Coeur De Lion Investments Pty Limited v The President's Club Limited, in the matter of The President's Club Limited

GREENWOOD J: 1 These proceedings are concerned with an interlocutory application by the plaintiff in the originating application, Coeur De Lion Investments Pty Limited ("CDLI") for an order pursuant to s 37P of the Federal Court of Australia Act 1976 and r 30.01 of the Federal Court Rules 2011 that separate trials be held for CDLI's originating process filed on 7 November 2018, and the proceeding constituted by the defendant's cross-claim supported by its concise statement of cross-claim (the "concise statement") both filed on 8 March 2019. 2 The defendant (cross-claimant) is an entity called "The President's Club Limited" ("TPC"). 3 An interlocutory application filed by TPC was also listed for hearing on the hearing of CDLI's application for separate trials. However, TPC's application was not pressed. 4 In order to understand the contentions for and against a separate trial of CDLI's claim and TPC's cross-claim, it is necessary to say some things about each proceeding. 5 By its originating process, CDLI seeks the following relief (together with costs), although by its amended concise statement, CDLI seems to have abandoned a claim for declarations: 1. A declaration that, at all material times, the defendant has been operating a "time-sharing scheme" (Scheme) within the meaning of section 9 of the [Corporations Act 2001 (Cth) (Act)]. 2. A declaration that, at all material times, the Scheme was a "managed investment scheme" within the meaning of section 9 of the Act. 3. A declaration that, at all material times, the Scheme was required by section 601ED(1) of the Act to be registered under section 601EB of the Act. 4. A declaration that the defendant has, in the period since on or around 17 March 2012, operated the Scheme in contravention of section 601ED(5) of the Act. 5. A declaration that an act by the defendant, namely a resolution passed on 28 November 2013 amending the constitution of the defendant to impose voting restrictions on the plaintiff, was oppressive, unfairly prejudicial or unfairly discriminatory to the plaintiff. 6. An order that the defendant be wound up pursuant to sections 461(1)(g) and/or 461(1)(k) of the Act. 6 The application is made by CDLI in its capacity as the owner of 40.32% of the ordinary issued shares in TPC. Section 461 of the Corporations Act 2001 (Cth) (the "Act") is well known but it should be noted that s 461(1) provides, relevantly, that the Court may order the winding up of a company if a resolution of a class of members of the company is oppressive or unfairly prejudicial to, or unfairly discriminatory against, a member (s 461(1)(g)), or the Court is of the opinion that it is just and equitable that the company be wound up: s 461(1)(k). Each of those grounds for an order for the winding up of a company is subject to the discretion contained in the introductory words to each of the grounds in s 461(1). 7 CDLI's originating process is supported by an amended concise statement. 8 In that statement, CDLI asserts a number of factual matters and, in summary, they are these. TPC is an unlisted public company. Its capital is divided into 7,488 ordinary shares and five subscriber shares. CDLI understands that TPC has 302 individual members. It owns 40.32% of the issued ordinary shares in TPC and holds the most shares of any individual shareholder. TPC was incorporated to operate a time-sharing scheme to be located within a resort now known as the Palmer Coolum Resort at Coolum. Pursuant to that scheme, TPC would regulate the rights of its members being persons entitled to occupy a residential apartment to which a person's shareholding bears a relationship with that part of the resort known as the "President's Site" for an "Entitlement Week" and to use the facilities of the resort. The time-sharing scheme is said to be constituted by a set of interlocking agreements set out in the concise statement at para 4A(a) to (f). Clause 3 of the Memorandum and Articles of Association of TPC states that the company "is established for the purpose of regulating the rights inter se of Members being persons entitled to Entitlement Weeks in [on] the [President's] Site". CDLI asserts that on 31 January 2005 the Australian Securities and Investments Commission ("ASIC") exercised powers under s 601QA(1)(a) of the Act to conditionally exempt the time-sharing scheme from registration as a managed investment scheme under Ch 5C of the Act and exempt TPC from Ch 5C in respect to the operation of the scheme. 9 CDLI further asserts that the exemption was provided on the basis that CDLI entered into a deed poll by which it provided certain covenants. Clause 4.2 of the deed poll entitles CDLI to revoke the deed poll on 180 days prior written notice to ASIC and TPC. By letter dated 15 September 2011, CDLI gave notice to ASIC and TPC that it intended to revoke the deed poll. On 13 March 2012, the revocation took effect. CDLI asserts that after 13 March 2012 TPC was no longer entitled to rely upon the ASIC exemption relieving it of an obligation to comply with s 601ED of the Act. The scheme has not been registered at any time after 13 March 2012. CDLI also asserts that s 601FA of the Act requires the responsible entity of a registered scheme to be a public company holding an Australian financial services licence authorising it to operate a managed investment scheme. TPC has not at any time held such a licence. 10 As to that part of the claim related to the passing of a resolution, CDLI asserts that on 28 November 2013 a resolution was passed at TPC's AGM to amend its Constitution by inserting a new Article 38A pursuant to which CDLI and its associated entities were restricted on a poll at a meeting of members from voting more than the number of votes equal to 10% of the total number of votes that may be cast on a resolution (other than in relation to a winding-up resolution). 11 The amendment was notified to ASIC on 15 April 2014. 12 CDLI asserts that on 15 December 2015 it wrote to TPC noting that the managed investment scheme operated by TPC ceased to have an ASIC exemption from compliance with the requirements of Ch 5C of the Act. On 17 December 2015, TPC wrote to CDLI denying that it operated a managed investment scheme for the purposes of the Act. By a notice of general meeting dated 15 November 2018, CDLI proposed a special resolution for the winding up of TPC. The meeting was held on 14 December 2018 and the special resolution was not passed. By para 18, CDLI notes that disputes have arisen between CDLI and TPC and those disputes are identified at para 18(a) to (j). 13 CDLI asserts that since 13 March 2012, the ASIC exemption has ceased to apply and Ch 5C applies to the scheme. It asserts that TPC has undertaken a series of steps and that it operates the scheme in contravention of s 601ED(5) and has failed to comply with obligations arising under s 601EE(1)(b) of the Act. 14 CDLI asserts that since TPC is operating the scheme in breach of s 601ED(5), it is just and equitable that TPC be wound up pursuant to s 461(1)(k) of the Act. 15 CDLI also says that because TPC is unable to "fulfil its purpose of lawfully operating" the scheme, it is just and equitable that TPC be wound up. 16 Further, it says that the voting restriction resolution justifies winding up the company on the s 461(1)(g) ground. 17 TPC filed a concise response on 13 March 2019. 18 By that response, TPC asserts a range of factual matters in answer to CDLI's various factual allegations and the claims for relief. It also asserts a range of factual matters which it says, if made good, provides an answer to CDLI's claim for a winding-up order either because CDLI has failed to establish a factual foundation for the ground relied upon or because, should findings of fact make good a contended ground, or the discretion would be exercised against making a winding-up order. 19 It is necessary to say some things about those factual matters because they bear upon the nature of the controversy which would need to be resolved should there be an order for a separate trial of the controversy constituted by the originating process, amended concise statement and the concise response on the one hand (especially having regard to CDLI's contentions as to the utility of making an order for separate trials and the basis upon which a separate trial of CDLI's proceeding ought to be held) and the cross-claim on the other hand. 20 In the concise response, TPC says these things. 21 CDLI developed an international resort known from 1 July 2011 as the Hyatt Regency Coolum Resort made up of land known as: The President's Site; The Regency Site; The Ambassador's Site; The President's Club AMC Site; and The Public Areas. CDLI created, along with others, a scheme to be conducted on the President's Site described as the "Letting Scheme". TPC was incorporated following the development of the resort to regulate the rights of members inter se entitled to use and occupy a lot in the President's Site as part of the Letting Scheme. TPC leases 144 lots comprising accommodation units (known as "villas") in the resort by two registered instruments between TPC and CDLI. CDLI assigned the benefit of the leases to members who purchased villa interests. The villas were constructed between 1985 and 1988. They were designed to function as part of an integrated resort. The villas have limited facilities. The villas rely on the resort for access and utility connections such as water, power and sewerage. They comprise about 44% of the accommodation available at the resort. 22 TPC asserts that Mr Clive Palmer is an "oppressor" and that he is a director, the controlling mind and the beneficial owner of CDLI, Coeur De Lion Holdings Pty Ltd ("CDLH"), Palmer Leisure Australia Pty Ltd, Palmer Leisure Coolum Pty Ltd ("PLC"), Palmer Coolum Resort Pty Ltd and Closeridge Pty Ltd ("Closeridge") (all referred to as the "Palmer companies"). CDLH owns all the shares in CDLI. 23 Between 1 July 2011 and 19 March 2012, Mr Palmer beneficially acquired CDLH by causing PLC to acquire 98% of the issued shares in CDLH on or about 1 July 2011 and by causing Closeridge to acquire the remaining 2% of the shares in CDLH between 13 and 19 March 2012. TPC says that Mr Palmer did so with the intention of undertaking a major redevelopment of the resort within two to three years (a proposition which is said to be supported by a finding at [23] in Hyatt of Australia Limited v Coolum Resort Pty Limited & Ors [2012] QSC 49. 24 TPC asserts that the circumstances of the acquisition of shares in TPC (through CDLH's ownership of the shares in CDLI which held the shares in TPC) were unacceptable for the purposes of s 657A of the Act; a contravention of s 606 of the Act; and known by Mr Palmer and entities associated with him as earlier described, to be a contravening acquisition (the "Unacceptable Takeover"). It is not necessary to examine decisions related to those propositions. 25 At para 8 of the concise response, TPC describes the elements of the Letting Scheme in some detail. 26 In summary, TPC asserts the following matters. The title to each villa was divided into shares. The purchaser of villa shares was allotted "linked shares" in TPC. Villa interests were acquired subject to the leases mentioned earlier. The Constitution conditioned membership in TPC upon co-ownership of villa shares. The Constitution conferred on the holder of shares in TPC the right to occupy the relevant villa for 13 specific weeks in a calendar year. Members agreed to procure TPC to enter into a Resort Administration Agreement (the "RAA"). The Letting Scheme provides for a Letting Pool Referral Agreement (the "Referral Agreement") by which each member relinquished their right of occupancy; placed their entitlement in the Letting Pool managed by Palmer Coolum Resort Pty Ltd (the "Resort Administrator"); obtained the right to share in Letting Pool income; and acquired other entitlements. TPC says that the RAA provides that the Letting Pool is established to provide for the use of members' occupation rights. It provides that the Resort Administrator is to maintain and administer the resort as a 5 Star resort; conduct hotel operations; provide reports to TPC; keep and not alter the fundamental character of the resort; maintain TPC's Share Register; conduct the Letting Pool; and manage the financial activities of TPC. The RAA provides that members are permitted to enter and use the resort facilities and enjoy lifestyle benefits such as discounts for use at the facilities of the resort. 27 At para 10, TPC addresses the topic of the s 601QA(1)(a) exemption. TPC says that on 31 January 2005, ASIC granted an exemption from the requirements of s 601ED of the Act to TPC, CDLI and the Resort Administrator. 28 That exemption was conditioned upon a requirement, put simply, that 90% of the votes that may be cast on a resolution by members of TPC, are held by members that are not, and are not associated with, any operator, manager, promoter or developer in relation to the scheme; or, alternatively, a covenant being entered into by CDLI in a form acceptable to ASIC. CDLI entered into a deed poll in a form acceptable to ASIC on 31 January 2005 and covenanted that (where it was not otherwise excluded from voting), any voting rights held by it (or any related entity) would not be exercised in excess of 10% of the votes that may be cast on a resolution by members of TPC, other than with ASIC's written consent (or in relation to a resolution to wind up the Letting Scheme). CDLI took steps to, among other things, give effect to the RAA, assist the Resort Administrator in performing its obligations under the RAA and make the President's Site accommodation available to guests of the resort. It could, according to the terms of the deed poll, revoke it on giving 180 days' notice to ASIC and TPC. 29 At para 12 of the concise response, TPC addresses the topic of the "vulnerability of members". TPC says that members of TPC not associated with CDLI were in a position of "commercial disadvantage" and "further special disadvantage or disability" in that those members acquired shares in TPC on the faith of, and to participate in, benefits offered by the scheme. They were, it is said, unable to protect their own interests in the scheme if, and from when, CDLI withdrew the deed poll; or, alone or with other Palmer companies, engaged in conduct "to disable or injure the Scheme". They were, it is said, reliant upon the deed poll not being revoked "unless an equivalent constraint or condition to the satisfaction of ASIC was first agreed to by CDLI"; and were reliant upon the Resort Administrator (and CDLI) continuing to operate the resort and the Letting Scheme. 30 At para 13, TPC asserts that at or about the time of the acquisition of the shares in CDLH, Mr Palmer and the Palmer companies knew all of the matters described at [21], [26], [27], [28], [29] and [31] of these reasons, and knew and believed that the land upon which the resort was situated was more valuable without the Management Agreement concerning the resort; without the Letting Scheme and without TPC's engagement in that Letting Scheme. 31 The Management Agreement is an agreement of 9 August 1985 under which Hyatt of Australia Limited ("Hyatt") managed and operated the resort. The benefit of that agreement was later assigned, it is said, to Palmer Coolum Resort Pty Ltd, CDLI and Hyatt. 32 At paras 14 to 17, TPC addresses the topic of the "death of the Resort and the Letting Scheme". 33 TPC asserts that CDLI revoked the deed poll by notice dated 15 September 2011 without warning to TPC; without making any reasonable effort to satisfy ASIC as to any alternative to the deed poll by which the ASIC exclusion could continue; in breach of obligations under the RAA; to prevent rather than assist the Resort Administrator to perform obligations under the RAA; and to prevent members of TPC obtaining the benefits of their interests in TPC and the Letting Scheme. 34 TPC says that on 20 February 2012, the Resort Administrator and CDLI terminated the Management Agreement with Hyatt, in breach of contract. On 10 November 2011, by letter, TPC sought information as to CDLI's intention and purpose behind termination of the deed poll and it received no response. 35 The revocation took effect on 15 March 2012 and since 15 March 2012, the Resort Administrator has refused to comply with the RAA. 36 Since 15 March 2012, the Letting Scheme and the Letting Pool has not operated. 37 In further addressing the topic mentioned at [32] of these reasons, TPC says this. 38 In a circular dated 11 April 2012 to members of TPC, CDLI and the Resort Administrator said that the ASIC deed had been revoked. They proposed "an alternative solution of dismantling the Letting Scheme" and gave notice that PLC intended to make an offer to members of TPC to purchase their real property interest in their villa and their corresponding ordinary shares in TPC. On 12 April 2012, PLC lodged a bidder's statement with ASIC for an unconditional bid for all the shares in TPC and corresponding villa interests. The consideration was to be $55,013.00 for each villa interest and its corresponding 13 shares. The reference to 13 shares concerns 52 shares "in common" (described as "Fractional Interests"). Each purchaser acquired 13 such shares. On 24 April 2012, the bidder's statement was withdrawn. ASIC required PLC to make offers having regard to s 631 of the Act. On or about 21 May 2012, a replacement bidder's statement was lodged with ASIC. On 24 May 2012, PLC wrote to owners advising that an offer would be distributed to members within the next two weeks. No offers were made. 39 TPC also asserts on this same topic as described at [32], that Mr Palmer and Palmer companies engaged in habitual and persistent litigation against TPC and/or its directors as identified in a schedule to the concise response. That schedule identifies 14 proceedings. TPC says that CDLI and PLC failed (and refused) to pay levies due and owing to TPC between 8 February 2013 and 31 August 2017. Those levies were paid consequent upon an application for summary judgment for their recovery, in the Supreme Court of Queensland. TPC says that from on or about 28 August 2012, power and water to the villas has been discontinued. It says that the resort has not been maintained as a 5 Star resort since 15 March 2012 and that the fundamental character of the resort has changed in that by 2013 (or so) "160 plastic dinosaurs" had been introduced onto the resort grounds some of which are nearby or adjacent to golf fairways and a "Motorama" exhibit has been introduced comprised of a collection of 85 antique and prestige cars. TPC says that members have been prevented from accessing the villas on numerous occasions and that since 16 March 2015, the accommodation, conference and resort facilities at the resort have been closed. It says that in late 2015, CDLI informed TPC that its members were not entitled to access the villas under the RAA and that any owner seeking access to any villa would be guilty of trespass and that appropriate action would be taken. The access codes to the villas were changed. Water and electricity supply to the villas was cut off. The precincts in which the villas are situated have since remained gated, preventing access by the public (including members of TPC). It says that in November 2018, CDLI applied to wind up TPC (being these proceeding). It also says that CDLI and PLC remain unwilling to buy out the shares in TPC and corresponding villa interests of the members at fair market value. It also says that Mr Palmer, CDLI and PLC have failed and refused to pay levies due and owing to TPC since 31 October 2018. 40 The proposition deriving from all of these contentions at paras 14 to 17 of the concise response is that the conduct constitutes "oppression": para 18. That is said to be so because the conduct was contrary to the interests of the members of TPC "as a whole"; was unfairly prejudicial to the interests of the non-CDLI members of TPC; was unconscionable; was not engaged in, in good faith or for a proper purpose (as the true purpose was the purposes asserted at para 18(b)). As to those para 18(b) purposes, TPC says that the conduct was undertaken to pressure the directors of TPC and the non-CDLI members of TPC; to enable Mr Palmer and the Palmer companies to gain complete control of TPC; to obtain a commercial benefit for Mr Palmer and the Palmer companies by devaluing the interests of members in TPC and the Letting Scheme; to deprive the non-CDLI members of TPC of their use and benefit of the "Club" (TPC), the resort and the Letting Scheme; to impose hardship on the non-CDLI members of TPC; and to cause the Letting Scheme to collapse: para 18. 41 At para 19, TPC says that as a consequence of the Unacceptable Takeover and the conduct said to constitute oppression: (a) The Resort does not operate, whether as contemplated by the Constitution or at all; (b) The fundamental character of the Resort has changed, as it: (i) Does not operate; (ii) Is neither kept nor maintained as a five star resort; (c) Hotel operations are not conducted; (d) The letting pool does not operate; (e) The Letting Scheme has not operated since on or about 15 March 2012; (f) Members have paid extraordinary levies related to the litigation mentioned therein; (g) Members have lost the benefit and value associated with their interest in the Club and the villas, but continued to incur levies nonetheless. 42 At para 20, TPC contends that based on the voting restriction resolution passed at the AGM on 28 November 2013 (and notified to ASIC on 15 April 2014); the conduct of oppression; and the matters at para 19 as quoted above, TPC "has not operated the Letting Scheme in contravention of s 601ED(5) [of the Act] since 15 March 2012" (the date CDLI's revocation of the deed poll took effect). 43 At para 21, TPC says that in all of the circumstances described in the concise response, "it is not 'just and equitable' that [TPC] be wound up under s 461(1)(k)". 44 As to that part of CDLI's claim related to the passing of the resolution on 28 November 2013, TPC says that CDLI's covenant contained in the deed poll limiting it to casting only 10% of the votes capable of being cast at a meeting, was not reflected in TPC's Constitution. It says that the resolution was passed having regard to all of the matters at paras 1 to 11 and paras 14 to 17 of the concise response ([21] to [28] and [32] to [39] of these reasons). TPC says that the resolution was passed in good faith and for a proper purpose, namely, to return members' voting rights to that position which existed under the deed poll; to ensure that CDLI could not take advantage of, or abuse the power it obtained due to its "Unacceptable Takeover" and its conduct of "oppression". It says the resolution was passed "in the best interests of the members as a whole": paras 22, 23 and 24 of the concise response. 45 CDLI contests each and every element of the oppression claim. 46 All of the facts in this inter parties contest going to each ground relied upon by CDLI to support a winding-up order under s 461 is in controversy and in that controversy, TPC asserts as an answer to CDLI's claims all of the factual matters just described. 47 Before turning to CDLI's proposal for the resolution of the principal proceeding inherent in the present interlocutory application, the elements of TPC's cross-claim need to be noted. By its cross-claim, TPC claims: 1. Damages pursuant to section 236 of the Competition and Consumer Act 2010 (Cth) (ACL) [the Australian Consumer Law], or alternatively at law, or in equity; 2. Other relief pursuant to section 243, ACL, or alternatively at law, or in equity; and 3. Costs. 48 The Concise Statement of cross-claim repeats paras 1 to 19 of the concise response and thus brings into the cross-claim each and every one of the factual contentions in the concise response. It adds these contentions. The contended oppression of Mr Palmer and the Palmer companies was conduct in trade and commerce in connection with the supply or acquisition, or possible supply or acquisition, of financial services to or from a person for the purposes of s 12CB of the Australian Securities and Investments Commission Act 2001 (Cth) (the "ASIC Act"): para 2(a) and (b). The asserted oppression was "unconscionable" under the general law or alternatively conduct contrary to s 21 of the ACL or s 12CB of the ASIC Act: para 2(c). As to the notion of unconscionable conduct for the purposes of s 12CB of the ASIC Act, see Australian Securities and Investments Commission v Kobelt [2019] HCA 18, 12 June 2019; Kiefel CJ and Bell J; Gageler J; Keane J, constituting the majority, and Nettle and Gordon J; Edelman J, constituting the minority. 49 TPC says that by reason of the matters at paras 1, 5, 8, 10 and 12 of the concise response (discussed at [21], [23], [25] and [29] of these reasons), CDLI and the Resort Administrator were carrying on a commercial Letting Scheme under the RAA as a "joint undertaking" with a view to "mutual profit". CDLI and the Resort Administrator were, it is said, in a fiduciary relationship with TPC and owed TPC fiduciary obligations not to act against the interests of TPC as a whole; not to act for an improper purpose; and not to put their interests ahead of TPC: para 3. 50 Having regard to paras 18 and 19 of the concise response, CDLI and the Resort Administrator did not engage in conduct in good faith; acted against the interests of TPC as a whole; acted for an improper purpose (that is, the purposes in para 18(b), see [40] of these reasons); and acted in order to obtain a benefit for Mr Palmer and the Palmer companies to the detriment of TPC and its non-CDLI members: para 4. The loss claimed by TPC in the 2010 financial year is $5,895,440.64 and in the 2011 financial year $6,769,111.68. TPC also says that unnecessary costs and expenses would not have been incurred, in effect, but for the alleged conduct. TPC also observes that due to the contended oppression, it has not received any distributions or Letting Pool Income under the RAA. 51 CDLI emphasises that all of these matters asserted by TPC are in controversy.

CDLI's essential contention 52 CDLI's essential contention is that having regard to the matters asserted in the concise response and particularly those matters asserted at para 19 of the concise response (see [41] of these reasons), the entire substratum of the company has plainly failed. CDLI says that the company simply does not function. CDLI says that it is inevitable that an order will be made on the just and equitable ground for the winding up of the company. That is said to follow not only because the substratum of the company has failed but also because no relief claimed in TPC's cross-claim will cure the difficulty that since 15 March 2012, on CDLI's case, TPC has been conducting a time-sharing scheme in contravention of the Act. CDLI says that to the extent that TPC has claims against CDLI and the Palmer companies and/or Mr Palmer, as asserted in the cross-claim, a liquidator of TPC could nevertheless bring or prosecute those claims and seek the same relief TPC asserts by its cross-claim. 53 Accordingly, CDLI urges the Court to adopt the following course. 54 First, CDLI's application for a winding-up order should be listed for separate determination on an assumed set of facts, for the purposes of that application, that TPC will be capable of establishing the conduct of oppression asserted in the concise response. CDLI does not admit the facts asserted but is content to have its winding-up application heard on the basis that the Court assumes those facts are capable of being made good by TPC. 55 Second, on that assumption, if there is no remedy available to TPC (or its relevant members which presumably is a reference to the non-CDLI members), which would answer CDLI's claim for the making of a winding-up order, and also assuming that CDLI has satisfied the Court that it is otherwise "just and equitable" to wind up TPC, an order for the winding up of the company could be made without engaging (by reason of the assumption) in a forensic contest between the parties leading to a fact-finding determination of the matters TPC has asserted and put in issue both by its concise response and its cross-claim which adopts all of those matters. There would be, it is said, no utility in such a process if it cannot lead to a remedial intervention or order that causes the Court not to make a winding-up order on the just and equitable ground under s 461(1)(k). 56 Third, if, at the conclusion of a hearing (held separately), on the assumption contended for, the Court concludes that it is not clear, or that it could not be said with a sufficient degree of certainty, that there is "no basis" on which the contended and assumed conduct of oppression on the part of CDLI (and the Palmer companies and Mr Palmer) would yield a remedy that answers CDLI's claim for a winding-up order, the proceeding could then be listed for an urgent hearing. 57 The difficulty with this proposal involves a number of considerations.

Considerations 58 The making of an order for the winding up of a company is a serious and significant order in any circumstances. Although this proceeding does not engage a question of winding up on the ground of insolvency (and counsel for CDLI emphasises that to be so), it remains worth noting, simply as a matter of principle by analogy, that where the Court is called upon to make an order in circumstances, for example, of contended insolvency, questions of fact going to insolvency are, in the main, matters of objective easily ascertained fact because normally statutory presumptions arise as a matter of non-compliance with the statutory demand. The company might be able to otherwise show that it is not insolvent. 59 In any event, findings of fact need to be made that the company is insolvent even where there is no attempt to otherwise demonstrate solvency and where there is such an attempt, findings need to be made with regard to the content of experts' reports and other evidence. 60 Here, the question is whether each of the factual assertions of CDLI can be made good; whether the scheme is of the statutory character contended for; whether TPC has been operating such a scheme; whether the substratum has failed; and whether, having regard to all of the matters in answer contained in the concise response, it is just and equitable that the company be wound up. Findings of fact going to all of these important matters need to be made about the various matters in controversy. Importantly, however, questions arise about whether Mr Palmer and the Palmer companies have, by their conduct, brought about the very set of circumstances asserted in para 19 of the concise response which is relied upon as the foundation for the failure in the substratum. 61 The Court is now asked to assume those conduct facts and decide, on that assumption, that the conduct is no answer to the making of a winding-up order. Two considerations arise in this context. The first is whether the assumed conduct of oppression (by Mr Palmer and the Palmer companies as asserted) has brought about the set of circumstances reflected at para 19 of the concise response and, if so, whether that conduct is such that the Court would or might not be satisfied that it is "just and equitable" to wind up TPC. The just and equitable ground must take into account all of the relevant contextual circumstances. Here, by reason of the invited assumptions, the author of the failure in the substratum is the applicant (and entities and persons related to it), for the order. 62 The second is that even if the Court is satisfied that it is just and equitable for an order to be made because the substratum of the company has failed, should an order be made, as a matter of discretion, on the application of the oppressor and those related to it, which, of course, is the assumption the Court is asked to make. Is CDLI disentitled to a winding-up order by its own conduct? Although, of course, the Court in this interlocutory application, is not deciding that question now, the notion that an applicant oppressor ought to have the order it seeks to bring the target to an end on the "just and equitable ground" does, prima facie, not have very much to commend it. 63 When the Court is called upon to exercise a discretionary power under s 461(1) or not exercise the discretion (even though the ground under s 461(1)(k) might otherwise be made out), it should only do so having regard to an exercise of judicial power involving the making of findings of fact about any disentitling conduct. The Court needs to, metaphorically, turn its own mind to these questions. 64 If, however, CDLI elects to admit the conduct allegations, very different considerations arise. In that case, the Court could and, subject to any relevant considerations, would, treat formal admissions as resolving each of the questions of fact conceded and admitted. The Court would not be acting upon either a hypothesis or an assumed state of affairs. It would be acting upon admissions made by a party. The concessions would become the fact for the purposes of the exercise of the Court's jurisdiction and the discretionary power conferred upon it by s 461(1) of the Act. 65 Here, CDLI wants the Court to act to separate out, as a matter of practice and procedure, the claim and cross-claim and then, on the separate hearing of the claim which is said by CDLI to be a two day hearing, treat the conduct allegations as assumed to be so (or at least capable of being made good by TPC) so as to test whether any of those assumed matters would provide a foundation on which the Court would refuse to make a winding-up order on the just and equitable ground having regard to the burden of the present position that the substratum of the company is said to have failed. Then, on that separate hearing, should the Court not be satisfied to a sufficient degree of certainty that the assumed facts provide "no basis" upon which the Court might not make a winding-up order on the just and equitable ground, CDLI would want to then set the matter down for a full hearing on the relevant questions of fact and law raised by the proceeding, on an urgent basis. 66 This approach necessarily involves duplication by conducting a two day trial, calling evidence on particular aspects of the matters to be tried, assuming other matters, and a judgment making findings on those matters in issue. CDLI wants to reserve the possibility of, in effect, "having another go" on the merits because it does not wish to make any admissions about the contended conduct. 67 The second difficulty is that it is not clear exactly what the scope of the controversy to be tried over the two day period really is. The issue to be resolved in the principal proceeding is not simply whether the discretion would or would not be exercised in favour of the making of a winding-up order on the just and equitable ground but whether, on all the facts, the just and equitable ground is made out at all having regard to all of the facts asserted in the concise response integrated with those facts in the concise statement in support of the cross-claim. 68 On the question of urgency, it should be noted that it has been known to CDLI since at least 15 March 2012 that TPC has, on CDLI's case, been operating, it is said, in contravention of the Act, a scheme that constitutes a managed investment scheme, since 15 March 2012. A period of seven years has elapsed which seems to suggest that this question has not been a matter of urgency for CDLI. TPC, of course, contests the notion that it has been operating a scheme in contravention of the Act. 69 Because of the difficulty in isolating the true scope of the matters to be tried over the contended two day trial; the difficulty of determining the scope of the carve-out from the residual questions and the relationship between findings on contested questions arising out of the two day hearing and the remaining questions which may be affected by views about witnesses formed in the course of the two day trial; the duplication involved inherent in CDLI's proposal; the non-admissions but merely assumptions; and the long period of time between the contended critical event of revocation of the deed poll and the commencement of the winding-up proceeding in late 2018, I am not satisfied that the contended efficiency and utility in separation arises. 70 Accordingly, the application is to be dismissed with costs and a case management hearing will be nominated to determine the future conduct of the case with a degree of expedition. I certify that the preceding seventy (70) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Greenwood.

SCHEDULE OF PARTIES QUD 801 of 2018 Cross-Respondents Second Cross-Respondent PALMER LEISURE AUSTRALIA PTY LTD ACN 152 386 617 Third Cross-Respondent PALMER LEISURE COOLUM PTY LTD ACN 146 828 122 Fourth Cross-Respondent CLOSERIDGE PTY LTD ACN 010 560 157 Fifth Cross-Respondent PALMER COOLUM RESORT PTY LTD ACN 010 593 638 Sixth Cross-Respondent CLIVE FREDERICK PALMER