Re Terry White Group Limited (No 1) - [2018] QSC 254

SUPREME COURT OF QUEENSLAND

CITATION:	Re Terry White Group Limited (No 1) [2018] QSC 254
PARTIES:	TERRY WHITE GROUP LIMITED ACN 136 808 243 (applicant)
FILE NO/S:	SC No 11492 of 2018
DIVISION:	Trial Division
PROCEEDING:	Originating Application
DELIVERED EX TEMPORE ON:	2 November 2018
DELIVERED AT:	Brisbane
HEARING DATE:	2 November 2018
JUDGE:	Bond J
ORDER:	The orders of the Court are that: In this Order, the term ‘Related Entity’ of a party means an entity which: (a) *is a related body corporate to that party within the meaning of section 50 of the Corporations Act* 2001 (Cth) (the Act); (b) is in any consolidated entity (as defined in section 9 of the Act) which contains the party; or (c) is controlled by the party within the meaning of section 50AA of the Act. In this Order, the term ‘Scheme Shareholder’ means a shareholder of the Applicant other than: (a) EBOS PH Pty Ltd ACN 613 974 253 (EBOS PH); (b) a Related Entity of EBOS PH (other than subsidiaries of the Applicant); (c) persons holding shares in the Applicant on behalf of, or for the benefit of, EBOS PH or a Related Entity of EBOS PH. 1. The matter be placed on the Commercial List. 2. Pursuant to section 411(1) of the Act, the Applicant shall convene a meeting (Scheme Meeting) of all Scheme Shareholders to consider, and if thought fit approve, with or without modification, a scheme of arrangement (Scheme) between the Applicant and the Scheme Shareholders comprised of Attachment C of the document entitled ‘Terry White Group Limited Scheme Booklet’ (Scheme Booklet), being exhibit ‘JBH-17’ to the third affidavit of James Brett Lochran Heading, sworn and filed on 2 November 2018. 3. Pursuant to section 411(1) of the Act, the explanatory statement substantially in the form of the Scheme Booklet be approved for distribution to Scheme Shareholders. 4. The Scheme Meeting shall be held commencing at 3.30 pm AEST on 5 December 2018 at Moda Events Portside, Viewing Room, Level 2, Portside Wharf, 39 Hercules Street, Hamilton QLD 4007. 5. The Scheme Meeting shall be convened by: (a) the Applicant sending or causing the following to be sent by prepaid priority post to each Scheme Shareholder appearing in the Applicant’s share register as at 5:00pm on 5 November 2018 with an address for notices within Australia (including those Scheme Shareholders who have consented to receiving notices electronically): (i) the Scheme Booklet substantially in the form approved by the Court; (ii) a notice of meeting substantially in the form in which it appears in Attachment D of the Scheme Booklet (Notice of Meeting); (iii) a Scheme Proxy Form for the purpose of the submission of proxies by Scheme Shareholders substantially in the form in which it appears in exhibit ‘JYT-8’ to the first affidavit of Joe Yew Tham sworn on 30 October 2018 (First Tham Affidavit); (iv) a Direct Credit Request Form substantially in the form in which it appears in exhibit ‘JYT-8’ to the First Tham…**

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: [2018] QSC 254
Decision Date: 2 November 2018

CaseChat Overview and Summary

Terry White Group Limited sought an order for a meeting of its shareholders to be convened so that they may consider whether to pass a resolution to approve a proposed scheme of arrangement. The scheme would allow a company to acquire all of the shares in Terry White Group Limited not already held by it or its related entities. The application was heard by Bond J in the Federal Court of Australia. The legal issue before the court was whether it should make an order for a meeting of the company's shareholders to be convened. The court found that the application should be granted, as the applicant had discharged the onus of proving that it had met the requirements of the Corporations Act 2001 (Cth). The court found that the scheme was in the best interests of the company and its shareholders, and that the necessary disclosures had been made to the shareholders. The court made an order that the applicant shall convene a meeting of all scheme shareholders to consider, and if thought fit approve, with or without modification, a scheme of arrangement. The explanatory statement was also approved for distribution to scheme shareholders. The scheme meeting was to be held on 5 December 2018, and the applicant was required to send various documents to the scheme shareholders before the meeting. Ronald Albert Higham or, in his absence, Jane Matisse McKellar, was authorised to act as chairman of the scheme meeting and any adjournments of the scheme meeting and to report to the court on the outcome of the scheme meeting and any adjournments of the scheme meeting. Proxies and attorneys or corporate representatives were subject to certain voting restrictions. The proceedings were adjourned until 7 December 2018.

Orders

Orders of the court

The orders of the Court are that:

In this Order, the term ‘Related Entity’ of a party means an entity which:

(a) is a related body corporate to that party within the meaning of section 50 of the Corporations Act 2001 (Cth) (the Act);

(b) is in any consolidated entity (as defined in section 9 of the Act) which contains the party; or

In this Order, the term ‘Scheme Shareholder’ means a shareholder of the Applicant other than:

(a) EBOS PH Pty Ltd ACN 613 974 253 (EBOS PH);

(b) a Related Entity of EBOS PH (other than subsidiaries of the Applicant);

1. The matter be placed on the Commercial List.

2. Pursuant to section 411(1) of the Act, the Applicant shall convene a meeting (Scheme Meeting) of all Scheme Shareholders to consider, and if thought fit approve, with or without modification, a scheme of arrangement (Scheme) between the Applicant and the Scheme Shareholders comprised of Attachment C of the document entitled ‘Terry White Group Limited Scheme Booklet’ (Scheme Booklet), being exhibit ‘JBH-17’ to the third affidavit of James Brett Lochran Heading, sworn and filed on 2 November 2018.

3. Pursuant to section 411(1) of the Act, the explanatory statement substantially in the form of the Scheme Booklet be approved for distribution to Scheme Shareholders.

4. The Scheme Meeting shall be held commencing at 3.30 pm AEST on 5 December 2018 at Moda Events Portside, Viewing Room, Level 2, Portside Wharf, 39 Hercules Street, Hamilton QLD 4007.

5. The Scheme Meeting shall be convened by:

(a) the Applicant sending or causing the following to be sent by prepaid priority post to each Scheme Shareholder appearing in the Applicant’s share register as at 5:00pm on 5 November 2018 with an address for notices within Australia (including those Scheme Shareholders who have consented to receiving notices electronically):

(i) the Scheme Booklet substantially in the form approved by the Court;

(ii) a notice of meeting substantially in the form in which it appears in Attachment D of the Scheme Booklet (Notice of Meeting);

(iii) a Scheme Proxy Form for the purpose of the submission of proxies by Scheme Shareholders substantially in the form in which it appears in exhibit ‘JYT-8’ to the first affidavit of Joe Yew Tham sworn on 30 October 2018 (First Tham Affidavit);

(iv) a Direct Credit Request Form substantially in the form in which it appears in exhibit ‘JYT-8’ to the First Tham Affidavit; and

(v) a reply-paid envelope addressed to Link Market Services Limited ACN 083 214 537 (Link) for the return of the Scheme Proxy Form; and

(b) the Applicant sending or causing the following to be sent by international express post to each Scheme Shareholder appearing in the Applicant’s share register as at 5:00pm on 5 November 2018 with an address for notices outside Australia (including those Scheme Shareholders who have consented to receiving notices electronically):

(i) the Scheme Booklet substantially in the form approved by the Court;

(ii) a Notice of Meeting;

(iii) a Scheme Proxy Form for the purpose of the submission of proxies by Scheme Shareholders substantially in the form in which it appears in exhibit ‘JYT-8’ to the First Tham Affidavit;

(iv) a Direct Credit Request Form substantially in the form in which it appears in exhibit ‘JYT-8’ to the First Tham Affidavit; and

(v) a reply-paid envelope addressed to Link for the return of the Scheme Proxy Form; and

(c) the Applicant sending or causing to be sent to all Scheme Shareholders who have consented to receive notices electronically as at 5:00pm on 5 November 2018, an email to the email addresses nominated by each Scheme Shareholder, substantially in the form in which it appears in exhibit ‘JYT-18’ to the second affidavit of Joe Yew Tham sworn on 1 November 2018 containing web links, which will enable Scheme Shareholders to:

(i) view the scheme Booklet (including the Notice of Meeting) online; and

(ii) lodge proxy instructions and update their nominated bank account details online; and

(d) the Applicant uploading a copy of the Scheme Booklet (including the Notice of Meeting) on the Applicant’s investor website (http://investors.terrywhitegroup.com.au/) in the ‘Shareholder Announcements’ section of the website.

6. Ronald Albert Higham or, in his absence, Jane Matisse McKellar, is authorised to act as chairman of the Scheme Meeting and any adjournments of the Scheme Meeting and to report to the Court on the outcome of the Scheme Meeting and any adjournments of the Scheme Meeting.

7. A proxy may not vote at the Scheme Meeting unless the instrument appointing the proxy is received by Link by 3:30pm on 3 December 2018 in the manner specified in the Notice of Meeting.

8. An attorney or corporate representative may not vote at the Scheme Meeting unless the instrument appointing the attorney or corporate representative is lodged at the registration desk on the day of the Scheme Meeting or with Link by 3:30pm on 3 December 2018 in the manner specified in the Notice of Meeting.

9. These proceedings shall be adjourned until 10am on 7 December 2018 before Bond J.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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