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Re Piedmont Lithium Ltd

Re Piedmont Lithium Ltd

Case [2021] WASC 76 22 March 2021

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JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   PIEDMONT LITHIUM LTD [2021] WASC 76
CORAM:   HILL J
HEARD:   2 MARCH 2021
DELIVERED          :   2 MARCH 2021
PUBLISHED           :   22 MARCH 2021
FILE NO/S:   COR 17 of 2021
MATTER:   IN THE MATTER OF PIEDMONT LITHIUM LTD
EX PARTE

PIEDMONT LITHIUM LTD
Plaintiff

Catchwords:

Corporations law - Scheme of arrangement - Application for orders convening scheme meeting under s 411(1) of the Corporations Act 2001 (Cth) - Members' scheme of arrangement to effect re-domicile of group to United States of America - Whether requirements to order scheme meeting are satisfied - Orders made convening meeting

Legislation:

Corporations Act 2001 (Cth), s 411(1), s 412(1)(a), s 1319
Corporations Regulations 2001 (Cth), sch 8
Securities Act 1933 (USA)
Supreme Court (Corporations) (WA) Rules 2004 (WA), r 3.2

Result:

Orders made convening scheme meeting

Category: B

Representation:

Counsel:

Plaintiff

Mr A J Papamatheos

Solicitors:

Plaintiff

Thomson Geer - Perth

Case(s) referred to in decision(s):

CannPal Animal Therapeutics Ltd [2021] WASC 37
Re Amcom Telecommunications Ltd [2015] FCA 341
Re APN News & Media Ltd [2007] FCA 770; (2007) 62 ACSR 400
Re CSR Ltd [2010] FCAFC 34; (2010) 183 FCR 358
Re David Jones Ltd [No 2] [2014] FCA 720; (2014) 101 ACSR 381
Re Doray Minerals Ltd; Ex parte Doray Minerals [2019] WASC 57
Re DUET Management Company 1 Ltd [2013] NSWSC 817; (2013) 95 ACSR 34
Re Kangaroo Resources Ltd; Ex Parte Kangaroo Resources Ltd [No 2] [2018] WASC 388
Re Macquarie Private Capital A Ltd [2008] NSWSC 323
Re NTM Gold Ltd; Ex parte NTM Gold Ltd [2021] WASC 22
Re Nzuri Copper Ltd [2019] WASC 189
Re Opes Prime Stockbroking Ltd [2009] FCA 813; (2009) 179 FCR 20
Re SRG Ltd [2018] FCA 1092
Re Wesfarmers Ltd; Ex parte Wesfarmers Ltd [2018] WASC 308

HILL J:

The plaintiff, Piedmont Lithium Limited (Piedmont), is an Australian public company listed on the official list of the Australian Securities Exchange (ASX).
On 9 December 2020, Piedmont announced it had entered into a scheme implementation deed (SID) with Piedmont Lithium Incorporated (Piedmont US) (Scheme).[1] Under the Scheme, it is proposed that Piedmont will become a wholly owned subsidiary of Piedmont US and will be subsequently delisted from the ASX.[2] Each shareholder will receive one Piedmont US CHESS Depositary Interest (CDI) for every fully paid ordinary share in Piedmont.[3]
[1] First affidavit of Gregory David Swan filed 11 February 2021, 'GDS-2'.
[2] Scheme booklet, [1.1].
[3] Scheme, cls 2.5(b), 5.4, 6.3(c).
By originating process dated 11 February 2021, Piedmont sought orders under s 411 of the Corporations Act 2001 (Cth) (Act) in relation to the proposed Scheme. The application came before me for the first court hearing on 2 March 2021.
On 2 March 2021, I made orders pursuant to s 411(1) of the Act to convene a meeting of Piedmont's members to consider and vote on the proposed Scheme. Orders were also made approving the…

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 Piedmont Lithium Ltd

Details

AGLC: Re Piedmont Lithium Ltd [2021] WASC 76
Case: [2021] WASC 76
Decision Date: 22 MARCH 2021

CaseChat Overview and Summary

The case involved Piedmont Lithium Limited, a company incorporated in Australia, and its members. The dispute centred on the convening of a scheme meeting to consider a proposal by the company to re-domicile the group to the United States of America. The matter was heard in the Federal Court of Australia. The members of the company sought orders convening a scheme meeting under section 411(1) of the Corporations Act 2001, to vote on the proposed re-domicile.

The central legal issue before the court was whether the requirements under section 411(1) of the Corporations Act were satisfied to order the convening of a scheme meeting. Specifically, the court had to consider whether the proposal was made in good faith for a proper purpose, whether the members of the company were fully informed about the proposal, and whether the meeting would be appropriately constituted to make a decision on the scheme. The court also had to assess whether the scheme had a reasonable prospect of being implemented.

The court found that the proposal was made in good faith and for a proper purpose, as it was intended to benefit the members by improving the company's access to capital markets and enhancing its overall value. The court concluded that the members had been adequately informed about the proposal and its implications, and that the meeting would be appropriately constituted to make a decision on the scheme. Finally, the court determined that there was a reasonable prospect of the scheme being implemented. Therefore, the court ordered the convening of a scheme meeting to allow the members to vote on the proposal.

The court's final orders included convening a meeting of the company's members to consider and vote on the proposed scheme of arrangement, as well as providing detailed instructions on the manner in which the meeting was to be conducted and the notice to be given to members. This decision ensures that the members of Piedmont Lithium Limited have the opportunity to exercise their rights and make an informed decision about the proposed re-domicile of the company.

Orders