Re Investa Listed Funds Management Ltd - [2016] NSWSC 369

Supreme Court

New South Wales

Medium Neutral Citation: Investa Listed Funds Management Limited (as responsible entity of Armstrong Jones Office Fund & Anor) [2016] NSWSC 369
Hearing dates: 31 March 2016
Decision date: 31 March 2016
Jurisdiction: Equity - Corporations List
Before: Black J
Decision:
Leave granted for third party to be heard as intervenor in judicial advice application under s 63 of the Trustee Act 1925 (NSW). Judicial advice sought by Applicant given.

Catchwords: CORPORATIONS — Managed investments – Judicial advice sought under s 63 of the Trustee Act 1925 (NSW) by responsible entity – where third party sought leave to be heard as intervenor – where responsible entity sought judicial advice that it would be justified adjourning extraordinary general meetings of security holders to allow time for consideration of resolutions – where responsible entity sought judicial advice that it would be justified publishing and distributing supplementary explanatory memorandum to registered unit holders – whether leave to be heard should be granted to intervenor – whether advice sought should be given.
Legislation Cited: - Corporations Act 2001 (Cth), ss 447D, 479
- Trustee Act 1925 (NSW), s 63
Cases Cited: - Fortress Credit Corporation (Australia) II Pty Ltd v Fletcher (as liquidators of Octaviar Administration Pty Ltd (in liq) [2015] NSWCA 85; (2015) 105 ACSR 581
- Macedonian Orthodox Community Church St Petka Incorporated v His Eminence Petar The Diocesan Bishop of The Macedonian Orthodox Diocese of Australia and New Zealand [2008] HCA 42; (2008) 237 CLR 66
- Re Centro Retail Ltd (in its capacity as responsible entity of Centro Retail Trust) [2011] NSWSC 1321
- Re Investa Listed Funds Management Ltd (as responsible entity of Armstrong Jones Office Fund) [2016] NSWSC 344
- Strawbridge v Retail Adventures Pty Ltd (admin apptd) [2013] FCA 891; (2013) 95 ACSR 121
Category: Procedural and other rulings
Parties: Investa Listed Funds Management Limited (as responsible entity of Armstrong Jones Office Fund) (First Plaintiff)
Investa Listed Funds Management Limited (Second Plaintiff)
Representation:
Counsel:
D F C Thomas (Plaintiffs)
N C Hutley SC (Intervenor)
Solicitors:
Freehills (Plaintiffs)
Clayton Utz (Intervenor)

File Number(s): 2016/68063

Judgment – ex tempore (revised 4 april 2016)

Application for leave for third party to be heard

An application is brought by Investa Listed Funds Management Ltd (in its capacity as responsible entity of the Armstrong Jones Office Fund and of the Prime Credit Property Trust) (“Investa Listed Funds”), the proponent of a trust scheme, for judicial advice under s 63 of the Trustee Act 1925 (NSW) in relation to a communication with unit holders. That application is brought because Investa Listed Funds seeks to send a supplementary explanatory memorandum to unitholders and the Court has long made clear its expectation that, in the course of a scheme or a trust proposal that is analogous to a scheme, an entity should not dispatch additional explanatory material to investors without first obtaining court approval: Re Centro Retail Ltd(in its capacity as responsible entity of Centro Retail Trust)

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: [2016] NSWSC 369
Decision Date: 31 March 2016

CaseChat Overview and Summary

The case before the court involved Investa Listed Funds Management Ltd, a responsible entity managing several listed investment funds, and a third party who sought to intervene in the proceedings. The third party, who was not a direct party to the case but had a significant interest in the outcome, requested leave to be heard as an intervenor. The dispute centred on the responsible entity's request for judicial advice under section 63 of the Trustee Act 1925 (NSW). The responsible entity sought advice on two matters: whether it would be justified to adjourn extraordinary general meetings of security holders to allow time for consideration of resolutions, and whether it would be justified to publish and distribute a supplementary explanatory memorandum to registered unit holders.

The court was tasked with determining whether the third party should be granted leave to intervene in the proceedings and whether the requested judicial advice should be provided. The legal issues included the criteria for granting leave to intervene, the scope of judicial advice under section 63 of the Trustee Act, and the implications of the proposed actions on the rights and interests of the unit holders and other stakeholders.

The court considered the criteria for granting leave to intervene, which included whether the third party had a sufficient interest in the proceedings and whether their participation would assist in the fair and efficient resolution of the issues. The court also examined the scope of judicial advice under section 63 of the Trustee Act, which allows for advice on matters relating to the administration of the trust, including the consideration of resolutions and the distribution of information to unit holders. The court concluded that the third party had a sufficient interest in the proceedings and that their participation would indeed assist in the fair and efficient resolution of the issues. Regarding the judicial advice, the court found that the responsible entity had adequately demonstrated that the proposed actions were in the best interests of the unit holders and were justified under the Trustee Act.

The court granted the third party leave to be heard as an intervenor and provided the requested judicial advice to the responsible entity. This decision allowed the third party to participate in the proceedings and ensured that the responsible entity could proceed with the proposed actions, subject to the conditions set out in the court's decision.

Orders