Yara Australia Pty Ltd v Oswal [No 2] - [2013] WASCA 187

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE COURT OF APPEAL (WA)

CITATION: YARA AUSTRALIA PTY LTD -v- OSWAL [No 2] [2013] WASCA 187

CORAM: McLURE P
PULLIN JA
MURPHY JA

HEARD: 18-20 FEBRUARY 2013

DELIVERED : 16 AUGUST 2013

FILE NO/S: CACV 121 of 2011

BETWEEN: YARA AUSTRALIA PTY LTD
Appellant
AND
RADHIKA OSWAL
First Respondent
PANKAJ OSWAL
Second Respondent
YARA PILBARA HOLDINGS PTY LTD (FORMERLY BURRUP HOLDINGS LTD)
Third Respondent
TOR HOLBA
First-named Fourth Respondent
VINOJIT AMBALAVANER
Second-named Fourth Respondent
YARA PILBARA FERTILISERS PTY LTD (FORMERLY BURRUP FERTILISERS PTY LTD) (Receivers and Managers Appointed)
Fifth Respondent
RAMESH SODUM
Sixth Respondent
IAN CARSON
First-named Seventh Respondent
DAVID McEVOY
Second-named Seventh Respondent
SIMON THEOBALD
Third-named Seventh Respondent

ON APPEAL FROM:
Jurisdiction              :  SUPREME COURT OF WESTERN AUSTRALIA
Coram  :KENNETH MARTIN J
Citation  :OSWAL -v- YARA AUSTRALIA PTY LTD [No 3] [2011] WASC 255
File No  :CIV 3078 of 2010

Catchwords:

Appeal - Interlocutory appeal from trial of preliminary questions - Proper construction of company shareholders deeds and other contractual instruments - Proper construction of phrase 'holder of shares' within contractual instruments - Proper construction of contractual clauses granting special voting rights to company directors - Proper construction of pre-emptive rights provisions within contractual instruments

Corporations law - Proper construction of phrase 'holder of shares' at law - Effect at law of notation of non-beneficial shareholding on company register of members - Reference in company register of members to shareholding as trustee

Trusts law - Effect of resolution to appoint trust property for benefit of beneficiaries of a discretionary trust - Whether appointment of trust property for benefit of beneficiaries of a discretionary trust creates a separate trust

Legislation:

Corporations Act 2001 (Cth), s 140(1), s 168, s 169(5A), s 1070A(1)(b), s 1071B(2), s 1072E(9), s 1072F(1), s 1072H(6)

Result:

Appeal dismissed
First respondent's cross-appeal upheld in part
Seventh respondents' cross-appeal upheld

Category: A

Representation:

Counsel:

Appellant:Mr R W Douglas & Mr D M
Benson

First Respondent:  Mr P Durack SC & Mr A Shearer
Second Respondent:  No appearance
Third Respondent:  No appearance
First-named Fourth Respondent:             No appearance
Second-named Fourth Respondent:         No appearance
Fifth Respondent:  No appearance
Sixth Respondent:  No appearance
First-named Seventh Respondent:         Mr J H Karkar QC & Mr K J Mony
De Kerloy

Second-named Seventh Respondent : Mr J H Karkar QC & Mr K J Mony
De Kerloy

Third-named Seventh Respondent: Mr J H Karkar QC & Mr K J Mony
De Kerloy

Solicitors:

Appellant:Clayton Utz
First Respondent:  Norton Rose Fulbright Australia
Second Respondent:  No appearance
Third Respondent:  No appearance
First-named Fourth Respondent:         No appearance
Second-named Fourth Respondent:         No appearance
Fifth Respondent:         No appearance
Sixth Respondent:         No appearance
First-named Seventh Respondent:         Herbert Smith Freehills
Second-named Seventh Respondent :        Herbert Smith Freehills
Third-named Seventh Respondent:         Herbert Smith Freehills

Case(s) referred to in judgment(s):

Air Tahiti Nui Pty Ltd v McKenzie [2009] NSWCA 429; (2009) 77 NSWLR 299
ALH Group Property Holdings Pty Ltd v Chief Commissioner of State Revenue (NSW) [2012] HCA 6; (2012) 245 CLR 338
Atwell v Roberts [2013] WASCA 37
Avon Downs Pty Ltd v Federal Commissioner of Taxation (1949) 78 CLR 353
BP Refinery (Westernport) Pty Ltd v Hastings Shire Council (1977) 180 CLR 266
Byrnes v Kendle [2011] HCA 26; (2011) 243 CLR 253
C B Peacocke Land Co Ltd v Hamilton Milk Producers Co Ltd [1963] NZLR 576
Carew Reid v Public Trustee (1996) 20 ACSR 443
Coachcraft Ltd v SVP Fruit Co Ltd [1978] VR 706
Commissioner of State Revenue v Lam & Kym Pty Ltd (2004) 10 VR 420
CPT Custodian Pty Ltd v Commissioner of State Revenue (Vic) [2005] HCA 53; (2005) 224 CLR 98
Dalgety Downs Pastoral Co Pty Ltd v Federal Commissioner of Taxation [1952] HCA 54; (1952) 86 CLR 335
Denham Bros Ltd v W Freestone Leasing Pty Ltd [2003] QCA 376; [2004] 1 Qd R 500
Director of Public Prosecutions (Cth) v Fysh [2010] QSC 216; (2010) 240 FLR 247
DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) [1982] HCA 14; (1982) 149 CLR 431
Duvall v Craig 15 US 2 Wheat 45 (1817)
Elders Trustee and Executor Co Ltd v E G Reeves Pty Ltd (1987) 78 ALR 193
Figgins Holdings Pty Ltd v SEAA Enterprises Pty Ltd [1999] HCA 20; (1999) 196 CLR 245
Franklin's Selfserve Pty Ltd v Federal Commissioner of Taxation (1970) 125 CLR 52
Glennon v Federal Commissioner of Taxation (1972) 127 CLR 503
Grant v John Grant & Sons Pty Ltd [1950] HCA 54; (1950) 82 CLR 1
Green v Sommerville [1979] HCA 60; (1979) 141 CLR 594
Hancock Prospecting Pty Ltd v Wright Prospecting Pty Ltd [2012] WASCA 216
Hart v Briscoe [1979] Ch 1
Helvetic Investment Corporation Pty Ltd v Knight (1984) 9 ACLR 773
Hunter v Hunter [1936] AC 222
Kendle v Melsom [1998] HCA 13; (1998) 193 CLR 46
Lady Naas v Westminster Bank Ltd [1940] AC 366
Laybutt v Amoco Australia Pty Ltd (1974) 132 CLR 57
Leveraged Equities Ltd v Goodridge [2011] FCAFC 3; (2011) 274 ALR 655
M R & R C Smith Pty Ltd T/As Ultra Tune (Osborne Park) v Wyatt [No 2] [2012] WASCA 110
Monarch Petroleum NL v Citco Australia Petroleum Ltd [1986] WAR 310
Norman v Federal Commissioner of Taxation [1963] HCA 21; (1963) 109 CLR 9
Octavo Investments Pty Ltd v Knight (1979) 144 CLR 360
Oswal v Commissioner of Taxation [2013] FCA 745
Oswal v Yara Australia Pty Ltd [No 3] [2011] WASC 255
Pacific Brands Sport & Leisure Pty Ltd v Underworks Pty Ltd [2006] FCAFC 40; (2006) 149 FCR 395
Pantorno v The Queen [1989] HCA 18; (1989) 166 CLR 466
Pilkington v Inland Revenue Commissioners [1964] AC 612
Raguz v Sullivan [2000] NSWCA 240; (2000) 50 NSWLR 236
Re A & K Holdings Pty Ltd [1964] VR 257
Re Camberwell Motors Pty Ltd [1926] VLR 539
Re Gosset's Settlement (1854) 19 Beav 529
Re Pilkington's Will Trusts [1959] 1 Ch 699
Re Wala Wynaad Indian Gold Mining Co (1882) 21 Ch D 849
Reef & Rainforest Travel Pty Ltd v Commissioner of Stamp Duties [2002] 1 Qd R 683
Roome v Edwards [1982] AC 279
Santos Ltd v Pettingell (1979) 4 ACLR 110
Saunders v Vautier (1841) Cr & Ph 240
Suncorp Insurance & Finance v Commissioner of Stamp Duties [1998] 2 Qd R 285
Suttor v Gundowda Pty Ltd [1950] HCA 35; (1950) 81 CLR 418
Swires v Renton [1991] STC 490
Tepko Pty Ltd v Water Board [2001] HCA 19; (2001) 206 CLR 1
Tipperary Developments Pty Ltd v The State of Western Australia [2009] WASCA 126; (2009) 38 WAR 488
Webb v Spicer (1849) 13 QB 886

TABLE OF CONTENTS

McLure P

Background
The Burrup Trust
The Nominee Director provisions
Limitations on Transfer of BHL shares - cl 9 of the OSD and SD
Other relevant provisions - OSD/SD
The Share Sale Agreement

Issues
Ownership of shares from time to time
The ordinary meaning of 'holder'
The meaning of 'holder' in cl 4.1(c)
Yara's contention as to the meaning of 'holder' in cl 4.1(c)
The meaning of Transfer in the OSD and SD
The scope and interrelationship of cl 9, cl 10 and cl 11
The assignability of the cl 4.1(c) rights
The effect of the March 2007 resolution
Separate fund or separate trust
The effect of the September registration changes
Loss of cl 4.1(c) rights
The issues relating to the Share Sale Agreement
The proper construction of the Share Sale Agreement

Conclusion

Pullin JA

Background

The incorporation of BHL and its constitution
The creation of the Burrup Trust
The allotment of shares in BHL
The Old Shareholders Deed (OSD)
Yara became a shareholder in BHL
The transfer of Mr Rambal's shares in BHL to Pankaj
The state of the register of members until 18 September 2008
Pankaj's resolution of 13 March 2007
Conversion of BHL into a public company ‑ a new constitution
Share split resolution
The Shareholders Deed (SD)
The events between May 2008 and 17 September 2008
The events of 18 September 2008
Documents executed on 19 September 2008
Events after the execution of the SSA

How the dispute arose
The court's order for a trial of preliminary issues
The trial judge's conclusions
Participants in the appeal
The grounds of appeal
Notices of contention
The issues in the appeal
Preliminary observation
Did the OSD terminate for Pankaj on 13 March 2007?
Did the SD terminate for Pankaj on 18 September 2008?

Whether the issue about whether Pankaj remained the holder after 18 September 2008 may be considered by this court
Pankaj remained the holder after 18 September 2008

Yara's ground 5
The pre‑emption issue
The proper construction of the SSA
Whether the right of Pankaj and Radhika under cl 4.1(c) of the SD was a right to be exercised jointly or jointly and severally
Whether Radhika and Pankaj had the right to appoint nominee directors as assignees of shares of Pankaj as trustee for the Burrup Trust pursuant to cl 1.2(c) of the SD
Radhika's other ground of appeal
Yara's grounds 1 and 2

Conclusion

Murphy JA

Introduction
The companies, the original constitution and the Burrup Trust
The parties to the old Shareholders Deed of 31 March 2005
The new Constitution
The new Shareholders Deed - 24 March 2008
An Assumption Deed
The Share Sale Agreement - 19 September 2008 and preliminary observations
The appeal, cross‑appeals and notices of contention

Yara's appeal
Radhika's cross‑appeal
Radhika's notice of contention
Seventh respondents' (Receivers') cross‑appeal and notice of contention

The construction issues
A party who 'holds' shares under cl 4.1(c) of the OSD/SD
Whether nominee rights can pass to a transferee under the OSD/SD
The proper construction of the SSA
Yara's grounds 1 and 2 - disposition
Yara's ground 3 - whether the 13 March 2007 resolution constituted a resettlement
Yara's Ground 4(a) - whether the 13 March 2007 resolution breached the pre‑emption provisions of the OSD
Yara's ground 4(b) - alleged breaches by virtue of 'Transfer' on 18 September 2008 - disposition
Yara's ground 5
Yara's ground 6
Radhika's cross‑appeal and notice of contention
Receivers' cross‑appeal and notice of contention

Conclusion

McLURE P: At the heart of this appeal is the right to appoint nominee directors to the Board of Directors of the third respondent (BHL) pursuant to two shareholders deeds. The grounds of appeal, cross‑appeal and contention are detailed in the reasons of Murphy JA.

Background

BHL was incorporated in 2001 as a proprietary company and was at all material times the holding company of the fifth respondent (BFPL). BFPL was the owner of an anhydrous ammonia plant on the Burrup Peninsula.
In March 2005, the shareholders of BHL were shown in the BHL register of members as Pankaj Oswal as trustee of the Burrup Trust and Vikas Rambal as trustee of the Vikas Rambal Trust (the Rambal Trustee). I will refer to Pankaj Oswal in his capacity as trustee of the Burrup Trust as 'the Burrup Trustee'.
The appellant (Yara) was interested in purchasing shares in BHL. By deed dated 31 March 2005 Yara, the Burrup Trustee, the Rambal Trustee, BHL and BFPL entered into a shareholders' deed (the OSD). Clause 4.1(c) of the OSD dealt with the power of shareholders to appoint nominee directors to BHL. The nominee director(s) appointed by each BHL shareholder were collectively entitled to one vote at a board meeting, at which they were present and entitled to vote, for each share held by the shareholder that appointed them (cl 4.5(a)(i)). By this mechanism the shareholder with the majority of shares would have control of the Board and the company except where a special majority (an affirmative vote of 90% or more of the votes cast) was required.
As contemplated by the OSD, Yara became a BHL shareholder. On 12 April 2005 the registered holders of the issued shares in BHL were shown as follows:
Burrup Trustee: 902 shares (55%);
Yara:492 shares (30%);
Rambal Trustee: 246 shares (15%).
In January 2007 a dispute between the Burrup Trust and the Rambal Trust was settled on the basis that the Rambal Trustee transfer his 246 shares in BHL to the Burrup Trustee. Registration of the transfer was not effected until 26 April 2007.
On 13 March 2007 the Burrup Trustee resolved to appoint for the absolute benefit of each of Pankaj personally and the first respondent (Radhika) half of the BHL shares held in respect of the Burrup Trust (the March 2007 resolution).
However, from 26 April 2007 until 18 September 2008 the BHL share register showed the Burrup Trustee holding 1,148 shares (70% of the issued capital) and Yara holding 492 shares (30% of the issued capital).
In anticipation of listing on the Australian Stock Exchange (ASX), by resolution dated 21 January 2008, BHL converted from a proprietary company to a public company.
On 19 March 2008 the members of BHL resolved to split each share on the basis of 670,756.96 new shares for each old share (the share split resolution). This was not reflected in the BHL register of members until 18 September 2008.
By deed dated 24 March 2008 Yara, the Burrup Trustee, BHL and BFPL entered into a new shareholders deed (the SD), which (prospectively) replaced the OSD. Clause 4.1(c) and cl 4.5(a)(i) of the SD also provided for the management of BHL by nominee directors.
By mid‑May 2008 BHL was considering an initial public offering (IPO) in conjunction with its listing on the ASX.
By early September 2008 Yara was negotiating with the Burrup Trustee for the purchase of a further 5% of BHL shares.
At some time on 18 September 2008 BHL's general counsel, Mr Lenzo, made entries in the register of members of BHL. The Burrup Trustee was removed from the register and Radhika and Pankaj (in his personal capacity) were each registered as the holder of 35% of the shares in BHL. The register was also amended to reflect the share split resolution.
By an agreement made on 19 September 2008 between Pankaj, Yara, Radhika and the Burrup Trustee, Pankaj sold to Yara 55,002,071 BHL shares, comprising 5% of the issued shares in BHL (the Share Sale Agreement).

The Burrup Trust

The Burrup Trust, a discretionary trust, was created by deed dated 22 June 2001. Pankaj Oswal was at all material times the trustee, guardian, appointor and one of three primary beneficiaries of the Burrup Trust. Radhika was another primary beneficiary.
The March 2007 resolution was made under cl 17.1 of the Burrup Trust, which deals with the application of capital before the vesting day of the trust. It provides:
17.1Capital of Fund
If:
(a)a Guardian is then in office … and the Guardian consents; or
(b) …
the Trustee may from time to time before the Vesting Day whether or not the Trustee has made an appointment under clause 16.1, appoint, apply, or distribute, the whole or any part of the capital of the Fund to or for a General Beneficiary for the Beneficiary's own use and benefit or for the maintenance, education, advancement, or benefit, of a General Beneficiary.
The March 2007 resolution provides:
I, Pankaj Oswal, being the Trustee of the Burrup Trust and having obtained consent of the Guardian of the Burrup Trust, do hereby resolve pursuant to Clause 17.1 of the Deed of Trust, to appoint for the absolute benefit of the named beneficiaries below, a part of the corpus of the trust as detailed below. Henceforth the corpus so appointed and income or accretion of capital therefrom shall be held on separate trust and for the absolute benefit of the named beneficiaries in their own individual capacities.
Mr Pankaj Oswal ‑ 574 shares in Burrup Holdings Pty Ltd
Mrs Radhika Oswal ‑ 574 shares in Burrup Holdings Pty Ltd.
This resolution anticipated the settlement of the agreement with the Rambal Trustee to transfer 246 shares to the Burrup Trustee which did not occur until 26 April 2007. The 1,148 shares the subject of the March 2007 resolution was 70% of the issued share capital in BHL. There is no express reference in the March 2007 resolution to the cl 4.1(c) right to appoint nominee directors.

The Nominee Director provisions

The central provision of the OSD and SD is cl 4.1(c) which relates to the power to appoint directors of BHL and each other company within the group, including BFPL (the Company Group).
Clause 4(1)(c) of the OSD relevantly provides:
Appointment: For as long as it holds 5% or more of the issued share capital of [BHL], Yara may appoint one nonexecutive director to the Board of each company in the Company Group. For as long as he holds 5% or more of the issued share capital of [BHL], Vikas Rambal may appoint one director to the Board of each company in the Company Group. For as long as he holds 5% or more of the issued share capital of [BHL], Pankaj Oswal may appoint the remaining 3 directors to the Board of each company in the Company Group. [BHL] will appoint to the Board of each other company in the Company Group the persons nominated by the Shareholders in accordance with this clause.
Provided that the shareholder has complied with clauses 4.1(c) and 4.1(g), a Director may be removed only by the shareholder who appointed him (clause 4.1(e) of the OSD).
Clause 4.1(g) provides that if at any time a shareholder holds less than the percentage of shares in BHL referred to in clause 4.1(c), the shareholder must ensure that its appointee director(s) resign from the Board with effect from the date on which the shareholder first held less than that percentage.
Under cl 4.5(a)(i) of the OSD, the voting rights of the Directors appointed pursuant to clause 4.1(c) are as follows:
The Nominee Directors appointed by each Shareholder and present and entitled to vote at a Board meeting are collectively entitled to one vote at a Board meeting for each Share held by the Shareholder that appointed those Nominee Directors.
Clause 4.1(c) of the SD is in similar terms to the OSD save for the removal of any reference to Vikas Rambal. Clause 4.1(c) of the SD relevantly provides:
For as long as it holds 5% or more of the issued share capital of [BHL], Yara may appoint one non‑executive director to the Board of each company in the Company Group. For as long as he holds 5% or more of the issued share capital of [BHL], Pankaj Oswal may appoint the remaining 3 directors to the Board of each Company in the Company Group.
Clause 4.1(d) of the SD is in materially the same terms as cl 4.1(e) of the OSD. Clause 4.1(f) of the SD is in the same terms as cl 4.1(g) of the OSD. Clause 4.5(a)(i) of the OSD and SD are in the same terms.
The terms 'Shareholders', 'Shareholder' and 'Shares' have the same meaning in the OSD and the SD. 'Shareholders' is defined in cl 1.1 to mean 'the people who hold Shares from time to time', and 'Shareholder' means one of them. 'Share' means a fully paid ordinary share in the capital of BHL and, where the context allows, includes an interest in a share.
The maximum number of Directors of BHL and other companies in the group was five (cl 4.1(b) of OSD and SD).

Limitations on Transfer of BHL shares - cl 9 of the OSD and SD

Clause 9.1 of the OSD provides for restrictions on the transfer of BHL shares. It states:
A Shareholder must not Transfer Shares it holds or to which it is entitled except:
(a)as set out in clauses 9.2, 9.3, 9.4 or 15.2(c); or
(b)where all the Shareholders otherwise agree.
The term 'Transfer' is widely defined in cl 1.1 of the OSD to mean 'sell, assign, transfer, convey or otherwise dispose of any interest in or confer rights in respect of any Shares'.
Clause 9.2 of the OSD permits a transfer to a wholly owned subsidiary. It relevantly provides:
(a)A Shareholder may Transfer some or all of its Shares to a Related Body Corporate … if, in addition to complying with clause 9.7, the Shareholder and the Subsidiary agree that the Shares must be retransferred to the Shareholder if the Subsidiary ceases to be wholly owned by the Shareholder or its ultimate holding company.
(b)A Shareholder remains liable for the performance of the duties, responsibilities and obligations assumed by any Subsidiary …

Clause 9.3 of the OSD provides:
Subject to clause 9.2, a Shareholder must not Transfer, directly or indirectly, its Shares unless it first issues a Transfer Notice to the Board in accordance with clause 10 and complies with clauses 10 and 11 inclusive in respect of that Transfer.
Clause 9.4 of the OSD relates to 'Change in Control' of a shareholder. It provides:
If there is a Change in Control of a Shareholder (other than under clause 9.2) that Shareholder must promptly notify [BHL] and each other Shareholder of that Change of Control including details of the nature of the change.
The expression 'Change in Control' of a shareholder is defined to mean:
(a)the acquisition by any person … of a relevant interest (as defined in the Corporations Act) in more than 50% of the issued Shares in the Shareholder or the Holding Company of the Shareholder … ; or
(b)where the Shareholder is the trustee of any trust, any change of the trustee of the trust or any person, other than a Relative of the trustee at any time, becomes beneficially entitled to the property or income of the trust.
The exception relating to a relative does not apply to a change of trustee. Clause 9.5 of the OSD deems a 'Change of Control' to be a transfer notice under cl 9.6. Clause 9.5 relevantly provides:
If there is a Change in Control of a Shareholder (other than under clause 9.2) then regardless of whether the Shareholder has served notice in accordance with clause 9.4 the Shareholder is deemed to have issued a transfer notice in accordance with clause 9.6 for all of its Shares and clause 10.2 applies, as if there had been a Transfer of those Shares except that the Shareholder is not deemed to have specified a Prescribed Price … and the Shareholders will procure the auditors of [BHL] to value the Offered Shares (as defined in clause 10.1) in accordance with clause 10.6 …
Clause 9.6 of the OSD provides:
Where a transfer notice is deemed to be issued by operation of clause 9.4, clause 10 will apply to the sale of those Shares …
Clause 9.7 of the OSD is also of significance in this case. It relevantly provides:
Unless all the other Shareholders agree, the following conditions of Transfer must be satisfied before a Transfer of Shares is effective:
(a)where Shares are proposed to be Transferred to a third party (including a Subsidiary under clause 9.2) the third party must execute and deliver to each other Shareholder an Assumption Deed.
An 'Assumption Deed' is defined in cl 1.1 to mean a deed of assumption in the form of annexure A to the OSD.
Clause 10 of the OSD provides for rights of pre-emption. The pre‑emptive rights apply, in terms, where the shareholder proposes to sell shares. It is unnecessary to refer to the clause in detail. It is sufficient for present purposes to note that (1) a transfer notice under cl 9.3 constitutes an offer to sell the shares to the other shareholders at a nominated price (cl 10.5); and (2) a transfer is permitted if acceptance notices have not been received for all the shares at the close of the offer period (cl 10.10).
Clause 11, which relates to the execution of an assumption deed, relevantly provides:
11.1If [BHL] proposes to allot and issue Shares to a person who is not already a Shareholder, the Shareholders must procure the Board to make the allotment and issue conditional on the proposed allottee first executing an Assumption Deed.
11.2The Shareholders must procure the Board to refuse to register the Transfer of any Shares to a person who is not already a party to this deed unless that person has executed an Assumption Deed.
The structure of cl 9 of the SD is similar to that of the OSD but there are material differences in content. Clause 9.1 prohibits a shareholder from transferring BHL shares it holds or to which it is entitled except (a) as set out in cl 9.2, cl 9.3 or cl 9.5; (b) either pursuant to or for the purposes of an IPO in relation to a listing of BHL on a stock exchange; or (c) where all the Shareholders otherwise agree.
Apart from the fact that cl 9.3 is made subject to cl 9.1 (not cl 9.2), cl 9.2, cl 9.3, cl 9.4, cl 9.5, cl 9.6, cl 9.7 and cl 11 of the SD are otherwise in materially the same terms as the OSD.
However, the term 'Transfer' has a narrower definition in the SD. It is defined to mean 'to sell, assign, transfer, convert, surrender, cancel, convey or otherwise dispose of any Shares'.
Further, the exceptions in the definition of 'Change in Control' are wider than in the OSD. The definition of that expression relevantly provides:
(b)where the Shareholder is the trustee of any trust:
(i)any change of the trustee of the trust to any person, other than a Relative of the trustee at any time; or
(ii)any person, other than a Relative of the trustee at any time, becomes beneficially entitled to more than 50% of the property or income of the trust.
Changes are also made to the pre‑emptive rights. Clause 10 of the SD relevantly provides:
10.1Subject to clauses 9.1(b), 9.1(c) and 9.2, before Transferring any Shares … the Shareholder proposing to Transfer the Shares … must give a Transfer Notice … to the other Shareholders …
10.2A Transfer Notice must specify the price per Share … at or above which the sale is to proceed.

Other relevant provisions - OSD/SD

The OSD and SD both provide that a reference to any party includes that party's successors and permitted assigns, including any person taking by way of novation (cl 1.2(c)).
Clause 16.2 of the OSD and SD, which are in materially the same terms, provide for their automatic termination in specified circumstances. Clause 16.2 of the SD provides:
16.2Automatic termination
(a)(Events): If:
(i)one Shareholder becomes the holder of all the Shares and all rights to subscribe for or convert any security into further Shares;
(ii)there is a listing of [BHL] on a stock exchange or any or all of [BHL's] Shares are quoted or listed on a stock exchange; or
(iii)the Shareholders agree in writing to terminate this deed,
then this deed will, without further action required by any Shareholder, automatically terminate.
(b)(Consequences): If this deed is terminated under clause 16.2(a) then, in addition to other rights, powers or remedies provided by law:
(i)each party is released from its obligations to perform this deed further, except those imposing obligations of confidentiality; and
(ii)each Shareholder retains the rights it has against each other Shareholder in respect of any past breach.
(c)(For outgoing Shareholder): This deed will also be terminated for any one Shareholder when it ceases to hold, directly or indirectly, any Shares. In that case, the provisions of clause 16.2(b) still apply.

The Share Sale Agreement

The SD is referred to in cl 5 of the Share Sale Agreement. It is another central provision. Clause 5 provides:
(a)The Oswal Parties represent and warrant that:
(i)Pankaj Oswal in his personal capacity is the legal and beneficial owner of ordinary fully paid shares in the capital representing 35% of the total issued ordinary shares in the capital of [BHL]; and
(ii)Radhika Oswal is the legal and beneficial owner of ordinary fully paid shares in the capital representing 35% of the total issued ordinary shares in the capital of [BHL].
(b)Pankaj Oswal, the Burrup Trustee and Radhika Oswal undertake to execute all documents necessary to join Pankaj Oswal in his personal capacity and Radhika Oswal to the Burrup Shareholders Deed in place of the Burrup Trustee and with such other amendments as agreed by the Buyer [Yara] and the Oswal Parties. Until such document has been executed, Pankaj Oswal in his personal capacity and Radhika Oswal agree to comply with the Burrup Shareholders Deed as if they were a party to the deed in the place of the Burrup Trustee.
Clause 19.6 of the Share Sale Agreement provides:
Each party must promptly do all further acts and execute and deliver all further documents (in form and content reasonably satisfactory to that party) required by law or reasonably requested by another party to give effect to this agreement.

Issues

The broad issues that emerge from Yara's grounds of appeal and the grounds of the cross‑appeals and notices of contention of Radhika and the seventh respondents (the receivers) are:
1.Whether the Burrup Trustee ceased to be the holder of 5% or more of the issued share capital in BHL as a result of:
(i)the March 2007 resolution;
(ii)the change in registered holder of BHL shares from the Burrup Trustee to Radhika and Pankaj on 18 September 2008;
2.If yes to question 1, whether the Burrup Trustee permanently lost his right to appoint nominee directors under cl 4.1(c);
3.If the Burrup Trustee's cl 4.1(c) rights were not lost, or not permanently lost, whether:
(i)the cl 4.1(c) rights are assignable;
(ii)if assignable, whether Radhika and Pankaj became parties to the SD and obtained the right to appoint nominee directors under cl 4.1(c):
(a)on them becoming registered holders of BHL shares on 18 September 2008 by virtue of cl 1.2(c) of the SD;
(b)by virtue of cl 5(b) of the Share Sale Agreement;
(c)pursuant to an implied term of the Share Sale Agreement;
4.If Radhika and Pankaj obtained the right to appoint nominee directors under cl 4.1(c) of the SD:
(a)was that right conditional on the execution by each of them of an assumption deed; and
(b)did they hold the right jointly or jointly and severally;
5.If Radhika and Pankaj received the cl 4.1(c) nominee director rights of the Burrup Trustee, whether Yara was entitled, jointly with Radhika and Pankaj, to appoint three nominee directors.
A number of sub‑issues also arise. They are:
6.Does the word 'holder' in cl 4.1(c) of the OSD and SD mean:
(a)the legal entity registered as holder in the BHL register;
(b)the legal entity in the specified capacity recorded in the BHL register; or
(c)as Yara contends, a person who is both the registered holder (or the parent of a registered holder) and either an original party to the OSD/SD in the specified capacity or a person who has taken following a compliant Transfer under the OSD/SD, including in compliance with cl 9, cl 10 and cl 11;
7.Did the March 2007 resolution create a separate fund as part of the Burrup Trust or a separate trust;
8.Did the March 2007 resolution and/or the change in registered holder of the BHL shares on 18 September 2008:
(a)constitute a transfer for the purposes of cl 9.1 and, if so, was it ineffective unless and until the execution of a deed of assumption;
(b)breach the pre‑emptive provisions;
9.Whether, by reason of the Share Sale Agreement, any transfer of the BHL shares to Radhika and Pankaj is one to which all shareholders agreed for the purpose of cl 9.1(c) of the SD;
10.Whether an agreement to transfer shares in contravention of cl 9 to cl 11 of the OSD/SD is effective to pass any interest in the BHL shares.

Ownership of shares from time to time

A share in a company is a legal chose in action. The legal owner of a share is the legal entity entered in the register of members in respect of the share.
Subject to the consequences of any breach of, or failure to comply with, the OSD or SD, and assuming for present purposes that there is a material distinction between the Burrup Trustee and Pankaj personally, the ownership of shares in BHL changed from time to time as follows:
(1)Immediately before the March 2007 resolution until immediately before registration of the transfer of shares from the Rambal Trustee to the Burrup Trustee on 26 April 2007:
•the Burrup Trustee was the legal owner of 55% of the shares in BHL;
•the Rambal Trustee was the legal owner of 15% of the shares in BHL (the Burrup Trustee having equitable title);
•Yara was the full (ie legal and beneficial) owner of 30% of the BHL shares.
(2)On and from the registration change on 26 April 2007 until immediately prior to the registration changes on 18 September 2008:
•the Burrup Trustee was the legal owner of 70% of the shares in BHL;
•Yara was the full owner of 30% of the shares in BHL.
(3)On and from the registration changes on 18 September 2008 until immediately prior to the execution of the Share Sale Agreement:
•Pankaj was the full owner of 35% of the shares in BHL;
•Radhika was the full owner of 35% of the shares in BHL;
•Yara was the full owner of 30% of the shares in BHL.
(4)On and from the execution of the Share Sale Agreement until registration of the transfer of 5% of the BHL shares from Pankaj to Yara:
•Pankaj was the full owner of 30% of the shares in BHL;
•Pankaj was the legal owner of 5% of the shares in BHL on trust for Yara;
•Radhika was the full owner of 35% of the shares in BHL;
•Yara was the full owner of 30% of the shares in BHL.
(5)Upon registration of the transfer of 5% of Pankaj's shareholding to Yara under the Share Sale Agreement:
•Pankaj was the full owner of 30% of the shares in BHL;
•Radhika was the full owner of 35% of the shares in BHL;
•Yara was the full owner of 35% of the shares in BHL.
The meaning of the word 'holds' in cl 4.1(c) first became a live issue during the hearing of the appeal. A sub‑issue flushed (and fleshed) out for the first time in supplementary submissions after the hearing of the appeal was whether the holder of the relevant shares for the purpose of cl 4.1(c) is the registered legal entity simpliciter or that entity in the capacity in which he acted. It is necessary to begin with the ordinary meaning of 'holder'.

The ordinary meaning of 'holder'

Ordinarily, the verb 'hold' and its variants, when used in relation to company shares, refers to the legal ownership of the shares according to the register of members: Dalgety Downs Pastoral Company Pty Ltd v Federal Commissioner of Taxation (1952) 86 CLR 335, 341. Of course, the meaning of a term in a contract is to be ascertained from the context in which it appears.
The ordinary meaning of 'hold' and 'holder' is reflected in s 1072F(1) of the Corporations Act 2001 (Cth) (CA), a replaceable rule, which provides:
A person transferring shares remains the holder of the shares until the transfer is registered and the name of the person to whom they are being transferred is entered in the register of members in respect of the shares.
'Holder' in the CA retains its ordinary meaning notwithstanding other provisions relating to notification in the register as to beneficial ownership. The CA requires that a company set up and maintain a register of members (s 168). At all material times, BHL was required to indicate in its register of members any shares that a member did not hold beneficially (s 169(5A)). Further, registered shares held by a trustee in respect of a particular trust may (not must), with the consent of the corporation, be marked in the register in such a way as to identify them as being 'held in respect of the trust' (s 1072E(9)). Finally, where a non‑beneficial holding of shares becomes beneficial, the holder is required to give to the company notice that, among other things, the person holds the relevant shares beneficially (s 1072H(6)).
The approach taken to the word 'holder' in s 1072F is informed by the broader legal framework. The relationship between shareholder and company and shareholders inter se is contractual. A company's constitution and any replaceable rules that apply have effect as a contract: s 140 CA.
If s 1072F applies, registration of a transfer of shares in the register of members of a company results in the novation of that (statutory) contract as between the existing registered shareholders, the transferee and the company.
A trust is not a legal entity. It cannot be a party to a contract. A trustee contracts as principal in his or her personal capacity as a legal entity without limitation. Thus, a trustee is personally liable, as are his assets, under the contract (unless the contract otherwise provides): Octavo Investments Pty Ltd v Knight (1979) 144 CLR 360, 367. However, the capacity in which the trustee acts is relevant to other contracting parties. Unless the contract otherwise provides, creditors of the trustee are entitled to be subrogated to the trustee's right of indemnity against the trust assets: Octavo (367). There are also insolvency ramifications.
Further, the holders (legal owners) of shares have, as between themselves and the company, all the rights attached to shares including voting, entitlement to receive dividends and benefits on a winding up: Glennon v Federal Commissioner of Taxation (1972) 127 CLR 503, 511 ‑ 512. Walsh J in Glennon considered the effect of s 156(3) of the Companies Act 1961 (Qld) which, like s 1072E(9) of the CA, provided that shares held by a trustee in respect of a particular trust may, with the consent of the corporation, be marked in the register in such a way as to identify them as being held in respect of the trust. Walsh J concluded that even if the shares in question in that case had been marked in the register so as to identify them as shares held in trust that had no consequence in relation to the rights of the holders of the shares as between themselves and the companies (512). That is, a notification in the register that shares are held in trust does not have any legal consequences affecting the mutual rights and obligations of shareholders and the company.
If the capacity in which the trustee held the shares is part of its status as the holder, there would be a requirement, not just a statutory power, for that information to be included in the register.
These features explain why the 'holder' of a share is, for CA purposes, the legal entity entered on the register of members. The capacity in which the legal owner of the share is acting is not relevant to the status of 'holder'.

The meaning of 'holder' in cl 4.1(c)

There are some indications that the term 'holder' in cl 4.1(c) of the OSD and SD means the legal entity registered in the register of members of BHL.
At all material times, the relevant provisions of the constitutions of BHL were consistent with s 1072F(1) of the CA. The June 2001 constitution (the old Constitution) and the January 2008 constitution (the new Constitution), relevantly provided that the transferor of a share remained the holder of it until the transfer was registered and the name of the transferee entered in the register of members. Further, both the old Constitution and the new Constitution confer rights only on persons registered as the holder of shares.
Both the OSD and SD provide in cl 20 that the Deed and the Constitution must be read together but that the Constitution was to be read subject to the Deed, which would prevail in the event of an inconsistency.
The term 'Shareholders' is defined in both Deeds to mean 'the people who hold shares from time to time, and 'Shareholder' means one of them'. The term shareholder is used throughout the Deeds and is intended to include the original parties to the Deeds who were shareholders (the original shareholders) as well as future shareholders who would become parties by the execution of a deed of assumption, which effects a novation. As to which, see Leveraged Equities Ltd v Goodridge (2011) 274 ALR 655 [299] ‑ [317].
The persons specified in cl 4.1(c) are referred to in their capacity as shareholders. This is demonstrated by the express provisions of the Deeds relating to the appointment, removal and resignation of nominee directors: cl 4.1(d), 4.1(e), and 4.1(g) of the OSD; cl 4.1(d), and cl 4.1(f) of the SD. Moreover, the clauses governing voting rights at board meetings refer to nominee directors appointed by each shareholder (cl 4.5 of both Deeds).

It is also necessary to distinguish between the rights which belong to the holder (legal owner) of shares, qua shareholder, and broader contractual and commercial considerations. All of the BHL shares held by Pankaj Oswal (and Vikas Rambal) were trust property. Yara was aware of that fact. There was no sensible alternative but for Mr Oswal to enter into the Deeds in his capacity as trustee of the Burrup Trust and warrant that he had both the power and authority to enter into the Deeds and a right to be indemnified out of the trust fund (see cl 12.2 of both Deeds). However, that did not have the effect of excluding Mr Oswal's liability under the Deed in his personal capacity: Helvetic Investment Corporation Pty Ltd v Knight (1984) 9 ACLR 773. That is, the fact that a party enters into a contract or deed in the capacity of trustee does not exclude or confine his personal liability to comply with the terms of the instrument. Unless the agreement otherwise provides, his personal liability continues even after his appointment as trustee ends.
Yara contends that on a proper construction of the Deeds, holder except for the parent company exception is the legal person and the capacity in which he acts as recorded in the register of members. Both the OSD and SD identify and define the relevant parties by reference to their capacity as trustee. Both Deeds describe the relevant party in the following terms:
Pankaj Oswal as trustee of the Burrup Trust … ('Pankaj Oswal')
Further, Recital A of the OSD and SD provides that:
Pankaj Oswal is the trustee of the Burrup Trust and in his capacity as trustee of the Burrup Trust is the holder of [specified number] ordinary fully paid shares in [BHL] representing [nominated percentage] of the issued shares in [BHL].
Yara also relies on cl 16.2(c) of the Deeds to refute what it describes as the narrow meaning of the word 'holder'. Clause 16.2 provides for the automatic termination of the relevant Deed. Clause 16.2(c) provides that the Deed will also be terminated for any one shareholder when it ceases 'to hold, directly or indirectly', any shares.
When read in the context of the Deeds as a whole, the reference to 'directly or indirectly' is intended to refer to the exclusion in cl 9(2) which permits a transfer from a shareholder to its wholly owned subsidiary if cl 9.7 is complied with (the execution of an assumption deed) and other conditions are met. The shareholder (the holding company) remains liable for the performance of the duties, responsibilities and obligations assumed by the subsidiary under the Deed. The holding company indirectly holds the shares because of its control over the actual holder, its subsidiary. In isolation, cl 16.2(c) has no wider significance.
However, there are other provisions of the Deeds supporting the conclusion that the parties thereto intended that the terms 'holder' and 'shareholder' include the capacity in which the legal entity entered into the Deeds. The unmistakeable intention of clauses 9, 10 and 11 is that only a party to the Deed can be a holder/shareholder. The party is intended to be the holder/shareholder under the Deeds. Further, the shareholder's capacity as trustee figures prominently in those clauses (9, 10 and 11) that are central to maintaining the managerial power‑sharing arrangement at the heart of the Deeds. Recital A also reflects the parties' intentions, which must prevail.
Moreover, the parties conducted the trial on the basis of pleadings to the effect that when registered as such in the register of members, the 'holder' of shares embraced both the legal entity (Pankaj Oswal) and his capacity as trustee of the Burrup Trust. The primary judge made a finding to that effect which is not the subject of any ground of appeal. The Share Sale Agreement was also drafted on that basis. In all the circumstances I would uphold the primary judge's decision and proceed on the basis on which the case was pleaded and litigated. I reach that decision without reliance on Yara's claim that it would have adduced evidence of earlier shareholder agreements if the issue had been litigated.

Yara's contention as to the meaning of 'holder' in cl 4.1(c)

Yara contends that a holder of shares for the purposes of cl 4.1(c) is a person who is both the registered person and either an original party to the OSD/SD in the specified capacity or a person who has taken following a compliant transfer under the OSD/SD, including in compliance with cl 9, cl 10 and cl 11.
I am here dealing with the alternative to the second limb of the contention, which requires the registered holder to have taken pursuant to a compliant transfer under the relevant Deed. This proposition involves an assumption that the nominee director appointment rights in cl 4.1(c) are capable of being transferred by the shareholder nominated in the clause. For present purposes, I will proceed on that assumption.
It is clear from the Deeds as a whole that the objective intention of the parties was that (in the absence of consent of all the other shareholders) no person could or would become the holder of BHL shares without first becoming a party to the relevant Deed by executing an assumption deed. That was necessary in order to protect the power sharing arrangement that would not otherwise bind a new shareholder. Clause 4.1(c) is central to that power sharing arrangement. Against that background, it is inconceivable that the parties intended 'holder' in cl 4.1 to mean any person who secured registration of shares in the register of members.
The objectively determined intention is that 'holder' in cl 4.1(c) means 'holder under and in compliance with this Deed'.

The meaning of Transfer in the OSD and SD

The term 'transfer' in the Deeds has a different meaning according to its context. In cl 9, it refers to the nature and effect of a transaction. In cl 11.2, it is a reference to the instrument of transfer required as a condition of its registration in the register of members. In the latter context, it is necessary to distinguish between a sale on a prescribed financial market (such as the ASX) and an off market transaction. Under s 1070A(1)(b) of the CA, a share is transferable as provided by the company's constitution. However, a company must only register a transfer if a proper instrument of transfer has been delivered to the company (s 1071B(2) of the CA).
Clause 9.1 of the Deeds provide that a shareholder 'must not Transfer Shares it holds or to which it is entitled' unless it falls within one or more of the specified exceptions.
The term 'transfer' is more widely defined in the OSD than in the SD. In the OSD it means 'sell, assign, transfer, convey or otherwise dispose of any interest in or confer rights in respect of any Shares'. The words in italics are missing from the definition in the SD.
Yara's position appears to be that the definition in the OSD covers both legal and equitable interests whereas the definition in the SD is confined to legal interests. The respondents did not join issue on this subject in the appeal.
However, I am not persuaded that Yara's position regarding the SD is correct. The prohibition in cl 9.1 is on a shareholder, defined to mean a person who holds shares in BHL. However, the shareholder is prohibited from transferring shares it holds or to which it is entitled. Thus cl 9.1 applies only to the holder (legal owner) of shares but the prohibition applies both to the shares it holds as well as to shares to which the holder is entitled, but in respect of which it is not the legal owner. For instance, between the date of the March 2007 resolution and 26 April 2007 Pankaj was the holder (for CA purposes) of 55% of the issued shares in BHL and was entitled to be the holder of the shares to be transferred from the Rambal Trust. There can be no doubt that the cl 9.1 prohibition in both the OSD and SD applies to the transfer of an equitable interest in shares in circumstances where that transfer would, under the general law, entitle the transferee to be registered as the holder of the shares. It is unnecessary to determine whether it has any wider operation.

The scope and interrelationship of cl 9, cl 10 and cl 11

Two related issues arise for determination in the appeal. They are whether (1) the express exceptions for transactions involving relatives in par (b) of the definition of 'Change in Control' can be a transfer under cl 9.1 that enlivens, through the obligation to issue a transfer notice under cl 9.3, the pre‑emptive rights in cl 10; and (2) the pre‑emption provision in cl 10 is confined to one type of transfer transaction, namely the sale of shares.
The primary judge was correct to answer the first question in the negative. The answer to the second question is also in the negative. The structure, but not the detail, of the SD is the same as the OSD. I will focus on the SD.
Clause 9.1 of the SD prohibits a 'Transfer' unless it falls within the exceptions specified therein. However, two of the 'exceptions' are of an unusual character in that they contain mutually exclusive routes that trigger the engagement of the pre‑emptive rights in cl 10. Under cl 9.1, a shareholder must not transfer shares except:
•pursuant to cl 9.2 (transfer to a subsidiary);
•pursuant to cl 9.3 (which activates the pre‑emptive rights);
•pursuant to cl 9.5 (which also activates the pre‑emptive rights but by a different route);
•for the purposes of an IPO; or
•with the agreement of all shareholders.
The effect of cl 9.1 and cl 9.3 is that if a cl 9.1 transfer is not within any of the other specified 'exceptions' in cl 9.1, a shareholder must not transfer its shares 'unless it first issues a Transfer Notice … in accordance with clause 10 and complies with clauses 10 and 11 inclusive in respect of that Transfer'.
The pre-emptive rights in cl 10 are not confined to 'Transfer' by way of sale. The scheme is as follows. When a transfer does not fall within one of the other cl 9.1 exceptions, the shareholder must issue a transfer notice under cl 9.3 which, pursuant to cl 10.5, constitutes an offer to sell the relevant shares to the other shareholders at the 'Prescribed Price'. The prescribed price is the price per share at or above which the offer to sell is to proceed (cl 10.2).
However, cl 9.3 does not apply if the transfer is one to which cl 9.5 applies. In that situation, the shareholder is not required to issue a transfer notice under cl 9.3 but rather is deemed to have issued a transfer notice in accordance with cl 9.6.
The difference between a cl 9.3 transfer notice and a deemed transfer notice required under cl 9.5 is that the former must identify the prescribed price whereas under the latter a shareholder is not deemed to have specified a prescribed price and the shareholders will procure the auditors to value the relevant shares in accordance with cl 10.6.
The definition of 'Change in Control' is wider than, but includes, transactions within the scope of a cl 9.1 transfer as defined. An example is a transfer of shares from an existing trustee to a new trustee, including a new trustee that is a relative. In circumstances where a cl 9.1 transfer is of a type to which cl 9.5 applies, such as a change in trustee, cl 9.5 and cl 9.6 would apply to the exclusion of cl 9.3. Further, there being two mutually exclusive routes which cover the field to activation of the pre‑emptive rights provision, it is tolerably clear that the exception for relatives in the definition of change in control is permissive; that is, it is not intended to be a transfer that activates the pre-emptive rights pursuant to cl 9.3.
However, where the exceptions in the definition of change in control relate to transactions which come within the definition of transfer in cl 9.1, it is the case that cl 9.7 (and cl 11.2) applies so that, unless all the shareholders otherwise agree, a transfer is ineffective unless and until the relevant third party executes and delivers to each other shareholder an assumption deed.

The assignability of the cl 4.1(c) rights

Yara accepts that the parties to the SD could, in principle, agree to transmit or grant cl 4.1(c) rights to Pankaj and Radhika personally. Whether or not that is the effect of the Share Sale Agreement is discussed below. The current question is whether the cl 4.1(c) rights are assignable. The arguments for and against the assignability of the cl 4.1(c) rights are tabulated by the primary judge in [397] of his reasons. In essence, the primary judge accepted the receivers' submissions on assignability.
First some background. An assignment involves the transfer of an existing proprietary right from an assignor to an assignee: Norman v Federal Commissioner of Taxation (1963) 109 CLR 9, 26. Only property, or a right of property, can be assigned, but not all property rights are assignable. Whether a contractual right (also a chose in action) is assignable depends upon the proper construction of the contract as a whole.
A contractual burden or obligation cannot be assigned except by way of novation. Novation typically results in the addition of a new party, whether in substitution of or in addition to an existing party: ALH Group Property Holdings Pty Ltd v Chief Commissioner of State Revenue(NSW) (2012) 245 CLR 338. One party to a contract cannot effect a novation without the consent of the other parties, whether that consent is given in the original contract itself or subsequently.
An assignment of a contractual right or benefit at law or equity does not result in the assignee becoming a party to the contract and nor does the general law require the consent of the other contractual parties. See Figgins Holdings Pty Ltd v SEAA Enterprises Pty Ltd(1999) 196 CLR 245 [36].
It is also necessary to bear in mind the distinction between the assignment of ordinary contractual rights on the one hand and other proprietary rights, such as rights under a trust or shares. A share is the totality of a bundle of rights and powers: Pacific Brands Sport & Leisure Pty Ltd v Underworks Pty Ltd (2006) 149 FCR 395 [39]. If cl 4.1(c) was a proprietary right, qua share, it must be assignable.
The parties conducted the appeal on the basis that the cl 4.1(c) right was contractual. I agree with that assessment. The cl 4.1(c) rights do not accrue to a BHL shareholder under the constitution and any replaceable rules that apply. They are rights that derive solely from the Deeds and do not bind any shareholder who is not a party to the Deed. As previously noted, the objectively determined intention from the terms of the Deeds as a whole is to ensure that (absent the consent of all shareholders) no person can become a holder of BHL shares without first executing an assumption deed; they become a party to the Deed by way of novation. Moreover, a transfer of BHL shares by a holder nominated in cl 4.1(c) that did not reduce his holding below 5% could not involve any transfer of cl 4.1(c) rights, even if they are assignable. The cl 4.1(c) right is not a right appurtenant or attached to a BHL share. The right is indivisible and relates to the totality of the issued shares held by the nominated original shareholder at the relevant time. If the cl 4.1(c) right is assignable it would, as a matter of contractual intention, 'go with' the transfer of the transferor's entire shareholding on the execution of a deed of assumption; that is, the cl 4.1(c) right need not be separately or expressly assigned.
Thus, the question in this case is whether the contractual right in cl 4.1(c) is personal to the named original shareholders. Yara relies on the following matters in support of its claim that the cl 4.1(c) rights are personal to the nominated original shareholders and non‑assignable.
First, the finding of assignability renders otiose the words 'for as long as' in cl 4.1(c). According to Yara, the clear meaning of that expression is that the right to appoint nominee directors determines when the condition (holding at least 5% of the issued shares) fails. That is partially correct. On the way the case was run, the right is lost when there is a change in the capacity in which the person holds the shares.
Yara also contends that assignability has the result that the condition will be satisfied whenever any successor holds a 5% shareholding with the consequence that the condition will never be unsatisfied. I am not persuaded that is correct. Whilst the original shareholder holds at least 5% of the issued shares, he retains the indivisible cl 4.1(c) right. A final transfer of less than 5% of the issued shares that reduced the original shareholder's holding to less than 5% would result in the loss of the right.
Second, cl 4.1(c) does not grant the right to 'shareholders' as defined in cl 1.1 (being people who hold shares from time to time) but to the particular, named original shareholders. Yara says the term shareholder in cl 4.1(c) is a shorthand way of identifying the particular named individuals who are the original shareholders. Yara also relies on cls 2, 4.1(d) and 4.1(f) in which the term Shareholder is used to refer to the original shareholders.
Third, the SD provides no mechanism for the allocation of the cl 4.1(c) right to assignees and any attempt to allocate the right to multiple assignees faces insurmountable difficulties, relying on cl 1.2(m) and cl 18.3 which expressly provide that rights under the SD are several, not joint or joint and several. Whereas cl 1.2(a) makes the interpretation subject to any context indicating a contrary intention, that is not the case with cl 18.3. The primary judge accepted the substance of Yara's submission as to the difficulties, which led to his conclusion that the cl 4.1(c) right could only be transferred to holders jointly [413], [397.47].
Fourth, Yara challenges the primary judge's finding that a transfer to a 'relative' beneficiary of the Burrup Trustee is exempt from the pre-emptive rights in the OSD and SD. In support of his finding that the cl 4.1(c) rights were assignable, the primary judge held that a share transfer to a Burrup Trust beneficiary who was a relative of the trustee did not trigger pre‑emptive rights under cl 9 and cl 10 [401] ‑ [403]. I have upheld the primary judge's construction of cl 9 and cl 10 in this respect.
Fifth, Yara claims that the SD has the character of a co‑venture in which the identity of the co‑venturers is critical. The primary judge noted that the SD expressly provided that it did not create a partnership between the shareholders (or any of them) and BHL or the relationship of principal and agent between the shareholders or between the shareholders (or any of them) and BHL. However, as Yara points out, the primary judge held that the SD had the essential character of a quasi-joint venture [49], a quasi‑incorporated co‑venture [16] and a 'good faith co‑venture' [434] and that restrictions on transfer adopted in such a context will be enforced [49], [50].
Accepting that the obligations under the SD are owed between shareholders, Yara relies on Pacific Brands Sport & Leisure Pty Ltd v Underworks Pty Ltd (2006) 149 FCR 395. The Full Court said:
[T]he right to [contractual performance] may … be unassignable because, having regard to the nature of the contract and the subject matter of the contractual right in question, that right is personal in the sense that the identity of the contractual obligee is material to the contractual relationship itself (ie it is a 'personal contract') [32].
Sixth, Yara contends the primary judge placed undue weight on his unchallenged conclusion that, if the right was personal and thus non‑assignable, the Burrup Trustee's death would terminate his cl 4.1(c) right. The primary judge characterised this as a compelling consideration, saying it would be 'naïve' to assess these SD parties (assessed objectively), leading up to 24 March 2008, as having accepted that an event such as the death or incapacity of the Burrup Trustee would deliver board control to Yara, as the sole remaining (minority) SD shareholder [405]. He said that such a result would be unrealistic and lead to the undermining of an otherwise carefully worked out board power balance. Therefore, the parties must 'surely have accepted an uncontroversial transmission to a "Relative" as a replacement trustee, as a successor or substitute for Pankaj' [405].

It is the case that if rights are personal and non‑assignable they die with the holder and cannot be exercised by the deceased's executor or other personal representative: Laybutt v Amoco Australia Pty Ltd (1974) 132 CLR 57, 71. The parties appear to accept that this proposition is capable of applying to a contractual right or benefit belonging to a trustee. Even if correct, there would be little scope to find an objective contractual intention that the right is personal to the trustee.
Finally, Yara says the primary judge was wrong to find that 'the carefully and equitably balanced BHL board power sharing arrangement' could not be reconciled with the loss of the cl 4.1(c) right upon the Burrup Trustee's holding falling below 5% [427] ‑ [439]. This finding only relates to the permanent loss of the cl 4.1(c) right, the primary judge having concluded that Pankaj and Radhika would not become the holder of the right until entering into deeds of assumption. Yara says the carefully balanced arrangements were crafted with regard to the identity of the co‑venturers from time to time.
I agree with the primary judge that the cl 4.1(c) right is assignable. These are my reasons. First, contractual provisions defining a party to include their assigns and successors generally indicate that contractual rights are assignable: Denham Bros Ltd v W Freestone Leasing Pty Ltd [2004] 1 Qd R 500 [58].
Second, the grant of the right to a trustee is not consistent with a conclusion that the right is personal for the reasons given by the trial judge. It is objectively inconceivable that the parties to the SD intended that the death of the Burrup Trustee would result in the loss to the trust of the cl 4.1(c) right.
Third, the very tight controls on transfers in cl 9 and cl 11(2) and the related pre‑emptive rights are consistent with the assignability of the cl 4.1(c) right in association with a transfer of all the shares held by the original shareholder. It is unnecessary to determine whether the cl 4.1(c) right could be assigned if the transferor transferred all but under 5% of the issued shares.
Fourth, the acknowledged power of a trustee to transfer shares to a new trustee who is a relative (in the definition of change in control) is not consistent with an inference that the identity of the contracting party is material to the relationship between the parties.
Fifth, the extent to which a bundle of shares can deliver control of a company affects the market value of the shares, but only if the right that delivers control is capable of being assigned to persons other than the original shareholders, who have their own cl 4.1(c) right. It offends commercial common sense that the original shareholders would not intend to maximise the market value of their shares.
Sixth, the assignability of the cl 4.1(c) right is consistent with the definition of 'Shareholder' and, for the reasons given above, does not render the expression 'for as long as' otiose.
I agree that the absence of a mechanism for the allocation of cl 4.1(c) rights to assignees has the potential to cause significant difficulties where the right is assigned to multiple assignees. However, this difficulty together with my conclusions as to the nature of the right, supports the correctness of the primary judge's conclusion, with which I agree, that the right can only be transferred to assignees jointly.

The effect of the March 2007 resolution

Prior to the March 2007 resolution, none of the beneficiaries of the (discretionary) Burrup Trust, including Pankaj and Radhika, had any equitable proprietary interest in the trust property.
It is necessary to separately consider the effect of the March 2007 resolution on each of Pankaj and Radhika. The primary judge held that the BHL shares were not held by the Burrup Trustee under a separate (I infer, bare) trust, but rather continued as a separate fund under the Burrup Trust. Yara challenges this finding. I will assume the trial judge is correct for present purposes.
Pankaj's position differs from that of Radhika. On and from the date of the March 2007 resolution, Pankaj became the beneficial owner of half of the 55% of BHL shares he then held in his capacity as the Burrup Trustee. On registration of the transfer of the Rambal shares, Pankaj became the beneficial owner of half of a further 15% of BHL shares held in his capacity as the Burrup Trustee resulting in a total shareholding of 35%.
At common law, a person could not effectively dispose of property to himself/herself/itself: Glennon v Federal Commissioner of Taxation (512 ‑ 513). That common law rule was changed by the Property Law Act 1969 (WA) (PLA), s 44, which relevantly provides that a person may convey property to himself. The term 'convey' is very widely defined: s 7 PLA. This provision accommodates situations where a legal entity acting in one capacity disposes of property to itself in another capacity.
Under the general law, a person cannot separately hold the legal and beneficial ownership of property. That is, a person cannot hold property on trust for himself alone: DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) (1982) 149 CLR 431, 474; Suncorp Insurance & Finance v Commissioner of Stamp Duties [1998] 2 Qd R 285, 304. But for the requirement for registration of the transfer to pass legal ownership, the March 2007 resolution would have effected a merger of Pankaj's legal and equitable interests to make him full owner of 574 BHL shares. As it was, and but for the provisions of the OSD, Pankaj was entitled to be registered as the holder of the shares.
The next issue is whether these changes involving Pankaj and Radhika were in breach of the OSD. That is, was there a 'Transfer' under cl 9.1 or a breach of the pre‑emption provisions in cl 9 and cl 10 of the OSD.
I will start with Pankaj. The first issue is whether the appointment pursuant to the March 2007 resolution constituted a 'Transfer'.
The prohibition in cl 9.1 is on a 'Shareholder', defined to mean a person who 'holds' shares in BHL. That is a reference to the holder as identified in the register of members, not the person entitled to be holder. The shareholder is prohibited from transferring 'Shares' (which in context would include an interest in a share) it holds or to which it is entitled.
By the exercise of the power of appointment under cl 17.1, the Burrup Trustee did not sell, assign, transfer or convey any shares in BHL or an interest in a share in BHL. That leaves for determination whether the Burrup Trustee otherwise disposed of any interest in or conferred rights in respect of any shares in BHL or an interest in a share in BHL. On balance, I am persuaded that he did.
The exercise of a power of appointment by the Burrup Trustee (an existing party/shareholder) that confers equitable ownership of BHL shares on Pankaj and necessitates a transfer under the CA from one holder to another to effect a change of legal ownership is a cl 9.1 transfer. In reaching this conclusion I have taken into account the fact that if and when the Burrup Trustee ceases to 'hold' any shares in that capacity, the OSD (and SD) automatically terminated vis a vis the Burrup Trustee pursuant to cl 16.2. Pankaj the legal entity would cease to be a party to the Deeds. One of the purposes of cl 9 of the OSD is to prevent a transfer that results in a third party (being a person other than an existing shareholder bound by the OSD) obtaining an interest in shares as defined.
Thus, the March 2007 resolution effected a transfer of shares to Pankaj within the prohibition in cl 9.1. A transfer that entitled Pankaj to be registered as the holder of the shares engaged the obligation to issue a transfer notice under cl 9.3. Clause 9.5 and cl 9.6 do not apply because the transaction does not come within the exclusion in the definition of change in control.
The next issue is whether the March 2007 resolution insofar as it relates to Radhika is a transfer within the prohibition in cl 9.1 of the OSD. The answer to that question is in the affirmative. The effect of the resolution was that Radhika went from having no equitable interest in the BHL shares the property of the Burrup Trust to becoming the beneficial owner of half of the BHL shares. The rule in Saunders v Vautier (1841) Cr & Ph 240 would apply. Under that rule, an adult beneficiary (or a number of adult beneficiaries) who has (or between them have) an absolute, vested and indefeasible interest in the capital and income of property may at any time require the transfer of the property to him (or them): CPT Custodian Pty Ltd v Commissioner of State Revenue (Vic) (2005) 224 CLR 98 [47]. It is not suggested that any direction to transfer was made until much later.
The effect of the March 2007 resolution insofar as it relates to Radhika was both to 'dispose of any interest in' and to 'confer rights in respect of any Shares'. However, it being a permitted change in control, the obligations in cl 9.3 and cl 9.5 were not activated. Thus there was no breach of the pre‑emptive provisions by virtue of this transfer.
Radhika was not a shareholder and not a party to the OSD. Thus, she was a third party for the purposes of cl 9.7. Radhika failed to execute and deliver to each other shareholder an assumption deed. The effect of that failure is discussed below.

Separate fund or separate trust

That question is to be determined objectively having regard to the text of the resolution in the context of the provisions of the Burrup Trust deed as a whole. See Byrnes v Kendle (2011) 243 CLR 253 [95] ‑ [118].
Clause 12 is headed 'Income held as separate fund'. Clause 12.1 provides:
An amount set aside for a Beneficiary under clauses 7 and 10 or 17 will be held by the Trustee as a separate fund on trust for that Beneficiary and until payment to that Beneficiary or any person in trust for that Beneficiary, the accretions to and income from that investment will belong to that Beneficiary.
Clause 12.2 provides that the Trustee's powers and the indemnities granted by cls 19 to 26 apply to a Beneficiary's Fund.
The term 'Beneficiary's Fund' is defined in cl 1 to mean 'a fund separate from the Fund held on trust by the Trustee for a Beneficiary under clauses 10 and 12'.
Clause 17 relates to the application of capital and is set out earlier in these reasons. Clause 17.2 provides:
Capital of Beneficiary's Funds
The Trustee may from time to time:
(a)if the beneficiary of a Beneficiary's fund is not an infant or a person under a legal disability, pay or transfer the capital of that fund to that beneficiary; or
(b)if the beneficiary of a Beneficiary's Fund is an infant or is a person under a legal disability, apply the capital of that fund in the manner provided in clause 10.1(d) and 10.1(e).
Clause 17.2 relates to the capital of the Beneficiary's Funds set up under cl 12.1. That is, the reference to cl 17 in cl 12.1 is a reference to cl 17.2 not 17.1.
Yara relied on Pilkington v Inland Revenue Commissioners [1964] AC 612 for the proposition that a power of appointment can include a power to settle on new trusts. However, that case concerned a power of advancement, not a power of appointment. As to the distinction between the two types of powers see Re Gosset's Settlement (1854) 19 Beav 529; Re Pilkington's Will Trusts [1959] 1 Ch 699, 705.
The exercise of a power of appointment given in a discretionary trust was considered in Commissioner of State Revenue v Lam & Kym Pty Ltd (2004) 10 VR 420. In that case the trustee of a discretionary family trust exercised a power under the trust deed declaring that certain property the subject of the power be:
held separately in trust for the Primary Beneficiaries named in the Trust Deed and for the Primary Beneficiaries and their parents, children etc … as Discretionary Beneficiaries to the exclusion of all other beneficiaries of the [Trust] … but otherwise upon the same trusts and subject to the same powers and condition[s] and for the same period as are set out in the Trust Deed.
Nettle JA, with whom Vincent JA and Hansen AJA agreed, rejected a contention that the exercise of a special power of appointment was an act of a different species to a declaration of trust [36]. There will be a declaration of trust if a trustee exercising a power of appointment declares that he or she will henceforth stand possessed of the subject of the power on trust for the object of the power [45].
I see no justification for failing to take the text of the March 2007 resolution at face value. The objectively determined intention was to establish a separate trust, in the nature of a bare trust, of the BHL shares in favour of Radhika. This was a 'Transfer' from the Burrup Trustee to Pankaj in the capacity as trustee of a separate (new) trust of half of the shares beneficially owned by Radhika which would engage the obligation in cl 9.3. Its effect on Pankaj was to confer equitable ownership of half of the shares on him personally and entitle him to be registered as the holder of these shares which also engaged the obligation in cl 9.3.
Although the Burrup Trustee remained the registered holder of the shares it was not under and in compliance with the OSD. Accordingly, the Burrup Trustee was not a holder for the purposes of cl 4.1(c).
However, I will assume the correctness of the facts recited in the SD in considering whether the Burrup Trustee lost his cl 4.1(c) rights under the SD as a result of the change in registered holder of BHL shares from the Burrup Trustee to Radhika and Pankaj on 18 September 2008.

The effect of the September registration changes

It is accepted by all parties that on 18 September 2008 the Burrup Trustee ceased to be the holder of any shares in BHL. Contemporaneously, Pankaj (personally) and Radhika were each registered as the holder, and full owner, of 35% of the issued shares in BHL.
It is also accepted that when the Burrup Trustee ceased to be the registered holder of the BHL shares, he lost his right to appoint nominee directors under cl 4.1(c). I have concluded that the cl 4.1(c) rights are capable of being assigned jointly to multiple assignees but not jointly and severally.
I note that Pankaj and Radhika were registered as the sole owners of different parcels of BHL shares, not co‑owners of all the shares formerly held by the Burrup Trustee. There was no evidence of any assignment, legal or equitable, of the cl 4.1(c) rights at any time on or before the registration changes on 18 September 2008.
The respondents' first contention is to the effect that after the March 2007 resolution, Pankaj and Radhika were each beneficiaries of the Burrup Trust who were sui juris and absolutely entitled and that on their registration as holders on 18 September 2008 they succeeded to the Burrup Trustee's title to the BHL shares.
The respondents' second contention is that on their registration as shareholders and on becoming the Burrup Trustee's successors or permitted assignees they thereby became a party to the SD by virtue of the definition of 'party' in cl 1.2(c).
Ordinarily, the beneficiary of a trust is not a party to a contract or deed entered into by the trustee of the trust. Further, unless the contract or deed otherwise provides, the legal entity remains a party to the contract even after he ceases to be the trustee. However, the Burrup Trustee (including Pankaj, the legal entity) ceased to be a party to the SD on 18 September 2008 pursuant to cl 16.2(c) of the SD. The cl 4.1(c) right, which was conditional upon him continuing to hold shares in his capacity as trustee of the Burrup Trust, was also lost.
I see no basis to conclude that Pankaj (personally) or Radhika became a party to the SD by virtue of their registration as holders. The purpose of cl 1.2(c) is to signify an intent that the rights in the SD are not personal so they can be assigned to a third party and enforced by a deceased party's executor or other personal representative. In any event, Pankaj and Radhika were not (at least before entry into the Share Sale Agreement) entitled to remain registered holders.
I infer that sometime after entry into the SD, each of Pankaj and Radhika called on the Burrup Trustee to transfer to them their BHL shares the subject of the March 2007 resolution. Their (separate) registration as holder of 35% of the BHL shares occurred in breach of the Burrup Trustee's obligations in cl 9.1, cl 9.3, cl 9.7, cl 10 and cl 11.2 of the SD (and without a proper instrument of transfer as required by s 1071B(2) of the CA).
Further, as Radhika and Pankaj did not become the 'holder' of the shares under and in accordance with the SD, they were not 'holders' for the purposes of cl 4.1(c).
There is a difference of view in the authorities on whether or not the failure to comply with rights of pre‑emption results in a transfer to a non‑party assignee being ineffective ab initio (Hunter v Hunter [1936] AC 222, 262; Carew Reid v Public Trustee (1996) 20 ACSR 443, 455 ‑ 456); cf Reef & Rainforest Travel Pty Ltd v Commissioner of Stamp Duties [2002] 1 Qd R 683 [10]. See also, Seddon N, Bigwood R, Ellinghaus M, Cheshire & Fifoot Law of Contract (10th Aust ed, 2012 [8.8]).
Putting to one side the effect of the Share Sale Agreement, I would conclude that the transfers of legal title to Radhika and Pankaj were ineffective in the unusual circumstances of this case. They are, first that the relationship between the assignor/trustee and the assignees were not at arm's length. Secondly, the provisions of the SD breached by the Burrup Trustee were not confined to ensuring the opportunity to exercise the pre‑emptive right. One of the primary purposes of cl 9 to cl 11 of the SD is to ensure that all new shareholders execute an assumption deed so as to become a party to, and be bound by, it. A right to damages for breach would be an inadequate remedy. Further, even if the transfers were effective notwithstanding non‑compliance, they would be liable to be set aside, and the register rectified pro tanto, on the application of another shareholder with standing: Hunter v Hunter; Coachcraft Ltd v SVP Fruit Co Ltd [1978] VR 706, 719. On this point, Hunter v Hunter was approved in Grant v John Grant & Sons Pty Ltd (1950) 82 CLR 1.

Loss of cl 4.1(c) rights

I have concluded that the Burrup Trustee had lost the cl 4.1(c) right to appoint nominee directors by virtue of the March 2007 resolution. If that is wrong, the Burrup Trustee lost his cl 4.1(c) right when he ceased to be the registered holder of any BHL shares on 18 September 2008.

The issues relating to the Share Sale Agreement

The primary judge held that from entry into the Share Sale Agreement, Pankaj and Radhika jointly replaced the Burrup Trustee as a shareholder under the SD and that subject to Pankaj and Radhika both entering into and delivering assumption deeds substantially in the pro forma terms of Annexure A to the SD, they would together hold a right to jointly appoint up to three nominee directors who could vote the joint shareholding of Pankaj and Radhika of 65% of the shares in BHL [452(D)(a)].
Both Radhika and the receivers contend it was an express or alternatively an implied term of the Share Sale Agreement that Pankaj and Radhika obtained the right to appoint nominee directors under cl 4.1(c) upon the execution of the Share Sale Agreement and without the need to execute or deliver an assumption deed.
The central issue of construction is the scope and effect of cl 5(b) of the Share Sale Agreement. The relevant provisions of that agreement, including cl 5(b), are set out above. For ease of analysis, I will set out the elements of cl 5(b). The first sentence is as follows.
-Pankaj Oswal, the Burrup Trustee and Radhika Oswal
-undertake to execute all documents necessary to join Pankaj Oswal in his personal capacity and Radhika Oswal to the [SD]
-in place of the Burrup Trustee
-and with such other amendments as agreed by the Buyer [Yara] and the Oswal parties.

Accordingly, subject to one further consideration, it would appear to me that the word 'holds' in cl 4.1(c) of the OSD (and the SD) does not have the meaning for which Yara contended. The further consideration is this. Yara argued that this point had not been in contest below. Yara observed that Radhika had, in effect, pleaded, and Pankaj and the Receivers (subject to the successor's and assign's point), and Yara, had admitted, that Pankaj's cl 4.1(c) nominee rights depended on him continuing to hold 5% or more of the Shares under the discretionary trust of the Burrup Trust. Yara also referred to the judge's finding, in effect, ([87], [93], [286], [288]) that on 18 September 2008, Pankaj ceased to hold any Shares on the trusts of the Burrup Trust, and the SD terminated with respect to him under cl 16.2 and noted that this finding was not challenged by the respondents in the appeal. Yara also contended that had this question been an issue below, there was extrinsic evidence available which could bear upon the meaning of 'holds' and 'Pankaj Oswal' which could have been led at trial. Reference was made to Suttor v Gundowda Pty Ltd [1950] HCA 35; (1950) 81 CLR 418, 438; Green v Sommerville [1979] HCA 60; (1979) 141 CLR 594, 608.
In relation to additional evidence, Yara submitted that:
(a)the register of members of Fertilisers, referred to in Recital C of the OSD/SD, shows Pankaj holding Shares in Fertilisers in his capacity as trustee of the Burrup Trust;
(b)the 'Burrup Two Shareholders Deed' dated on or about 31 March 2005, referred to in cl 1.1 of the OSD, and the 'Previous Shareholders Agreement' dated December 2002 referred to in cl 1.1 and cl 1.3 of the OSD, each shows Pankaj entering into the agreement as trustee and personally.
On the basis that the documents were as described by Yara in submissions, the register of members of Fertilisers would not appear to assist Yara's construction. It recognises that the person on the register has the legal interest and is the holder of the Shares, but that person may not hold beneficially. Nor does the fact that Pankaj entered into the 'Burrup Two Shareholders Deed' and the 'Previous Shareholders Agreement' in his personal and trustee capacity appear to add anything to the construction of cl 4.1(c) of the OSD and the SD. The express acceptance of personal liability in those instruments is unlikely to alter the meaning to be attributed to cl 4.1(c) of the OSD and the SD. Accordingly, the point having been raised and argued in the appeal, I would conclude that the word 'holds' in cl 4.1(c) of the OSD (and the SD) signifies legal owner according to the register of members, and in its application to Pankaj it would not, in any event, be read so as to, in effect, divest Pankaj of nominee rights if he held on trust for a Relative such as Radhika, or even beneficially.
Nevertheless, as the findings to the effect referred to in [414] above have not been contested by the respondents I will assume (although I should not be taken as finding) that the judge was correct to find that as at 18 September 2008, the SD terminated with respect to Pankaj in accordance with cl 16.2(b) and cl 16.2(c) (as to which see [371] above).
Yara also advanced a further argument on the proper construction of 'holds' in cl 4.1(c). It contended that a party with 5% or more of the issued capital of Holdings who committed any breach of the restrictions on transfer and pre‑emptive provisions in cl 9 and cl 10 of the OSD, even if it did not lead to the disposition of any legal or equitable interest in the Shares, would no longer 'hold' Shares in the company for the purposes of cl 4.1(c) of the OSD.
I am unable to accept that argument. First, there is nothing in the text of cl 4.1(c) to justify that qualification, either expressly or by necessary implication. Secondly, Yara's contention in this regard really amounts to a contention that there is a defeasance of nominee rights under cl 4.1(c) - for any breach of cl 9 and cl 10. Such an important and deleterious consequence, in an otherwise very elaborate instrument, would likely have been expressly provided for had that been the parties' intention. Yara's argument is also inconsistent with cl 15.2 of the OSD (see also cl 15.2 and cl 15.3 of the SD). Thirdly, the OSD operates intelligibly and commercially without the suggested additional qualification of the word 'holds' in cl 4.1(c). Any transferee who took in breach of the pre‑emption provisions could not expect to be registered as a member because they would need to execute and deliver an Assumption Deed without which, the transfer would be 'ineffective' (cl 9.7 and cl 11.2). Thus, if a transferee was to become registered as a member in breach of the pre‑emption provisions, a Shareholder could apply to rectify the register and require the Shares to be offered to it in accordance with the pre‑emption provisions: see Grant v John Grant & Sons Pty Ltd [1950] HCA 54; (1950) 82 CLR 1, 29. Moreover, as explained below, the scheme of the SD, and in particular Annexure A thereto, is that if a transferee becomes registered without executing an Assumption Deed, it could not, in any event, ordinarily acquire cl 4.1(c) rights (absent agreement otherwise by the existing Shareholders).

Whether nominee rights can pass to a transferee under the OSD/SD

Yara contended that nominee rights under cl 4.1(c) were not capable of passing to a transferee and that the words 'for as long as' in cl 4.1(c) mean that once a Shareholder party ceases to be a holder of at least 5% of the Shares in Holdings, its nominee rights under cl 4.1(c) are lost. In this regard, Yara contended that the interpretation term in cl 1.2(c) concerning 'permitted assigns' has no application to cl 4.1(c) because the context of cl 4.1(c) indicates a contrary intention, in that nominee rights are intended to be personal, in effect, to the founding 'joint venture' Shareholders of Holdings. Also, Yara contended that the terms of the pro forma Assumption Deed in Annexure A indicate that the transferee is not intended to acquire cl 4.1(c) nominee rights. Yara draws particular attention to the difference in wording between cl 2(a) and cl 2(b) of the Assumption Deed. The two points are ultimately related as the OSD must be construed as a whole.
Subject, of course, to the question of whether the context indicates otherwise, an express reference to a party or its 'assigns' in a contract would ordinarily indicate that the contract was not personal and not incapable of assignment: C B Peacocke Land Co Ltd v Hamilton Milk Producers Co Ltd [1963] NZLR 576, 581 ‑ 582; Denham Bros Ltd v W Freestone Leasing Pty Ltd [2003] QCA 376; [2004] 1 Qd R 500 [55]. Moreover, a reference to a party or its 'assigns' may impliedly provide for assignment: Denham v W Freestone [58].
I have set out in [379] ‑ [383] above the terms of the Assumption Deed and its general operation. The following additional observations should be made. First, it is to be noted that the pro forma Assumption Deed in Annexure A appears to be drafted on the basis that, with respect to transfers (as opposed to allotments), it is designed principally to apply to a Shareholder transferring the whole of its shareholding in Holdings. That appears from cl 2(a) ('assumes all the rights enjoyed by the [Transferor]') and from cl 2(b) ('bound … as if … named as a party … [instead of the Transferor]'). Also, cl 2(c) and cl 2(d) appear to be designed to ameliorate the operation of cl 2(b) and to ensure that the new Shareholder does not assume any liabilities prior to the Effective Date. Clause 2(c) and cl 2(d) appear to mirror cl 16.2(b) of the OSD, which applies when a Shareholder ceases to hold any Shares.
Secondly, Recital C says that the OSD requires a transferee or allottee to execute an Assumption Deed 'in substantially the form of this deed'. The OSD does not say 'in substantially the form of' (see cl 1.1 definition of Assumption Deed, cl 9.7 and cl 11.1). Nevertheless, the parties, by including those words in Recital C to the pro forma Assumption Deed, presumably intended the operative provisions of the OSD to be read that way. The tolerance in form indicated by Recital C suggests that the parties intended that Annexure A could be modified where appropriate. This would include dealing with a transfer of a part of a shareholding. A modification would be required to preserve the cl 4.1(c) rights in the transferor insofar as the transferor Shareholder retained 5% or more of the issued capital of Holdings. In that case, cl 2(a) of the Assumption Deed would require modification by adding 'except those in cl 4.1(c)' after the words 'all the rights enjoyed by the [Transferor]'.
Thirdly, as noted earlier, an Assumption Deed is evidently intended to be a deed poll, to be executed only by the new Shareholder (in effect, the incoming transferee or allottee). Once an Assumption Deed is executed and delivered by a new Shareholder, the new Shareholder binds itself to the OSD, and other Shareholder parties to the OSD could enforce cl 2(b) of the Assumption Deed (and hence the OSD) against the new Shareholder, as they would be persons sufficiently identified in the deed poll for whose benefit cl 2(b) was made: see Tipperary v The State of Western Australia [253] and [383] above. Further, in my view, the other Shareholders, being sufficiently identified and who knowingly took the benefit of the new Shareholders' covenant in cl 2(b) of the Assumption Deed would, in turn, themselves be bound by cl 2(a), and thereby be bound to recognise the rights which, according to cl 2(a), were assumed by the new Shareholder under the OSD: cf Webb v Spicer (1849) 13 QB 886; Lady Naas v Westminster Bank Ltd [1940] AC 366, 373, 406; Monarch v Citco (359). Moreover, the OSD may also be viewed as authorising, prospectively, a novation if an Assumption Deed is executed

and delivered: see Leveraged Equities Ltd v Goodridge [2011] FCAFC 3; (2011) 274 ALR 655, 691 ‑ 693. Alternatively, there would be an inferred, multipartite, agreement between other Shareholders and the new Shareholder: Raguz v Sullivan [2000] NSWCA 240; (2000) 50 NSWLR 236 [65] ‑ [68]. One way or another, the execution and delivery of the Assumption Deed would bring about, or lead to, a novation of the OSD.

It may also be, although it is unnecessary to decide this, that by accepting delivery of an executed Assumption Deed and permitting Holdings to register the transferred or allotted shares, the parties to the OSD would be estopped from denying that a new Shareholder was a party to the OSD on the terms of cl 2(a) and cl 2(b) of the Assumption Deed: see, eg, Air Tahiti Nui Pty Ltd v McKenzie [2009] NSWCA 429; (2009) 77 NSWLR 299 [59] ‑ [66].
Fourthly, a 'permitted assign' under cl 1.2(c) of the OSD includes 'any person taking by way of novation'.
In light of the foregoing, it seems to me that there is nothing in the context of the OSD, read as a whole, which would indicate that the parties intended that nominee rights under cl 4.1(c) should be incapable of being transferred. That construction also appears to me to be the more preferable commercial construction of the instrument. On that construction, a party could terminate its shareholding, if it wished, and extract a value for its cl 4.1(c) rights - either from existing Shareholders buying it out under cl 10.6 with the Shares to be valued having regard to those rights, or by transfer to a third party. Otherwise, a Shareholder would be commercially locked in (absent a further agreement with the other Shareholders) because the exercise of even a permitted sale, would mean that it would forfeit its valuable rights under cl 4.1(c). Even if the Shareholders were to be treated as analogous to 'joint venturers', there is an important buy‑out mechanism which tends against the construction for which Yara contended. The fact that the OSD had no finite term is, again, also of significance.
It follows that, in my view, cl 4.1(c) nominee rights could pass to a permitted assign of either Pankaj or Yara providing the transferor did not retain 5% or more of their Shares in Holdings. Any transfer which left Pankaj or Yara still holding 5% or more of their Shares, would not effect a transfer of their respective cl 4.1(c) rights. The same observations apply to the SD.
The above discussion has proceeded on the basis that there is a transfer to a third party who has executed and delivered an Assumption Deed. If a third party became registered as a member without executing and delivering an Assumption Deed, it would always, of course, be open to Pankaj and Yara to reach agreement with the new Shareholder so as to bind the new Shareholder to the provisions of the SD instead of rectifying the register. That is what occurred in this case when Pankaj, Radhika and Yara entered into the SSA on 19 September 2008.

The proper construction of the SSA

Yara's essential contention in relation to the operation of the SSA had both a negative and a positive element to it. In its negative aspect, Yara contended that Pankaj and Radhika could not, by cl 5(b) of the SSA, acquire any rights under the SD as, in the events preceding the entry into the SSA, the 'Burrup Trustee' had, in fact, ceased to be a party to the SD and had ceased to hold any rights under it. In its positive aspect, Yara contended that the parties, by cl 5(b) agreed, in effect, to allow Yara to exercise cl 4.1(c) rights to the exclusion of Pankaj and Radhika, and hence to exercise board control over Holdings (and hence the Company Group), even though after the completion of the sale, Pankaj and Radhika would hold 65% of the share capital of Holdings between them.
The question is one of determining, objectively, the intention of the parties to the SSA on its proper construction. Yara's submission appears to me to involve imputing an unusual intention to these parties, and it savours of unreality. I am unable to accept that, properly construed, the SSA has the effect contended for by Yara. My reasons are as follows.
It is evident that the primary object of the SSA was to effect the sale of a 5% parcel of shares from Pankaj to Yara. It is not insignificant that the first part of cl 5 of the SSA, cl 5(a), contains warranties for the protection of Yara for the achievement of that object. It is also evident, from the fact that in one form or another the relations between the Shareholders of Holdings had, for many years, been conducted within the framework of a separate agreement (the OSD and the SD) and from the text and context of cl 5(b), that Yara and Pankaj intended that this sale be effected within that contractual framework.
On 18 September 2008, Radhika was a Shareholder who stood outside that framework. It was necessary to bind her as a Shareholder of Holdings and thereby ensure that the provisions of the SD prevailed against her over the rights she had as a Shareholder under the New Constitution (see cl 20.2 of the SD, which is in the same terms as cl 20.2 of the OSD which I have set out in [374(b)] above). Perhaps it was also thought prudent to bind her to avoid any potential pre‑emption disputes concerning the 5% sale of the parcel from Pankaj to Yara. It is also apparent that the parties assumed that Pankaj was not personally bound by the covenants in the SD because he had executed the SD in his trustee capacity and that it was therefore necessary for him to enter into a new agreement to bind him to the SD in his personal capacity. In this regard, the parties appear to have treated the 'Burrup Trustee' (as defined in the SSA), ie Pankaj as trustee of the Burrup Trust, as having a different legal personality from Pankaj.
It is also evident that a secondary object of the SSA was to deal with specific commercial matters which were then in contemplation by the Shareholders (Pankaj, Yara and Radhika). These were the IPO (cl 6 to cl 7), the Offtake Agreement (cl 8 and cl 10) and the TAN Project (cl 9 and cl 10).
It is also to be noted that the parties to the SSA defined the SD in a way which indicates that, for the purposes of the operation of the SSA, they were treating the SD as an operative instrument between the 'Burrup Trustee', Yara, Holdings and Fertilisers. That is confirmed by cl 6.1(b) which provides for the timing of the proposed float, 'notwithstanding' any provision in the SD. There is no indication that the parties were intending, in the arrangements contemplated by the SSA, to treat the SD as terminated with respect to the 'Burrup Trustee' under cl 16.2(c) of the SD or otherwise.
In this context, the following observations may be made about cl 5(b) of the SSA.
It appears that by the first sentence of cl 5(b), the parties intended that for the longer term, their relationship should be governed by a formal instrument or instruments. In the past, that had been done by two 'Shareholder Deeds' (the OSD and the SD), each of which in turn provided for the entry into an Assumption Deed by successors and assigns. Clause 10 of the SSA also required the execution of a deed. It may be inferred that the parties preferred the solemnity of a deed rather than a mere agreement for the purposes of governing their relationship longer term, subject to 'such other amendments as agreed' between Yara, the 'Burrup Trustee', Pankaj and Radhika. The generic reference to 'documents' rather than an Assumption Deed in the first sentence of cl 5(b) suggests that no particular form of instrument had then been agreed upon. Indeed, the term 'Assumption Deed' is conspicuous by its absence in the first sentence of cl 5(b). Nevertheless, the conclusion to be drawn from the first sentence of cl 5(b) as a whole is that, upon execution of the 'documents', the parties intended that Pankaj and Radhika would have the rights, and incur the obligations, which the SD had provided for in respect of the 'Burrup Trustee'. I agree with the primary judge that in the absence of further agreement (as contemplated in the first sentence of cl 5(b)), the parties must be presumed to have contemplated that upon execution of the 'documents', the right to appoint directors by Pankaj and Radhika would be exercised jointly.
The second sentence of cl 5(b) governs the interim period, pending the execution of formal 'documents'. The following observations may be made about the second sentence of cl 5(b):
(1)an agreement by a person to 'comply with' an instrument as if they were the original party to it, is an agreement by that person to perform the promises made in the instrument by the original party;
(2)Pankaj and Radhika thereby agreed to perform the promises in the SD in place of performance of those promises by the 'Burrup Trustee'. As noted earlier at [435], if the 'Burrup Trustee' had ceased to have any executory obligations owed to him by Yara, or any executory obligations to perform in favour of Yara, under the SD, that was not the way in which these parties had drawn their agreement in the SSA;
(3)Pankaj's and Radhika's agreement to perform the promises made by the 'Burrup Trustee' in the SD would, necessarily and implicitly, involve an acknowledgement by Pankaj and Radhika of the rights conferred on Yara under the SD, including cl 4.1(c) rights;
(4)points (1) ‑ (3) involve a tacit agreement by Yara that, for its part, it would accept performance of the SD by Pankaj and Radhika, in place of performance of the SD by the 'Burrup Trustee'.
(5)Yara's agreement that it would accept performance of the SD by Pankaj and Radhika in place of performance by the 'Burrup Trustee' points to the existence of a reciprocal implied promise by Yara that, pending the execution of a formal instrument under the first sentence of cl 5(b), it would perform, in favour of Pankaj and Radhika, the promises it had made to the 'Burrup Trustee' under the SD. The implied term (similarly to (3) above) would implicitly involve an acknowledgement by Yara that Pankaj and Radhika would enjoy the rights conferred on the 'Burrup Trustee' under the SD, including cl 4.1(c) rights; and
(6)such a term would be implied on the tests in BP Refinery (Westernport) Pty Ltd v Hastings Shire Council (1977) 180 CLR 266, 283. It is reasonable and equitable; it is so obvious that it 'goes without saying', particularly in light of cl 6 to cl 10 of the SSA; it is capable of clear expression; it does not contradict any express terms of the SSA; and the operation of the SSA could not be effective without it, in that without it, the SSA would confer interim board control on, in effect, a minority shareholder, pending the execution of documents under the first limb of cl 5(b), leaving the second limb of cl 5(b) operating asymmetrically from the first.

Radhika further contended that the right she acquired under cl 5(b) of the SSA was 'joint and several'. Radhika referred to cl 1.2(a) of the SSA. Radhika also referred to Kendle v Melsom [1998] HCA 13; (1998) 193 CLR 46. Gummow and Kirby JJ in that case said:
The legal content and operation of the term 'joint and several' is seen in the construction of covenants or other contractual promises. The term also finds application in partnership law and in the law dealing with liability to account and with joint and several tortious liability. With respect to property interests, it is contradictory to describe a joint interest as 'joint and several'. If the property is owned in severalty, that is to say, by persons singly, so that the share of each is ascertained, it cannot be owned jointly. A joint owner does not have 'a distinct or separate title, interest or possession' in the subject matter [20].
I have referred to cl 1.2(a) of the SSA in [392] ‑ [393] above. Also, cl 5(b) of the SSA is not merely a 'right conferred on' Pankaj and Radhika, but is a provision which, as a whole, deals with the future operation of the SD. The nature and scope of any power to appoint directors under cl 4.1(c) of the SD falls to be examined by reference to the provisions of the SD and not an interpretation provision in the SSA.
As to the SD, Yara contended, in effect, that cl 1.2(m) and cl 18.3 of the SD provide only for several rights, and thereby preclude Pankaj and Radhika from acquiring a power to appoint jointly under cl 4.1(c). In my view, neither clause has any relevant application. The contractual right to appoint directors under cl 4.1(c) is undoubtedly a right inhering in the person or persons who may appoint, but the right is in the nature of a power which may be exercised. Clause 1.2(m) and cl 18.3 do not appear to me to be dealing with a right of that kind. Rather, read as a whole, each indicates that the 'rights' referred to are the rights to receive performance from the other parties. For example, Pankaj and Radhika would severally have the right to receive performance of the pre‑emption provisions in the SD in the event that Yara proposed to transfer its Shares to a third party, even though both have the right to appoint under cl 4.1(c). Similarly, if either Pankaj or Radhika proposed to sell their respective shareholdings, each would have, as against the other, a several right to the performance of the pre‑emption provisions. Neither clause is addressing how a power is to be exercised by two parties having the right to exercise it.

Yara's grounds 1 and 2 - disposition

For the reasons given earlier, these grounds should be dismissed. Nominee rights may pass to assigns and the parties to the SSA did not treat the 'Burrup Trustee's' rights under the SD as having been 'permanently terminated'.
No cl 4.1(c) rights were transferred to Yara from Pankaj under the SSA.

Yara's ground 3 - whether the 13 March 2007 resolution constituted a resettlement

On 13 March 2007, Pankaj, as trustee of the Burrup Trust, executed the following resolution:
I … do hereby resolve pursuant to cl 17.1 of the [Burrup Trust Deed], to appoint for the absolute benefit of the named beneficiaries below, a part of the corpus of the trust as detailed below. Henceforth the corpus so appointed and income or accretion of capital therefrom shall be held on separate trust and for the absolute benefit of the named beneficiaries in their own individual capacities.
Mr Pankaj Oswal - 574 shares in Burrup Holdings Pty Ltd
Mrs Radhika Oswal - 574 shares in Burrup Holdings Pty Ltd[.] (emphasis added)
Yara contended in this appeal that the resolution of 13 March 2007 involved the exercise of a power of advancement and removed the shares in Holdings from the Burrup Trust settlement and resettled them on separate bare trusts with the result that, for the purposes of the OSD, the shares ceased to be held by Pankaj as trustee of the Burrup Trust. This

contention involves a question of the proper construction of the 13 March 2007 resolution in light of the surrounding circumstances: Roome v Edwards [1982] AC 279, 293; Hart v Briscoe [1979] Ch 1, 8; Swires v Renton [1991] STC 490, 500.

After the hearing of this appeal, we were also referred to a decision of the Federal Court of Australia, Oswal v Commissioner of Taxation [2013] FCA 745, dealing with questions of whether the resolution of 13 March 2007 involved a declaration of trust or a settlement for the purposes of the Income Tax Assessment Act 1997 (Cth). This court did not hear argument on that decision.
The point arises in this case in the context of a determination of the proper construction and operation of the OSD and the SD.
For the purposes of the disposition of the appeal with respect to the preliminary issues, it is unnecessary to conclude the question of the proper construction of the 13 March 2007 resolution. Even if there was a resettlement on bare trusts on 13 March 2007, as Yara contended, for the reasons given in relation to ground 4, there has been no relevant breach of the pre‑emption provisions of the OSD or the SD. Also Pankaj continued to 'hold' 5% of the Shares in Holdings in any event.
The burden of ground 3 is that Pankaj lost cl 4.1(c) rights by virtue of the 13 March 2007 resolution. Irrespective of the 13 March 2007 resolution, in my view he did not lose such rights. Accordingly, I would dismiss ground 3.

Yara's Ground 4(a) - whether the 13 March 2007 resolution breached the pre‑emption provisions of the OSD

If and to the extent that Radhika became beneficial owner of 35% of the shares on 13 March 2007, there was no breach of the pre‑emption provisions with respect to her.
The Shares held by Pankaj were known to be held by him as trustee for the Burrup Trust (Recital A of the OSD). The Burrup Trust was, self‑evidently, a discretionary family trust. It was known that Pankaj's wife was designated as a 'primary beneficiary' under the Burrup Trust Deed. In this context, the OSD provided, in effect, by virtue of par (b) of the definition of 'Change in Control', that there would be no 'Change in Control' if Pankaj's wife became 'beneficially entitled' to the property of the Burrup Trust, including the Shares.
The prohibition in cl 9.1 of the OSD is subject to exception by the operation of cl 9.4. Clause 9.4, in effect, excludes from the operation of cl 10 the circumstance where a Relative (Radhika) of a trustee Shareholder (Pankaj) becomes beneficially entitled to the property of the Burrup Trust (the Shares). The parties, having agreed that the pre‑emption provisions would not apply in that particular circumstance through the operation of cl 9.4, cannot, in my view, have intended that those provisions would nevertheless apply by virtue of the general prohibition in cl 9.1. In my view, the exception to the general prohibition in cl 9.1 extends, on its proper construction, to the exception to the Change in Control which forms the subject matter of cl 9.4.
In this regard, I agree with the primary judge's conclusion at [417] to the effect that insofar as Radhika became beneficially entitled to 35% of the Shares prior to 18 September 2008, the entitlement did not arise in breach of the pre‑emption provisions. Although his Honour reached that conclusion with respect to the SD, cl 9.1 of the OSD and the exceptions to it are not, in this context, materially different.
Also, and in any event, for the reasons given in relation to ground 4(b) below, Yara otherwise agreed to any relevant 'Transfer' to either Pankaj or Radhika with respect to the declaration on 13 March 2007 when it knew of the relevant facts by 19 September 2008. In the circumstances the parties must, objectively, have intended their agreement to operate with effect from the date of any relevant Transfer. To the extent that questions of estoppel might also have allegedly arisen, they have not been tried.
In my view, Yara's ground 4(a) should be dismissed.

Yara's ground 4(b) - alleged breaches by virtue of 'Transfer' on 18 September 2008 - disposition

The primary judge found, in effect, that by entering into the SSA in the circumstances to which he referred [325], or at least by completing the sale under the SSA [418], Yara signified that it did 'otherwise agree' to the 'Transfer' of legal title to Radhika and to Pankaj in his personal capacity for the purposes of cl 9.1 and cl 9.7 of the SD.
As to Pankaj, Yara was purchasing a 5% parcel of the 35% shareholding held by Pankaj in Holdings, for the consideration stated in the SSA. It is to be inferred that Yara did not require the pre‑emption provisions in cl 10 to be complied with, either in respect of that 5% parcel or the wider 35% shareholding held by Pankaj. As to Radhika, although Yara was not purchasing shares from her, it knew that she was, or at least purported to be, the legal and beneficial owner of 35% of the issued capital of Holdings; it did not require the opportunity to purchase that 35% parcel at a price to be agreed or valued in accordance with cl 10.2 to cl 10.6 of the SD; it made no claim to rectify the register (Grant v John Grant); it treated her as a shareholder as one of the 'Oswal Parties', including providing for her further participation as a shareholder in a float of the company (cl 6 to cl 10 of the SSA); and it required Radhika to bind herself, as a shareholder, to the terms of the SD. In my view, the primary judge was correct. The proper inference was that Yara had otherwise agreed to any 'Transfer' to Pankaj or Radhika by 19 September 2008.
There is nothing in the OSD or the SD to indicate that Shareholders may not 'otherwise agree' after a 'Transfer' has been effected, or after registration has been obtained.
I would dismiss Yara's ground 4(b).

Yara's ground 5

By ground 5, Yara contended that the judge erred in finding at [423] ‑ [424] of his reasons, that the SSA was capable of providing for the conferral of cl 4.1(c) rights on Radhika and Pankaj because the 'Burrup Trustee' had, in the period prior to the SSA, ceased to hold such rights by virtue of the operation of cl 16.2(c) of the OSD. For the reasons given earlier in relation to the proper construction of the SSA, that contention should be rejected. Further, even if the SD had terminated with respect to Pankaj prior to 19 September 2008, there would have been no executory obligations for Pankaj to perform under the SD and Yara would not have any continuing rights under the SD, including cl 4.1(c) rights, which it could enforce against Pankaj as he was (it may be assumed) no longer a party to the SD. Also, in the period up to 18 September 2008, Pankaj, in any event, held more than 5% of the Shares of Holdings for the purposes of cl 4.1(c) of the SD. He was the legal owner and to the extent that, pursuant to the operation of the Burrup Trust settlement, he held 5% or more on separate trust for Radhika, or even beneficially, he continued in either case to hold more than 5% of the issued capital of Holdings.
I would dismiss ground 5.

Yara's ground 6

For the reasons given in relation to the proper construction of the SSA, ground 6 should be dismissed.

Radhika's cross‑appeal and notice of contention

For the reasons given earlier, ground 3 of Radhika's cross‑appeal should be upheld and grounds 1 and 2 should be upheld to the extent that they contend that Radhika was not required to execute an Assumption Deed before acquiring any cl 4.1(c) rights. The remainder of the grounds should be dismissed. It is unnecessary to deal with Radhika's notice of contention.

Receivers' cross‑appeal and notice of contention

For the reasons given earlier, I would allow the Receivers' cross‑appeal to the extent that the Receivers assert that Radhika and Pankaj had the joint power to appoint Nominee Directors under cl 4.1(c) by reason of an implied term of the SSA. I would otherwise dismiss the Receivers' cross‑appeal and notice of contention.

Conclusion

Subject to hearing from the parties, I would agree with the amendments to the primary judge's orders proposed by Pullin JA in his reasons.