Re Palandri Production Ltd
[2008] WASC 16
•13 DECEMBER 2007
RE PALANDRI PRODUCTION LTD [2008] WASC 16
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2008] WASC 16 | |
| 17/02/2008 | |||
| Case No: | COR:9/2001 | 13 DECEMBER 2007 | |
| Coram: | MARTIN CJ | 12/12/07 | |
| 7 | Judgment Part: | 1 of 1 | |
| Result: | Application granted | ||
| B | |||
| PDF Version |
| Parties: | RE PALANDRI PRODUCTION LTD (ACN 085 042 879) |
Catchwords: | Scheme of arrangement Application pursuant to s 1322(4) of the Corporations Act Approval of scheme to take effect upon lodgement of office copy Mislaid or unsent office copy |
Legislation: | Corporations Act 2001 (Cth), s 411(10), s 1322 |
Case References: | Caboolture Park Shopping Centre Pty Ltd (in liq) v White Industries (Qld) Pty Ltd (1993) 45 FCR 224; (1999) 117 ALR 253 Re Aquarius Platinum (Australia) Pty Ltd [1999] WASC 22; (1999) 153 FLR 284 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Applicant
Catchwords:
Scheme of arrangement - Application pursuant to s 1322(4) of the Corporations Act - Approval of scheme to take effect upon lodgement of office copy - Mislaid or unsent office copy
Legislation:
Corporations Act 2001 (Cth), s 411(10), s 1322
Result:
Application granted
(Page 2)
Category: B
Representation:
Counsel:
Applicant : Mr C D Belyea
Solicitors:
Applicant : Clayton Utz
Case(s) referred to in judgment(s):
Caboolture Park Shopping Centre Pty Ltd (in liq) v White Industries (Qld) Pty Ltd (1993) 45 FCR 224; (1999) 117 ALR 253
Re Aquarius Platinum (Australia) Pty Ltd [1999] WASC 22; (1999) 153 FLR 284
(Page 3)
- MARTIN CJ:
(This judgment was delivered extemporaneously on 18 December 2007 and has been edited from the transcript)
1 The application before the Court is for orders that upon the lodgement with the Australian Securities and Investment Commission (ASIC) of an office copy of the order made in these proceedings on 3 April 2001, together with an office copy of the order to be made on this occasion, the order made by the Court on 3 April 2001 shall be deemed to have taken effect on 9 April 2001. The order sought would have the effect that the effective date for the purposes of the scheme of arrangement referred to in the order of 3 April 2001, and the date upon which the scheme takes effect under the Corporations Law shall be 9 April 2001.
2 The applicant also applies for an order pursuant to s 1322(4)(a) of the Corporations Act 2001 (Cth) (the Act) to the effect that all Acts, matters or things purporting to have been done or any proceeding purporting to have been instituted or taken pursuant to the orders made on 3 April 2001 is not invalid by reason of any contravention of s 411(10) of the Act. It is also proposed that the Court expressly declare that those orders are to be supplemental to the orders of the Court made on 3 April 2001.
3 In order to explain the circumstances in which the application comes to be made, it is appropriate to refer to the affidavit evidence which has been filed in support of the application. I refer first to an affidavit of Mr Geoffrey Simpson sworn 12 December 2007. Mr Simpson was a partner at Clayton Utz with overall responsibility for a scheme of arrangement relating to the company Palandri Production Ltd (Palandri) which was presented to the Court in 2001. He asserts that he was assisted by others in the firm in relation to that scheme of arrangement.
4 He deposes that on 3 December 2007 he was advised that the solicitors now acting for Palandri had been unable to find a court order approving the scheme that was approved by orders made by Owen J of this Court on 3 April 2001. As a result of that advice Mr Simpson caused an examination to be made of the files maintained by Clayton Utz. Not all of the documents and all the files could now be located because the events in question occurred six years ago.
5 However, from Mr Simpson's analysis of the files, he concludes that the scheme order, that is to say, the order that was made by Owen J on 3 April 2001, was extracted and returned to the firm on 9 April, bearing
(Page 4)
- various stamps and dates. Another member of the firm of solicitors then prepared a letter dated 9 April 2001 addressed to a Mr Stefan Pfeifle of ASIC which letter asserted that it enclosed a true copy of the order. The same member of the firm also prepared a letter to Palandri dated 10 April 2001, confirming that the scheme order had been served on ASIC the previous day, 9 April 2001.
6 Mr Simpson goes on to depose that he was unable to identify a lodgement form recording ASIC's receipt of that order and the letter, but he says that ASIC usually does not provide documents of receipt in relation to the lodgement of documents. Mr Simpson spoke to officers of ASIC. He was advised that despite a review of the archived files relating to the scheme, ASIC had not been able to find the scheme orders on those files or in any other place where the order may have been filed or placed, and that ASIC had no evidence of receipt of the scheme orders or of any letter from Clayton Utz similar to that which was on the files of Clayton Utz.
7 The relevant officers of Clayton Utz, who have been spoken to by Mr Simpson, cannot recall today whether or not the documents were in fact sent to ASIC, although they believe from the basis of the documents that are on the file that in all probability they would have been sent to ASIC. In particular the officer who sent the letter to Palandri has told Mr Simpson that he would not have sent that letter unless he had in fact lodged the scheme order with ASIC.
8 Mr Simpson concludes that he cannot say whether or not an office copy of the scheme order was served upon ASIC. That seems to be a fair summary of the conclusions which are properly drawn from his affidavit. There appear to be at least three possibilities open. One is that the order was not in fact sent by Clayton Utz to ASIC. A second possibility is that the letter and the order somehow went missing between Clayton Utz's office and ASIC. The third possibility is that the letter and order were in fact received by ASIC but for some reason cannot now be located by ASIC.
9 All three possibilities have in common the feature of inadvertence. It is I think unnecessary to resolve which of those possibilities is the more likely because it is sufficient to conclude, as I have, that all of them would involve a circumstance that came about through inadvertence and not through any wilful default or neglect by any person.
(Page 5)
10 I have also received an affidavit of Ms Carol Williams. Until recently she was the company secretary of Palandri. She deposes to the historical circumstances relating to the scheme of arrangement and the making of the order by the Court on 3 April 2001. She deposes that since 9 April 2001 the scheme the subject of the order made by the Court has in fact been implemented with the result that legal and beneficial ownership of all of the shares in Palandri was transferred to and vested in Margaret River Wine Production Ltd. Shares were issued in that company to persons who had previously held shares in Palandri and various other steps were taken in order to give effect to the scheme.
11 Since those events, additional shares in Margaret River Wine Production Ltd have been issued on a number of occasions since 2001. That company changed its name to Palandri Ltd in December 2002 and it became a publicly listed company on the United Kingdom's Alternative Investment Market in 2004. However, the company delisted from that market on 22 December 2006, with the intention of listing on the Australian Stock Exchange. Steps are being currently taken to prepare an application for listing on that exchange hopefully either as early as tomorrow or some time next week. Those steps are complicated by an option arrangement which exists with a third party.
12 Ms Williams also deposes that to the best of her information, knowledge and belief no substantial injustice has been or is likely to be caused to any person if orders are made in accordance with the summons. She also deposes that substantial injustice is likely to be caused if the orders are not made. That conclusion appears to me to be justified on the evidence. The scheme in question was a scheme relating to a solvent company, so the considerations that might apply in a scheme involving an insolvent company where the interests of third party creditors would have to be taken into account do not apply to this case.
13 I have received a further affidavit from Ms Williams deposing to recent circumstances and repeating that the resolution of the question of the validity of the scheme which was implemented in 2001 is a matter of urgency. I have also received an affidavit of Ms Phoebe Berridge who is an articled clerk with a firm of solicitors. To that affidavit is annexed a letter from ASIC dated 12 December 2007, advising that it has received copies of the applications for orders, the affidavits in support and outlines of submissions, and further advising that ASIC does not oppose the orders sought and does not intend to appear at the hearing of the application for those orders.
(Page 6)
14 The orders are sought because of s 411(10) of the Act, which provides:
An order of the Court made for the purposes of paragraph 4(b) [of s 411] -
- which was the relevantly applicable section in the case of this scheme -
does not have any effect until an office copy of the order is lodged with ASIC, and upon being so lodged, the order takes effect, or is taken to have taken effect, on and from the date of lodgement or such earlier date as the Court determines and specifies in the order.
16 As I have observed, the evidence sustains the conclusion that substantial injustice would follow if the orders sought are not made. This is therefore a case in which it is appropriate for the orders to be made, provided I can be satisfied that there is jurisdiction to make them.
17 In that regard I refer to the decision in Re Aquarius Platinum (Australia) Pty Ltd [1999] WASC 22; (1999) 153 FLR 284. The circumstances of that case were very similar to the current case. Owen J concluded on the evidence before him in that case that the failure to lodge an office copy was simply an oversight, and also concluded that considerable prejudice would flow to the company and its members if the matter were not to be rectified. Those conclusions are equally apt to this case, save that it cannot be safely concluded that the office copy was not in fact lodged, but rather that there is a doubt as to whether or not it was in fact lodged.
18 Owen J then referred to Caboolture Park Shopping Centre Pty Ltd (in liq) v White Industries (Qld) Pty Ltd (1993) 45 FCR 224; (1999) 117 ALR 253 and concluded that there was jurisdiction to make orders in the terms that were sought then, and which are effectively equivalent to the orders which are sought in this case, on the basis that such an order would be supplemental to the order previously made by the Court and within the scope of the power conferred by s 411(10) of the Act which empowers the Court to make an order in terms that the scheme takes effect from a date earlier than the lodgement of the order.
(Page 7)
19 As I have mentioned, orders are also sought pursuant to s 1322 of the Act validating and putting beyond doubt the validity of steps that have been taken in reliance upon the assumed efficacy of the scheme since 9 April 2001. It seems to me that s 1322 of the Act is applicable in the circumstances that are presently before the Court and that because of the findings that I have made in relation to injustice, this is an appropriate occasion upon which to exercise the powers conferred upon the Court by this section.
20 As I have observed, in the case of a solvent restructure such as this it is difficult to see any relevant injustice flowing from an accidental failure to comply with the requirements relating to notification of the scheme, if in fact that failure occurred. So for those reasons, it seems to me to be appropriate to grant the relief sought under s 1322 of the Act. I will therefore make orders in terms of the summons.
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