Legal Research
Cases
Re TMK Energy Ltd

Re TMK Energy Ltd

Case [2022] WASC 307 13 September 2022

Type to search within this case.

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   RE TMK ENERGY LTD; EX PARTE TMK ENERGY LTD [2022] WASC 307
CORAM:   HILL J
HEARD:   22 AUGUST 2022
DELIVERED          :   22 AUGUST 2022
PUBLISHED           :   13 SEPTEMBER 2022
FILE NO/S:   COR 152 of 2022
MATTER:   IN THE MATTER OF TMK ENERGY LTD

EX PARTE
TMK ENERGY LIMITED
Plaintiff

Catchwords:

Corporations law - Securities - Application for orders extending the period for lodging cleansing notices under s 708A of the Corporations Act 2001 (Cth) - Application for declaratory relief to validate trading in securities issued without a valid cleansing prospectus - Five instances of securities being issued without a valid cleansing notice - Where no blatant or flagrant disregard of obligations - Where no substantial injustice if orders made - Application granted

Legislation:

Corporations Act 2001 (Cth) s 707(3), s 708A, s 1322(4)

Result:

Application granted

Category: B

Representation:

Counsel:

Plaintiff

M F Holler & A W Bartlett

Solicitors:

Plaintiff

Steinepreis Paganin

Cases referred to in decision:

Blaze Asset Pty Ltd v Target Energy Ltd [2009] FCA 698; (2009) 177 FCR 488
Re Austpac Resources NL [2010] NSWSC 1438
Re Bellevue Gold Ltd [2021] WASC 80
Re Caeneus Minerals Ltd [2018] FCA 560
Re Classic Minerals Ltd [2018] FCA 2039
Re G8 Communications Ltd [2016] FCA 297; (2016) 112 ACSR 22
Re Golden Gate Petroleum Ltd [2010] FCA 40; (2010) 77 ACSR 17
Re Helios Energy Ltd [2017] FCA 840; (2017) 122 ACSR 174
Re ICandy Interactive Ltd [2018] FCA 533; (2018) 125 ACSR 369
Re Imdex Ltd [2020] WASC 298
Re Jaxsta Ltd; Ex parte Jaxsta Ltd [2018] WASC 390
Re Metalicity Ltd [2020] WASC 387
Re Wave Capital Ltd [2003] FCA 969; (2003) 47 ACSR 418
Weinstock v Beck [2013] HCA 14; (2013) 251 CLR 396

HILL J:

On 18 August 2022, the plaintiff, TMK Energy Limited (TMK), filed an originating process seeking orders under s 1322(4)(a) and s 1322(4)(d) of the Corporations Act 2001 (Cth) (Act) relating to contraventions of s 708A(5)(e) and s 707(3) of the Act. The contraventions occurred as a result of five issues of shares in the plaintiff between 31 October 2019 and 13 July 2022 (Share Issues), without a valid cleaning notice or prospectus having been lodged pursuant to s 708A of the Act, and the subsequent sale of some of these shares.
TMK has provided a frank and detailed explanation as to the circumstances surrounding the issue of these shares. Based on the evidence before me, I was and am satisfied that the failure to issue a cleansing notice was caused by inadvertence rather than any deliberate disregard of the plaintiff's obligations.
In light of the urgency with which the application was brought, I made orders at the conclusion of the hearing on 22 August 2022 granting the relief sought and said that I would subsequently publish reasons for my decision. These are the reasons for my decision.

Reporting requirements under…

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 TMK Energy Ltd

Details

AGLC: Re TMK Energy Ltd [2022] WASC 307
Case: [2022] WASC 307
Decision Date: 13 SEPTEMBER 2022

CaseChat Overview and Summary

The case before the court involved TMK Energy Ltd, which sought an extension of time for lodging cleansing notices under section 708A of the Corporations Act 2001 and declaratory relief to validate trading in securities issued without a valid cleansing prospectus. The dispute centred around five instances where securities were issued without a valid cleansing notice. The court was tasked with determining whether the company's failure to issue valid cleansing notices was due to a blatant or flagrant disregard of its obligations under the Act, and whether granting the relief would cause substantial injustice to any party.

The legal issues before the court were whether the company's failure to issue valid cleansing notices amounted to a blatant or flagrant disregard of its statutory obligations, and if granting the relief would result in substantial injustice to any party. The court had to consider the circumstances surrounding the issuance of the securities, the reasons for the delay in lodging the cleansing notices, and the potential impact of the relief on the company, its shareholders, and the market.

The court found that there was no blatant or flagrant disregard of the company's obligations in this case, as the delays were due to administrative errors and not a deliberate attempt to circumvent the law. The court further held that granting the relief would not cause substantial injustice to any party, as the company had taken steps to rectify the situation and the delay in lodging the cleansing notices had not materially affected the market. Accordingly, the court granted the application, extending the period for lodging the cleansing notices and validating the trading in the securities issued without a valid cleansing prospectus.

The court's final orders included an extension of the time for lodging the cleansing notices and a declaration that the trading in the securities issued without a valid cleansing prospectus was valid. The company was also ordered to take steps to ensure compliance with the Act in the future. This decision provides guidance to companies on the consequences of failing to issue valid cleansing notices and the potential relief available under the Act.

Orders