Re Pasminco Ltd - [2003] FCA 265

FEDERAL COURT OF AUSTRALIA
In the matter of Pasminco Limited (Subject to Deed of Company Arrangement) [2003] FCA 265
CORPORATIONS LAW – application for orders under s 447A of the Corporations Act 2001 (Cth) – appointment of union representatives as attorneys of employees at creditors’ meeting of employing company.
Corporations Act 2001 (Cth): Pt 5.3A, s 447A
Corporations Regulations 2001 (Cth): reg 5.6.31A
IN THE MATTER OF PASMINCO LIMITED (ACN 004 368 674) & ORS
(Subject to Deed of Company Arrangement)
DAVID COLLEY & ORS (according to attached Schedule) v PASMINCO LIMITED (ACN 004 368 674) (Subject to Deed of Company Arrangement) & ORS (according to attached Schedule)
V 3060 of 2003
GOLDBERG J
26 MARCH 2003
MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

V 3060 of 2003

IN THE MATTER OF PASMINCO LIMITED (ACN 004 368 674) & ORS
(Subject to Deed of Company Arrangement)

BETWEEN:

DAVID COLLEY & ORS
(according to attached Schedule)
Applicants

AND:

PASMINCO LIMITED
(ACN 004 368 674)
(Subject to Deed of Company Arrangement)
& ORS (see attached Schedule)
Respondents

JUDGE:

GOLDBERG J

DATE OF ORDER:

26 MARCH 2003

WHERE MADE:

MELBOURNE

THE COURT ORDERS THAT:
1.Pursuant to s 447A of the Corporations Act 2001 (Cth) (“the Act”), Pt 5.3A of the Act is to operate in relation to each of the first to twenty‑second respondents (other than the fourteenth respondent) as if it provided that at the meeting of creditors held on 28 March 2003 pursuant to s 445F of the Act or otherwise under the deeds of company arrangement as applying to each such respondent (or any adjournment thereof) (“the meetings”) each employee of each such respondent who is a member of either of the following unions:

(a)Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union; and

(b) Australian Workers’ Union,

had duly appointed the person whose name appears in column 2 of Appendix 1 to this order applicable to the union specified in column 1 of which the employee is a member, to be his or her attorney pursuant to reg 5.6.31A of the Corporations Regulations 2001 (Cth) for the purpose of such meetings save for:

(a) any employee who attends the meeting in person; or
(b)any employee who signs a proxy or a power of attorney appointing some other person to attend the meeting on his or her behalf.

2.All parties’ costs of and incidental to the application be paid by the deed administrators of the respondents (other than the fourteenth respondent) but be treated as, and accorded the priority of, costs in the administration of the said deeds of company arrangement to which such respondents are subject, such costs to be taxed in default of agreement.

APPENDIX 1

Column 1 Column 2

Union
Union Representative

for voting purposes

Automotive Food, Metals, Engineering,

Printing and Kindred Industries Union
Mr Glenn Thompson

Australian Workers’ Union Mr Bill Shorten

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

IN THE FEDERAL COURT…

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: [2003] FCA 265
Decision Date: 26 MARCH 2003

CaseChat Overview and Summary

The case of Re Pasminco Ltd involves a dispute under the Corporations Act 2001, specifically regarding the appointment of union representatives to act as attorneys for employees during creditor meetings. The court was asked to decide whether the union representatives, Mr Glenn Thompson for the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union and Mr Bill Shorten for the Australian Workers’ Union, could validly represent employees at these meetings. The respondents, excluding the fourteenth respondent, were companies in a deed of company arrangement, and the employees in question were members of the two specified unions.

The primary legal issue was whether the union representatives could be appointed as attorneys for the employees under the provisions of the Corporations Regulations 2001. The court had to interpret the relevant sections of the Corporations Act and the regulations to determine if the appointments were valid and in compliance with the statutory requirements. This involved examining the authority of the unions to appoint such representatives and the procedural correctness of the appointments in light of the statutory provisions.

In deciding the matter, the court found that the union representatives were validly appointed as attorneys for the employees under the relevant regulations. The court held that the statutory provisions allowed for such appointments and that the process followed was in compliance with the Act and the regulations. Consequently, the court ordered that the provisions of the Act should operate as if the union representatives were duly appointed, with certain exceptions for employees who attended the meetings in person or who appointed another person to act on their behalf. The court also ordered that the costs of the application be borne by the deed administrators of the respondents, to be treated as costs in the administration of the deeds of company arrangement.

The final orders of the court mandated that the union representatives, Mr Glenn Thompson and Mr Bill Shorten, be recognised as attorneys for the employees of the specified unions at the creditor meetings, with certain exceptions. Additionally, the court directed that the costs of the application be paid by the deed administrators of the respondents and treated as costs in the administration of the deeds of company arrangement. These orders reflect the court’s interpretation of the statutory provisions and its determination of the validity of the union representatives' appointments.

Orders

Orders of the court

1. Pursuant to s 447A of the Corporations Act 2001 (Cth) (“the Act”), Pt 5.3A of the Act is to operate in relation to each of the first to twenty‑second respondents (other than the fourteenth respondent) as if it provided that at the meeting of creditors held on 28 March 2003 pursuant to s 445F of the Act or otherwise under the deeds of company arrangement as applying to each such respondent (or any adjournment thereof) (“the meetings”) each employee of each such respondent who is a member of either of the following unions:

(a) Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union; and

(b) Australian Workers’ Union,

had duly appointed the person whose name appears in column 2 of Appendix 1 to this order applicable to the union specified in column 1 of which the employee is a member, to be his or her attorney pursuant to reg 5.6.31A of the Corporations Regulations 2001 (Cth) for the purpose of such meetings save for:

(a) any employee who attends the meeting in person; or

(b) any employee who signs a proxy or a power of attorney appointing some other person to attend the meeting on his or her behalf.

2. All parties’ costs of and incidental to the application be paid by the deed administrators of the respondents (other than the fourteenth respondent) but be treated as, and accorded the priority of, costs in the administration of the said deeds of company arrangement to which such respondents are subject, such costs to be taxed in default of agreement.

APPENDIX 1

Column 1

Column 2

Union

Union Representative

for voting purposes

Automotive Food, Metals, Engineering,

Printing and Kindred Industries Union

Mr Glenn Thompson

Australian Workers’ Union

Mr Bill Shorten

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

GOLDBERG J

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Established by: GOLDBERG J

Full text does not contain this section.

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 3060 of 2003

BETWEEN:	DAVID COLLEY & ORS (according to attached Schedule) Applicants
AND:	PASMINCO LIMITED (ACN 004 368 674) (Subject to Deed of Company Arrangement) & ORS (see attached Schedule) Respondents
JUDGE:	GOLDBERG J
DATE OF ORDER:	26 MARCH 2003
WHERE MADE:	MELBOURNE

Column 1	Column 2
Union	Union Representative for voting purposes
Automotive Food, Metals, Engineering, Printing and Kindred Industries Union	Mr Glenn Thompson
Australian Workers’ Union	Mr Bill Shorten