Re NuSep Ltd - [2007] FCA 613

FEDERAL COURT OF AUSTRALIA

In the matter of NuSep Ltd [2007] FCA 613

CORPORATIONS – prospectus for a rights issue of shares and attached options to take up further shares – prospectus foreshadows that company will apply to Australian Stock Exchange (“ASX”) for official quotation of the shares and of the options – failure to apply for admission of securities to quotation within seven days after date of prospectus – also securities not listed within three months after date of prospectus – s 723(3) of Corporations Act 2001 (Cth) (“the Act”) producing results that issue of securities void and that company liable to refund to the applicants for the securities all money received from them for the securities – application by company for remedial orders under s 1322(4)(d) of the Act extending the seven-day and three-month periods – letters sent to all applicants and underwriters advising them of application to Court – no objection – no objection by Australian Securities and Investments Commission or ASX. Held: (1) Court has power under s 1322(4)(d) to extend both periods; (2) Court exercises discretion to make orders; (3) making of orders does not affect any right of action for breach by company of contractual undertaking in prospectus to apply to ASX for official quotation within stipulated period.

Corporations Act 2001 (Cth) ss 723, 1322

Re Cabcharge Australia Ltd [2007] FCA 421 discussed
Re Insurance Australia Group Ltd (2003) 128 FCR 581 followed

IN THE MATTER OF NUSEP LTD (ACN 120 047 556)

NSD 672 OF 2007

LINDGREN J
18 APRIL 2007
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

NSD 672 OF 2007

IN THE MATTER OF NUSEP LTD

BETWEEN:

NUSEP LTD (ACN 120 047 556)
Plaintiff

JUDGE:

LINDGREN J

DATE OF ORDER:

18 APRIL 2007

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

Pursuant to s 1322 of the Corporations Act 2001 (Cth) (“the Act”), for the purposes of s 723(3)(a) of the Act, the time for the making of an application for the admission to quotation by Australian Securities Exchange Limited of shares issued pursuant to the prospectus dated 14 December 2006 (“the shares”) be extended to 2 March 2007.
Pursuant to s 1322 of the Act, for the purposes of s 723(3)(b) of the Act, the time for the shares to be admitted to quotation by Australian Securities Exchange Limited be extended to Wednesday 16 May 2007.
The plaintiff have liberty to apply for a variation of order 2 and generally on three hours’ notice.
These orders be entered expeditiously.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

NSD 672 OF 2007

IN THE MATTER OF NUSEP LTD

BETWEEN:

NUSEP LTD (ACN 120 047 556)
Plaintiff

JUDGE:

LINDGREN J

DATE:

30 APRIL 2007

PLACE:

SYDNEY

REASONS FOR JUDGMENT

INTRODUCTION

The plaintiff, NuSep Ltd (“NuSep”), has applied to have shares and options quoted on the Australian Stock…

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 NuSep Ltd

Details

AGLC: Re NuSep Ltd [2007] FCA 613
Case: [2007] FCA 613
Decision Date: 18 April 2007 (Decision); 30 April 2007 (Publication of Reasons )

CaseChat Overview and Summary

Re NuSep Ltd is a case involving the extension of time limits for the admission of shares to quotation by the Australian Securities Exchange Limited (ASX) under the Corporations Act 2001. The plaintiff, who was presumably a party with an interest in the admission of the shares, sought an extension of time for the application and subsequent quotation of shares issued pursuant to a prospectus dated 14 December 2006. The case was heard and determined by a court exercising its powers under section 1322 of the Corporations Act.

The primary legal issue before the court was whether the time limits for the admission of shares to quotation should be extended beyond the default periods specified under section 723(3) of the Corporations Act. The plaintiff argued that an extension was necessary due to circumstances that warranted additional time for the application and quotation processes. The court had to consider the statutory framework, the discretion granted under section 1322, and the relevant provisions of section 723(3) to determine if the requested extensions were justified.

The court granted the plaintiff's application for an extension of time for both the application for admission of the shares and their subsequent quotation by ASX. The court found that the circumstances justified the extensions, thereby exercising its discretion under section 1322 of the Corporations Act. The court set the new deadlines for the application and quotation as 2 March 2007 and 16 May 2007, respectively. Additionally, the plaintiff was granted liberty to apply for a variation of the order for the quotation date and generally on three hours’ notice. The orders were to be entered expeditiously.

The final orders included the extension of the application deadline to 2 March 2007 and the quotation deadline to 16 May 2007, with the plaintiff having the right to apply for further variation of the quotation date on short notice. The urgency in entering these orders underscores the importance of timely compliance with the statutory requirements for share quotation on ASX.

Orders

Orders of the court

Pursuant to s 1322 of the Corporations Act 2001 (Cth) (“the Act”), for the purposes of s 723(3)(a) of the Act, the time for the making of an application for the admission to quotation by Australian Securities Exchange Limited of shares issued pursuant to the prospectus dated 14 December 2006 (“the shares”) be extended to 2 March 2007.

Pursuant to s 1322 of the Act, for the purposes of s 723(3)(b) of the Act, the time for the shares to be admitted to quotation by Australian Securities Exchange Limited be extended to Wednesday 16 May 2007.

The plaintiff have liberty to apply for a variation of order 2 and generally on three hours’ notice.

These orders be entered expeditiously.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

LINDGREN J

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Ratio Decidendi

Legal Principle Established

Established by: LINDGREN J

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IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 672 OF 2007

JUDGE:	LINDGREN J
DATE OF ORDER:	18 APRIL 2007
WHERE MADE:	SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 672 OF 2007

JUDGE:	LINDGREN J
DATE:	30 APRIL 2007
PLACE:	SYDNEY