Achieve Foundation Limited v ACNewCo Limited; In the Matter of Achieve Foundation Limited and The Crowle Foundation Limited

4 Pursuant to section 413(1) of the Act (using the definitions in the Achieve Scheme), as from the Transfer Date, each of the following transactions will occur in the order set out below:

(a) first, except for the Property referred to in Order 8 below, the whole of the undertaking and Property of the First Plaintiff will be transferred to and vested in the Defendant; and

(b) second, except for the Liabilities referred to in Order 8 below, all of the Liabilities of the First Plaintiff will be transferred to and become the Liabilities of the Defendant.

5 Pursuant to section 413(1) of the Act (using the definitions in the Crowle Scheme), as from the Transfer Date, each of the following transactions will occur in the order set out below:

(a) first, the whole of the undertaking and Property of the Second Plaintiff will be transferred to and vested in the Defendant; and

(b) second, all of the Liabilities of the Second Plaintiff will be transferred to and become the Liabilities of the Defendant.

6 Pursuant to section 413(1) of the Act, without limiting Order 4, and using the definitions in the Achieve Scheme, all bequests received by the First Plaintiff after the Merger Date shall be paid by the First Plaintiff to the Defendant.

7 Pursuant to section 413(1) of the Act, without limiting Order 5, and using the definitions in the Crowle Scheme, all bequests received by the Second Plaintiff after the Merger Date shall be paid by the Second Plaintiff to the Defendant.

s The property of the First Plaintiff being its interest in the real property known as 4a Alicia Road, Mount Kuring-Gai;

s The property of the First Plaintiff being its rights under the Deed of Loan dated 24 October 2001 between the First Plaintiff and Judith Valentine Ellis;

s The property of the First Plaintiff being any agreement, arrangement or understanding with the Department of Ageing Disability and Home Care (or its predecessors) in relation to 4a Alicia Road, Mount Kuring-Gai;

s The liability of the First Plaintiff to Judith Valentine Ellis under the said Deed of Loan ("Excepted Liability").

(b) Excepted Property will not be transferred or vested in the Defendant, and the Excepted Liability will not be transferred to and become a liability of the Defendant, unless and until the Court makes a further order pursuant to Order 10 or 11 below.

9 Pursuant to section 413(1)(c) of the Act, as from the Transfer Date (as defined in each of the Achieve Scheme and the Crowle Scheme), any legal proceedings pending by or against each Plaintiff will be continued by or against the Defendant in respect of that Plaintiff.

10 Liberty be reserved to any party to apply for any consequential orders as may be considered necessary or desirable under section 413 of the Act.

11 Without limiting the generality of Order 8, liberty to the First Plaintiff and the Defendant to apply at any time for an order under section 413 in respect of any Excepted Property or the Excepted Liability.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. The text of entered orders can be located using Federal Law Search on the Court's website.

ANNEXURE A ACHIEVE FOUNDATION SCHEME OF ARRANGEMENT Table of Contents

1 Definitions and Interpretation v 1.1 Definitions v 1.2 Interpretation vii

2 Preliminary viii 2.1 Achieve viii 2.2 ACNewCo viii 2.3 Implementation of the Achieve Scheme viii 2.4 Legal Proceedings viii 2.5 Consequences of the Achieve Scheme becoming Effective viii

3 Conditions Precedent ix 3.1 Conditions Precedent ix 3.2 Lapse of Achieve Scheme ix 3.3 Certificate ix

4 Implementation of the Achieve Scheme x 4.1 Lodgement of Scheme Orders x 4.2 Cancellation and Issue of Memberships x 4.3 Transfer of Undertaking, Assets and Liabilities x 4.4 Continuation of Achieve xi

5 General Provisions xi 5.1 Achieve Register xi 5.2 Provision of Information xi 5.3 Achieve Scheme binds Achieve Members xi 5.4 Authority to Achieve xi 5.5 Enforcement of ACNewCo Deed Poll xi 5.6 Further Assurance xii 5.7 Amendments to the Achieve Scheme xii 5.8 Governing Law xii

ACHIEVE FOUNDATION SCHEME OF ARRANGEMENT Pursuant to sections 411 and 413 of the Corporations Act 2001 (Cth) BETWEEN ACHIEVE FOUNDATION LIMITED ACN 059 432 610 of Level 4, 2 Rowe Street, Eastwood, NSW 2122 (ACHIEVE); and THE ACHIEVE MEMBERS IMMEDIATELY PRIOR TO THE MERGER DATE (Participating Achieve Members and Nominee Members)

Achieve Member means a person who is registered as the holder of an Achieve Membership in the Achieve Register immediately prior to the Effective Date.

Achieve Membership means a class of membership in Achieve as provided for in the constitution of Achieve.

Achieve Register means the register of members of Achieve.

Achieve Scheme means this scheme of arrangement, subject to any alterations or conditions made or required by the Court pursuant to section 411(6) of the Corporations Act.

Achieve Scheme Meeting means the meeting of Achieve Members ordered by the Federal Court to be convened under section 411(1) of the Corporations Act to consider and, if thought fit, to approve the Achieve Scheme.

ACNewCo Deed Poll means the deed poll dated 24 September 2008 executed by ACNewCo in favour of the Participating Achieve Members.

ACNewCo Ordinary Member means an initial member of ACNewCo on incorporation as named in the constitution of ACNewCo whose rights and obligations as an ordinary member are set out in the constitution of ACNewCo.

ASIC means the Australian Securities and Investments Commission.

Business Day means a day other than a Saturday, Sunday or public holiday in Sydney, New South Wales.

Conditions Precedent means the conditions set out in clause 3.1 of this Achieve Scheme.

Corporations Act means the Corporations Act 2001 (Cth).

Court Approval Date means the first day on which the application made to the Federal Court for an order pursuant to section 411(4)(b) of the Corporations Act approving the Achieve Scheme is heard or, if the application is adjourned for any reason, the first day on which the adjourned application is heard.

Crowle means The Crowle Foundation Limited ACN 059 150 604.

Crowle Member means a person who is registered as the holder of a Crowle Membership in the Crowle Register immediately prior to the Effective Date.

Crowle Membership means a class of membership in Crowle as provided for in the constitution of Crowle.

Crowle Register means the register of members of Crowle.

Crowle Scheme means the scheme of arrangement under sections 411 and 413 of the Corporations Act to be proposed between Crowle and its members in connection with the Merger.

Effective means in relation to a scheme of arrangement, the coming into effect, pursuant to section 411(10) of the Corporations Act, of the orders of the Federal Court made under section 411(4)(b) of the Corporations Act in relation to that scheme.

Effective Date means the date on which the Achieve Scheme becomes Effective.

End Date means 31 January 2009 or such later date as Achieve and Crowle may agree in writing.

Federal Court means the Federal Court of Australia.

Friends of ACNewCo Membership means the class of membership in ACNewCo the rights and obligations of which are set out in the constitution of ACNewCo.

Liabilities has the meaning given to that term in section 413(4) of the Corporations Act.

Merger means the proposed merger of Achieve and Crowle.

Merger Date means the second Business Day after the Effective Date.

New Achieve Membership means Achieve Memberships issued to the Nominee Members under clause 2.5(a)(3) of this Achieve Scheme whereby each Nominee Member agrees to hold its New Achieve Membership on behalf of, and to exercise all rights, powers and discretions in respect of it only in accordance with the instructions of, ACNewCo from time to time, subject to the terms of its respective individual deed poll.

Nominee Member means an Achieve Member who is also an ACNewCo Ordinary Member and who will enter into an individual deed poll in favour of ACNewCo pursuant to which it will agree to hold its New Achieve Membership for the benefit of ACNewCo and to exercise the rights attaching to its New Achieve Membership at the direction of ACNewCo.

Participating Achieve Member means a person other than a Nominee Member who is an Achieve Member immediately prior to the Merger Date.

Property has the meaning given to that term in section 9 and section 413(4) of the Corporations Act.

Registered Address means, in relation to an Achieve Member, their address as shown in the Achieve Register immediately prior to the Merger Date.

Scheme Book means the explanatory statement prepared and issued by Achieve and Crowle in connection with the Achieve Scheme and the Crowle Scheme for the purpose of section 412 of the Corporations Act.

Transfer Date means the third Business Day after the Effective Date.

In this Achieve Scheme, unless a contrary intention appears:

(a) words or expressions importing the singular include the plural and vice versa;

(b) words or expressions importing a gender include the other gender;

(c) words or expressions denoting individuals include corporations, firms, unincorporated bodies, government authorities and instrumentalities;

(d) where a word or expression is defined or given meaning, another grammatical form has a corresponding meaning;

(e) any heading, index, table of contents or marginal note is for convenience only and does not affect the interpretation of this Achieve Scheme;

(f) a reference to a clause, paragraph or subparagraph is a reference to a clause, paragraph or subparagraph of this Achieve Scheme;

(g) a reference to this Achieve Scheme or another document includes that document as amended, varied, novated, supplemented or replaced from time to time;

(h) a reference to legislation or a provision of legislation includes:

(1) all regulations, orders or instruments issued under the legislation or provision; and

(2) any modification, consolidation, amendment, re-enactment, replacement or codification of such legislation or provision;

(i) any recitals, schedule or annexure form part of this Achieve Scheme and have effect as if set out in full in the body of this Achieve Scheme;

(j) references to include and including are to be construed without limitation;

(k) words or expressions defined in the Corporations Act have the same meaning when used in this Achieve Scheme; and

(l) a reference to time is to New South Wales time.

Achieve is a public company limited by guarantee registered in New South Wales.

ACNewCo is a public company limited by guarantee registered in New South Wales.

(a) The directors of Achieve consider that it is in the best interests of Achieve Members for Achieve to merge with Crowle and that this should be done through the implementation of this Achieve Scheme and the Crowle Scheme.

(b) Achieve and Crowle have agreed to implement the Merger.

(c) ACNewCo has agreed by entering into the ACNewCo Deed Poll to:

(1) provide Friends of ACNewCo Memberships to Participating Achieve Members in accordance with this Achieve Scheme;

(2) accept the transfers of the undertaking, Property and Liabilities of Achieve under this Achieve Scheme; and

(3) take the other actions attributed to it under this Achieve Scheme.

Achieve is not a party to any legal proceedings as at the date of the Scheme Book.

2.5 Consequences of the Achieve Scheme becoming Effective

If the Achieve Scheme becomes Effective and is implemented, each of the following will occur:

(1) the memberships of each Achieve Member will be cancelled; and

(2) ACNewCo will issue Friends of ACNewCo Memberships to Participating Achieve Members in accordance with this Achieve Scheme; and

(3) Achieve will issue New Achieve Memberships to all Nominee Members.

(b) on the Transfer Date, the whole of the undertaking, Property and Liabilities of Achieve will be transferred to ACNewCo.

(c) Achieve will remain in existence after the Merger Date for the sole purpose of receiving any future bequests. On the Court Approval Date Achieve will make an application to the Federal Court for an order under section 413 of the Corporations Act that all bequests received by Achieve after the Merger Date be paid by Achieve to ACNewCo.

(a) (Scheme Meeting approval): the Achieve Members approving the Scheme at the Scheme Meeting by the requisite majority as required under the Corporations Act;

(b) (ASIC approval): ASIC providing such consents or approvals or other acts which the parties agree are necessary or desirable to implement the Merger;

(c) (Federal Court approval): this Achieve Scheme being approved by the Federal Court for the purpose of section 411(4)(b) of the Corporations Act; and

(d) (Crowle approval): the Crowle Scheme being approved by the Federal Court for the purpose of section 411(4)(b) of the Corporations Act.

The Achieve Scheme will lapse and be of no further force or effect if all of the Conditions Precedent are not met or if the Effective Date does not occur on or before the End Date. If this Achieve Scheme lapses in accordance with its terms each of Achieve and ACNewCo are released from:

(a) any further obligation to take steps to implement this Achieve Scheme; and

(b) any liability with respect to this Achieve Scheme.

At or before the Federal Court hearing on the Court Approval Date, Achieve must provide the Federal Court with a certificate, or such other evidence as the Federal Court requests, confirming the Conditions Precedent listed at clause 3.1 (a) and 3.1(b) of this Achieve Scheme have been met.

Achieve must lodge the orders of the Federal Court approving the Achieve Scheme with ASIC as soon as practicable and, in any event, by no later than 5.00 pm on the first Business Day following the date on which the Federal Court approves the Achieve Scheme.

(2) ACNewCo must issue Friends of ACNewCo Memberships to Participating Achieve Members; and

(3) Achieve must issue New Achieve Memberships to all Nominee Members.

(b) Without the need for any further act, all Achieve Members agree to the cancellation of their Achieve Memberships pursuant to clause 4.2(a).

(c) Without the need for any further act, the Participating Achieve Members agree to accept the Friends of ACNewCo Memberships issued under this Achieve Scheme and to be bound by the constitution of ACNewCo.

(d) Without the need for any further act, the Nominee Members agree to accept the New Achieve Memberships issued under this Achieve Scheme and to hold them subject to their respective individual deed polls.

(e) ACNewCo must by no later than 10 Business Days after the Merger Date, dispatch to each Participating Achieve Member at his or her address recorded in the Achieve Register immediately prior to the Merger Date, a statement confirming that person's membership of ACNewCo.

4.3 Transfer of Undertaking, Assets and Liabilities

(a) the whole of the undertaking and Property of Achieve will be transferred to and vested in ACNewCo without the need for any further act or deed;

(b) all Liabilities of Achieve will be transferred to and become Liabilities of ACNewCo without the need for any further act or deed; and

(c) all legal proceedings pending by or against Achieve (if any) will be deemed continued by or against ACNewCo without the need for any further act or deed, other than appropriate amendment of the record of the relevant court or tribunal.

Achieve will remain in existence after the Merger Date for the sole purpose of receiving any future bequests. On the Court Approval Date Achieve will make an application to the Federal Court for an order under section 413 of the Corporations Act that all bequests received by Achieve after the Merger Date be paid by Achieve to ACNewCo.

For the purpose of determining entitlements to Friends of ACNewCo Memberships, Achieve must, until the Friends of ACNewCo Memberships have been provided to Participating Achieve Members in accordance with this Achieve Scheme, maintain or procure the maintenance of the Achieve Register in accordance with Achieve's constitution and all applicable laws. The Achieve Register in this form will solely determine entitlements to Friends of ACNewCo Memberships under this Achieve Scheme.

As soon as practicable after the Court Approval Date, and in any event by no later than the end of the first Business Day after the Court Approval Date, Achieve will ensure that details of the names, Registered Addresses and memberships of Achieve Members are made available to ACNewCo in such form as ACNewCo may reasonably require.

Each Achieve Member acknowledges and agrees that this Achieve Scheme binds Achieve and all Achieve Members (including those who do not attend the Achieve Scheme Meeting or vote at that meeting) and, to the extent permitted by law, overrides the constitution of Achieve.

(a) Each Participating Achieve Member consents to Achieve and ACNewCo doing all acts and things as may be necessary or desirable to give full effect to the Achieve Scheme and the transactions contemplated by it.

(b) Each Participating Achieve Member, without the need for any further act, irrevocably appoints Achieve and each of its directors and officers (jointly and severally) as its agent and attorney for the purpose of executing any document or doing any other act necessary or expedient to give effect to the terms of this Achieve Scheme and the transactions contemplated by it.

(a) Each Achieve Member, without the need for any further act, irrevocably appoints Achieve and each of its directors and officers (jointly and severally) as its agent and attorney for the purpose of enforcing the ACNewCo Deed Poll against ACNewCo.

(b) Achieve undertakes in favour of each Achieve Member that it will enforce the ACNewCo Deed Poll against ACNewCo on behalf of and as agent and attorney for each Achieve Member.

Achieve and ACNewCo will execute all documents and do all acts and things as may be necessary or desirable to give full effect to the Achieve Scheme and the transactions contemplated by it.

If the Federal Court proposes to approve the Achieve Scheme subject to any alterations or conditions, Achieve may consent on behalf of all persons concerned, by its counsel, to those alterations or conditions to which ACNewCo and Crowle have consented in writing.

(a) This Achieve Scheme is governed by the laws of New South Wales.

(b) Each of Achieve, ACNewCo and the Participating Achieve Members irrevocably and unconditionally submit, in connection with this Achieve Scheme, to the non-exclusive jurisdiction of the Federal Court and any courts which have jurisdiction to hear appeals from the Federal Court.

2.5 Consequences of the Crowle Scheme becoming Effective xvii

4.3 Transfer of Undertaking, Assets and Liabilities xix

Pursuant to sections 411 and 413 of the Corporations Act 2001 (Cth)

THE CROWLE FOUNDATION LIMITED ABN 48 059 150 604 of PO Box 1020 Meadowbank, New South Wales 2114 (CROWLE); and

THE CROWLE MEMBERS IMMEDIATELY PRIOR TO THE MERGER DATE (Participating Crowle Members and Nominee Members)

Achieve Member means a person who is registered as the holder of an Achieve Membership in the Achieve Register.

Achieve Membership means a class of membership in Achieve as provided for in the constitution of Achieve.

Achieve Register means the register of members of Achieve.

Achieve Scheme means this scheme of arrangement, subject to any alterations or conditions made or required by the Court pursuant to section 411(6) of the Corporations Act.

ACNewCo Deed Poll means the deed poll dated 24 September 2008 executed by ACNewCo in favour of the Participating Crowle Members.

ACNewCo Ordinary Member means an initial member of ACNewCo on incorporation as named in the constitution of ACNewCo whose rights and obligations as an ordinary member are set out in the constitution of ACNewCo.

ASIC means the Australian Securities and Investments Commission.

Business Day means a day other than a Saturday, Sunday or public holiday in Sydney, New South Wales.

Conditions Precedent means the conditions set out in clause 3.1 of this Crowle Scheme.

Corporations Act means the Corporations Act 2001 (Cth).

Court Approval Date means the first day on which the application made to the Federal Court for an order pursuant to section 411(4)(b) of the Corporations Act approving the Crowle Scheme is heard or, if the application is adjourned for any reason, the first day on which the adjourned application is heard.

Crowle Member means a person who is registered as the holder of a Crowle Membership in the Crowle Register immediately prior to the Effective Date.

Crowle Membership means a class of membership in Crowle as provided for in the constitution of Crowle.

Crowle Register means the register of members of Crowle.

Crowle Scheme means the scheme of arrangement under sections 411 and 413 of the Corporations Act to be proposed between Crowle and its members in connection with the Merger.

Crowle Scheme Meeting means the meeting of Crowle Members ordered by the Federal Court to be convened under section 411(1) of the Corporations Act to consider and, if thought fit, to approve the Crowle Scheme.

Effective means in relation to a scheme of arrangement, the coming into effect, pursuant to section 411(10) of the Corporations Act, of the orders of the Federal Court made under section 411(4)(b) of the Corporations Act in relation to that scheme.

Effective Date means the date on which the Crowle Scheme becomes Effective.

End Date means 31 January 2009 or such later date as Achieve and Crowle may agree in writing.

Federal Court means the Federal Court of Australia.

Friends of ACNewCo Membership means the class of membership in ACNewCo the rights and obligations of which are set out in the constitution of ACNewCo.

Liabilities has the meaning given to that term in section 413(4) of the Corporations Act.

Merger means the proposed merger of Achieve and Crowle.

Merger Date means the second Business Day after the Effective Date.

New Crowle Membership means Crowle Memberships issued to the Nominee Members under clause 2.5(a)(3) of this Crowle Scheme whereby each Nominee Member agrees to hold its New Crowle Membership on behalf of, and to exercise all rights, powers and discretions in respect of it only in accordance with the instructions of, ACNewCo from time to time, subject to the terms of its respective individual deed poll.

Nominee Member means a Crowle Member who is also an ACNewCo Ordinary Member and who will enter into an individual deed poll in favour of ACNewCo pursuant to which it will agree to hold its New Crowle Membership for the benefit of ACNewCo and to exercise the rights attaching to its Crowle Membership at the direction of ACNewCo.

Participating Crowle Member means a person other than a Nominee Member who is a Crowle Member immediately prior to the Merger Date.

Property has the meaning given to that term in section 9 and section 413(4) of the Corporations Act.

Registered Address means, in relation to a Crowle Member, their address as shown in the Crowle Register immediately prior to the Merger Date.

Scheme Book means the explanatory statement prepared and issued by Achieve and Crowle in connection with the Achieve Scheme and the Crowle Scheme for the purpose of section 412 of the Corporations Act.

Transfer Date means the third Business Day after the Effective Date.

In this Crowle Scheme, unless a contrary intention appears:

(a) words or expressions importing the singular include the plural and vice versa;

(b) words or expressions importing a gender include the other gender;

(c) words or expressions denoting individuals include corporations, firms, unincorporated bodies, government authorities and instrumentalities;

(d) where a word or expression is defined or given meaning, another grammatical form has a corresponding meaning;

(e) any heading, index, table of contents or marginal note is for convenience only and does not affect the interpretation of this Crowle Scheme;

(f) a reference to a clause, paragraph or subparagraph is a reference to a clause, paragraph or subparagraph of this Crowle Scheme;

(g) a reference to this Crowle Scheme or another document includes that document as amended, varied, novated, supplemented or replaced from time to time;

(h) a reference to legislation or a provision of legislation includes:

(1) all regulations, orders or instruments issued under the legislation or provision; and

(2) any modification, consolidation, amendment, re-enactment, replacement or codification of such legislation or provision;

(i) any recitals, schedule or annexure form part of this Crowle Scheme and have effect as if set out in full in the body of this Crowle Scheme;

(j) references to include and including are to be construed without limitation;

(k) words or expressions defined in the Corporations Act have the same meaning when used in this Crowle Scheme; and

(l) a reference to time is to New South Wales time.

Crowle is a public company limited by guarantee registered in New South Wales.

ACNewCo is a public company limited by guarantee registered in New South Wales.

(a) The directors of Crowle consider that it is in the best interests of Crowle Members for Crowle to merge with Achieve and that this should be done through the implementation of this Crowle Scheme and the Achieve Scheme.

(b) Achieve and Crowle have agreed to implement the Merger.

(c) ACNewCo has agreed by entering into the ACNewCo Deed Poll to:

(1) provide Friends of ACNewCo Memberships to Participating Crowle Members in accordance with this Crowle Scheme;

(2) accept the transfers of the undertaking, Property and Liabilities of Crowle under this Crowle Scheme; and

(3) take the other actions attributed to it under this Crowle Scheme.

Crowle is not a party to any legal proceedings as at the date of the Scheme Book.

2.5 Consequences of the Crowle Scheme becoming Effective

If the Crowle Scheme becomes Effective and is implemented, each of the following will:

(1) the memberships of each Crowle Member will be cancelled; and

(2) ACNewCo will issue Friends of ACNewCo Memberships to Participating Crowle Members in accordance with this Crowle Scheme; and

(3) Crowle will issue New Crowle Memberships to all Nominee Members.

(b) on the Transfer Date, the whole of the undertaking, Property and Liabilities of Crowle will be transferred to ACNewCo.

(c) Crowle will remain in existence after the Merger Date for the sole purpose of receiving any future bequests. On the Court Approval Date Crowle will make an application to the Federal Court for an order under section 413 of the Corporations Act that all bequests received by Crowle after the Merger Date be paid by Crowle to ACNewCo.

(a) (Scheme Meeting approval): the Crowle Members approving the Scheme at the Scheme Meeting by the requisite majority as required under the Corporations Act;

(b) (ASIC approval): ASIC providing such consents or approvals or other acts which the parties agree are necessary or desirable to implement the Merger;

(c) (Federal Court approval): this Crowle Scheme being approved by the Federal Court for the purpose of section 411(4)(b) of the Corporations Act; and

(d) (Achieve approval): the Achieve Scheme being approved by the Federal Court for the purpose of section 411(4)(b) of the Corporations Act.

The Crowle Scheme will lapse and be of no further force or effect if all of the Conditions Precedent are not met or if the Effective Date does not occur on or before the End Date. If this Crowle Scheme lapses in accordance with its terms each of Crowle and ACNewCo are released from:

(a) any further obligation to take steps to implement this Crowle Scheme; and

(b) any liability with respect to this Crowle Scheme.

At or before the Federal Court hearing on the Court Approval Date, Crowle must provide the Federal Court with a certificate, or such other evidence as the Federal Court requests, confirming the Conditions Precedent listed at clause 3.1(a) and 3.1(b) of this Crowle Scheme have been met.

Crowle must lodge the orders of the Federal Court approving the Crowle Scheme with ASIC as soon as practicable and, in any event, by no later than 5.00 pm on the first Business Day following the date on which the Federal Court approves the Crowle Scheme.

(2) ACNewCo must issue Friends of ACNewCo Memberships to Participating Crowle Members; and

(3) Crowle must issue New Crowle Memberships to all Nominee Members.

(b) Without the need for any further act, all Crowle Members agree to the cancellation of their Crowle Memberships pursuant to clause 4.2(a).

(c) Without the need for any further act, the Participating Crowle Members agree to accept the Friends of ACNewCo Memberships issued under this Crowle Scheme and to be bound by the constitution of ACNewCo.

(d) Without the need for any further act, the Nominee Members agree to accept the New Crowle Memberships issued under this Crowle Scheme and to hold them subject to their respective individual deed polls.

(e) ACNewCo must by no later than 10 Business Days after the Merger Date, dispatch to each Participating Crowle Member at his or her address recorded in the Crowle Register immediately prior to the Merger Date, a statement confirming that person's membership of ACNewCo.

4.3 Transfer of Undertaking, Assets and Liabilities

(a) the whole of the undertaking and Property of Crowle will be transferred to and vested in ACNewCo without the need for any further act or deed;

(b) all Liabilities of Crowle will be transferred to and become Liabilities of ACNewCo without the need for any further act or deed; and

(c) all legal proceedings pending by or against Crowle (if any) will be deemed continued by or against ACNewCo without the need for any further act or deed, other than appropriate amendment of the record of the relevant court or tribunal.

Crowle will remain in existence after the Merger Date for the sole purpose of receiving any future bequests. On the Court Approval Date Crowle will make an application to the Federal Court for an order under section 413 of the Corporations Act that all bequests received by Crowle after the Merger Date be paid by Crowle to ACNewCo.

For the purpose of determining entitlements to Friends of ACNewCo Memberships, Crowle must, until the Friends of ACNewCo Memberships have been provided to Participating Crowle Members in accordance with this Crowle Scheme, maintain or procure the maintenance of the Crowle Register in accordance with Crowle's constitution and all applicable laws. The Crowle Register in this form will solely determine entitlements to Friends of ACNewCo Memberships under this Crowle Scheme.

As soon as practicable after the Court Approval Date, and in any event by no later than the end of the first Business Day after the Court Approval Date, Crowle will ensure that details of the names, Registered Addresses and memberships of Crowle Members are made available to ACNewCo in such form as ACNewCo may reasonably require.

Each Crowle Member acknowledges and agrees that this Crowle Scheme binds Crowle and all Crowle Members (including those who do not attend the Crowle Scheme Meeting or vote at that meeting) and, to the extent permitted by law, overrides the constitution of Crowle.

(a) Each Participating Crowle Member consents to Crowle and ACNewCo doing all acts and things as may be necessary or desirable to give full effect to the Crowle Scheme and the transactions contemplated by it.

(b) Each Participating Crowle Member, without the need for any further act, irrevocably appoints Crowle and each of its directors and officers (jointly and severally) as its agent and attorney for the purpose of executing any document or doing any other act necessary or expedient to give effect to the terms of this Crowle Scheme and the transactions contemplated by it.

(a) Each Crowle Member, without the need for any further act, irrevocably appoints Crowle and each of its directors and officers (jointly and severally) as its agent and attorney for the purpose of enforcing the ACNewCo Deed Poll against ACNewCo.

(b) Crowle undertakes in favour of each Crowle Member that it will enforce the ACNewCo Deed Poll against ACNewCo on behalf of and as agent and attorney for each Crowle Member.

Crowle and ACNewCo will execute all documents and do all acts and things as may be necessary or desirable to give full effect to the Crowle Scheme and the transactions contemplated by it.

If the Federal Court proposes to approve the Crowle Scheme subject to any alterations or conditions, Crowle may consent on behalf of all persons concerned, by its counsel, to those alterations or conditions to which ACNewCo and Achieve have consented in writing.

(a) This Crowle Scheme is governed by the laws of New South Wales.

(b) Each of Crowle, ACNewCo and the Participating Crowle Members irrevocably and unconditionally submit, in connection with this Crowle Scheme, to the non-exclusive jurisdiction of the Federal Court and any courts which have jurisdiction to hear appeals from the Federal Court.

GENERAL DIVISION NSD 1559 of 2008

IN THE MATTER OF ACHIEVE FOUNDATION LIMITED (ACN 059 432 610) AND THE CROWLE FOUNDATION LIMITED (ACN 059 150 604) BETWEEN: ACHIEVE FOUNDATION LIMITED (ACN 059 432 610)

REASONS FOR JUDGMENT 1 From about July 2008, the first plaintiff (Achieve) and the second plaintiff (Crowle) wished to merge their activities by transferring to the defendant (NewCo) their entire undertaking and all of their liabilities. Each of the plaintiffs is a publicly listed company limited by guarantee. 2 On 2 October 2008, this proceeding was commenced. The principal relief ultimately sought by Achieve and Crowle was Court approval of two schemes of arrangement which by then had been finalised as between the Board of Directors of each of the parties (the schemes). 3 On 10 October 2008, the Court made orders convening a meeting of the members of each of Achieve and Crowle for the purpose of having those members consider and, if thought appropriate, resolve to agree to the schemes. 4 The meetings which the Court ordered to be held took place on 2 November 2008 in the case of Crowle and on 4 November 2008 in the case of Achieve. 5 The proceeding came before me on 20 November 2008 for the purpose of my considering whether to make an order approving the schemes and for ancillary relief. I made orders approving both of the schemes on that day. I also made other orders directed to various specific issues raised by the schemes. Subsequently, those orders were varied under the slip rule. 6 These Reasons for Judgment are my reasons for making the orders which I made on 20 November 2008 and which I varied on 5 December 2008.

The Crowle Foundation as at October 2008 7 Crowle was established in 1952. By late 2008, it was a community-based organisation providing accommodation, training, employment and community access services to adults with disabilities, particularly intellectual disabilities. Its activities were concentrated in the inner western suburbs of Sydney. The total number of persons being assisted by Crowle at this time was more than 325 people. It had 200 full-time and part-time staff and volunteers. It provided accommodation for 46 residents at its premises at Belmore Street Ryde as well as community based accommodation for an additional 30 people in the Ryde area. Employment training and employment services were provided to approximately 130 people and community access day services to approximately 120 people. 8 Crowle was a member based organisation, being a corporation limited by guarantee with an elected Board of Directors whose numbers were not to exceed 12. 9 The funding for its services was largely provided by the Federal Government and the NSW State Government. Twenty percent of its funding needs was raised by the Foundation itself. 10 In the years 2005-2008, Crowle experienced difficulties in maintaining operational surpluses and positive cash flows. The Board of Directors of Crowle came to the view that the best option for Crowle was to merge with Achieve or with some other like-minded service provider. 11 In the Scheme Booklet (Exhibit 1), at p 64, the following was said: The Finance Committee, Management and the Board, are therefore of the opinion, that the best option for The Crowle Foundation to be able to continue to meet its mission and objectives, is to seek a merger with Achieve Foundation or a similar like-minded service provider, as a matter of urgency. This will enable the existing services of The Crowle Foundation to be retained and also provide the opportunity to grow and expand the services currently offered, such as, respite.

The Crowle Foundation may be able to survive for a time without such a merger, but certain unacceptable and unpalatable options will need to be implemented, such as the closure of or reduction of current services, particularly within Crowle Industries and Employment sectors. Likewise, The Crowle Foundation would have to sell or mortgage part of its property portfolio to fund these actions and future operational deficits. 12 As at 30 June 2008, Crowle had total assets valued at $9,773,144 with total liabilities of $3,572,259. Thus, the value of its net assets was $6,200,885.

Achieve Foundation as at October 2008 13 At the time of the proposed merger, Achieve was a very similar organisation to Crowle. It began its operations in 1964. It provided similar services and facilities to those provided by Crowle. Its activities were concentrated in the Hornsby, Ryde and Parramatta areas of Sydney. Its services were provided to over 170 people. It had approximately 200 full-time and part-time staff and volunteers. 14 Achieve was committed to providing opportunities for people with disabilities to live and work in the community and to be recognised as valued citizens. Its particular focus was on providing employment opportunities and training to persons with intellectual disabilities. 15 In the period 2005-2008, Achieve suffered operational losses. Although, for the year ended 30 June 2008, it incurred a smaller loss than it had incurred in the previous two years, the loss was nonetheless of the order of $355,000. 16 The Board of Directors of Achieve was firmly of the view that the trend of continuing losses needed to be arrested if the Foundation and the services provided by it were to be maintained into the future. 17 As at 30 June 2008, the value of the total assets of Achieve was $7,467,353 with total liabilities of $2,231,595. The value of the net assets of Achieve was thus $5,235,758.

The Schemes 18 The schemes involved the transfer of all of the assets and liabilities of both Crowle and Achieve to a recently registered public company limited by guarantee which, at the time this proceeding was commenced, was known as ACNewCo Limited (NewCo) which is the defendant in this proceeding. It was intended that NewCo would be established as a not-for-profit company with deductible gift recipient status. 19 Crowle and Achieve were to be retained as entities controlled by NewCo (and not wound up and dissolved) for the sole purpose of receiving bequests, which bequests were then to be passed on to NewCo. 20 The Scheme Booklet gave notice of the fact that Crowle and Achieve would seek a special order from the Court that bequests received by either Foundation would be required, by order of the Court, to be transferred to NewCo immediately after such bequests were received by either Achieve or Crowle. 21 The Crowle Foundation Personal Fund Trust was a special trust which, at the time of the proposed merger, administered the funds of Crowle's participating service users. The funds in this Trust were being treated by Crowle independently of any other funds and independently of the accounts of Crowle. It was intended that the funds in this Trust would be transferred to NewCo but would continue to be treated independently of any other funds or accounts so that these funds would be used for the sole use and benefit of the participating service users who had previously benefitted from The Crowle Foundation Personal Fund Trust. 22 All memberships in Crowle and Achieve existing at the time the schemes were approved by the Court were to be cancelled. Membership of NewCo was initially to be limited to a total of 16 persons, eight of whom were to be nominated by Crowle and eight of whom were to be nominated by Achieve. It was anticipated that membership would be expanded as and from the merger date. 23 All members of Crowle and Achieve at the time of the merger who were not one of the nominated 16 members would become a member of NewCo as a Friend of ACNewCo. The Friends of ACNewCo would have no liability to pay any subscription or other membership fee until 30 June 2009. The Friends of ACNewCo might attend and speak at general meetings of NewCo but would not be permitted to vote at such meetings and would not be eligible for election to the Board of NewCo or for appointment or election to any other office within NewCo. 24 The initial Board of Directors of NewCo was to comprise eight nominated persons, four from each of Achieve and Crowle. 25 All of the directors of both of the merging Foundations supported the merger. No director opposed it. 26 The benefits of the merger were described by the Chairpersons of the two merging foundations as follows: We are all firmly convinced that that [sic] we can provide these services more effectively, and at a reduced cost, by merging our organisations into one Foundation. We can reduce overheads and make better use of combined resources, strengthening the financial base of the Merged Foundation to provide greater access to a broader range of services.

Government has recognised and commended the leadership demonstrated by this merger initiative, which highlights a proactive solution to boosting the financially thin and fragmented disability services sector in New South Wales. We further believe that our capacity to raise funds from Governments, Corporations and the public will be enhanced by the establishment of one Foundation.

Our two existing Foundations want to continue to provide high quality services at a local level to people with disabilities. We want to maintain the quality of those services, and make them available to more people. We also want to optimise the generous support of our volunteer community towards fundraising in order to improve service delivery. It is our view that we can most effectively do this by merging our two Foundations. 27 In the Scheme Booklet, it was also said that the merger would ensure the survival, long term viability and success of the activities of both Achieve and Crowle. Combining the expertise and resources of both Foundations was considered to be a sound basis for providing future opportunities for growth and corporate recognition and an increased capacity for fundraising. Administration costs were expected to be reduced. 28 The Scheme Booklet explained the perceived benefits of the merger in considerable detail (see, eg pp 17-20 and p 54). The proposed merger was supported by an expert's report made by Derek Maxwell Ryan, who has accounting and valuation qualifications. Mr Ryan expressed the opinion that the Crowle scheme was in the best interests of the Crowle members and that the Achieve scheme was in the best interests of the Achieve members. He also expressed the opinion that the creditors of both organisations would not be prejudiced should the schemes go ahead. In essence, Mr Ryan assessed the advantages and disadvantages of the schemes. He endorsed the list of advantages prepared by the executives of both organisations. He also expressed the view that the merger would result in a more efficient operation in respect of the activities of both Crowle and Achieve through the combination of finance, administration and marketing activities, resulting in a more focused approach to those activities and in the optimisation of available resources. He believed that the merger would improve overall management skills and experience of the two organisations by combining the two management teams which had complementary strengths and experiences. He saw the disadvantages as coming down to the costs to be incurred by Crowle and Achieve in executing the transactions and the temporary disenfranchisement of some members of each organisation. In his opinion, the advantages which he discussed in his report far outweighed the disadvantages. The schemes were also supported by an investigating accountant retained by the plaintiffs, Julie Hough. 29 The implementation of the merger was not going to have a material adverse effect on the interests of creditors or on either of the merging Foundations. Other than transaction costs associated with the merger proposal, no material or additional liability was to be incurred by either of those Foundations by virtue of the merger. 30 In addition, there was to be no other significant outflow of funds or property from either Achieve or Crowle under, or by reason of, the merger, other than the transaction costs incurred in connection with the implementation of the merger and any consolidation of the operations into NewCo. 31 The proponents of the merger expected that the transaction would be given an exemption from duty by the NSW Government and that there would be no income tax, GST or capital gains tax implications from the merger. 32 In the Scheme Booklet, the following was said in respect of the expected benefits to flow from a streamlined organisational structure: Principles & Objectives of ACNewCo's Organisational Structure

Through the Merger of the two Foundations, the following will be achieved:

· The structure will support the realisation of ACNewCo's purpose, mission and values.

· The structure will support management in key roles both internally with operations and externally with full stakeholder involvement and management.

· The structure will include a blended and new executive team competent to deliver the Merged Foundation's goals and mission.

· The structure will be designed to address the period of merger implementation allowing for merger contingencies.

· The structure will be reviewed in March 2009 as part of ACNewCo's strategic and service planning process.

· The structure will support service provision across accommodation, with multiple models and innovative service developments including respite provision, day services, including return from work programs to address ageing client needs, and employment services, including training, enclaves and business social enterprise. These services will be supported by corporate services, finance and IT.

· The structure will be predicted on the achievement of a budget surplus and the ability to self fund some innovative new services. 33 In the same document, the advantages of the proposed merger were described as follows: Advantages of the Merger Proposal

Each of the Directors of The Crowle Foundation and Achieve Foundation, recommend the Merger as the best way forward to securing the future survival and viability of both Foundations. The Foundations are a good fit for each other; both Foundations are committed to providing excellent accommodation, day and employment services to people with disabilities. Main advantages of the Merger Proposal are:

· Increased size will allow greater say at the policy level in the area of disability and disability service provision.

· Enhanced financial viability that should lead to increased funding opportunities and support for recognition as a "preferred provider" by governments.

· Maintaining employment services into the future; which have been under threat from Federal Government changes.

· Enhanced capacity to see "own programs" which will assist in meeting local need, for example, respite services.

· Additional pool from which to draw potential Board Members, creating succession planning opportunities.

· Future opportunities to increase investment into purpose built and purchased housing, which will decrease exposure to rental market issues and decrease movements of people in rented premises.

· Potential to create a living environment more directly linked to the person's needs, via purchasing or building properties.

· Increased exposure to the general community both as a direct result of the merger engagement process and if the entities merge - increasing the pool of potential supporters.

· Opportunity to review internal structures and systems that support the operations of the Foundations - allowing for some internal and external examination that could lead to improvements in the way foundation business is conducted. 34 Clause 4.4 of the scheme of arrangement considered by the members of Crowle provided: Continuation of Crowle

Crowle will remain in existence after the Merger Date for the sole purpose of receiving any future bequests. On the Court Approval Date Crowle will make an application to the Federal Court for an order under section 413 of the Corporations Act that all bequests received by Crowle after the Merger Date be paid by Crowle to ACNewCo. 35 Clause 4.4 of the scheme of arrangement considered by the members of Achieve was in the same terms, with only the Foundation's name changed. 36 The text of cl 4.4 of each scheme approved by the Court is in the same terms as that which was considered by the members of Achieve and Crowle.

The Evidence at the Approval Hearing 37 The approval hearing was initially listed before me on 18 November 2008. The plaintiffs were not ready to proceed on that day. Nonetheless, I maintained the listing in order to ensure that any persons who wished to appear at the approval hearing, either to support or oppose the orders sought, would not be denied the opportunity of doing so by reason of some late change in the date of that hearing which had not been publicly notified. The approval hearing then took place on 20 November 2008. 38 No person or entity other than the plaintiffs appeared at the approval hearing either to support or oppose the orders sought. In particular, NewCo did not appear and did not seek to place any submissions before the Court in relation to the orders sought. 39 In support of the factual information set out in the Scheme Booklet, the plaintiffs read the affidavit of Anne Bryce sworn on 10 October 2008 (her second affidavit) which was relied upon by Achieve and the affidavit of David Hancock sworn on 10 October 2008 (his second affidavit) which was relied upon by Crowle. The plaintiffs also read the affidavit of Derek Maxwell Ryan sworn on 8 October 2008 and the affidavit of Julie Hough sworn on 9 October 2008. As I have already mentioned, Mr Ryan was the independent expert retained by the plaintiffs to assess the proposal embodied in the schemes and Ms Hough was an investigating accountant retained by the parties to support the financial information presented to the Court. 40 The plaintiffs read the affidavit of David Hancock sworn on 4 November 2008 (his third affidavit) in order to prove that the Scheme Booklet had been posted to the members of Crowle. Mr Hancock also testified as to the procedure which he undertook in relation to the collation and assessment of proxies for the general meeting of members which had previously been ordered by the Court. I was satisfied, on the evidence of Mr Hancock, that the Scheme Booklet and a proxy form in relation to the scheme meeting had been sent to each of the members of Crowle. The total number of persons recorded as members of Crowle as at 11 October 2008 was 209. 41 The plaintiffs relied upon the affidavit of Anne Bryce sworn on 18 November 2008 (her third affidavit) in order to prove that the Scheme Booklet had been posted to the members of Achieve. I was satisfied, on the evidence of Ms Bryce, that the Scheme Booklet and appropriate proxy forms had been sent to all the members of Achieve. The total number of persons recorded as members of Achieve as at 11 October 2008 was 15. 42 The plaintiffs read the affidavit of Jill Helen Macnaught sworn on 17 November 2008 (her second affidavit). Ms Macnaught testified as to what occurred at the Crowle scheme meeting. She said that 56 members of Crowle attended the Crowle meeting and that, therefore, under the Constitution of Crowle, there was a quorum for a general meeting. A poll was taken. The result of the poll was as follows: (a) 101 Crowle members who were present at the Crowle scheme meeting, either in person or by proxy, voted in favour of the Crowle scheme resolution and 15 who were present at the Crowle scheme meeting, either in person or by proxy, voted against the Crowle scheme resolution; (b) The members of Crowle who voted in favour of the Crowle scheme resolution represented 87.1% of all Crowle members present and voting at the Crowle scheme meeting; and (c) The Crowle members who voted against the Crowle scheme resolution represented 12.9% of all Crowle members present and voting at the Crowle scheme meeting. 43 I was therefore satisfied that the Crowle scheme resolution had been passed by the requisite majority in accordance with the requirements of s 411(4) of the Corporations Act 2001 (Cth) (the Act). 44 The votes at the Crowle scheme meeting were tagged in the sense that the votes of those members of Crowle who were to become members of NewCo at the point of merger were segregated and identified as a separate group from the votes of the remaining members. This was done so that the Court would have available at the approval hearing evidence of the number of votes cast for and against the scheme resolution by the eight Crowle nominees to NewCo and the number of votes cast for and against that resolution by the Friends of ACNewCo. All eight Crowle nominees to NewCo voted in favour of the Crowle scheme resolution. Therefore, the votes at the Crowle scheme meeting of the Crowle members who were not ordinary members but who would become Friends of ACNewCo members in NewCo were as follows: (a) Ninety-three voted in favour of the Crowle scheme resolution, representing 86.1% of the Friends of ACNewCo present and voting; and (b) Fifteen voted against the Crowle scheme resolution, representing 13.9% of the Friends of ACNewCo present and voting. 45 Dina Hayes, who swore an affidavit on 17 November 2008 (her second affidavit), proved what occurred at the Achieve scheme meeting. All 15 members of Achieve who were present at that meeting, either in person or by proxy, voted in favour of the Achieve scheme resolution. 46 Gordon Joseph McCann, the solicitor for the plaintiffs, swore an affidavit on 19 November 2008 (his second affidavit). Mr McCann proved lodgement of the Scheme Booklet for registration with the Australian Securities and Investments Commission (ASIC). Mr McCann also proved that ASIC had in fact registered the Scheme Booklet. Mr McCann also proved receipt of a letter from ASIC pursuant to s 411(17)(b) of the Act in which ASIC stated that it had no objection to the schemes being approved by the Court. Finally, Mr McCann proved that the proposed merger had been appropriately advertised in The Sydney Morning Herald pursuant to r 3.4 of the Federal Court (Corporations) Rules 2000 (Cth). 47 Mr McCann testified in a further affidavit that he had not received notice from any person of any intention to appear at the approval hearing. He also proved that the Scheme Booklet which had been considered at the meetings of Crowle and Achieve was in the same form as the Scheme Booklet which had been sent to and registered by ASIC. 48 There were several conditions precedent set out in the Scheme Booklet. Proof of the fulfilment of those conditions precedent was given by Anne Bryce in her affidavit sworn on 18 November 2008 (her fourth affidavit), on behalf of Achieve, and Jennie Broadley sworn on 18 November 2008, on behalf of Crowle. The conditions precedent required that the scheme resolution be approved by the requisite majority of each organisation. 49 The terms upon which the nominee members put forward by each of Crowle and Achieve would conduct themselves in relation to NewCo were embodied in a Deed Poll. All 16 nominee members executed a Deed Poll and the bundle of executed Deeds Poll became Exhibit 3. Each Deed Poll was in the same form. It is not necessary to traverse the detail of these Deeds Poll. The substance of the document was directed to ensuring a smooth transition pursuant to the agreed merger terms of the activities of each of the merging Foundations into one in the form of NewCo. 50 Ms Bryce gave detailed updating information in respect of the creditors of Achieve. On the basis of her evidence, I was satisfied that the creditors of Achieve would not be prejudiced should the merger go ahead. The evidence of Ms Bryce established that the NSW Department of Ageing, Disability and Home Care consented to the merger and supported it. Indications of support had also been given orally by the relevant Federal departments. 51 A similar affidavit was sworn by Jennie Broadley on 18 November 2008 (her second affidavit) on behalf of Crowle. I was also satisfied that a similar position obtained in respect of Crowle. 52 I was therefore satisfied that all relevant necessary statutory requirements laid down by s 411 and s 412 of the Act had been complied with. 53 Subject to two further matters, I was satisfied that the schemes should both be approved. 54 The two further matters concerned: (a) The subject matter of Order 6 and Order 7 (as varied); and (b) The subject matter of Order 8.

Order 6 and Order 7 55 As each of Crowle and Achieve was a charitable organisation likely to receive bequests in the future and had received such bequests in the past, the parties had agreed that each of those corporations would remain in existence after the merger for the express purpose of enabling bequests which were actually made and received in the future to be received (as appropriate) by the pre-merger corporate structures and then passed on to NewCo pursuant to an order under s 413(1) of the Act, such bequests to be utilised in the interests of the merged entity, its members and clients. 56 The plaintiffs' claim for Order 6 and Order 7 required the Court to consider whether orders in those terms were authorised by s 413(1) of the Act. There was no doubt that, if the Court had power to make those orders, it was desirable that they be made in the circumstances of the present case. The work done by the pre-merger Foundations and expected to be done by NewCo is vital beneficial community work. The merged entity should not, if at all possible, be deprived of the benefit of the bequests which might fall in at some time in the future simply because those bequests were made to one or other of the pre-merger Foundations. 57 Section 413 of the Act is in the following terms: 413 Provisions for facilitating reconstruction and amalgamation of Part 5.1 bodies

(1) Where an application is made to the Court under this Part for the approval of a compromise or arrangement and it is shown to the Court that the compromise or arrangement has been proposed for the purposes of, or in connection with, a scheme for the reconstruction of a Part 5.1 body or Part 5.1 bodies or the amalgamation of 2 or more Part 5.1 bodies and that, under the scheme, the whole or any part of the undertaking or of the property of a body concerned in the scheme (in this section called the transferor body) is to be transferred to a company (in this section called the transferee company), the Court may, either by the order approving the compromise or arrangement or by a later order, provide for all or any of the following matters:

(a) the transfer to the transferee company of the whole or a part of the undertaking and of the property or liabilities of the transferor body;

(b) the allotting or appropriation by the transferee company of shares, debentures, policies or other interests in that company that, under the compromise or arrangement, are to be allotted or appropriated by that company to or for any person;

(c) the continuation by or against the transferee company of any legal proceedings pending by or against the transferor body;

(d) if the transferor body is a company - the deregistration by ASIC, without winding up, of the transferor body;

(e) the provision to be made for any persons who, within such time and in such manner as the Court directs, dissent from the compromise or arrangement;

(f) the transfer or allotment of any interest in property to any person concerned in the compromise or arrangement;

(g) such incidental, consequential and supplemental matters as are necessary to ensure that the reconstruction or amalgamation is fully and effectively carried out.

(2) Where an order made under this section provides for the transfer of property or liabilities, then, by virtue of the order, that property is transferred to and vests in, and those liabilities are transferred to and become the liabilities of, the transferee company, free, in the case of any particular property if the order so directs, from any charge that is, by virtue of the compromise or arrangement, to cease to have effect.

(3) Where an order is made under this section, each body to which the order relates must, within 14 days after the making of the order, lodge with ASIC an office copy of the order.

liabilities includes duties of any description, including duties that are of a personal character or are incapable under the general law of being assigned or performed vicariously.

property includes rights and powers of any description, including rights and powers that are of a personal character and are incapable under the general law of being assigned or performed vicariously. 58 In Re Stork ICM Australia Pty Ltd (2006) 25 ACLC 208, Lindgren J made orders approving a scheme of arrangement which included the transfer of liabilities which might arise in the future from one Stork company to another arising out of future proceedings as defined in the scheme documentation. In that documentation, future proceedings was defined as: Legal proceedings which have not yet commenced, but for which a cause of action has accrued or the injury or other event that may lead to a cause of action accruing (including, without limitation, exposure to asbestos dust) has occurred, or will occur in the future. 59 At [79]-[92], his Honour reviewed a number of relevant authorities. Some of those authorities supported by analogy an expansive interpretation of the concept of liabilities for the purposes of s 413(1)(a) and s 413(2) of the Act. 60 In Re Stork ICM Australia Pty Ltd 25 ACLC 208, the potential liabilities under consideration by Lindgren J were described by his Honour at [92] as … inchoate, potential or contingent liabilities … This was because the definition covered claims in the future by asbestos victims arising from injury or illness already being suffered by those victims but in circumstances where they may not necessarily be aware of the fact that they had that illness or injury. 61 In the present case, I was content to make an order transferring the liabilities of both Achieve and Crowle to NewCo (Order 5). I did so on the basis of the definition of liabilities in each of the schemes. That definition simply incorporated the definition in s 413(4) of the Act. 62 The subject matter of Re Stork ICM Australia Pty Ltd 25 ACLC 208 was, of course, different from the subject matter of Order 6 and Order 7 in the present case. In Re Stork ICM Australia Pty Ltd 25 ACLC 208, Lindgren J was dealing with liabilities. In particular, his Honour was considering certain kinds of future liabilities. In the present case, the subject matter calling for consideration is a potential future asset. That potential future asset is a bequest that becomes effective at some time in the future as a result of the death of the testator. Such bequests may have been in testamentary instruments which had been made prior to the merger date or may be in such instruments made after that date. In no sense could the subject matter of such bequests be regarded as property of either Achieve or Crowle in existence as at the merger date. Furthermore, looking at the matter prospectively from that date, the subject matter of such bequests could at best be described as contingent property. 63 However, the reasoning of Lindgren J in Re Stork ICM Australia Pty Ltd 25 ACLC 208 is capable of application by analogy. The definition of property in s 413(4) of the Act, in effect, mirrors the ideas behind the definition of liabilities in the same subsection. Applying reasoning similar to that undertaken by Lindgren J in Re Stork ICM Australia Pty Ltd 25 ACLC 208 to the present question would lead to a similarly expansive view being taken of the definition of property as it appears in s 413(4). 64 Notwithstanding the fact that bequests of the kind in contemplation in the present case cannot be described as inchoate in the same way that an unrevealed but nonetheless existing asbestos-caused injury or illness might be described as inchoate, Lindgren J's reasoning seems to me to be apposite. Future property should be regarded as falling within the definition of property in s 413(4), even if, as at the merger date, it is nothing more than potential or contingent. 65 There is, of course, a general definition of property in s 9 (Dictionary) of the Act. That definition is to apply … unless the contrary intention appears … The terms of that definition are as follows: property means any legal or equitable estate or interest (whether present or future and whether vested or contingent) in real or personal property of any description and includes a thing in action. 66 The general definition in s 9 of the Act sits quite comfortably with the specific definition in s 413(4) of the Act. The two can sensibly be interpreted together. 67 In Bell Group Ltd (in liq) v Westpac Banking Corporation (1996) 18 WAR 21, (1996) 22 ACSR 337, (1996) 15 ACLC 8 at 22 ACSR 343, Templeman J held that, when used in s 564 of the Act, the word property did not include future property but was confined to property presently in existence. 68 To the opposite effect is a decision of Elfic Ltd v Macks (2001) 181 ALR 1, (2001) 162 FLR 41, (2001) 19 ACLC 1324. Although Elfic Ltd v Macks 162 FLR 41 was not a decision which dealt with s 564 of the Act (rather it considered s 477(2)(c)), at [79]-[81] McMurdo P held that the term property should retain the broad meaning which it bears generally in the Act. At [182]-[183], Davies JA (with whom Cullinane J agreed) considered the meaning of property when used in s 477(2)(c) and said: 182 The first contention was that, if cl 15 of the policy was no more than a purported disposal of future property, it was not a disposal of property within the meaning of s 477(2)(c) even if it was effective in equity. Property is defined in s 9 to mean "any legal or equitable estate or interest (whether present or future and whether vested or contingent) in real or personal property of any description and includes a thing in action". Mr Keane submitted (Relying on Bell Group Ltd (in liq) v Westpac Banking Corporation (1996) 18 WAR 21 at 27-8) that the words "present or future" in this definition qualified the words "estate or interest" not "property"; and that therefore it relates only to presently existing property.

183 But in my opinion the definition of property should not be read as narrowly as Mr Keane submitted it should. It was, in my opinion, intended to be very broad, unless the contrary intention appears, not confined to the whole estate or the whole interest in property or to the legal as opposed to the equitable estate or interest or to a present interest or a vested interest. Nor does the decision of the Western Australian Supreme Court in Bell Group Ltd (in liq) v Westpac Banking Corporation ((1996) 18 WAR 21) compel a contrary conclusion. 69 I do not think that either Bell Group Ltd (in liq) v Westpac Banking Corporation 18 WAR 21 or Elfic Ltd v Macks 162 FLR 41 determines the present question. However, the reasoning which underpins the judgment in Elfic Ltd v Macks 162 FLR 41 seems to me to be more in tune with the reasoning of Lindgren J in Re Stork ICM Australia Pty Ltd 25 ACLC 208 and is to be preferred. Reasoning along the lines of that deployed by the Queensland Court of Appeal in Elfic Ltd v Macks 162 FLR 41 would support the conclusion which I have expressed at [64] above. The definition of property in s 413 should be interpreted expansively. 70 Another way of dealing with the issue thrown up by the parties' desire to capture future bequests is to deal with those bequests by way of a cy-prčs scheme (as to which see the observations of Finkelstein J in Royal Victorian Institute of the Blind Ltd v RBS.RVIB.VAF Ltd (2004) 206 ALR 581 at [18]-[21]). This was not the approach favoured by the parties in the present case. 71 The orders which I made reserved a liberty to deal with any matters or difficulties which might arise from the effectuation of the approved schemes.

Order 8 72 For some time, Achieve had dealt with the property known as 4A Alicia Road Mount Kuring-gai NSW upon the terms of a Deed of Loan dated 24 October 2001 (Exhibit 2). The essence of the arrangement was that Judith Valentine Ellis was to provide loan funds to enable the purchase of that property by the NSW Minister for Disability Services and Achieve as tenants in common for the benefit of Matthew Ellis. In addition to loan funds provided by Judith Ellis, the Minister was to provide further funding. The property was to be used as accommodation for Matthew Ellis. 73 In order not to upset the arrangement reflected in Exhibit 2, the arrangement was excepted from the terms of the approved schemes and thus left in place pending further consideration by all relevant parties. 74 At the time I made the orders, I was satisfied that this was the most appropriate way of preserving the rights of Judith and Matthew Ellis in respect of the property known as 4A Alicia Avenue Mount Kuring-gai NSW. 75 In the event that all relevant parties come to some revised arrangement by agreement, that arrangement can be the subject of an application to the Court pursuant to Order 10 and Order 11.

Conclusions 76 For all of the above reasons, I was satisfied that, subject to the particular terms and conditions of the orders, the Court should approve the schemes. I was also satisfied that the orders which I made on 20 November 2008 and varied on 5 December 2008 were appropriate and should be made. I certify that the preceding seventy-six (76) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Foster.