 Judge: FOSTER J Date of Judgment: 3 November 2016 Date of Orders: 3 November 2016 Date of Publication of Reasons: 24 November 2016 Legislation: Corporations Act 2001 (Cth), s 411 Cases cited: PAYCE Consolidated Limited; In the Matter of PAYCE Consolidated Limited (No 1) [2016] FCA 1412
Re NRMA Ltd (No 1) (2000) 156 FLR 349
Re Seven Network Ltd (No 3) (2010) 267 ALR 583
Date of hearing: 3 November 2016 Registry: New South Wales Division: General Division National Practice Area: Commercial and Corporations Sub-area: Corporations and Corporate Insolvency Category: No Catchwords Number of paragraphs: 8 Counsel for the Plaintiff: Mr RA Dick SC Solicitor for the Plaintiff: Addisons ORDERS
NSD 1575 of 2016
IN THE MATTER OF PAYCE CONSOLIDATED LIMITED (ACN 001 566 310)
PAYCE CONSOLIDATED LIMITED (ACN 001 566 310)
Plaintiff
JUDGE:
FOSTER J
DATE OF ORDER:
3 NOVEMBER 2016
THE COURT ORDERS THAT:
1.Pursuant to subs 411(4)(b) of the Corporations Act 2001 (Cth) (the Act):
(a)The scheme of arrangement between the plaintiff and the holders of its ordinary shares (other than Bellawest Pty Limited (ACN 612 757 829) and Lanox Pty Limited (ACN 077 164 884)) (Ordinary Scheme), being in the form contained in Annexure B to the Explanatory Booklet which was registered with the Australian Securities and Investments Commission on 23 September 2016 and which is Exhibit SN7 in this proceeding (Explanatory Booklet), be approved; and
(b)The scheme of arrangement between the plaintiff and the holders of its preference shares (Preference Scheme), being in the form contained in Annexure E to the Explanatory Booklet, be approved.
2.Pursuant to subs 411(12) of the Act, the plaintiff be exempted from compliance with subs 411(11) of the Act in relation to the Ordinary Scheme and the Preference Scheme.
3.These Orders be entered forthwith.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
FOSTER J:
On 23 September 2016, I made orders convening a meeting of the ordinary shareholders of the plaintiff (PCL) and a meeting of the preference shareholders of PCL for the purpose of considering two inter-conditional schemes. My reasons for making those orders are found at PAYCE Consolidated Limited; In the Matter of PAYCE Consolidated Limited (No 1) [2016] FCA 1412. Persons reading these Reasons should also read my earlier Reasons in order to understand these Reasons.
On 3 November 2016, I made orders approving the schemes. These are my reasons for making those orders.
The evidence before me at the second Court hearing established the following matters:
(a)A majority in number of ordinary shareholders present and voting at the meeting of ordinary shareholders (97.5%) voted in favour of the ordinary scheme resolution and the shareholders present and voting cast 99.79% votes in favour of that resolution;
(b)At the preference shareholders meeting, a majority in number of shareholders present and voting (100%) voted in favour of the preference scheme resolution and the shareholders present and voting cast 100% votes in favour of that resolution;
(c)The other resolutions (viz the financial assistance resolution and the capital reduction resolution) put to the meetings were validly passed;
(d)The Explanatory Statement was lodged with Australian Securities and Investments Commission (ASIC) after the first Court hearing;
(e)The Explanatory Statement was despatched to shareholders;
(f)The Explanatory Statement as lodged with ASIC and despatched to shareholders corresponded with the Explanatory Statement tendered and approved at the first Court hearing;
(g)The conduct of the scheme meetings satisfied all relevant legal requirements;
(h)Notice of the scheme meetings was published as ordered by me on 23 September 2016;
(i)No person notified PCL of an intention to appear at the second Court hearing;
(j)ASIC had no objection to either scheme. This was proved by the tender of a letter from ASIC in which it stated that it had no objection to either scheme (as to which, see exhibit BJ-10 to the affidavit of Brad Joffe sworn on 2 November 2016); and
(k)Satisfaction of the conditions precedent set forth in the Scheme Implementation Deed. These matters were proved by the tender of Certificates given by PCL, Bellawest and Lanox (as to which, see Exhibit D).
I was also satisfied that the factual information as set out in the Explanatory Statement and the Expert’s Report previously tendered remained true.
In light of the above, I was satisfied that all of the relevant conditions required by s 411 of the Act had been complied with, that those who had voted at the scheme meetings had acted in good faith and not for any illegitimate purpose and that the schemes in respect of which the votes were cast were fair and reasonable in the sense that an intelligent and honest person, who is a shareholder and acting alone in respect of his or her interest as a member, might approve them (see Re NRMA Ltd (No 1) (2000) 156 FLR 349 at 361 [41] per Santow J; Re Seven Network Ltd (No 3) (2010) 267 ALR 583 at 588–589 [31]–[44] per Jacobson J).
In light of the overwhelming support for the scheme resolutions, it was not necessary to revisit the issue which had led to the tagging of votes at the scheme meetings.
It is to be noted that Mrs Colleen Boyd did not exercise any votes in respect of the shares which she controls in relation to the ordinary scheme, the preference scheme or any of the other resolutions put to the meetings. Therefore, there was no issue with respect to voting by Mrs Boyd.
The above observations constitute my reasons for making the orders which I made on 3 November 2016.
I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Foster. Associate:
Dated: 24 November 2016
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