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Re Aveo Group Ltd and Aveo Funds Management Ltd

Re Aveo Group Ltd and Aveo Funds Management Ltd

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Case Copied 4 October 2019 33 min read

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Supreme Court

New South Wales

Medium Neutral Citation: In the matter of Aveo Group Limited and Aveo Funds Management Limited [2019] NSWSC 1348
Hearing dates: 27 September 2019
Date of orders: 27 September 2019
Decision date: 04 October 2019
Jurisdiction: Equity - Corporations List
Before: Black J
Decision:
Order made convening scheme meetings and approving the scheme booklet for distribution to shareholders. Judicial advice given that Aveo Funds RE is justified in propounding resolutions to implement the proposed Trust Scheme and proceeding on the basis that constitutional amendments to implement the Trust Scheme is within the constitutional powers of alteration conferred and s 601GC of the Corporations Act 2001 (Cth).

Catchwords:
CORPORATIONS – arrangements and reconstructions – schemes of arrangement or compromise – application under s 411 of the Corporations Act 2001 (Cth) for orders convening meetings of members to consider and, if thought fit, to agree to proposed scheme of arrangement – whether requirements to order scheme meetings are satisfied.
CORPORATIONS – managed investments – application for judicial advice by responsible entity under s 63 of the Trustee Act 1925 (NSW) – whether responsible entity would be justified in propounding resolutions to implement the proposed trust scheme – whether proposed amendments are within the constitutional powers of alteration and s 601GC of the Corporations Act.
Legislation Cited: - Corporations Act 2001 (Cth) Ch 5C; Pt 5.1; ss 411, 411(1), 411(17), 411(17)(b), 601GC, 611
- Corporations Regulations 2001 (Cth) Sch 8, reg 8301(a)
- Supreme Court (Corporations) Rules 1999 (NSW) r 2.15
- Trustee Act 1925 (NSW) s 63
Cases Cited: - Australian Securities Commission v Marlborough Gold Mines Ltd (1993) 177 CLR 485
- F T Eastment & Sons Pty Ltd v Metal Roof Decking Supplies Pty Ltd (1977) 3 ACLR 69
- Re Abacus Funds Management Ltd [2005] NSWSC 1309; (2006) 24 ACLC 211
- Re APN News & Media Ltd [2007] FCA 770; (2007) 62 ACSR 400
- Re Ardent Leisure Ltd [2018] NSWSC 1665
- Re Arthur Yates & Co Ltd [2001] NSWSC 40; (2001) 36 ACSR 758
- Re Atlas Iron Ltd [2015] FCA 366; (2016) 112 ACSR 554
- Re Bigair Group Ltd [2016] FCA 1296
- Re BIS Finance Pty Ltd [2017] NSWSC 1713
- Re Bolnisi Gold NL (No 2) (2007) 65 ACSR 510
- Re Capilano Honey Ltd [2018] FCA 1568
- Re Centrebet International Ltd [2011] FCA 870
- Re CSR Ltd (2010) 183 FCR 358
- Re DUET Finance Ltd [2017] NSWSC 415
- Re DUET Management Company 1 Ltd [2013] NSWSC 817; (2013) 95 ACSR 34
- Re eircom Holdings Ltd [2009] FCA 1418
- Re Foster’s Group Ltd (No 2) [2011] VSC 547
- Re Foundation Healthcare Ltd [2002] FCA 742; (2002) 42 ACSR 252
- Re Gazal Corporation Ltd [2019] FCA 701
- Re GBST Holdings Ltd [2019] NSWSC 1280
- Re Hills Motorway Ltd (2002) 43 ACSR 101
- Re Kidman Resources Ltd [2019] FCA 1226
- Re Macquarie…

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.

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Details

Case: [2019] NSWSC 1348
Decision Date: 04 October 2019

CaseChat Overview and Summary

In this case, Aveo Group Ltd and Aveo Funds Management Ltd applied to the court for orders to convene meetings of their members to consider a proposed scheme of arrangement. The application was made under section 411 of the Corporations Act 2001 (Cth). The court needed to decide if the statutory requirements to order these meetings were met. The court was also asked to provide judicial advice to Aveo Funds Management Ltd, the responsible entity, under section 63 of the Trustee Act 1925 (NSW) on whether it would be justified in proposing resolutions to implement the proposed trust scheme. Additionally, the court had to determine if the proposed amendments were within the constitutional powers of alteration and section 601GC of the Corporations Act.

The court examined the application and considered whether the statutory requirements for convening the meetings were met. The court also reviewed the proposed trust scheme and assessed whether the responsible entity would be justified in proposing the resolutions. Furthermore, the court evaluated if the proposed amendments were within the constitutional powers of alteration and section 601GC of the Corporations Act. After considering all the evidence and arguments presented, the court concluded that the statutory requirements were satisfied, and the responsible entity would be justified in proposing the resolutions. The court found that the proposed amendments were within the constitutional powers of alteration and section 601GC of the Corporations Act.

The court granted the orders convening meetings of the members of Aveo Group Ltd and Aveo Funds Management Ltd to consider the proposed scheme of arrangement. The court also provided the requested judicial advice to the responsible entity, confirming that it would be justified in propounding the resolutions to implement the proposed trust scheme. The court held that the proposed amendments were within the constitutional powers of alteration and section 601GC of the Corporations Act. These findings and conclusions formed the basis of the final orders made by the court.

Orders