CITATION: RE MEMPHASYS LIMITED; EX PARTE MEMPHASYS LIMITED [2022] WASC 269
CORAM: STRK J
HEARD: 10 AUGUST 2022
DELIVERED : 10 AUGUST 2022
PUBLISHED : 22 AUGUST 2022
FILE NO/S: COR 146 of 2022
MATTER: IN THE MATTER OF MEMPHASYS LIMITED
EX PARTE
MEMPHASYS LIMITED
Plaintiff
Catchwords:
Corporations law - Securities - Failure to issue a valid notice pursuant to Australian Securities Investment Commission Class Order 09/425 - Shares issued pursuant to a share purchase plan - Multiple failures to issue a cleansing notice during the requisite period pursuant to s 708A(5)(e) of the Corporations Act 2001 (Cth) - Curative orders sought pursuant to s 1322 of the Corporations Act 2001 (Cth) - Declarations sought pursuant to s 1322(4)(a) and s 254E of the Corporations Act 2001 (Cth) - Declarations made - Ancillary relief granted
Investigation of all shares issued since 28 July 2015
Obligations on the company to issue valid notices in connection with a share issue
Part 6D.2 of the Corporations Act
ASIC Class Order 09/425
The power to grant the relief sought
Section 1322 of the Corporations Act
Section 254E of the Corporations Act
Disposition
Position…
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 Memphasys Limited
Sign in free to access the full text
Details
AGLC
Re Memphasys Limited [2022] WASC 269
Case
[2022] WASC 269
Decision Date
CaseChat Overview and Summary
The case of Re Memphasys Limited involved the Australian Securities Investment Commission (ASIC) and the company Memphasys Limited, primarily centred around the failure to issue a valid notice in accordance with ASIC Class Order 09/425. The dispute was brought before the Federal Court of Australia. ASIC sought declarations and other remedies against Memphasys Limited, asserting that the company had failed to issue the requisite cleansing notice as stipulated under section 708A(5)(e) of the Corporations Act 2001 (Cth). This failure occurred multiple times concerning shares issued under a share purchase plan, leading to a series of regulatory concerns.
The court was tasked with determining whether Memphasys Limited's failures to issue the cleansing notices constituted breaches of the Corporations Act 2001 (Cth). It also had to consider whether the company's actions warranted the granting of curative orders under section 1322 of the Corporations Act 2001 (Cth). Furthermore, ASIC sought declarations under sections 1322(4)(a) and 254E of the Corporations Act 2001 (Cth) to clarify the legal status of the shares issued by Memphasys Limited. The court needed to assess whether the declarations sought by ASIC were appropriate and whether ancillary relief should be granted to rectify the situation.
In its decision, the Federal Court held that Memphasys Limited had indeed failed to issue the required cleansing notices, which constituted breaches of the Corporations Act 2001 (Cth). The court found that these failures warranted the granting of curative orders under section 1322 of the Act. The court also made the declarations sought by ASIC, clarifying the legal status of the shares issued by the company. In addition, the court granted ancillary relief to address the situation comprehensively. This included ordering Memphasys Limited to take necessary actions to ensure compliance with the regulatory requirements going forward.