In the matter of DUET Finance Limited; In the matter of DUET Company Limited; In the matter of DUET Investment Holdings Limited; In the matter of DUET Finance Limited as responsible entity of DUET Finance Trust [2017] NSWSC 415
Hearing dates:
8 March 2017
Decision date:
08 March 2017
Jurisdiction:
Equity - Corporations List
Before:
Black J
Decision:
The Court orders pursuant to s 411 of the Corporations Act 2001 (Cth) that the First to Third Plaintiffs convene meetings of shareholders for the purpose of considering and, if thought fit, agreeing to proposed schemes of arrangement and makes ancillary orders. The Court gives judicial advice that the Fourth Plaintiff, as responsible entity for a managed investment scheme, would be justified in propounding resolutions to unitholders to implement a corresponding scheme and proceeding on the basis that the amendments to be made to the constitution of the managed investment scheme to implement the corresponding scheme would be within the powers of alteration conferred by that document and s 601GC of the Corporations Act 2001 (Cth).
Catchwords:
CORPORATIONS – Arrangements and reconstructions – Schemes of arrangement or compromise – Applications 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 schemes of arrangement – where schemes of arrangement involve the Plaintiffs’ shareholders transferring their shares to another company for cash consideration – 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 convening a meeting of unitholders to approve amendments to the trust constitution to give effect to a proposed scheme – whether proposed amendments are within the powers of alteration conferred by the constitution of the managed investment scheme and s 601GC of the Corporations Act 2001 (Cth).
[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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AGLC
Re DUET Finance Ltd [2017] NSWSC 415
Case
[2017] NSWSC 415
Decision Date
CaseChat Overview and Summary
The matter before the court involved DUET Finance Ltd and its shareholders, as well as the Trustee Act 1925 (NSW) and the Corporations Act 2001 (Cth). The primary issue was whether the court should order meetings of DUET Finance Ltd's shareholders to consider a proposed scheme of arrangement. The proposed scheme involved the transfer of shareholders' shares to another company for cash consideration. The plaintiffs sought orders convening meetings to consider the scheme.
The court had to decide if the requirements under section 411 of the Corporations Act 2001 (Cth) were met for the court to order the meetings. The court also had to consider whether the responsible entity would be justified in convening a meeting of unitholders to approve amendments to the trust constitution, as per section 63 of the Trustee Act 1925 (NSW). The court examined whether the proposed amendments fell within the powers of alteration conferred by the managed investment scheme's constitution and section 601GC of the Corporations Act 2001 (Cth).
The court found that the requirements under section 411 of the Corporations Act 2001 (Cth) were satisfied, and granted the orders convening meetings of DUET Finance Ltd's shareholders to consider the proposed scheme. The court also found that the responsible entity would be justified in convening a meeting of unitholders to approve the amendments to the trust constitution, as the proposed amendments fell within the powers of alteration conferred by the constitution and section 601GC of the Corporations Act 2001 (Cth). The court concluded that the proposed scheme and amendments were in accordance with the relevant legislation and the interests of DUET Finance Ltd's shareholders and unitholders.