RE CROWN DIAMONDS NL [2005] WASC 93

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2005] WASC 93
Case No:	COR:82/2005	Heard:	18-20 APRIL 2005
Coram:	COMMISSIONER MCKERRACHER QC	Delivered:	20/04/05
No of pages:	13	Judgment Part:	1 of 1
Result:	Approval granted to convene meetings and for Explanatory Statement to accompany the Notice of Meetings
Category:	B
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Parties:	CROWN DIAMONDS NL (ABN 16 050 541 332)
Catchwords:	Schemes of Arrangement Merger Meetings of shareholders and convertible note holders Different classes Approval of Explanatory Statement
Legislation:	Corporations Act 2001 (Cth), s 411, s 412, s 636, s 683 Corporations Regulations 2001 (Cth), reg 5.1.01(b)
Case References:	F T Eastment and Sons Pty Ltd v Metal Roof Decking Supplies Pty Ltd (1977) 3 ACLR 69 Re ACM Gold Ltd and Re Mount Leyshon Mines Ltd (1992) 34 FCR 530 Re Bank of Adelaide (1979) 22 SASR 481 Re Bond Corporation Holdings Ltd (1991) 5 WAR 143 Re Chevron (Sydney) Ltd [1963] VR 249 Re Crusader Ltd [1996] Qd R 117 Re Foundation Healthcare Ltd (2002) 42 ACSR 252 Re International Goldfields Ltd [2003] WASC 86 Re International Harvester Ltd (Receiver and Manager Appointed) [1953] VR 669 Re NRMA & Anor (No 1) (2000) 156 FLR 349 Re Stockbridge (1993) 9 ACSR 637 Sovereign Life Assurance Co v Dodd [1892] 2 QB 573 Nil

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION : RE CROWN DIAMONDS NL [2005] WASC 93 CORAM : COMMISSIONER MCKERRACHER QC HEARD : 18-20 APRIL 2005 DELIVERED : 20 APRIL 2005 FILE NO/S : COR 82 of 2005 MATTER : CROWN DIAMONDS NL (ABN 16 050 541 332) EX PARTE

CROWN DIAMONDS NL (ABN 16 050 541 332)

Plaintiff

Catchwords:

Schemes of Arrangement - Merger - Meetings of shareholders and convertible note holders - Different classes - Approval of Explanatory Statement

Legislation:

Corporations Act 2001 (Cth), s 411, s 412, s 636, s 683

Corporations Regulations 2001 (Cth), reg 5.1.01(b)

Result:

Approval granted to convene meetings and for Explanatory Statement to accompany the Notice of Meetings

(Page 2)

Category: B

Representation:

Counsel:

Plaintiff : Mr M J Feutrill & Mr T A Hicks

Amicus Curiae

: Mr S Pillera (18 April 2005)

Solicitors:

Plaintiff : Steinepreis Paganin

Amicus Curiae

: Australian Securities & Investments Commission

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

F T Eastment and Sons Pty Ltd v Metal Roof Decking Supplies Pty Ltd (1977) 3 ACLR 69
Re ACM Gold Ltd and Re Mount Leyshon Mines Ltd (1992) 34 FCR 530
Re Bank of Adelaide (1979) 22 SASR 481
Re Bond Corporation Holdings Ltd (1991) 5 WAR 143
Re Chevron (Sydney) Ltd [1963] VR 249
Re Crusader Ltd [1996] Qd R 117
Re Foundation Healthcare Ltd (2002) 42 ACSR 252
Re International Goldfields Ltd [2003] WASC 86
Re International Harvester Ltd (Receiver and Manager Appointed) [1953] VR 669
Re NRMA & Anor (No 1) (2000) 156 FLR 349
Re Stockbridge (1993) 9 ACSR 637
Sovereign Life Assurance Co v Dodd [1892] 2 QB…

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 Crown Diamonds Nl

Details

AGLC: Re Crown Diamonds Nl [2005] WASC 93
Case: [2005] WASC 93
Decision Date

CaseChat Overview and Summary

Crown Diamonds NL (Crown) sought approval from the Supreme Court of Western Australia to convene meetings of its shareholders and convertible note holders to consider a proposed merger with Petra Diamonds Ltd (Petra). The merger involved the transfer of Crown's assets and liabilities to Petra, with Crown shareholders receiving Petra shares in exchange and Crown's convertible note obligations being assumed by Petra. The application, brought under s 411 of the Corporations Act 2001 (Cth), sought orders for convening the meetings, approving the explanatory statement, and providing directions on the conduct of the meetings and distribution of notices. The Australian Securities and Investments Commission (ASIC) appeared and did not object to the schemes in principle.

The court examined whether the explanatory statement provided proper disclosure, as required by s 412(1)(a) of the Corporations Act. It found that the statement contained sufficient information for shareholders and note holders to make an informed decision, including summaries of Crown and Petra's businesses, financial information, risk factors, tax implications, and an independent expert's report. The court also considered whether the schemes were properly proposed, concluding that there was no evidence suggesting the schemes were designed to avoid the provisions of ch 6 of the Corporations Act. The purpose of the schemes was deemed to be a commercially desirable merger, approved by the directors of both companies.

The court exercised its discretion to grant the orders sought, finding no reason to prevent the meetings from convening. The explanatory statement was approved, and directions were given for the convening of the meetings, distribution of notices, and advertising of the meetings. The court made orders in line with the amended minute, allowing the meetings to proceed as proposed.

Orders