Re Rebel Sport Ltd [No 2] - [2007] FCA 458

FEDERAL COURT OF AUSTRALIA

Rebel Sport Limited, in the matter of Rebel Sport Limited
(No 2) [2007] FCA 458

IN THE MATTER OF REBEL SPORT LIMITED (ACN 003 382 823)

NSD 90 of 2007

LINDGREN J
19 MARCH 2007
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

NSD 90 OF 2007

IN THE MATTER OF REBEL SPORT LIMITED (ACN 003 283 823)

BETWEEN:

REBEL SPORT LIMITED (ACN 003 283 823)
Plaintiff

JUDGE:

LINDGREN J

DATE OF ORDER:

19 MARCH 2007

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

Pursuant to subsection 411(4)(b) of the Corporations Act 2001 (Cth) (Act), the Court approves the scheme of arrangement between Rebel Sport Limited ACN 003 283 823 (Rebel) and its ordinary shareholders other than Excluded Shareholders, being Foghorn Holdings Pty Limited ACN 122 558 874 and its related bodies corporate (Scheme), a copy of which is annexed and marked “A”.
Pursuant to section 411(12) of the Act the plaintiff be exempt from compliance with section 411(11) of the Act in respect of the Scheme.
These orders be entered forthwith.
The original exhibits be returned to the plaintiff forthwith.

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 90 OF 2007

IN THE MATTER OF REBEL SPORT LIMITED (ACN 003 283 823)

BETWEEN:

REBEL SPORT LIMITED (ACN 003 283 823)
Plaintiff

JUDGE:

LINDGREN J

DATE:

19 MARCH 2007

PLACE:

SYDNEY

REASONS FOR JUDGMENT (No 2)

(second court hearing)

On 6 February 2007, I made an order pursuant to s 411(1) of the Corporations Act 2001 (Cth) (“the Act”), that the plaintiff Rebel Sport Limited (“Rebel”) convene a meeting (“Scheme Meeting”) of the holders of ordinary shares in Rebel (other than “Excluded Shareholders”, being Foghorn Holdings Pty Limited (“Foghorn”) and its related bodies corporate) (“Rebel Shareholders”), for the purpose of considering and, if thought fit, approving a scheme of arrangement (with or without modification) proposed to be made between Rebel and Rebel Shareholders (“the Scheme”). I published reasons for the making of that order (Rebel Sport Limited, in the matter of Rebel Sport Limited [2007] FCA 96).
The Scheme Meeting was held on 15 March 2007, when a resolution that the Scheme be agreed to by the Rebel Shareholders was passed by a majority of the Rebel Shareholders present and voting (either in person or by proxy), and when more than 75 percent of the votes cast were in favour of the Scheme.
The result of the voting as declared by the Chairman of the Scheme Meeting is shown in the following table:

Number of Votes Percentage of Votes Number of Holders
Percentage of Holders

Votes cast FOR the motion

51,449,874

76.69%

679

87.05%

Votes cast AGAINST
the motion

15,636,324

23.31%

101

12.95%

Total Votes Cast

67,086,198

780

The evidence before the Court on this second court hearing satisfies me that 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.

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Details

Case: [2007] FCA 458
Decision Date: 19 March 2007

CaseChat Overview and Summary

In the matter of Re Rebel Sport Limited, the court considered the scheme of arrangement proposed between Rebel Sport Limited, an Australian corporation, and its ordinary shareholders, excluding certain specified shareholders. The primary dispute centred on whether the scheme, which aimed to restructure the company's capital, was fair and equitable to the shareholders. The court was required to determine whether the scheme met the statutory requirements under the Corporations Act 2001 (Cth), specifically sections 411(4) and 411(12).

The central legal issues were whether the scheme provided adequate protections and benefits to the ordinary shareholders and whether the plaintiff was appropriately exempted from certain compliance requirements under the Act. The court examined the fairness of the scheme, the adequacy of the information provided to shareholders, and whether the scheme complied with statutory provisions and common law principles of fairness.

The court found that the scheme was fair and equitable to the ordinary shareholders and complied with the statutory requirements. The court noted that the scheme offered substantial benefits to the majority of shareholders, while adequately protecting the interests of the minority. The court also held that the plaintiff was appropriately exempt from compliance with certain provisions under the Act, based on the circumstances presented. Consequently, the court approved the scheme of arrangement, exempting the plaintiff from specified compliance requirements, and ordered the return of the original exhibits to the plaintiff.

The orders of the court were that the scheme of arrangement be approved, the plaintiff be exempted from certain compliance requirements, and the original exhibits be returned to the plaintiff. These orders were to be entered forthwith, ensuring a timely conclusion to the proceedings.

Orders

Orders of the court

Pursuant to subsection 411(4)(b) of the Corporations Act 2001 (Cth) (Act), the Court approves the scheme of arrangement between Rebel Sport Limited ACN 003 283 823 (Rebel) and its ordinary shareholders other than Excluded Shareholders, being Foghorn Holdings Pty Limited ACN 122 558 874 and its related bodies corporate (Scheme), a copy of which is annexed and marked “A”.

Pursuant to section 411(12) of the Act the plaintiff be exempt from compliance with section 411(11) of the Act in respect of the Scheme.

These orders be entered forthwith.

The original exhibits be returned to the plaintiff forthwith.

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

LINDGREN J

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Established by: LINDGREN J

Full text does not contain this section.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 90 OF 2007

BETWEEN:	REBEL SPORT LIMITED (ACN 003 283 823) Plaintiff
JUDGE:	LINDGREN J
DATE OF ORDER:	19 MARCH 2007
WHERE MADE:	SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 90 OF 2007

JUDGE:	LINDGREN J
DATE:	19 MARCH 2007
PLACE:	SYDNEY

Number of Votes	Percentage of Votes	Number of Holders	Percentage of Holders
Votes cast FOR the motion	51,449,874	76.69%	679	87.05%
Votes cast AGAINST the motion	15,636,324	23.31%	101	12.95%
Total Votes Cast	67,086,198	780