JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: RE BARDOC GOLD LTD; EX PARTE BARDOC GOLD LTD [2022] WASC 94
CORAM: STRK J
HEARD: 22 FEBRUARY 2022
DELIVERED : 22 FEBRUARY 2022
PUBLISHED : 17 MARCH 2022
FILE NO/S: COR 22 of 2022
MATTER: IN THE MATTER OF BARDOC GOLD LTD
EX PARTE
BARDOC GOLD LTD
Plaintiff
ST BARBARA LTD
Interested Party
Catchwords:
Corporations law - Scheme of arrangement - Proposed share acquisition - Application for orders convening a scheme meeting under Corporations Act 2001 (Cth) s 411(1) - Whether requirements to order scheme meeting are satisfied - Orders made convening scheme meeting - Distribution of scheme booklet containing the explanatory statement required by the Corporations Act 2001 (Cth) s 412(1)(a) approved - Ancillary orders
Legislation:
Corporations Act 2001 (Cth), s 411(1), s 412(1)(a), s 1319
Corporations Regulations 2001 (Cth), sch 8
Supreme Court (Corporations) (WA) Rules 2004 (WA), r 3.2
Result:
Application granted
Orders made convening scheme meeting
Category: B
Representation:
Counsel:
| Plaintiff | : | J M Healy |
| Interested Party | : | J Y Wang |
Solicitors:
| Plaintiff | : | Steinepreis Paganin |
| Interested Party | : | King & Wood Mallesons |
Cases referred to in decision:
Anatolia Energy Ltd, in the matter of Anatolia Energy Ltd [2015] FCA 1134
APN News & Media Ltd, in the matter of APN News & Media Ltd [2007] FCA 770; (2007) 62 ACSR 400
Australian Securities Commission v Marlborough Gold Mines Ltd [1993] HCA 15; (1993) 177 CLR 485
Creso Pharma Ltd [2019] WASC 472
Excelsior Gold Ltd; Re Excelsior Gold Ltd [2018] FCA 2064
Firefly Resources Ltd [2021] WASC 376
First Pacific Advisors LLC v Boart Longyear Ltd [2017] NSWCA 116; (2017) 320 FLR 78
Integra Mining Ltd, in the matter of Integra Mining Ltd [2012] FCA 1414
Piedmont Lithium Ltd [2021] WASC 76
Re Advance Bank Australia Ltd (1997) 136 FLR 281
Re Alinta Ltd [2007] FCA 1416
Re Doray Minerals Ltd; Ex parte Doray Minerals Ltd [2019] WASC 57
Re Envestra Ltd [2014] FCA 395
Re Galaxy Resources Ltd; Ex parte Galaxy Resources Ltd [2021] WASC 277
Re Gazal Corporation Ltd [2019] FCA 701
Re Kangaroo Resources Ltd; Ex parte Kangaroo Resources Ltd [2018] WASC 327
Re Kangaroo Resources Ltd; Ex parte Kangaroo Resources Ltd [No 2] [2018] WASC 388
Re Kidman Resources Ltd [2019] FCA 1226
Re Macquarie Private Capital A Ltd [2008] NSWSC 323
Re Mosaic Oil NL [2010] FCA 985
Re Navitas Ltd; Ex parte Navitas Ltd [2019] WASC 180
Re NRMA Insurance Ltd (No 1) [2000] NSWSC 82; (2000) 156 FLR 349
Re NTM Gold Ltd; Ex parte NTM Gold Ltd [2021] WASC 22
Re Nzuri Copper Ltd [2019] WASC 189
Re Peak Coal Ltd [2010] FCA 6
Re Ruralco Holdings Ltd [2019] FCA 878
Re SRG Ltd [2018] FCA 1092
Re Tower Australia Group Ltd [2011] FCA 224
Re Wesfarmers Ltd; Ex parte Wesfarmers Ltd [No 2] [2018] WASC 357
Re Zenith Energy Ltd; Ex parte Zenith Energy Ltd [2020] WASC 266
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- AGLC
- Re Bardoc Gold Ltd [2022] WASC 94
- Case
- [2022] WASC 94
- Decision Date
CaseChat Overview and Summary
The Court reviewed the scheme booklet and the submissions made by counsel for both parties. It found that the directors' recommendations were within acceptable bounds, as they had unanimously recommended the scheme to shareholders in the absence of a superior proposal. The Court noted that the scheme booklet contained a section titled 'Important Information Regarding Director's Recommendations', which disclosed the interests of each director in clear terms. The booklet specified the number of St Barbara shares each director would receive and the corresponding monetary value, calculated based on a set price of St Barbara shares. This disclosure was deemed sufficient to meet the requirements of the Corporations Act 2001 (Cth) and to ensure that shareholders were adequately informed of the directors' potential benefits.
Based on the comprehensive disclosure and the absence of a superior proposal, the Court concluded that the requirements for convening the scheme meeting were satisfied. It issued orders convening the scheme meeting and approved the distribution of the scheme booklet containing the explanatory statement as required by section 412(1)(a) of the Corporations Act 2001 (Cth). The Court also made ancillary orders to facilitate the scheme meeting and ensure that all statutory requirements were met. These orders aimed to protect the interests of the shareholders and ensure that the scheme was conducted in a fair and transparent manner.
Orders
Orders of the court
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Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
Counsel for Bardoc submitted that the directors' recommendation was 'within bounds', observing that recent court decisions have considered the appropriateness of directors joining in a recommendation to shareholders to vote in favour of a scheme where, by reason of a bonus or similar benefit, the directors have an additional and different interest to the members in the approval of the scheme.[73] It was submitted that the critical consideration for the court is to ensure that the nature and extent of the relevant benefits that the directors stand to receive if the scheme is approved are properly disclosed.[74][73] Bardoc's submissions par 110, citing Re Gazal Corporation Ltd [2019] FCA 701; and Re Ruralco Holdings Ltd [2019] FCA 878.[74] Bardoc's submissions par 111, citing Re Kidman Resources Ltd [2019] FCA 1226 [115]; and Re Nzuri Copper Ltd [2019] WASC 189. Counsel for Bardoc noted that in this case, Bardoc's directors have unanimously recommended that Bardoc shareholders vote in favour of the scheme, in the absence of a superior proposal and subject to the independent expert continuing to conclude that the scheme is in the best interests of Bardoc shareholders. Further, full disclosure of the Bardoc directors' respective interests in Bardoc and the scheme is made at the section titled 'Important Information Regarding Director's Recommendations' in the scheme booklet.[75][75] Bardoc's submissions pars 112 and 113. See also ts 5 ‑ 7 (22 February 2022). I noted that the benefit to be received for each director is set out with clarity and prominently in the scheme booklet. Pages 3 and 4 of the scheme booklet sets out 'important information regarding director's recommendations'. In clear terms, Bardoc shareholders are informed that:[76](a)Mr Tony Leibowitz has an interest in Bardoc shares and Bardoc performance rights and will receive aggregate scheme consideration of 2,180,245 St Barbara shares, equating to approximately $3,139,553 if the scheme is implemented. He will also receive an additional $50,000 from Bardoc for services in relation to Bardoc's previous strategic review;(b)Mr Neil Biddle has an interest in Bardoc shares and Bardoc performance rights and will receive aggregate scheme consideration of 2,420,853 St Barbara shares, equating to approximately $3,486,028 if the scheme is implemented;(c)Mr Rowan Johnston has an interest in Bardoc shares and Bardoc performance rights and will receive aggregate scheme consideration of 553,032 St Barbara shares, equating to approximately $796,366 if the scheme is implemented;(d)Mr John Young has an interest in Bardoc shares and Bardoc performance rights and will receive aggregate scheme consideration of 2,522,800 St Barbara shares, equating to approximately $3,632,832 if the scheme is implemented; and(e)Mr Peter Buttigieg has an interest in Bardoc shares and Bardoc performance rights and will receive aggregate scheme consideration of 4,837,695 St Barbara shares, equating to approximately $6,966,281 if the scheme is implemented.[76] Scheme booklet pages 3 - 4, annexed to the second Ferguson affidavit, JIF-12, pages 365 - 366. As noted in the scheme booklet, the value is calculated based on a closing price of St Barbara shares of $0.44 as at the Last Practicable Date.