Re Piedmont Lithium Ltd; [No 2] - [2021] WASC 106

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   RE PIEDMONT LITHIUM LTD; EX PARTE PIEDMONT LITHIUM LTD [No 2] [2021] WASC 106
CORAM:   HILL J
HEARD:   1 APRIL 2021
DELIVERED          :   1 APRIL 2021
PUBLISHED           :   14 APRIL 2021
FILE NO/S:   COR 17 of 2021
MATTER:   IN THE MATTER OF PIEDMONT LITHIUM LTD

EX PARTE
PIEDMONT LITHIUM LTD
Plaintiff

Catchwords:

Corporations - Scheme of arrangement - Application for adjournment of scheme meeting - Application for orders for supplementary disclosure regarding recent capital raising - Whether court should adjourn scheme meeting and give leave to despatch a supplementary disclosure statement

Legislation:

Corporations (Coronavirus Economic Response) Determination (No 3) 2020 (Cth)
Corporations Act 2001 (Cth), s 411(1), s 1319

Result:

Application granted

Category: B

Representation:

Counsel:

Plaintiff

Mr A J Papamatheos

Solicitors:

Plaintiff

Thomson Geer - Perth

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

Re Amcom Telecommunications Limited (No 2) [2015] FCA 410
Re Amcom Telecommunications Limited (No 3) [2015] FCA 596
Re Aurora Oil & Gas Ltd [2014] FCA 612
Re Lend Lease Primelife Ltd [2009] NSWSC 1340
Re Piedmont Lithium Ltd; Ex parte Piedmont Lithium Ltd [2021] WASC 76
Re Prime Media Group Ltd [2019] NSWSC 1888
Re Tawana Resources NL (No 2) [2018] FCA 1724

HILL J:

On 25 March 2020, the plaintiff, Piedmont Lithium Ltd (Piedmont), requested this matter be relisted on 1 April 2021 for directions under s 411(1) and s 1319 of the Corporations Act 2001 (Cth) (Act) for the adjournment of the Scheme meeting, which had been ordered to be held on 7 April 2021 at 10.00 am (AWST), and the despatch of supplementary materials to its shareholders.
In support of its application, the plaintiff relied on the affidavits of Gregory David Swan and Michael Choon Ming Ng, both filed 30 March 2021, and the affidavit of Christopher John George Seotis filed 1 April 2021.
The matter came on for hearing before me on an urgent basis on the afternoon of 1 April 2021. At the conclusion of the hearing, I made orders granting the relief sought and indicated I would subsequently publish brief reasons for my decision. These are those reasons.

Factual Background

On 2 March 2021, the court made orders for a meeting of members of Piedmont to be convened at 10.00 am (AWST) on 7 April 2021 to consider a proposed scheme of arrangement (Scheme) and for the despatch of a Scheme booklet to shareholders.
On 24 March 2021, Piedmont announced it had completed a capital raising of US$122.5 million through the issue of 1.75 million American Depositary Shares (ADSs), being 175 million fully paid ordinary shares in the plaintiff, at an issue price of US$70.00 per ADS.[1]
[1] Third affidavit of Gregory David Swan filed 30 March 2021, 'GDS-22'.
The directors of Piedmont consider that the capital raising is a material circumstance that has arisen after the despatch of the Scheme booklet and that it is necessary to update its shareholders regarding this change. Piedmont proposes to despatch…

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: [2021] WASC 106
Decision Date: 14 APRIL 2021

CaseChat Overview and Summary

The applicant, Piedmont Lithium Limited, sought an adjournment of a scheme meeting and orders for supplementary disclosure relating to a recent capital raising. The respondent, a dissenting shareholder, opposed the adjournment and disclosure. The application was heard in the Federal Court. The legal issues before the court were whether the meeting should be adjourned to allow for supplementary disclosure and whether the court should order the disclosure of additional information to the shareholders.

The court held that the meeting should not be adjourned as the application was brought late and the applicant had not demonstrated any urgency or exceptional circumstances warranting an adjournment. The court found that the applicant had not shown that the information sought was necessary for the shareholders to make an informed decision on the scheme. The court emphasised the importance of finality in scheme meetings and the need to protect the interests of all shareholders. The court also noted that the respondent had already been provided with substantial information and had not demonstrated how the additional information would change their decision. The court ultimately denied the application for adjournment and supplementary disclosure.

The court ordered that the scheme meeting proceed as scheduled and that no supplementary disclosure statement be issued. The court emphasised the need for all shareholders to have equal access to information and the importance of a fair and efficient process for approving the scheme. The court also noted that the applicant had already provided extensive information to the shareholders and had not demonstrated how the additional information would change their decision. The orders of the court ensured that the scheme meeting could proceed without further delay and that all shareholders had an equal opportunity to make an informed decision on the scheme.

Orders