Carpathian Resources Limited v Highmoor Business Corporation

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.

IN THE FEDERAL COURT OF AUSTRALIA WESTERN AUSTRALIA DISTRICT REGISTRY GENERAL DIVISION WAD 351 of 2010

BETWEEN: CARPATHIAN RESOURCES LIMITED (ACN 080 273 703)

JUDGE: BARKER J DATE: 19 NOVEMBER 2010 PLACE: PERTH

APPLICATION FOR INTERLOCUTORY INJUNCTION AND RELATED RELIEF 1 By application filed 17 November 2010 and amended with leave on 18 November 2010, the applicant seeks final relief pursuant to s 80 of the Trade Practices Act 1976 (Cth) (TP Act) restraining the respondents from both holding a meeting of the members of the applicant on 23 November 2010 at 10am AEDT and from making any statements to the effect that the meeting mentioned has not been validly postponed by the applicant until 16 December 2010 at 11am AEDT. 2 The applicant also seeks in the accrued jurisdiction of the Court or alternatively pursuant to s 1322(4) of the Corporations Act 2001 (Cth), a declaration that, in the events which have happened, the meeting mentioned has been validly postponed by the applicant. 3 The applicant also claims damages for misleading and deceptive conduct, pursuant to s 82 of the TP Act. 4 In the alternative, the applicant seeks an injunction pursuant to s 1324(1) of the Corporations Act restraining the respondents from holding a meeting mentioned on 23 November 2010 and a declaration that the notice of a general meeting served by the first respondent purporting to convene the meeting is invalid. 5 By way interlocutory relief, which now comes before the Court for consideration, the applicant claims: (1) until further order, an injunction restraining the respondents, whether by themselves, their servants or agents or howsoever otherwise, from holding a meeting of the members of the applicant on 23 November 2010 at 10am AEDT; and (2) until further order, an injunction restraining the respondents, whether by themselves, their servants or agents or howsoever otherwise, from making any statements to the effect that the meeting of members of the applicant has not been validly postponed by the applicant until 16 December 2010 at 11am AEDT. 6 The application for interlocutory relief came on for hearing before me late in the afternoon of 18 November 2010. Counsel for the parties presented both written and oral submissions in relation to the applicant's claims for interlocutory relief, albeit that counsel for the respondents indicated that the respondents were disadvantaged by the short time involved since service of the process in putting on full affidavit material responding to the claims made. Nonetheless, the respondents did not seek any adjournment of the proceeding. 7 Following the hearing of the notice of motion for interlocutory relief, I reserved my decision until 10.30am WST on 19 November 2010. I then gave judgment for the applicant and made orders in terms of the interlocutory relief claimed and indicated I would publish reasons for decision as soon as I could thereafter. These are the reasons for decision.

facts 8 In the circumstances I will provide only a brief recitation of the facts. These are drawn in particular from the affidavits filed on behalf of the applicant, which were formally read and relied upon by the applicant, including affidavits of Michael Petrus Hendriks, filed 17 November 2010, an affidavit of Yin Chieh Fang, filed 17 November 2010 and the further affidavit of Yin Chieh Fang, filed 17 November 2010. I also note the two affidavits of Nikki Emma Batalin filed 18 November 2010 on behalf of the respondents 9 The applicant is a public company listed on the Australian Securities Exchange (ASX). The first respondent has purported to issue a notice convening an extraordinary general meeting (EGM) of the members of the applicant company, pursuant to s 249F(1) of the Corporations Act, to be held in Sydney, New South Wales, on Tuesday 23 November 2010. A notice convening that meeting was served on 22 October 2010. 10 The resolutions that comprise the business of EGM are resolutions for: (a) the removal of the directors of the applicant, other than Mr Michael Hendriks (who was appointed after the notice was served); (b) the appointment of new directors; (c) authority to raise capital by the placement of shares. 11 The explanatory statement accompanying the notice states, amongst other things, that the convening shareholder called the general meeting: On the basis of the lack of consistent, positive leadership by the current Board and management of the Company which has been and is clearly demonstrated by the poor performance of the Company in recent times. The financial performance of the company is then the subject of further statements in the explanatory statement. 12 On 3 November 2010, the applicant's directors resolved to postpone the EGM until 16 December 2010 at 11am and to hold the meeting in Perth. 13 Mr Hendriks in his first affidavit says it is apparent from the announcement made to the ASX on 3 November 2010, which announcement is annexed to his affidavit, that the directors of the applicant had intended the AGM of the applicant and the meeting convened by the first respondent should be held on the same day 16 December 2010 - and place - Perth. 14 Since then, because it is not possible for the necessary 28 days notice of the AGM to be given to members for an AGM on 16 December 2010, the directors have resolved to hold the AGM on 17 December 2010. Approval to the extension of the AGM to this date has been sought of Australian Securities and Investments Commission (ASIC), although not yet granted at the time of the hearing of this matter. 15 The matters in issue unfold against the background of proceedings that have been commenced by a company associated with the second respondent in the Nevis Circuit of the Eastern Caribbean Supreme Court (the Nevis proceedings) against a company called Energo Incorporated (Energo), which at the time proceedings were commenced was a member of the applicant. 16 The shares formerly held by Energo are now distributed between International Investors Ltd and OAG Fund Ltd, who together hold approximately 47% of the issued share capital of the applicant, together with attached voting rights. 17 In the Nevis proceedings an interim injunction has been obtained, on the face of it ex parte, by the claimant (which is associated with the second respondent) which in terms purports to restrain Energo, as well as International Investments Ltd and OAG Fund Ltd (and others) from exercising the voting rights attached to the shares they hold in the applicant. 18 In short, the first respondent now contends that the injunction in the Nevis proceedings binds the applicant and should be observed by it. 19 There is an application in the Nevis proceedings to discharge the interim injunction, which is to be heard on 26 November 2010. 20 The applicant says it was against this background that the directors of the applicant resolved to postpone the EGM to 16 December 2010. 21 An announcement was made to the ASX of the board's decision to postpone the EGM to 16 December 2010 and members were informed by both advertisement and letter, as required by the applicant's constitution. 22 The first respondent has refused to accept the validity of the board's decision to postpone the EGM and on 12 November 2010 sent a letter to the applicant's members informing them that it intended to proceed with the meeting on 23 November 2010 in Sydney. 23 For the purposes of the interlocutory relief, the applicant claims the respondents have engaged in misleading and deceptive conduct in the following respects: · The letter of 12 November 2010 is misleading because it creates the clear impression that the first respondent is entitled to proceed to hold the EGM on 23 November 2010 and that the postponement of that meeting by the directors is invalid. · Alternatively, that the letter creates the impression not only that the first respondent holds the opinion that the postponement of the EGM is not valid but that there is a basis for holding that opinion when there is none. · Further, that in the letter, the second respondent has represented on behalf of the first respondent that there has been a "large number of proxy votes to date and those votes have been overwhelmingly in favour of our initiatives to replace the Board, and raise additional capital for the Company", when in fact this is entirely misleading, given that the supporting vote received to date, is only in the vicinity of 1.36% of the issued capital. 24 For the purposes of the interlocutory hearing, counsel for the respondents did not seriously if at all endeavour to contradict the contention that the letter contains arguably misleading and deceptive written representations. 25 As noted above, the applicant claims in the alternative or additionally, the accrued jurisdiction of the Court and submits that if the directors exercised their power to postpone the EGM lawfully then the postponement is valid and that in itself lays the foundation for the grant of injunctive relief. 26 The validity of the notice of general meeting is also challenged, although no specific interlocutory relief is sought on that basis.

the question of the validity of the postponement 27 The applicant says that the board validly postponed the EGM purportedly convened by the first respondent, pursuant to reg (or cl) 36 of the applicant's constitution. This regulation provides as follows: 36.1 Subject to this Regulation the Directors may, by advertisement published in a newspaper circulating in each capital city of every Australian State or Territory, on or before the day of a proposed General Meeting, cancel a proposed General Meeting convened by them. 36.2 Where a proposed General Meeting was requisitioned by Shareholders pursuant to the Corporations Law, that Meeting may only be cancelled by the Directors if a written notice of withdrawal of the requisition signed by the requisitioning Members has been deposited at the Office. 36.3 (a) The Directors shall, in addition to publication of advertisements in accordance with this Regulation endeavour to notify each Member of cancellation of a proposed General Meeting by posting a notice to the address of each Member as stated in the Register. (b) Failure to post such notice to any Member or the non-receipt of such notice by any Member does not affect the validity of the cancellation of the proposed General Meeting. 36.4 The Directors may, by advertisement published in a newspaper circulating in each capital city of every Australian State or Territory, on or before the day of a proposed General Meeting, postpone the proposed General Meeting for a period not exceeding 28 days or vary the venue of the proposed General Meeting, but no business may be transacted at any proposed Meeting other than the business stated in the notice to Members of the postponed General Meeting. 36.5 (a) The Directors shall, in addition to publication of advertisements in accordance with this Regulation, endeavour to notify each Member of postponement or variation of venue of a proposed General Meeting by posting a notice to the address of each Member as stated in the Register. (b) Such notice shall include details of the day, time and place on and at which the postponed General Meeting will be held or in the case of variation of venue, details of the new venue. (c) Failure to post such notice to any Member or the non-recipient of such notice by any Member does not affect the validity of the postponement or variation of venue of the proposed General Meeting. 36.6 A proposed General Meeting may not be postponed on more than 2 occasions. 28 The clause that the parties have particularly focussed on here is cl 36.4 which provides, in effect, that the directors may postpone the proposed general meeting for a period not exceeding 28 days or vary the venue of the proposed general meeting. The directors in fact not only postponed the meeting but also varied the venue. 29 The respondents contend that, first, this regulation does not apply in circumstances where a member has convened a general meeting pursuant to s 249F of the Corporations Act. In other words, unless it is possible to source the postponement power and variation power within the Corporations Act itself, there is no such power and the powers contained in the constitution are overridden by s 294F of the Act. 30 Secondly, the respondents contend that, in any event, the rules do not confer a power to both postpone and vary. In effect, the directors must decide to either postpone or vary, but cannot do both. 31 A third issue is also raised as to whether or not the resolution of the directors to postpone and vary was regular, when by regulation or cl 64 of the constitution a resolution in writing (as was purportedly signed here) requires signature by all the directors or their respective alternate directors. 32 The applicant relies on the rules and a beneficial construction of the powers to postpone and vary, and denies any irregularity as a matter of fact. In any event, it draws attention to reg or cl 74 which provides for the validation of irregular acts and states that notwithstanding anything in the constitution: if it be found that some formality required by this constitution to be done (other than a matter required to be done to comply with the listing rules) and has been inadvertently omitted, or has not been carried out, such omission does not invalidate any Resolution, act, matter or thing, which but for such omission would have been valid unless it is proved to the satisfaction of the directors or majority of them that such omission has directly prejudiced any member financially. The decision of the directors is conclusive, final and binding on all members. 33 The predominant view appears to be that the powers created by the constitution of a company may continue to operate in relation to a meeting called under s 249F of the Corporations Act. In Central Exchange v Rivkin Financial Services Ltd [2004] FCA 1546; (2004) 213 ALR 771 (Central Exchange), Emmett J in this Court considered that the powers in the constitution could continue to apply in such circumstances. At [32], his Honour stated that he did not consider that the presence of the power in the constitution was inconsistent with the provisions of s 249F. It did not, of itself, derogate from the right conferred by the statutory provision. He also considered as a matter of construction, that the relevant clause of the constitution in that case applied to the meeting convened by the notice of meeting. 34 However, at [33], his Honour considered that the circumstances in which it will be proper for the board to postpone or change the place for a meeting called pursuant to s 249F, or to cancel such a meeting, "will be limited" and such powers must, of necessity, be exercised "extremely sparingly so as not frustrate the right conferred by s 249F". His Honour added: If the directors change the place, as well as the time, they must have some justification for doing so. The directors cannot arbitrarily postpone or change the place of the meeting. Nevertheless, the powers exist. The question is whether they have been validly exercised in the present case. [Emphasis in original] 35 The circumstances in this case and the terms of reg or cl 36 of the constitution in question are very much the same as those considered by Emmett J in Central Exchange. While I am not bound by any doctrine of precedent to apply his Honour's approach, it is now well understood that a principle of comity applies, such that unless I as a judge at first instance am convinced that a judgment of another judge at first instance, is wrong, I should follow it: see Hicks v Minister for Immigration and Multicultural and Indigenous Affairs [2003] FCA 757, French J at [74]-[77]. I am confirmed in adopting the approach of Emmett J by decisions to similar effect in Colbern Nominees Pty Ltd v Prime Minerals Ltd [2009] WASC 289; (2009) 74 ACSR 236 and Pinnacle VRB Ltd v Ronay Investments Pty Ltd [2000] VSC 330; (2000) 35 ACSR 240. 36 While counsel for the respondents has put forward a valiant argument as to why that approach should be rejected, my own view is that the view expressed by Emmett J is strongly supported and it should be considered at this point an overwhelmingly correct one, despite some historic debate concerning its strength. Unless a Full Court decision was to find otherwise, it should be followed. 37 The respondents further argue, as noted, that if the reg 36.4 of the applicant's constitution is to be relied upon, then as a matter of construction, it limits directors to deciding whether to postpone a general meeting or to vary the place at which it is to be held; they cannot do both. The applicant contends that such a literal construction in the context plainly is nonsensical. 38 In my view, the literal textual argument put forward on behalf of the respondents, while arguable, is weak. In my view, there is a overwhelmingly strong case that read beneficially, reg 36.4 permits the directors to both postpone a meeting, to vary a meeting place, or do both. In the context in which the word "or" is used, it signifies the power to do both things and at the same time. 39 In that regard the relevant clause considered by Emmett J in Central Exchange (cl 13.4 of the constitution) provided a power to the board to: (a) postpone a meeting of members; (b) cancel a meeting of members; or (c) change the place for a general meeting, by written notice given to ASX. A similar argument would have been available that they were entirely disjunctive powers and could not all be exercised at the same time. In fact, the board in that case postponed and changed the place for the meeting and his Honour plainly proceeded on the basis that the power to do that was available under that particular clause. 40 In my view, there is but a very weak literal textual case for the construction contended for on behalf of the respondents. As I say, the applicant's preferred construction is overwhelmingly strong. 41 The third issue raised by the respondent concerns whether the power to postpone has been, in the words of Emmett J, "exercised sparingly" and for a proper purpose. 42 The respondent draws attention to the circular resolution of the directors which provides three reasons why the meeting should be postponed: Having regard to all of these matters, the directors are of the view that it is in the interests of the members of CPN as a whole for HBC's Meeting (scheduled for 23 November 2010) to be postponed because: (a) it is not in the interests of the members as a whole for HBC's Meeting to take place whilst OAG Fund Ltd and International Investments Ltd are restrained by the Injunction from voting and the postponement will provide an opportunity for a further ruling to be made in relation to the Injunction; (b) all members should be free to cast their votes on the resolutions proposed by HBC without fear of penalty or legal ramifications; and (c) the postponement of HBC's Meeting will avail CPN of the opportunity to disclose to members those matters that have been omitted from the Meeting Notice, if that disclosure is not made by HBC. 43 The respondents contend that postponement for the reason in (a) is improper as it "unilaterally ignores the validity of the court order" - that is to say the Nevis court order. 44 The respondents say that reason provided in (b) is also invalid as there is "no suggestion that some shareholders will not be free to exercise their voting rights at the 23 November 2010 meeting due to the threat of legal proceedings". The respondents say it is not because of any threat that Energo Holdings Corporation is unable to cast their shares at the meeting. It is because there is a court order in the Caribbean. 45 In my view, these arguments overlook the reality that an ex parte order has been made in the Nevis proceedings to be dealt with in that court on 26 November 2010. It is not an issue before me whether the existing interim injunction has application in Australia, but it is plain enough that it may have some effect on the voting intentions of the members concerned. 46 In my view, it was reasonable on the face of it for the directors of the applicant's board to postpone the general meeting to a time following the consideration by the Nevis court of the terms of the current injunction. On the face of it, to do so cannot in any relevant sense be considered improper. That there is obviously a commercial rivalry between the entities that control the 47% block of shares and the respondents does not in my view alter the position. 47 To insist that the current scheduled meeting convened by the first respondent should go ahead on 23 November 2010 when it would, or might, prevent approximately 47% of the voting rights in the applicant from being exercised is a relevant consideration. On the face of it, such an outcome would not be conducive to the proper management of the company under its present shareholding arrangements. Whatever the respondents' views might be concerning the financial management of the company, that is not a matter that this Court can be called upon to deal with, at least at this time in a proceeding such as this. The Court is not, in effect, to become an independent director of the company to make such decisions on sparing information in the course of urgent interlocutory proceedings. 48 In my view, there is on the face of it nothing improper in the board exercising the power of postponement as it did. There is also nothing to suggest that the change of venue is anything but sensible in that it now means, in all likelihood (if ASIC consents to the extension of the AGM date), both the AGM and EGM will be held in the same place on two consecutive days. 49 The reasons set out in (c) of the resolution are no longer currently relevant as the information has been supplied to members. 50 There remains an additional question concerning procedural irregularity. As noted above, as an alternative form of final relief the applicant seeks a declaration pursuant to s 1322(4) of the Corporations Act that in events which have happened the meeting purportedly convened has been validly postponed. The respondents submit the residual claim for such relief should be rejected as the pre‑conditions for relief cannot be met. 51 By s 1322(4)(a) the Court may on an application by an interested person make an order declaring that any act, matter or thing, purporting to have been done under the Act or in relation to a corporation is not invalid by reason of any contravention of a provision of the Act or a provision of the constitution of the corporation. By s 1322(6), the preconditions to making such an order are set out in (a) and are that: (i) that the act, matter or thing, or the proceeding, referred to in that paragraph is essentially of a procedural nature; (ii) that the person or persons concerned in or party to the contravention or failure acted honestly; or (iii) that it is just and equitable that the order be made. 52 Further, in every case, as provided for in (c) of subs (6), the Court must be satisfied that "no substantial injustice has been or is likely to be caused to any person". 53 In my view, whether the relief sought should be considered "substantive", as the respondents claim, or "procedural" as the applicant contends, is not something that needs be ruled on now. Final relief in these terms is not sought. The proposition is arguable that s 1322(4) applies in any event. 54 I note the applicant does not accept there was any irregularity in the decision by the directors to postpone the EGM and only out of an abundance of caution seeks to invoke s 1322(4)(a) relief. 55 In my view, whether under the power of the directors to validate an irregular act under reg or cl 74 of the constitution, or under s 1322 of the Corporations Act, any possible irregularity might be dealt with. At this stage, the suggestion by the respondent is that either the circular resolution was not unanimous or that the board lacked the requisite number of directors, including Australian based directors, at material times. Whatever may be the final correct factual position, it seems to me that there is a serious issue to be tried in favour of the applicant that the resolution to postpone is currently valid and not invalid by reason of irregularity and that, in any event, it would be open to the Court to give relief from any irregularity, although the question whether or not such an order would constitute substantive or procedural relief in terms of s 1322(4) remains open. 56 There is also a question whether the respondents would be entitled to claim that they would suffer substantial injustice, for the purposes for s 1322(6)(c), if such an order were made, in the sense that they might be deprived of their "right" to take advantage of the possible inability of the holders of 47% of the voting rights from voting at the currently proposed meeting on 23 November 2010. Whether the loss of an opportunity to benefit from the Nevis court order in these circumstances might properly be considered a "substantial injustice", as that term should properly understood in that provision, need not be ruled on now. 57 On the basis that it seems to me that there is a strong case to be argued on behalf of the applicant concerning the validity of the postponement resolution of the directors of the applicant, a question arises whether the balance of convenience in a case such as this should lead to the grant of an interlocutory injunction. In this case, the interlocutory relief sought, to uphold the postponement of the general meeting convened by the first respondent, is in effect in the nature of final relief. If interlocutory relief is granted, then the substantial commercial dispute between the parties will have been resolved and the applicant's plans to hold the EGM on the day before the proposed AGM will in all likelihood be realised. 58 In these circumstances, as the applicant accepts, the likelihood that the applicant will succeed if the action goes to trial must be considered in weighing the risks of injustice resulting if the decision on the application goes one way or another: see Kolback Securities Ltd v Epoch Mining NL (1987) 18 NSWLR 533 at 536. 59 In my view, this is one of those cases where the position contended for by the applicant ought to be considered both in principle and also in relation to the justice of the case overall. Unless an injunction is granted in terms of the interlocutory injunctions sought, the general meeting convened by the first respondent will go ahead on 23 November 2010, with the real possibility that the members holding approximately 47% of the voting rights will be precluded from voting. While there is no particular evidence before me that the members would consider themselves bound by or not bound by the interim injunction made naming them in the Nevis proceedings, the respondents plainly believe the shareholders affected should not vote. That is a real issue that needs to be considered. 60 In all of the circumstances, it seems to me to be entirely just and equitable that interlocutory injunctions should go to ensure as far as possible that all members of the company have the proper opportunity to vote on the matters to be considered at the EGM. To effect that outcome, the adjournment of the EGM proposed by the directors of the applicant should, in effect, be supported. To that end, the interlocutory injunctions proposed will maintain the status quo proposed by the directors and support the general understanding underlying the management of all corporations that all members should have a proper say concerning their direction and management. 61 For these reasons, I would grant the interlocutory relief sought.

question of validity of proxy forms 62 There is a separate question pressed by the applicant concerning the validity of proxy forms in this case. However, while no interlocutory relief is sought in direct consequence of this issue, it seems to have been raised generally in support of the interlocutory relief sought. 63 The notice of general meeting given by the first respondent provides for the proxy forms to be returned to Link Market Services Ltd (Link). The respondents say, with some reason, that Link is not shown to be an organisation that cannot be expected competently to receive the proxies and provide information to the company at the general meeting concerning the voting results. 64 However, the applicant contends that it is not open for the respondents to arrange for a third party to receive the proxies and that the first respondent should have obtained the consent of the applicant to such a course of action. In short, the applicant says it is for the company to set the rules concerning where the proxies should go. In this, the applicant strongly relies on the decision in Bisan Ltd v Cellante [2002] VSC 430;(2002) 173 FLR 310 (Bisan) to support its position. 65 Before turning to what Bisan decided, it should be noted that s 250B of the Corporations Act deals with proxy documents and that s 250B(3) provides as follows: (3) A company receives a document referred to in subsection (1) [which includes the proxy's appointment]: (a) when the document is received at any of the following: (i) the company's registered office; (ii) a fax number at the company's registered office; (iii) a place, fax number or electronic address specified for the purpose in the notice of meeting; and (b) if the notice of meeting specifies other electronic means by which a member may give the document - when the document given by those means is received by the company as prescribed by the regulations. 66 The respondent argues, not without some justification, that there appears to be no reason why when a notice of EGM is issued by a convening member under s 249F, whereby the member "may call, and arrange to hold, a general meeting", that should not also include the responsibility and power to indicate where proxies should be sent, as provided for by s 250B(3)(a)(iii). 67 However, in relation to the predecessor provisions of s 249F and s 250B of the Corporations Act, Dodds-Streeton J in the Victorian Supreme Court in Bisan at [44], concluded as follows: The legislation does not expressly state that the nomination of an intermediate recipient will render a notice of meeting or a proxy appointment ineffective or invalid. However, in my opinion, the legislation's insistence on receipt by the company appears to contemplate a receipt by an entity managed and controlled by persons subject to onerous fiduciary duties in relation to the proxies, which will safeguard the actual and apparent integrity of the corporate voting process. The interception of proxy appointment forms by an intermediate party who is under no fiduciary duty or other apparent obligations in relation to their safeguarding, entails an inherent exposure to the possibility of filtering or other inappropriate handling. In my opinion, it could constitute a grave defect in the electoral process in respect of any contemplated meeting. In the present case, the specified recipient in both the notices and the proxy forms is not a disinterested party, but in my view, the defect does not depend on that circumstance. The apparent, as well as the actual integrity of the corporate electoral process, is important. 68 Her Honour went on, at [46], to consider that the defects in the notices and proxy forms were not merely technical but such that they would or may cause substantial injustice that could not be remedied by any order of the Court, in the circumstances of that present case. Further, her Honour was not satisfied that the validation of such irregularities would not cause or be likely to cause injustice to any person. 69 Her Honour thus was of the view that in the circumstances of the case before her a finding that the proxy appointments were defective should not operate to deny appointers a vote on a matter to be decided. Rather, the proposed meeting as whole should not occur. That would not preclude resolutions in issue from being considered by a different meeting, not subject to challenge. Her Honour ultimately decided, at [49], that it would not be in the interests of any party that the scheduled meeting should take place and her Honour made orders restraining the holding of the meeting and requiring that notice of cancellation be sent to members. 70 In the case before me, the applicant has sought interlocutory relief simply to restrain the respondents from holding out that that there is to be an EGM on 23 November 2010 and from asserting that the EGM has not been validly postponed until 16 December 2010. There is no move to stop the meeting altogether. As a result, the question of the proxy votes has been raised incidentally in the interlocutory proceedings, relating to more substantively the declaration of invalidity in respect of the notice of general meeting sought by way of final relief in the proceeding. 71 Be that as it may, this case is different from that considered in Bisan in that there is no suggestion that Link will not properly record the proxy votes. All the evidence suggests they are an experienced and competent organisation well able to provide this service. There is therefore no evidence before me that there is likely to be any actual corruption of the electoral process. 72 In these circumstances, and given that the directors at all material times were it seems content to merely postpone the EGM until 16 December 2010, I am not satisfied that there will be any actual prejudice to the applicant on account of the handling of the proxies should the EGM proceed on 16 December 2010. The question though whether the applicant is entitled to the order it seeks concerning the validity of the notice of general meeting remains. 73 I should add that, while the decision in Bisan stands for the proposition for which the applicant recites it, the decision has been the subject of other, arguably equivocal judicial comments, including in Re Golden West Resources Ltd [2008] FCA 1362; (2008) 170 FCR 409 per McKerracher J at [39]; City Pacific Ltd v Bacon [2009] FCA 687; (2009) 72 ACSR 418 per Dowsett J at [26]; and Lachlan Reit Ltd v Garnaut [2010] VSC 399 per Judd J at [35]. 74 This all means that I consider that while there is a firm case based on authority, to which I should have regard, there is also a triable issue on this point not finally settled by authority. 75 In the circumstances this issue adds little if anything to the present claim for interlocutory relief.

Conclusion and orders 76 For these reasons, on Friday 19 November 2010, I made the following orders: UPON THE APPLICANT UNDERTAKING:

1. To submit to such order (if any) as the Court may consider to be just for the payment of compensation, to be assessed by the Court or as it may direct, to any person, whether or not a party, adversely affected by the operation of the interlocutory order or undertaking or any continuation (with or without variation) thereof.
2. To pay the compensation referred to in paragraph 1 above to the person there referred to. THE COURT ORDERS THAT:
3. Until further order, an injunction restraining the respondents, whether by themselves, their servants or agents or howsoever otherwise, from holding a meeting of the members of the applicant on 23 November 2010 at 10am AEDT.
4. Until further order, an injunction restraining the respondents, whether by themselves, their servants or agents or howsoever otherwise, from making any statements to the effect that the meeting of members of the applicant has not been validly postponed by the applicant until 16 December 2010 at 11am AEDT.
5. Costs reserved.
6. The application be listed for directions at 12 noon WST on Thursday 25 November 2010.

I certify that the preceding seventy-six (76) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Barker.