Re Strategic Energy Resources Ltd (No 2) - [2012] VSC 75

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION
COMMERCIAL COURT

CORPORATIONS LIST

No. 0611 of 2011

IN THE MATTER OF STRATEGIC ENERGY RESOURCES LIMITED (ACN 051 212 429)

STRATEGIC ENERGY RESOURCES LIMITED

Plaintiff

---

JUDGE:	Davies J
WHERE HELD:	Melbourne
DATE OF HEARING:	17 February 2012
DATE OF JUDGMENT:	17 February 2012
CASE MAY BE CITED AS:	Re Strategic Energy Resources Ltd (No. 2)
MEDIUM NEUTRAL CITATION:	[2012] VSC 75

---

CORPORATIONS – order made under s 411 Corporations Act 2001 (Cth) for the convening of a meeting to consider a proposed scheme of arrangement – meeting adjourned because many shareholders not served with the scheme booklet because their addresses in the company register were incorrect or there was no address – application to reconvene meeting - dispensation sought from the requirement to send scheme booklet and notice of meeting to shareholders on static list– proposed alternate process to give notice to those shareholders – dispensation granted and other procedural orders made - ss 411, 1319 Corporations Act 2001 (Cth)

---

APPEARANCES:	Counsel	Solicitors
For the Plaintiff	JG Santamaria QC TRO Boston	Rigby Cooke Lawyers

HER HONOUR:

An order was made under s 411(1) of the Corporations Act 2001 (Cth) (“the Act”) that Strategic Energy Resources Pty Ltd (“SER”) convene a meeting of its shareholders on 23 January 2012 to consider a scheme of arrangement (“the scheme”).[1] Prior to the convening date, SER obtained an order from the Court adjourning the convening of the meeting to a date to be fixed. The adjournment was occasioned by the non-service of the scheme booklet and proxy form on 709 of SER’s shareholders (“the Static Shareholders”), either because those shareholders had incorrect addresses recorded on SER’s register or because there was no address recorded. Since the last court hearing, SER has been able to reduce the number of Static Shareholders to 638, representing approximately 17.5% of the total number of SER shareholders and 2.10% of the value of shareholding.
[1]Re Strategic Energy Resources Ltd [2011] VSC 645.

On 17 February 2012, SER sought an order for the reconvening of the meeting on

22 March 2012. In light of the fact that there are still a substantial number of Static Shareholders, SER sought dispensation from the requirement to send the scheme booklet, proxy form and notice of adjourned meeting to those shareholders. SER proposed that it be required in lieu:

(a) to publish in the Australian and Financial Review newspapers, and on the websites of the ASX and SER, a notice containing the date and place for the adjourned scheme meeting, a brief explanation of the demerger scheme and contact details to obtain further information; and

(b)to send Static Shareholders with an address in the SER Register a letter notifying them:
(i) that their address in the SER register is believed to be incorrect and asking them to update or confirm their address;
(ii)of the proposed meeting;
(iii)that the scheme booklet, proxy form and notice of…

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.

Keep reading for free

Create a free CaseChat account to read Re Strategic Energy Resources Ltd (No 2) and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2012] VSC 75
Decision Date: 17 February 2012

CaseChat Overview and Summary

Strategic Energy Resources Ltd was the subject of an application for a court order under section 411 of the Corporations Act 2001 to convene a meeting of the company's members to consider a proposed scheme of arrangement. The original meeting was adjourned as many shareholders were not served with the scheme booklet as their addresses in the company register were either incorrect or missing. An application was subsequently made to reconvene the meeting, seeking dispensation from the statutory requirement to send the scheme booklet and notice of the meeting to shareholders on the static list. The applicants proposed an alternate process to notify those shareholders and sought dispensation from the requirement to serve the scheme booklet and notice of meeting on those shareholders.

The court was required to determine whether to grant the applicants' request for dispensation from the statutory notice and booklet requirements, and to consider the proposed alternate process for notifying shareholders. The court also needed to determine if the proposed process was reasonable and practicable, and whether it complied with the statutory provisions. The applicants argued that serving the scheme booklet and notice of meeting on the static list shareholders would be impracticable and costly, and that the proposed alternate process would be a reasonable and effective way to notify those shareholders.

The court found that the statutory notice and booklet requirements could be dispensed with in this case, as the applicants had demonstrated that serving those documents on the static list shareholders would be impracticable and costly. The court accepted the proposed alternate process as reasonable and practicable, and found that it complied with the statutory provisions. The court also found that the proposed process was fair and would not unfairly prejudice the shareholders. The court granted the applicants' request for dispensation and made orders convening the meeting and setting out the procedures for the alternate process.

The court ordered that the meeting be reconvened on the specified date and time, and that the alternate process for notifying shareholders on the static list be used. The court also made orders setting out the procedures for the alternate process, including the requirement for the applicants to provide evidence of the steps taken to notify those shareholders. The court further ordered that the scheme booklet be made available for inspection at the meeting and that the meeting be conducted in accordance with the Corporations Act and the company's constitution.

Orders