Re Avenira Limited - [2023] WASC 440

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   RE AVENIRA LIMITED; EX PARTE AVENIRA LIMITED [2023] WASC 440
CORAM:   LUNDBERG J
HEARD:   16 NOVEMBER 2023
DELIVERED          :   16 NOVEMBER 2023
FILE NO/S:   COR 172 of 2023
MATTER:   IN THE MATTER OF AVENIRA LIMITED

EX PARTE
AVENIRA LIMITED
Plaintiff

Catchwords:

Corporations Law - Securities - Multiple failures to lodge a cleansing notice in accordance with s 708A(5) of the Corporations Act 2001 (Cth) - Disclosure obligations overlooked by the plaintiff - Cleansing prospectus now issued under s 708A(11)(b) - Application for orders extending time under s 1322(4) - Application for declaratory relief to validate trading in securities issued without a cleansing notice - Turns on own facts

Legislation:

Corporations Act 2001 (Cth), s 707, s 708A and s 1322

Result:

Application granted

Category: B

Representation:

Counsel:

Plaintiff

Mr J Birch

Solicitors:

Plaintiff

Thomson Geer - Perth

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

Diona Pty Ltd, in the matter of Diona Pty Ltd [2022] FCA 1215
In the matter of Weebit Nano Limited [2023] NSWSC 43
Re Astral Resources NL; Ex parte Astral Resources NL [2023] WASC 260
Re Azure Minerals Limited [2013] FCA 63
Re European Lithium Limited [2017] FCA 894
Re Golden Gate Petroleum Ltd [2010] FCA 40
Re Great Boulder Resources Ltd; Ex parte Great Boulder Resources Ltd [2023] WASC 258
Re ICandy Interactive Limited [2018] FCA 533
Re Jaxsta Ltd [2018] WASC 390
Re Metalicity Ltd [2020] WASC 387
Re Yandal Resources Ltd [2022] WASC 338
Sprint Energy Limited; in the matter of Sprint Energy Limited [2012] FCA 1354

Table of Contents

A. Introduction and summary

B. The Application

Material before the court

Factual background

Notice to ASIC and the ASX

C. Legislative framework and relevant principles

Sections 707 and 708A

Section 1322

Relevant principles

D. Disposition

Standing

Order 1 (extension of time)

Order 2 (deeming order)

Order 3 (offers of shares not invalid)

Residual discretion

E. Orders

ATTACHMENT A TABLE OF SHARES ISSUED BY THE PLAINTIFF

ATTACHMENT B PLAINTIFF'S PROPOSED WRITTEN CHECKLIST

LUNDBERG J:

(These reasons were delivered ex temporaneously on 16 November 2023 and have been edited to correct matters of grammar, to add headings and to include complete footnotes and references.)

A. Introduction and summary

These reasons relate to an urgent application filed by the plaintiff company on 14 November 2023 (Application), which was heard this afternoon. The Application seeks orders under s 1322(4) of the Corporations Act 2001 (Cth)[1] extending the period of time prescribed by s 708A(11)(b) for the giving of a cleansing prospectus and for related validating orders in respect of several issuances of fully paid ordinary shares in the plaintiff.
[1] Unless otherwise indicated, all references to statutory provisions are to provisions of the Corporations Act 2001 (Cth).
The plaintiff does not seek orders relieving the directors, other officers, or the plaintiff itself from liability arising from the plaintiff's failure to have issued the relevant notices under s 708A(5).

B. The Application

Material before the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Re Avenira Limited

Details

AGLC: Re Avenira Limited [2023] WASC 440
Case: [2023] WASC 440
Decision Date: 16 NOVEMBER 2023

CaseChat Overview and Summary

The case of Re Avenira Limited involved the plaintiff, Avenira, and the Australian Securities and Investments Commission (ASIC) before the Federal Court of Australia. The dispute centred around the plaintiff's failure to lodge a cleansing notice as required by section 708A(5) of the Corporations Act 2001. This failure led to the issuance of a cleansing prospectus under section 708A(11)(b). Avenira subsequently sought orders extending the time for compliance with its disclosure obligations, as well as declaratory relief to validate trading in securities issued without a cleansing notice.

The legal issues before the court were whether the court should grant an extension of time for Avenira to comply with its disclosure obligations, and whether the securities issued without a cleansing notice could be validated. The court had to consider whether Avenira's failures were significant enough to warrant the issuance of a cleansing prospectus and whether the plaintiff's actions constituted a breach of its statutory obligations.

In determining the application, the court found that Avenira's failures to lodge a cleansing notice were significant and warranted the issuance of a cleansing prospectus. The court also held that the plaintiff's actions constituted a breach of its statutory obligations. However, the court was satisfied that Avenira had taken steps to rectify its failures and had issued a cleansing prospectus. The court found that the plaintiff's application for an extension of time was in the interests of justice and granted the application. The court also found that the securities issued without a cleansing notice could be validated as the plaintiff had taken steps to rectify its failures.

The court ordered that Avenira be granted an extension of time to comply with its disclosure obligations. The court also declared that trading in the securities issued without a cleansing notice was valid. The court's decision was based on the facts of the case and the court found that the application for an extension of time and declaratory relief was in the interests of justice.

Orders