Snowside Pty Ltd as trustee for the Snowside Trust, in the matter Boart Longyear Ltd

In the matter of Snowside Pty Ltd as trustee for the Snowside Trust, in the matter of Boart Longyear Ltd, the Federal Court was tasked with determining the outcome of an application for leave to appeal and an extension of time. The Snowside parties, who are shareholders in Boart Longyear Limited (BLY), commenced oppression proceedings against BLY and others in the Supreme Court of New South Wales. Subsequently, BLY initiated proceedings seeking approval for a proposed members' scheme of arrangement under the Corporations Act 2001 (Cth). The primary judge had already dismissed the Snowside parties' application to adjourn the first court hearing, and had made orders convening a shareholders meeting to consider the proposed scheme. The Snowside parties argued that the scheme's implementation would deprive them of their standing to maintain the oppression proceeding, but the primary judge found that the Snowside parties would not lose standing if the scheme were implemented. The Snowside parties sought leave to appeal the primary judge's decision, but BLY contended that the proposed grounds of appeal lacked sufficient prospects of success.

The court considered whether the primary judge's decision was attended by doubt, focusing on the Snowside parties' argument that the scheme would deprive them of standing to maintain the oppression proceeding. The court examined the Snowside letter, which was found to contain misleading statements, and concluded that the Snowside parties would not lose standing if the scheme were implemented. The court further determined that the misleading statements in the Snowside letter cast doubt on the integrity of the vote at the scheme meeting and provided a basis for BLY to apply to dispense with the headcount test. However, BLY did not establish reliance on the misleading statement, and the Snowside parties successfully resisted the relief sought. The court found that the Snowside parties were not entitled to costs for defending their wrongful conduct.

In conclusion, the Federal Court dismissed the Snowside parties' application for leave to appeal and an extension of time, and ordered that the applicant pay the first respondent's costs of the application. The court found that the primary judge's decision was not attended by doubt and that the proposed grounds of appeal lacked sufficient prospects of success. The court emphasised that the Snowside parties' wrongful conduct in issuing the misleading Snowside letter resulted in their unsuccessful defence, and therefore, they were not entitled to costs for defending it.