In the matter of Aveo Group Limited and Aveo Funds Management Limited [2019] NSWSC 1679
Hearing dates:
13 November 2019
Date of orders:
13 November 2019
Decision date:
28 November 2019
Jurisdiction:
Equity - Corporations List
Before:
Black J
Decision:
Orders made approving the Company Scheme. Judicial advice given to the effect that the Second Plaintiff is justified in implementing the Trust Scheme.
Catchwords:
CORPORATIONS – arrangements and reconstructions – schemes of arrangement or compromise – application under s 411 of the Corporations Act 2001 (Cth) for orders approving scheme of arrangement – where formal requirements satisfied – whether scheme of arrangement should be approved.
CORPORATIONS – managed investments – application for judicial advice by responsible entity under s 63 of the Trustee Act 1925 (NSW) – where procedural requirements to obtain approval of unitholders has been satisfied – whether responsible entity would be justified in implementing the proposed trust scheme – whether advice sought should be given.
Counsel: J Williams (Plaintiffs) S Nixon SC/N Bender (Interested Party)
Solicitors: Herbert Smith Freehills (Plaintiffs) Allens (Interested Party)
File Number(s):
2019/285476
Judgment
Background
By Originating Process filed on 12 September 2019, the First Plaintiff, Aveo Group Limited (“AGL”) sought orders under s 411 of the Corporations Act 2001 (Cth) convening a meeting of its members to consider a scheme of arrangement between AGL and its members and, subsequently, for approval of the scheme (“Company Scheme”). The Second Plaintiff, Aveo Funds Management Limited (“Aveo Funds RE”), which is the responsible entity of the Aveo Group Trust (“Trust”), also sought judicial advice to the effect that it was justified in convening a meeting of its unitholders to consider an amendment to the constitution of the Trust to facilitate a transfer of all units in a manner consistent with…
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 Aveo Group Ltd
Sign in free to access the full text
Details
AGLC
Re Aveo Group Ltd [2019] NSWSC 1679
Case
[2019] NSWSC 1679
Decision Date
CaseChat Overview and Summary
In the matter of Aveo Group Ltd, the central issue was the approval of a scheme of arrangement under the Corporations Act 2001 (Cth), and a request for judicial advice under the Trustee Act 1925 (NSW) concerning a proposed trust scheme. The case reached the court as an application for judicial advice and approval of the scheme, which had been lodged by the relevant parties after fulfilling the formal requirements stipulated by the respective statutes. The court was tasked with determining whether the scheme of arrangement should be approved and whether the responsible entity was justified in implementing the proposed trust scheme.
The primary legal issues addressed by the court involved the interpretation of statutory requirements and the assessment of the merits of the proposed scheme. The court examined whether the formal requirements under sections 411 and 63 of the Corporations Act and Trustee Act had been adequately met, respectively. Additionally, the court assessed the fairness and appropriateness of the proposed scheme, considering the interests of all relevant parties, including creditors, shareholders, and unitholders. The court's decision hinged on whether the scheme offered a fair and reasonable outcome for all stakeholders involved.
Upon reviewing the evidence and submissions, the court concluded that the formal requirements had indeed been satisfied. The court found that the scheme of arrangement was fair and equitable, providing an appropriate solution to the financial and operational challenges faced by Aveo Group Ltd. The court further determined that the responsible entity had acted in the best interests of the unitholders in proposing the trust scheme. Consequently, the court approved the scheme of arrangement and advised that the responsible entity was justified in implementing the proposed trust scheme. This decision provided clarity and guidance to the parties involved, facilitating the resolution of the dispute.