Cromwell Corporation Limited v ARA Real Estate Investors XXI Pte Ltd

Sub-area: Corporations and Corporate Insolvency

Number of paragraphs: 145

Date of hearing: 6 October 2020

Counsel for the Prospective Applicants: Mr David Batt QC, Ms Kathleen Foley and Mr Huw Whitwell

Solicitor for the Prospective Applicants: Minter Ellison

Counsel for the First to Third Prospective Respondents: Mr Michael Borsky QC, Mr Mark Hosking and Mr Karan Raghavan

Solicitor for the First to Third Prospective Respondents: Arnold Bloch Leibler

Counsel for the Fourth to Ninth Prospective Respondents: Dr Catherine Button QC and Ms Kateena O'Gorman

Solicitor for the Fourth to Ninth Prospective Respondents: Gilbert + Tobin

BETWEEN: CROMWELL CORPORATION LIMITED First Prospective Applicant

CROMWELL PROPERTY SECURITIES LIMITED Second Prospective Applicant

AND: ARA REAL ESTATE INVESTORS XXI PTE. LTD. First Prospective Respondent

ARA ASSET MANAGEMENT LIMITED Second Prospective Respondent

ARA ASSET MANAGEMENT HOLDINGS PTE. LTD. (and others named in the Schedule) Third Prospective Respondent

order made by: ANDERSON J DATE OF ORDER: 16 october 2020

1. The prospective applicants' application for preliminary discovery is dismissed.
2. The prospective applicants will pay the prospective respondents' costs of and incidental to the preliminary discovery application, to be assessed if not agreed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

The application and the parties 1 By originating application dated 31 July 2020, the prospective applicants, Cromwell Corporation Ltd and Cromwell Property Securities Limited (together, Cromwell), apply for a preliminary discovery order under r 7.23 of the Federal Court Rules 2011 (Cth) (Rules). 2 The first prospective applicant, Cromwell Corporation Ltd, and the Cromwell Diversified Property Trust, of which Cromwell Property Securities Ltd (the second prospective applicant) is the responsible entity, are together known as the "Cromwell Property Group". Cromwell Property Group is a real estate investor and manager with a substantial domestic and international investment asset portfolio. 3 Stapled securities in the Cromwell Property Group (Cromwell securities) trade on the Australian Securities Exchange. Each stapled security consists of one share in Cromwell Corporation Ltd and one unit in the Cromwell Diversified Property Trust. 4 The prospective respondents can be grouped into two categories: the ARA respondents (the first to third prospective respondents) and the Tang respondents (the fourth to ninth prospective respondents). 5 The first of the ARA respondents (ARA) is a Singaporean company. ARA is the largest single holder of Cromwell securities. ARA is a wholly owned subsidiary of the second of the ARA prospective respondents (ARA Asset Management), a company incorporated in Bermuda. ARA and ARA Asset Management are controlled entities of the third ARA respondent (ARA Holdings), a Singaporean company. 6 The Tang respondents are: (1) a Singaporean businessman, Mr Gordon Tang; (2) a Singaporean businesswoman and wife of Mr Tang, Mrs Celine Tang; (3) their daughter, Ms Jialei Tang; and (4) three companies, namely Haiyi Holdings Pte. Ltd, SingHaiyi Group Ltd and Senz Holdings Limited. 7 Cromwell, by its originating application dated 31 July 2020, applies for a preliminary discovery order under r 7.23 of the Rules on the basis that, in Cromwell's submission, the affidavits filed by Cromwell establish a belief by Cromwell that it may have a right to obtain relief in this Court from each of the prospective respondents for contraventions of s 606(1) and s 671B(1) of the Corporations Act 2001 (Cth) (Act). 8 On 21 August 2020, Moshinsky J made various orders requiring the prospective applicants and the prospective respondents to file evidence upon which they intend to rely and written submissions. The prospective applicants filed written submissions dated 18 September 2020. The prospective respondents filed written submissions dated 1 October 2020. On 5 October 2020, the prospective applicants filed written reply submissions concerning s 659B of the Act after I directed that they do so. 9 Cromwell relies upon the following affidavits: (1) an affidavit of the Managing Director and Chief Executive Officer of Cromwell, Mr Paul Louis Weightman, sworn 31 July 2020 (first Weightman affidavit); (2) an affidavit of Ms Christine Zoe Demiris sworn 18 September 2020 (first Demiris affidavit); (3) a further affidavit of Mr Weightman sworn 18 September 2020 (second Weightman affidavit); (4) a further affidavit of Ms Christine Zoe Demiris sworn 5 October 2020 (second Demiris affidavit), (collectively, the Cromwell affidavits). 10 The prospective respondents oppose the application for preliminary discovery and have filed the following affidavits: (1) Mitchell Coidan affirmed 20 August 2020 (first Coidan affidavit); (2) Stephen Lloyd dated 20 August 2020 (Lloyd affidavit); (3) David Blight affirmed 11 September 2020 (Blight affidavit); (4) Mitchell Coidan affirmed 11 September 2020 (second Coidan affidavit); (5) Justin Vaatstra sworn 1 October 2020 (Vaatstra affidavit); (6) Mitchell Coidan affirmed 2 October 2020 (third Coidan affidavit); (7) Raphael Leibler affirmed 5 October 2020 (Leibler affidavit), (collectively, the respondent affidavits).

The context of the application 11 The affidavit material filed by the parties disclose the following relevant matters. 12 This application has been brought in the context of long-running disputes between Cromwell and the ARA respondents regarding the management and operation of Cromwell. By way of example: (1) ARA first acquired an interest in Cromwell securities in 2018. The CEO of the Australian business of ARA Asset Management, Mr David Blight, was appointed to Cromwell's board of directors as ARA's nominee. (2) On 30 April 2019, Mr John Lim, the CEO of the ARA Group, wrote to the then-Chair of the Cromwell Board, Mr Geoff Levy, requesting that he announce to the ASX that he would retire at Cromwell's 2019 annual general meeting. (3) On 26 June 2019, Cromwell announced that it would undertake an institutional placement (Placement) whereby $375 million of Cromwell securities would be issued to institutional investors who elected to participate in the Placement. On the same day, Mr Weightman announced that, based on legal advice Cromwell had received, ARA would not be entitled to participate in the Placement. ARA alleged that Cromwell's exclusion from the Placement was unlawful. (4) On 19 July 2019, Mr Blight resigned from Cromwell's board. Mr Blight deposes that he believes he had been excluded from decision-making by Cromwell's board in relation to the Placement. Mr Blight had been receiving redacted Board papers on the basis that the other Cromwell directors were concerned that Mr Blight had conflicts of interest relating to his role with ARA. (5) At the November 2019 Cromwell AGM, Cromwell's board opposed the election of ARA's nominee, Dr Gary Weiss, to the Cromwell Board. Cromwell's board also recommended a number of resolutions that were opposed by ARA. (6) In December 2019, Cromwell made an application to the Takeovers Panel (Panel Application) for a declaration of unacceptable circumstances based on the same matters which form the basis of Cromwell's application to this Court for preliminary discovery. Cromwell represented to the Takeovers Panel that there was a substantial body of evidence which established the existence of the alleged undisclosed association. The application was rejected by the Panel who declined to conduct proceedings in January 2020. (7) Mr Blight deposes that, in February 2020, Cromwell did not allow ARA to participate in Cromwell's distribution reinvestment plan in respect of its entitlement to a distribution for the December 2019 quarter, which led to ARA commencing Court proceedings against Cromwell in May 2020. (8) In March 2020, Cromwell opposed the election of Dr Gary Weiss at an extraordinary general meeting convened by ARA. Mr Blight deposes that, following a dispute about the adequacy of the inspection Cromwell had allowed ARA to make of proxy documents and other documents relating to votes cast at the November 2019 Cromwell AGM, ARA commenced Court proceedings against Cromwell seeking the production of those documents. (9) Cromwell commenced this proceeding approximately six months after its Panel Application was rejected. 13 On 21 July 2020, ARA Real Estate Investors 28 Ltd (ARA BidCo) lodged with the Australian Securities Exchange a bidder's statement enclosing an offer to Cromwell securityholders to purchase 29% of each securityholder's securities (the proportional takeover bid). ARA BidCo is a subsidiary of ARA Holdings and its related entities. 14 On 21 July 2020, Cromwell lodged with the ASX an announcement entitled "Response to ARA's Proportional Bid". The announcement stated, among other things: TAKE NO ACTION IGNORE ARA'S OPPORTUNISTIC PROPORTIONAL TAKEOVER OFFER AND MISLEADING STATEMENTS ARA'S BIDDER'S STATEMENT CONTAINS MATERIAL OMISSIONS AND FAILS TO DISCLOSE ARA'S TRUE INTENTIONS DON'T LET ARA SEIZE CONTROL WITHOUT PAYING A PREMIUM. (Capitals in the original.) 15 On 31 July 2020, Cromwell commenced the present proceeding. 16 On 11 August 2020, Arnold Bloch Leibler, the solicitors for ARA, wrote to MinterEllison, the solicitors for Cromwell, providing notice that ARA intended to requisition an extraordinary general meeting as soon as possible to consider the election of Dr Gary Weiss and Mr Joseph Gersh as directors of the first prospective applicant, Cromwell Corporation Ltd (CCL). 17 On 17 August 2020, Cromwell released an announcement to the ASX entitled "Stop ARA's Takeover by Stealth", which advised Cromwell securityholders to reject the proportional takeover bid, vote against the election of Dr Weiss and Mr Gersh to the CCL board, and to ignore all Proportional Offer documents issued by ARA.

JURISDICTION 18 Before turning to whether Cromwell has satisfied the requirements of r 7.23, a question of jurisdiction was raised. It is the first rule of every court, where a real question is raised as to its jurisdiction and powers (or as to the exercise thereof), that the court must satisfy itself that the jurisdiction exists and that the powers may be exercised: Re Application by the Chief Commissioner of Police (Victoria) [2005] HCA 18; 214 ALR 422 (per Gleeson CJ, McHugh, Gummow, Hayne and Heydon JJ) at [68].

The ARA respondents' submissions 19 The ARA respondents made the following submissions. 20 The ARA respondents submit that Cromwell does not fall within any of the categories of persons identified in s 659B(1) who may commence court proceedings in relation to a takeover bid before the end of the bid period. 21 The ARA respondents submit that this proceeding is a court proceeding "in relation to … an action taken or to be taken as part of, or for the purposes of" ARA BidCo's proportional takeover bid, with the result that the proceeding was commenced in contravention of s 659B(1), for the following reasons: (1) the ARA respondents contend that the term "court proceedings in relation to a takeover bid or proposed takeover bid" is defined in s 659B(4) and, relevantly, s 659B(4)(a)(i) provides that the term includes "any proceedings before a court in relation to … an action taken or to be taken as part of, or for the purposes of, the bid or the target's response to the bid"; (2) the ARA respondents submit that, here, the relevant "action taken or to be taken as part of, or for the purposes of" ARA BidCo's proportional takeover bid is the acquisition by ARA BidCo of Cromwell securities as part of that takeover bid. The ARA respondents contend as follows: [t]his proceeding is a court proceeding "in relation to" that action because, the purpose of this proceeding is to enable Cromwell to commence a proceeding in which it will seek orders requiring the ARA respondents to divest themselves of any interests in Cromwell securities they obtained as part of ARA BidCo's proportional takeover bid. 22 The ARA respondents submit that is the position because, in the ARA respondents' submission, Cromwell has commenced this proceeding during the bid period for the following reasons: (1) Cromwell believes that the ARA respondents and the Tang respondents have been, and remain, associates within the meaning of the Act; (2) Cromwell believes that any acquisition of a relevant interest in Cromwell securities by the ARA respondents therefore constitutes, or may constitute, a contravention of s 606(1) of the Act; and (3) as a consequence, Cromwell believes that it has a right to obtain relief against the ARA respondents. 23 The ARA respondents submit that those matters "are sufficient for this proceeding to be characterised as a proceeding "in relation to" the acquisition by ARA BidCo of Cromwell securities as part of ARA BidCo's takeover bid". The ARA respondents submit that "in relation to" has a broad meaning. In this respect, the ARA respondents submit that: (1) the connection between this proceeding and ARA BidCo's takeover bid is neither accidental nor remote; (2) this proceeding was commenced 10 days after ARA BidCo lodged its bidder's statement, for the purpose of enabling Cromwell to establish that the acquisition of securities as part of that takeover bid contravened s 606(1) of the Act and to seek orders requiring the ARA respondents to divest themselves of interests in Cromwell securities obtained as part of the takeover bid; (3) the relationship between the proceeding and the acquisition of securities as part of ARA BidCo's takeover bid is clear and sufficiently close for this to be characterised as a proceeding "in relation to" the bid. 24 The ARA respondents then submitted that, on a proper interpretation of s 659B, if a proceeding is commenced in contravention of s 659B(1), this Court has "no jurisdiction to hear and determine it".

Cromwell's submissions 25 Cromwell's submissions took issue with the way the ARA respondents characterised this proceeding. Cromwell submits that this proceeding is a preliminary discovery application under the rules of this Court, and is founded upon historical acquisitions and other matters. Cromwell submits that such a proceeding is simply not a proceeding "in relation to an action taken or to be taken as part of, or for the purposes of, the [takeover] bid". 26 Cromwell submits that the core of the ARA respondents' argument is the proposition that, as a matter of fact, this proceeding was commenced in response to the takeover bid. However, Cromwell submits that asserted position is not correct. Cromwell submits that: (1) the second Demiris affidavit deposes that it was on 19 June 2020 that Cromwell's solicitors, Minter Ellison, on instructions from Cromwell, instructed Counsel to prepare this preliminary discovery application; (2) ARA BidCo's intention to make a takeover bid was only announced on 23 June 2020; and (3) the bidder's statement was not lodged until 21 July 2020. 27 In these circumstances, Cromwell submits that the notion that this proceeding was commenced in response to ARA BidCo's takeover bid has, in Cromwell's submission, "no factual basis". 28 Cromwell accepts that the words "in relation to" are broad. However, Cromwell submits that, in circumstances where there is no evidence before the Court to suggest Cromwell was preparing the application in anticipation of a potential takeover bid and was in fact preparing the application before it knew of any takeover bid, it would be stretching the words "in relation to" beyond any conceivable limit to say that such a proceeding is "in relation to" the acquisition of securities as part of that bid. 29 Cromwell also submits that this Court should read s 659B to minimise any ouster of jurisdiction. In this respect, Cromwell referred to Lionsgate Australia v Macquarie Private Portfolio [2007] NSWSC 318; 210 FLR 106 at [27] (Lionsgate). 30 Cromwell then submits that, even if this proceeding falls within the terms of s 659B(1), s 659B(1) does not automatically oust this Court's jurisdiction. Cromwell submits that s 659B(1) imposes a timing restriction on the commencement of proceedings in relation to a takeover bid "before the end of the bid period" and, under s 659B(2), in the event of non-compliance with s 659B(1), a proceeding may be stayed "until the end of the bid period". 31 If, contrary to Cromwell's principal submission, this proceeding falls within s 659B(1), Cromwell submitted that this Court should not exercise its discretion to stay the proceeding. Cromwell submits that the purposes of s 602 would not be served by staying this proceeding. Cromwell submits that this proceeding is not seeking review of any decision by the Takeovers Panel, and the bid period of ARA BidCo's bid was due to expire imminently after the hearing of this application. In Cromwell's submission, there would be no utility in staying the proceeding for such a short period of time.

Section 659B 32 Section 659B appears in Chapter 6 of the Corporations Act 2001 (Cth). Chapter 6 is titled "Takeovers". Section 659B appears in Division 3 of Part 6.10. That Division is titled "Court powers". 33 Section 659AA provides: 659AA Object of sections 659B and 659C The object of sections 659B and 659C is to make the Panel the main forum for resolving disputes about a takeover bid until the bid period has ended. 34 Section 659B provides: 659B Court proceedings before end of bid period Delay in commencing court proceedings until after end of bid period (1) Only the following may commence court proceedings in relation to a takeover bid, or proposed takeover bid, before the end of the bid period: (a) ASIC; (b) a Minister of the Commonwealth; (c) a Minister of a State or Territory in this jurisdiction; (d) the holder of an office established by a law of: (i) the Commonwealth; or (ii) a State or Territory in this jurisdiction; (e) a body corporate incorporated for a public purpose by a law of: (i) the Commonwealth; or (ii) a State or Territory in this jurisdiction; to the extent to which it is exercising a power conferred by a law of the Commonwealth or a State or Territory in this jurisdiction. Court power to stay proceedings that have already commenced (2) A court may stay: (a) court proceedings in relation to a takeover bid or proposed takeover bid; or (b) court proceedings that would have a significant effect on the progress of a takeover bid; until the end of the bid period. (3) In deciding whether to exercise its powers under subsection (2), the court is to have regard to: (a) the purposes of this Chapter; and (b) the availability of review by the Panel under Division 2. (4) For the purposes of this section: court proceedings in relation to a takeover bid or proposed takeover bid: (a) means any proceedings before a court in relation to: (i) an action taken or to be taken as part of, or for the purposes of, the bid or the target's response to the bid; or (ii) a document prepared or to be prepared, or a notice given or to be given, under this Chapter; and (b) includes: (i) proceedings to enforce an obligation imposed by this Chapter; or (ii) proceedings for the review of a decision, or the exercise of a power or discretion, under this Chapter; or (iii) proceedings for the review of a decision, or the exercise of a power or discretion, under Chapter 6C in relation to securities of the target of a takeover bid during the bid period; and (iv) proceedings under Part 2F.1A for leave to bring, or to intervene in, proceedings referred to in paragraph (a) or subparagraph (b)(i), (ii) or (iii). This is not limited to proceedings brought under this Chapter or this Act but includes proceedings under other Commonwealth and State or Territory laws (including the general law). (5) Nothing in this section is intended to affect the jurisdiction of the High Court under section 75 of the Constitution. 35 The Explanatory Memorandum to the Corporate Law Economic Reform Program Bill 1998 (Cth) (CLERP Explanatory Memorandum) provides context for this provision. It stated at [7.2]-[7.3]: Target companies often resort to litigation in hostile takeover bids, sometimes for tactical reasons. This can result in bids being delayed and, where a final hearing cannot be held within the bid period, the courts having to decide between disrupting the bid by granting an injunction without the benefit of full evidence and allowing the bid to proceed even though it may later be found to be defective. To meet these concerns, a reconstituted Panel will take the place of the courts as the principal forum for resolving takeover disputes under the Corporations Law, with the exception of civil claims after a takeover has occurred and criminal prosecutions. This will allow takeover disputes to be resolved as quickly and efficiently as possible by a specialist body largely comprised of takeover experts, so that the outcome of the bid can be resolved by the target shareholders on the basis of its commercial merits. Other benefits of an effective panel for dispute resolution include the minimisation of tactical litigation and the freeing up of court resources to attend to other priorities.

The issue between the parties under s 659B(1) 36 As to the initial parts of s 659B, it was common ground between the parties that Cromwell is not a person referred to in ss 659B(1)(a)-(e). 37 The ARA respondents did not contend that this proceeding is, and it is self-evident that this proceeding is not, to be characterised as any of the following: (1) a proceeding "to enforce an obligation imposed by … Chapter" 6 of the Act: s 659B(4)(b)(i); (2) a proceeding "for the review of a decision, or the exercise of a power or discretion, under … Chapter" 6 of the Act: s 659B(4)(b)(ii); (3) a proceeding "for the review of a decision, or the exercise of a power or discretion, under Chapter 6C in relation to securities of the target of a takeover bid during the bid period": s 659B(4)(b)(iii); (4) a proceeding "under Part 2F.1A for leave to bring, or to intervene in, [certain] proceedings": s 659B(4)(b)(iv); (5) "a document prepared or to be prepared, or a notice given or to be given, under … Chapter" 6 of the Act: s 659B(4)(a)(ii). 38 As a consequence, the issue between the parties was whether this proceeding is a court proceeding "before a court in relation to … an action taken or to be taken as part of, or for the purposes of, the bid or the target's response to the bid": s 659B(4)(a)(i).

Meaning of "in relation to a takeover bid, or proposed takeover bid" 39 In St Barbara Mines Ltd v Australian Securities & Investments Commission [2001] FCA 119; 110 FCR 550 (St Barbara), Hill J considered s 659B. In that case, ASIC objected to the jurisdiction of the Court and in so doing relied upon s 659B(1). 40 Hill J stated at [10]-[14]: 10. The terms of s 659B(1) of the Corporations Law are very broad. That section speaks of proceedings "in relation to a takeover bid". As the cases clearly show and counsel for St Barbara accepts, the words "in relation to" must take colour from the context in which they appear: see Chief Executive Officer of Customs v AMI Toyota Ltd [2000] FCA 1343 at paragraphs 30-31 (Hill, North and Merkel JJ); First Provincial Building Society Ltd v Commissioner of Taxation (1995) 56 FCR 320 at 333 per Hill J. In some cases they have been said to be so broad as to comprehend any relationship at all that may exist between two subject matters. In other cases, because of the context, a more narrow view has been accepted. 11. Queens Counsel for St Barbara submits that the present proceedings should not be seen to be proceedings in relation to a bid but rather proceedings relating to the act of non acceptance of bid documents by [ASIC]. With respect, that seems to me rather too narrow a view of the relationship to which s 659B(1) refers having regard to the legislative policy underlying the law. 12. The legislative policy of s 659B, and taking into account the object of the section as set out in s 659AA, is clear enough. If it be necessary, reference can be made to the explanatory memorandum which makes the legislative policy quite explicit. It is that the Panel take the place of the courts as the principal forum for resolving takeover disputes until the bid period has ended. However wide or narrow s 659B(1) may be, and it is not necessary in this case to explore the width of it, it clearly comprehends a proceeding which relates to a bid in the sense also that it is within the jurisdiction of the Panel to determine. 13. The present is an obvious example of such a case. As things stand at the moment, and indeed prior to the application made to the Court, St Barbara has a right to seek to have [ASIC]'s decision on the modification of the Corporations Law reviewed by the Panel. It seems to me that this is the kind of case which parliament contemplated should not be determined by the courts until such time at least as the bid period has terminated. On this view of the matter, the Court would have no jurisdiction at all to deal with the proceedings at this stage. 14. In saying this, I note the position of St Barbara that in its view there is nothing for [ASIC] to modify because the law should be interpreted as it suggests with the consequence that there could be nothing for the Panel to review. While I understand that is a respectable argument, the issue ultimately comes back to whether the present proceedings could be said to be in relation to a bid and although it is no doubt true in a very direct sense that the proceedings relate to the acceptance or non acceptance by the [ASIC] of documents, one has only to ask the question of documents about what. The answer is clearly enough documents which relate to the takeover bid and in my view s 659B(1) operates to exclude jurisdiction. 41 In McKerlie v Drillsearch Energy Ltd [2009] NSWSC 497 (Drillsearch), Beach Petroleum, as well as being a shareholder of Drillsearch, was the bidder under a takeover bid for Drillsearch under Chapter 6 of the Act. Beach Petroleum had made an application to the Takeovers Panel for a declaration of "unacceptable circumstances" in relation to its takeover bid. Beach Petroleum's complaint concerned circulars and statements made by a director of Drillsearch in the lead up to a proposed meeting of shareholders. 42 In Drillsearch, Barrett J stated at [11] to [15]: 11. The question of immediate relevance is whether s 659B(1) operates to preclude the commencement by Beach Petroleum of the proceedings it now wishes to commence and its joinder to these present proceedings. … 14. Section 659B(1) raises the question whether the steps Beach Petroleum now seeks to take in this court entail the commencement by it of proceedings "in relation to a takeover bid" as mentioned at the start of s 659B(1). 15. The submission made by Mr Sullivan QC on behalf of Beach Petroleum is that any such connection is lacking and that Beach Petroleum's standing as a shareholder of Drillsearch is such as to enable it, in any event, to complain about the particular statements in the context of the forthcoming meeting. He points out that one of the current plaintiffs, Glenluce Properties Pty Ltd, is a shareholder in Drillsearch and, in that respect, stands in the same position as Beach. He also points out that the wrong done from Beach Petroleum's point of view, in the particular context, is that often associated with the case of Bulfin v Bebarfald's Ltd (1938) 38 SR (NSW) 423; in other words, there has been a breach of the duty to give full, frank and fair information for the purpose of a meeting of members. 43 Barrett J stated at [18]-[19]: 18. Beach Petroleum has seen fit to invoke the jurisdiction of the Takeovers Panel in relation to the matters that it would wish to agitate in its proposed proceedings in this court, including by way of its becoming a party to the proceeding now before me. Having chosen that forum and decided to seek the assistance of the Takeovers Panel, according to the broad remedial jurisdiction that the Panel possesses, Beach Petroleum has clearly accepted that the matters in respect of which it wishes to obtain redress are really matters within the Panel's province. Indeed, by seeking orders here imposing certain restraints until its application to the Takeovers Panel has been determined and until any remedial action the Panel may order has been taken, Beach seeks, in a real sense, to make its court proceedings an adjunct to its Panel application. 19. The controversy that Beach Petroleum wishes to air in court has already been put before the Takeovers Panel by Beach. That controversy has clearly arisen "in relation to" the takeover bid now on foot. The proposed court proceedings therefore involve matters in respect of which s 659B displaces the jurisdiction of the court until such time as the bid period has ended. 44 In Lionsgate , Austin J considered whether, having regard to s 659B of the Act, a bidder under a takeover bid may commence court proceedings for specific performance of its contract with a substantial shareholder of the target company, under which the shareholder had undertaken to sell into the bid. 45 In Lionsgate, Austin J stated at [18]: … Lionsgate does not invoke any other provision of the Corporations Act, and relies instead on its common law and equitable rights of enforcement of a contract … 46 His Honour continued at [21]: In my view, the underlying policy concerns identified in the Explanatory Memorandum are not in evidence in the present case. Here Lionsgate wishes to enforce a contract, in circumstances where there is a dispute about the meaning of one of the clauses of the contract. The issue is about the meaning and enforceability of a contract, not about whether the takeover bid should be disrupted or allowed to proceed. If Macquarie is not required to sell into Lionsgate's bid, the bid will still proceed, subject to Chapter 6, and will either succeed or fail. The resolution of the dispute between Lionsgate and Macquarie may have an impact on whether the proposal for a scheme of arrangement proceeds, but schemes are not within the purview of s 659B in any case. The specialist body with the greatest expertise to resolve the dispute is a commercial court … Although the takeover tactics of both sides may lay behind the litigation, what brings the matter to court is the existence of a contract and (if the plaintiff is right) the defendant's threat to repudiate it. 47 Austin J stated at [29]-[30]: 29. Section 659B(1) has the effect of preventing a person, other than those listed, from commencing "court proceedings in relation to a takeover bid, or proposed takeover bid", before the end of the bid period. The quoted words are defined in subsection (4) in two steps: first, in subparagraph (a) there is what appears ex facie to be a definition of the scope of the quoted words; and secondly, there is in subparagraph (b) a list of things included (or, perhaps, deemed to be included) in the definition. The last sentence of subsection (4) is introduced by the highly ambiguous word "This", but in its context the word "This" probably refers to subparagraph (a), or both subparagraphs (a) and (b), rather than to subparagraph (b) alone. So construed, the last sentence operates to require that the definition as a whole be read so as to encompass court proceedings under the general law or any statutory provisions. 30. None of the inclusory provisions of subparagraph (b) is applicable here. The question is whether the present proceeding falls within subparagraph (a). Some of the submissions made on behalf of [the respondent in Lionsgate], particularly the written submissions, suggest that s 659B(1) raises a broad question as to whether the present proceeding is "in relation to" the pending takeover bid. But in my view that misunderstands the effect of s 659B(4)(a), which is an exhaustive definition of the words "court proceedings in relation to a takeover bid or proposed takeover bid". If subsection (4) does not apply, then the present proceeding is not a court proceeding "in relation to a takeover bid or proposed takeover bid" for the purposes of s 659B(1), and consequently there is no restriction on the plaintiff commencing or continuing the proceeding, even if in some more general sense the proceeding relates to the bid. 48 Austin J addressed the meaning of the words "in relation to" in s 659B at [34]-[37]: 34. I turn, first, to s 659B(4)(ii). However wide the words "in relation to" may be if considered in isolation, the present proceeding cannot be described as a proceeding "in relation to a document prepared or to be prepared, or a notice given or to be given" under Chapter 6. The present proceeding is in relation to the Deed between the parties, and in relation to the enforcement of [an] alleged contractual obligation. True it is that the Deed contemplates the takeover bid that has subsequently been made, and in particular the Bidder's Statement that has subsequently been issued by Lionsgate, and the time limits for the contractual obligations undertaken in the Deed are set by reference to the bid period. That may be enough to warrant the conclusion that the Deed is a document "in relation to" Lionsgate's takeover bid. But as I have pointed out, that is not the issue under subparagraph (a). For the purposes of subparagraph (a)(ii), the question is whether the court proceeding is in relation to a document or notice prepared or given under Chapter 6. The Deed is clearly not such a document. 35. … It would unduly strain even the wide words "in relation to" to say that a proceeding to enforce [a contractual clause] by requiring Macquarie to sell its shares into the bid is a proceeding in relation to the Bidder's Statement. 36. I turn to s 659B(4)(i). The question is whether the present proceeding is in relation to some action taken or proposed to be taken as part of or for the purposes of the takeover bid. The "action" to which the subparagraph refers cannot be the action of commencing the proceeding, because the commencement of the proceeding is the conduct prohibited by subsection (1), once it is established that there are court proceedings in relation to the bid as defined in subsection (4). In other words the "action" referred to in the definition must be something anterior to the commencement of the proceeding … 37. Senior counsel for the defendant submitted that there were several components of "action" for the purposes of the definition. First he submitted, in substance, that Macquarie's future performance of what Lionsgate contended was a binding obligation to sell the shares into the bid was "an action … to be taken as part of, or for the purposes of, the bid" … It seems to me, however, that if Macquarie sold into the bid, purportedly in performance of the contractual obligation, its action in doing so would not be action as part of or for the purposes of Lionsgate's bid, but rather it would be action in response to the bid. Senior counsel then submitted that Macquarie's actions included its promises in clause 5, its conduct subsequent to the announcement communicating its intention not to comply with clause 5.1(a), and the letters of demand that followed thereafter … Again, however, these matters seem to me to relate to the question whether an offeree shareholder should accept a takeover bid or proposed bid - that is, they relate to the offeree's response to the bid (or proposed bid), and are therefore not actions taken or to be taken as part of, or for the purposes of the bid (and they are obviously not taken as part of or for the purposes of the target's response to the bid). Therefore I have reached the conclusion that subparagraph (a)(i) does not apply to any of the actions identified by senior counsel for Macquarie in submissions. (Emphasis in the original.) 49 Austin J then concluded at [40]-[41]: 40. In the result, while I accept that the words "in relation to" are words of very broad connotation when considered in isolation, here they are combined (in subparagraphs (a)(i) and (ii)) with words of a more specific kind which are not apt to apply to the present situation. 41. In my view, the thrust of the definition in subsection (4) is to identify court proceedings that raise the sorts of issues typically invoked in the tactical takeover litigation of the 1980s and 1990s, to do with such matters as misleading Bidders' Statements and Targets' Statements, whether the litigation was based on the provisions of corporations legislation, or other statutory provisions (such as s 52 of the Trade Practices Act) or general law matters (such as the law of deceit).

Is this proceeding a proceeding "in relation to a takeover bid"? 50 Guided by the text of s 659B and the authorities set out above, in my view, this proceeding is not a proceeding "in relation to a takeover bid". This is so for the following reasons. 51 First, the ARA respondents' submissions should not be accepted. 52 The ARA respondents submit that this proceeding is "in relation to" ARA BidCo's proportional takeover bid because, in the ARA respondents' submission, this proceeding should be characterised as "enabl[ing]" Cromwell to commence a future proceeding in which Cromwell "will" seek orders requiring the ARA respondents to divest Cromwell securities the ARA respondents obtained as part of that proportional takeover bid. The ARA respondents submit that Cromwell's belief - that it may have a right to obtain relief (in a future proceeding) by reason of the prospective respondents' potential contraventions of s 606(1) and s 671B(1) - is sufficient to characterise this proceeding as being "in relation to" a takeover bid. 53 That submission should not be accepted because it invalidly conflates this application for preliminary discovery and any potential future proceeding. Any potential future proceeding contemplated by Cromwell is not on foot and may not arise. It presumably may only arise if this preliminary discovery application is successful, Cromwell receives documents as a consequence, and then Cromwell decides to commence some future proceeding on the basis of those documents. Whether this proceeding is "in relation to a takeover bid" must be tested as at the date of this preliminary discovery application. It is not to be tested by reference to future possibilities or hypothetical scenarios. In addition, a preliminary discovery application is separate and distinct from any potential future proceeding. Rule 7.23 is in Part 7 of the Federal Court Rules 2011 (Cth), which is titled "Orders before start of a proceeding". Part 8 of the Federal Court Rules 2011 (Cth) is titled "Starting proceedings", and it is under that latter part that any future proceeding (which may or may not arise) would be commenced. 54 The ARA respondents also submitted that the requisite relation between this proceeding and ARA's takeover bid exists here. 55 The expression "in relation to" is "one of wide connotation" but "requires a relation between one thing and another": Chief Executive Officer of Customs v AMI Toyota Ltd [2000] FCA 1343; 102 FCR 578 at [30] (Hill, North and Merkel JJ); see also Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 (Project Blue Sky) at [87] (McHugh, Gummow, Kirby and Hayne JJ); St Barbara at [10]-[14] (Hill J). What "constitutes a sufficient connection or association to form the required relationship is a matter for judgment depending on the facts of the case": Project Blue Sky at [87] (McHugh, Gummow, Kirby and Hayne JJ). 56 The ARA respondents submit that this proceeding is related to ARA BidCo's takeover bid because it was commenced 10 days after ARA BidCo lodged its bidder's statement. However, Cromwell's evidence discloses that it briefed Counsel to prepare this application 4 days before that bid was announced. The second Demiris affidavit deposes that it was on 19 June 2020 that MinterEllison, on instructions from Cromwell, instructed Counsel to prepare this preliminary discovery application. ARA BidCo's intention to make a takeover bid was only announced on 23 June 2020 and the bidder's statement was not lodged until 21 July 2020. As a consequence, in the absence of evidence that Cromwell was preparing this application in anticipation of a takeover bid, the ARA respondents are not assisted by the temporal order of Cromwell's application for preliminary discovery and ARA BidCo's takeover bid. 57 The ARA respondents also submit that this preliminary discovery application is "for the purpose of enabling" Cromwell to establish that the ARA respondents and the Tang respondents have contravened s 606(1) of the Act, and to seek orders requiring the ARA respondents to divest themselves of interests in Cromwell securities obtained as part of the takeover bid. However, this application should not be characterised in that way. The purpose of an application under r 7.23 is obtaining documents to enable a decision to be made about whether or not to commence proceedings. Once that happens, the preliminary discovery proceeding comes to an end. While the ARA respondents assume a further, future proceeding will be commenced, it may well be that Cromwell never commences other proceedings against the prospective respondents in relation to the matters which underpin this preliminary discovery application. The ARA respondents also assume that any proceeding which Cromwell might commence will seek certain orders, but any such orders in a potential future proceeding have not yet been furnished to any court (let alone this Court). Such hypothetical orders do not provide a basis to characterise this application. 58 The ARA respondents' submissions failed to show that this application, properly characterised, relates to ARA BidCo's takeover bid. 59 Second, the cases referred to by the ARA respondents were not preliminary discovery applications. 60 St Barbara concerned a review of a decision of the Australian Securities and Investments Commission (ASIC) to refuse to accept for registration bid documents, relating to a proposed takeover offer, which St Barbara had sought to lodge with ASIC. Drillsearch concerned proceedings seeking an injunction restraining the holding of a proposed meeting of members of Drillsearch until the Takeovers Panel had determined an outstanding application made to the Panel based on allegations of "unacceptable circumstances" in relation to the takeover and until any remedial action ordered by the Takeovers Panel had been taken. 61 Those are cases which quintessentially relate to a takeover bid, but they are decidedly different to a preliminary discovery application, the consequence of which is the mere provision of documents to the prospective applicants by the prospective respondents. 62 Lionsgate concerned whether a bidder under a takeover bid may commence court proceedings for specific performance of its contract with a substantial shareholder of the target company, under which the shareholder had undertaken to sell into the bid. Even then, Austin J held that such a proceeding was not a proceeding "in relation to a takeover bid". Cromwell's application for preliminary discovery, which merely concerns the provision of documents, when compared to the facts of Lionsgate, is further removed from a proceeding which can be properly characterised as being "in relation to a takeover bid". 63 Third, this proceeding does not owe its existence to the Act. This proceeding arises under r 7.23 of the Rules. "Although the takeover tactics of both sides may lay behind the litigation, what brings the matter to court is the existence of" a rule of this Court, namely r 7.23: Lionsgate at [21]. This proceeding is about the provision of documents - it is not about "whether the takeover bid should be disrupted or allowed to proceed": Lionsgate at [21]. 64 Fourth, "courts will interpret any provision affecting their jurisdiction in such a way as to have the minimum effect on it": Lionsgate at [27]. The same approach "is to be taken where a statute purports to prevent proceedings from being commenced during a stated period, even if the provision does not in its terms deprive the court of jurisdiction": Lionsgate, [27]. That principle is contrary to the overly broad interpretation which the ARA respondents sought to ascribe to the words "in relation to" in s 659B. 65 Fifth, the "starting point for the ascertainment of the meaning of a statutory provision is the text of the statute whilst, at the same time, regard is had to its context and purpose": SZTAL v Minister for Immigration and Border Protection [2017] HCA 34, 262 CLR 362, [14] (Kiefel CJ, Nettle and Gordon JJ). Explanatory memoranda can be considered in interpreting s 659B: Acts Interpretation Act 1901 (Cth), s 15AB; Corporations Act 2001 (Cth), s 5C. 66 An obvious purpose of s 659B was avoiding "tactical litigation" that "can result in bids being delayed" and "the courts having to decide between disrupting the bid by granting an injunction without the benefit of full evidence and allowing the bid to proceed even though it may later be found to be defective": CLERP Explanatory Memorandum, [7.2]. There is no reason to suspect that granting Cromwell's application will result in any delay to ARA BidCo's proportional takeover bid, or this Court having to grant injunctions relating to that bid without the benefit of full evidence. If Cromwell's application for preliminary discovery is granted, all that will happen is documents will be provided to Cromwell by the prospective respondents. Granting this preliminary discovery application does not result in or cause the problem that s 659B sought to remedy. Like the position in Lionsgate, if Cromwell's preliminary discovery application is successful, the bid will still proceed: Lionsgate, [21]. 67 Sixth, the Takeovers Panel, when considering Cromwell's application to it, noted the following at [31]-[32]: 31. In Dragon Mining Limited [[2014] ATP 5 at [27]], the Panel stated that, in considering whether to conduct proceedings: … there must be a sufficient body of material demonstrated by the applicant, which together with inferences (for example from partial evidence, patterns of behaviour and a lack of a commercially viable explanation) support the Panel conducting proceedings. 32. The Panel went on to state: Dromana Estate Limited 01R acknowledges the difficulties that an applicant faces in gathering evidence in association matters. In deciding whether to conduct proceedings on an association case, this must be kept in mind. However, the Panel has limited investigatory powers which means, before we decide to conduct proceedings, an applicant must do more than make allegations of association and rely on us to substantiate them. An applicant must persuade us by the evidence it adduces that we should conduct proceedings. (Cromwell Property Group [2020] ATP 1; emphasis added.) 68 The Takeovers Panel also does not have the power to order broad discovery or preliminary discovery: Australian Securities and Investments Commission Act 2001 (Cth), ss 192 and 199; Australian Securities and Investments Commission Regulations 2001 (Cth), reg 16; Re Pinnacle VRB Ltd (No 8) (2001) 39 ACSR 55, 67. 69 In these circumstances, an application for preliminary discovery is not a matter which is "really … within the [Takeover] Panel's province": Drillsearch, [18].

Section 659B(1) does not apply 70 For the reasons given, in the particular context of this application, s 659B(1) has no application to this proceeding. 71 Given I have decided that s 659B(1) does not apply to this preliminary discovery application, it is unnecessary for me to consider the parties' submissions on the construction of s 659B(2). 72 However, the question remains whether Cromwell has satisfied r 7.23.

RULE 7.23 73 The relevant principles to be applied in determining an application for preliminary discovery under r 7.23 of the Rules may be summarised as follows. 74 Rule 7.23 provides: (1) A prospective applicant may apply to the Court for an order under subrule (2) if the prospective applicant: (a) reasonably believes that the prospective applicant may have the right to obtain relief in the Court from a prospective respondent whose description has been ascertained; and (b) after making reasonable inquiries, does not have sufficient information to decide whether to start a proceeding in the Court to obtain that relief; and (c) reasonably believes that: (i) the prospective respondent has or is likely to have or has had or is likely to have had in the prospective respondent's control documents directly relevant to the question whether the prospective applicant has a right to obtain the relief; and (ii) inspection of the documents by the prospective applicant would assist in making the decision. (2) If the Court is satisfied about matters mentioned in subrule (1), the Court may order the prospective respondent to give discovery to the prospective applicant of the documents of the kind mentioned in subparagraph (1)(c)(i). 75 In Poole v Australian Pacific Touring Pty Ltd [2017] FCA 424 (Poole), Bromwich J summarised the applicable principles at [39]: … the general body of principles developed in relation to the requirements for an application for preliminary discovery in this Court, many of which were originally expounded in relation to the old rule, remain apposite and may be summarised as follows: (1) Rule 7.23 is to be beneficially construed and given the fullest scope that its language will reasonably allow, with the proper brake on any excesses lying in the discretion of the Court, exercised in the particular circumstances of each case: [Optiver Australia Pty Ltd v Tibra Trading Pty Ltd [2008] FCAFC 133; 169 FCR 435 (Optiver)] at [43] quoting with approval St George Bank Ltd v Rabo Australia Ltd [2004] FCA 1360; 211 ALR 147 [(St George Bank Ltd)] at 153 [26(a)] and Paxus Services Ltd v People Bank Pty Ltd (1990) 99 ALR 728 at 733. (2) Each of the pre-requisites set out in r 7.23(1) must be met before the discretion in r 7.23(2) is enlivened: St George Bank Ltd at [26(b)], citing Hooper v Kirella Pty Ltd (1999) 96 FCR 1 at 11 [38]. (3) Not every element of any relevant cause of action must be established, provided there exists a reasonable cause to believe the prospective applicant "may have" a right to obtain the relief: Optiver at [48]. (4) A "belief" requires more than mere assertion and more than suspicion or conjecture. The evidence must "incline the mind towards the matter of fact in question": Optiver at [48], citing, inter alia, John Holland Services Pty Ltd v Terranora Group Management Pty Ltd [2004] FCA 679 at [13], [14], [17] and [73]. (5) The rule does not speak in terms of a belief in the existence of a cause of action. It speaks of a right to relief. By reason of the expression "may have", the rule is concerned with a belief in the possibility (not the existence) of such a right: Sandhurst Trustees Limited v Clarke [2015] FCAFC 21; (2015) 321 ALR 1 at 16 [24], citing [EBOS Group Pty Ltd v Team Medical Supplies Pty Ltd (No 3) [2012] FCA 48; 199 FCR 533] at [31]. (6) The notion that an order for preliminary discovery is no longer appropriate once a prospective applicant has sufficient information to meet the threshold of "a bare pleadable case" is fundamentally inconsistent with the purpose of the rule, which is concerned not just with reasonable belief as to the possible right to relief, but also with whether the cost and risk of litigation is worthwhile: Optiver at [35]-[36]. It follows that the question posed by r 7.23(1)(b) is not whether the applicant has sufficient information to decide if a cause of action is available against the prospective respondent, but rather whether the applicant has sufficient information to make a decision whether to commence proceedings in the Court. (7) It is not an answer to an application to say that preliminary discovery is in the nature of a fishing expedition, because that is precisely what such a rule contemplates: St George Bank at 154 [26(h)]. (Emphasis in the original.) 76 The summary of applicable principles in Poole was recently adopted by Moshinsky J in Nalini Asher Enterprises Pty Ltd v H&M Tracey Construction Pty Ltd [2019] FCA 2161 (Nalini) at [11]. 77 In Pfizer Ireland Pharmaceuticals v Samsung Bioepis AU Pty Ltd [2017] FCAFC 193; 257 FCR 62 (Pfizer), Chief Justice Allsop cautioned that the "existing authorities appear to have been influencing these applications into a form of mini-trial where a form of fact finding takes place, well beyond the mandate of the words of the rule": Pfizer, [2]. Chief Justice Allsop observed that "[t]hese are summary applications not mini-trials": Pfizer, [2]. His Honour stated that "[r]ule 7.23 is a beneficial provision, the purpose of which is to enable a person who believes he, she or it may have a right to seek relief to obtain information to make a responsible decision as to whether to commence proceedings": Pfizer, [4] (emphasis added). 78 In Pfizer, Allsop CJ stated at [8]: There have been a large number of cases now (both at first instance and Full Court) dealing with and explaining the relevant rule. Those authorities should not be utilised to form a complex matrix of sub-rules for the operation and application of a tolerably straightforward provision … [T]here does appear to have been a tendency to create an overly abstracted conceptualisation of refined states of mind which, if the words of the rule are not kept in mind, can lead in application to a misstatement of the essence of the rule, focused as it is upon what may be the position. The foundation of the application in r 7.23(1)(a) is that an applicant (a person or a corporation) reasonably believes that he, she or it may have a right to relief. The belief therefore must be reasonable (expressed in the active voice that someone reasonably believes) and it is about something that may be the case, not is the case. It is unhelpful and likely to mislead to use different words such as "suspicion" or "speculation" to re-express the rule. For instance, it is unhelpful to discuss the theoretical difference between "reasonably believing that one may have a right to relief" and "suspecting that one does have a right to relief" or "suspecting that one may have a right to relief" or "speculating" in these respects. The use of such (different) words and phrases, with subtleties of differences of imprecise meaning, and not found within the rule itself is likely to lead to the proliferation of evidence and of argument, to confusion and to error. One must keep the words of the rule firmly in mind in examining the material that exists in order to come to an evaluation as to whether the relevant person reasonably believes that he or she may have a right to relief. That evaluation may well be one about which reasonable minds may differ. (Emphasis in the original.) 79 "The applicants must reasonably believe that they may have, not that they have, the right to obtain relief": Pfizer, [17] (Allsop CJ); bold text in the original. 80 Allsop CJ stated at [81]: … in my respectful view, the primary judge approached the matter by asking himself the wrong question. It was not a matter of which body of expert evidence to prefer; rather, it was whether Pfizer reasonably believed that it may have a right to relief. That involved the question whether Dr Ibarra's views were capable of giving a reasonable basis for a belief about that matter. 81 In Pfizer, Perram J stated, at [118]-[119]: … the Court has occasionally applied the necessity for the reasonable belief to relate to the existence of a right to obtain relief rather than a possible existence of a right to obtain relief … The practical effect of this misapprehension has been that, in recent times, applications under FCR 7.23 have tended to become in many instances mini-trials because of a perceived need to show the reasonableness of a belief that a right to relief exists rather than might exist. In my opinion, St George does not require this and, to the extent that John Holland does, it is difficult to reconcile with the text of the rule. (Citations omitted.) 82 Perram J stated at [120]-[121]: … the question of whether the belief is reasonable requires one to ask whether a person apprised of all of the material before the person holding the belief (or subsequently the Court) could reasonably believe that they may have a right to obtain relief; and … it is useful to ask whether the material inclines the mind to that proposition but very important to keep at the forefront of the inclining mind the subjunctive nature of the proposition. One may believe that a person may have a case on certain material without one's mind being in any way inclined to the notion that they do have such a case. In practice, to defeat a claim for preliminary discovery it will be necessary either to show that the subjectively held belief does not exist or, if it does, that there is no reasonable basis for thinking that there may be (not is) such a case. Showing that some aspect of the material on which the belief is based is contestable, or even arguably wrong, will rarely come close to making good such a contention. Many views may be held with which one disagrees, perhaps even strongly, but this does not make such a view one which is necessarily unreasonably held. Nor will it be an answer to an application for preliminary discovery to say that the belief relied upon may involve a degree of speculation. Where the language of FCR 7.23 relates to a belief that a claim may exist, a degree of speculation is unavoidable. The question is not whether the belief involves some degree of speculation (how could it not?); it is whether the belief resulting from that speculation is a reasonable one. Debate on an application will rarely be advanced, therefore, by observing that speculation is involved. 83 Perram J stated at [123] that "[u]ltimately, a degree of speculation on a preliminary discovery application is an inevitable consequence of the nature of [an] application [for preliminary discovery] itself" (emphasis added). 84 Perram J stated at [125]: … it may prove practically difficult to disprove a reasonable belief that a case may exist by seeking to demonstrate that the internal legal mechanics of the suspected case are faulty or contestable. In many cases this will have little impact on the question of whether the belief that a case may exist is reasonably held. More likely fruitful will be arguments to the effect that no reasonable person apprised of what the prospective applicant puts before the Court would think that a right to obtain relief might exist. Couched in those terms the difficulty confronting a prospective respondent on a preliminary discovery application may be clearer. 85 Pausing there, I note that the parties to this application adopted an approach which essentially entailed a "mini-trial". By way of example: (1) Cromwell's written submissions were 32 pages long, and were supported by the first Weightman affidavit, first Demiris affidavit, second Weightman affidavit and second Demiris affidavit. The first Weightman affidavit (including annexures) ran to approximately 1,200 pages; (2) the submissions of the ARA respondents were 20 pages in length and supported by the Lloyd affidavit, the Blight affidavit, the Vaatstra affidavit and the Leibler affidavit. The Blight affidavit ran to 422 pages. When combined, including annexures, the ARA respondents' affidavit material was approximately 700 pages in length; (3) the submissions of the Tang respondents were 38 pages long. The Tang respondents have filed 4 affidavits which, when combined, including annexures, ran to over 400 pages in length. 86 Submissions were made by the Tang respondents concerning the minutiae of what inferences were available on the basis of communications between the parties or representatives of the parties. By way of example, submissions were made about whether certain statements could "bear the weight" that Cromwell seeks to place on them, whether statements by Cromwell were "implausible", whether Cromwell's evidence indicates a "spiral of suspicion", whether Cromwell's evidence relating to a text message was a "plausible deduction" or supported the inference which Cromwell sought to derive from it. 87 Much of the affidavit material was totally unnecessary for an application of this kind, which is made under a rule that is "tolerably straightforward": Pfizer, [8] (Allsop CJ). Assessing some of the submissions based on much of this material would have required making determinations concerning nuanced inferences, without the benefit of cross-examination, and, in many cases, merely on the basis of affidavits of the parties' solicitors, not the parties themselves. Much of the material, at best, showed that matters in the first Weightman affidavit were "contestable" which, as Perram J stated in Pfizer, will "rarely come close" to showing that a matter has no reasonable basis: Pfizer, [121] (Perram J). The material was provided to the Court in the context of an application which essentially involves "examining the material that exists in order to come to an evaluation as to whether the relevant person reasonably believes that he or she may have a right to relief", and that "evaluation may well be one about which reasonable minds may differ": Pfizer, [8] (Allsop CJ). 88 The parties' approaching this application as if it were a "mini-trial", was contrary to Full Court authority. 89 With that summary set out, I do not propose to burden these reasons with the various competing submissions that were put by the parties. The written submissions of the parties may be found on the Court file.

First limb - r 7.23(1)(a) of the Rules 90 The first limb of r 7.23(1) requires that Cromwell "reasonably believe" that it may have a right to obtain relief from the prospective respondents. 91 Mr Weightman is the managing director and chief executive officer of Cromwell. Mr Weightman has filed two affidavits in which he deposes to his belief about an association between the ARA respondents and the Tang respondents: first Weightman affidavit at [15] and [136]. Mr Weightman's belief concerns alleged contraventions of s 606(1) and s 671B(1) of the Act. It is necessary to set out the operation of those provisions.

Possible contravention of s 606(1) 92 Section 606(1) provides: (1) A person must not acquire a relevant interest in issued voting shares in a company if: (a) the company is: (i) a listed company; or (ii) an unlisted company with more than 50 members; and (b) the person acquiring the interest does so through a transaction in relation to securities entered into by or on behalf of the person; and (c) because of the transaction, that person's or someone else's voting power in the company increases: (i) from 20% or below to more than 20%; or (ii) from a starting point that is above 20% and below 90%. 93 The first element of s 606(1) is that a person has acquired a "relevant interest" in issued voting shares. Section 608 describes when a person has a "relevant interest" in securities. Relevantly, for present purposes: (1) a person has a "relevant interest" in securities where, while not holding the securities, the person has the power to exercise, or control the exercise of, a right to vote attached to the securities: s 608(1)(b); (2) "power or control" includes power or control that is indirect: s 608(2)(a); (3) where a person controls a body corporate, or has voting power in a body corporate above 20%, the person has a relevant interest in any securities which that body corporate has: s 608(3). 94 The second element of s 606(1) is that the person's acquisition of the relevant interest occurs through a transaction by or on behalf of that person. The third element is that, because of that transaction, the person's "voting power", or someone else's "voting power", increases as described in s 606(1)(c). 95 "Voting power" is defined in s 610. A person's "voting power" in a "designated body" (being a body, including a body corporate, or a managed investment scheme) is calculated according to the following formula (incorporating the definitions in s 610): (total number of votes attached to all voting shares in the designated body that the person or an associate has a relevant interest in / total number of votes attached to all voting shares in the designated body) x 100 96 Calculating a person's voting power involves counting not just the votes attached to all voting shares in which the person has a relevant interest, but also the votes attached to all voting shares in which any associates of the person have a relevant interest. 97 When a person is an "associate" of another is dealt with in s 12, which relevantly provides: (2) … a person (the second person) is an associate of the primary person if, and only if, one or more of the following paragraphs applies: (a) … (b) the second person is a person with whom the primary person has, or proposes to enter into, a relevant agreement for the purpose of controlling or influencing the composition of the designated body's board or the conduct of the designated body's affairs; (c) the second person is a person with whom the primary person is acting, or proposing to act, in concert in relation to the designated body's affairs. 98 Subparagraph (b) refers to a "relevant agreement". "Relevant agreement" is defined broadly in s 9 to mean "an agreement, arrangement or understanding", "whether formal or informal or partly formal and partly informal", "whether written or oral or partly written and partly oral", and "whether or not having legal or equitable force and whether or not based on legal or equitable rights". 99 Both subparagraphs (b) and (c) of s 12(2) refer to the "designated body's affairs". This concept is defined very broadly in s 53. The definition in s 53 applies for the purposes of s 12 of the Act by virtue of regulation 1.0.18(b) of the Corporations Regulations 2001 (Cth). 100 Mr Weightman deposes that Cromwell believes the ARA respondents and the Tang respondents: (1) have had and continue to have a "relevant agreement" for the purpose of controlling or influencing the composition of the board of Cromwell or the conduct of Cromwell's affairs; and (2) have acted and continue to act in concert in relation to Cromwell's affairs, such that they have been, and remain, associates within the meaning of s 12: first Weightman affidavit at [52]-[135]. 101 I address Mr Weightman's belief on this matter further below.

Possible contravention of s 671B(1) 102 Section 671B(1) relevantly provides: (1) A person must give the information referred to in subsection (3) to a listed company, or the responsible entity for a listed registered scheme, or the operator of a listed notified foreign passport fund, if: (a) the person begins to have, or ceases to have, a substantial holding in the company, scheme or fund; or (b) the person has a substantial holding in the company, scheme or fund and there is a movement of at least 1% in their holding; … 103 There are two states of affairs that relevantly engage s 671B(1): beginning to have a "substantial holding" or a "movement of at least 1%" occurring in an existing substantial holding. 104 "Substantial holding" is defined in s 9 relevantly as follows: a person has a substantial holding in a body corporate, listed registered scheme or listed notified foreign passport fund if: (a) the total votes attached to voting shares in the body or voting interests in the scheme or fund, in which they or their associates: (i) have relevant interests; … is 5% or more of the total number of votes attached to voting shares in the body or interests in the scheme or fund; … 105 Calculating whether a person has a "substantial holding" involves counting not just the votes attached to voting shares in which the person has a relevant interest, but also the votes attached to voting shares in which "their associates" have a relevant interest. 106 The concept of a "movement of at least 1%" is dealt with in s 671B(2). That section provides that there is a "movement of at least 1%" in a person's holding if the percentage worked out using the following formula increases or decreases by 1 or more percentage points from the percentage last disclosed: (total number of votes attached to all voting shares in the company, interests in the scheme or interests in the fund that the person or an associate has a relevant interest in / total number of votes attached to all voting shares in the company, interests in the scheme or interests in the fund) x 100 107 This formula takes into account not just the votes attached to securities in which the person has a relevant interest, but also the votes attached to securities in which any associates of the person have a relevant interest. Thus, where a person has one or more undisclosed associates, that person's holding may experience a "movement of at least 1%" in circumstances where, on the face of the matter, this is not immediately apparent. 108 Where a person begins to have a substantial holding, or experiences a movement of at least 1%, s 671B(1) provides that the "information referred to in subsection (3)" must be given to the company concerned. That information includes the name of each associate who has a relevant interest in the securities and the nature of the association with that associate: s 671B(3)(d). Section 671B(6) relevantly provides that the person must give the information in subsection (3) within two business days after the person becomes aware of the information. 109 Mr Weightman deposes to occasions on which he believes, assuming association (to which I will come), that the first, fourth, fifth and seventh prospective respondents experienced a movement of at least 1% of their substantial holdings and failed to provide the information required by s 671B(3), thus contravening s 671B(1). Annexure PLW-32 to the first Weightman affidavit lists transactions which, if association between the ARA and Tang respondents is assumed, are said to contravene s 671B(1) of the Act.

Summary of the prospective respondents' submissions on r 7.23(1)(a) 110 The ARA respondents' submissions did not concede that Cromwell has a reasonable belief that it has a right to obtain relief from the ARA respondents, but, for the purposes of this application, the ARA respondents did not contest the requirement in r 7.23(1)(a). 111 By way of summary, the Tang respondents submitted that: (1) Cromwell has not established a reasonable belief that they may have the right to obtain relief from any of the Tang respondents, so as to justify an order against that particular prospective respondent; (2) Cromwell has publicly and repeatedly asserted an association of the kind about which Cromwell says it is too uncertain to commence proceedings.

Is Cromwell's belief reasonably based? 112 As to the Tang respondents' submissions that Cromwell's belief is not reasonable or is not reasonably based, I have read those submissions and considered the affidavit material which I was referred to during the hearing of this matter. I have evaluated all of the voluminous material filed by the parties. Having conducted that evaluation, I am satisfied that Cromwell's belief (as distinct from that belief's content, to which I will return) had a sufficient basis for the purposes of r 7.23(1)(a). 113 At best, the Tang respondents' submissions showed that the basis of Cromwell's belief was "contestable", but, as Perram J stated in Pfizer, that will "rarely come close" to showing that a subjectively held belief does not exist or, if it does, that there is no reasonable basis for it: Pfizer, [121]. In addition, as I have foreshadowed above, to properly test the Tang respondents' submissions would have required deciding between nuanced inferences asserted by the parties about "refined states of mind": Pfizer, [8] (Allsop CJ). It would have been necessary to do that without the benefit of cross-examination and, in the Tang respondents' case, merely on the basis of evidence affirmed by the Tang respondents' solicitor, Mr Coidan of Gilbert + Tobin, not the Tang respondents themselves or a representative of the corporate Tang respondents. 114 I was not in a position to make factual findings of that kind in this proceeding, which was a summary application, not a mini-trial. 115 In any event, as will become apparent, the main issue was not whether Cromwell's relevant belief was reasonably based. The more pressing question was the content of that belief, to which I now turn.

Does Cromwell reasonably believe that it may have a right to the relevant relief? 116 I am not satisfied that Cromwell reasonably believes that it may have the right to obtain relief on the basis of the provisions of the Act as set out above. Rather, based on the affidavit material filed by the parties, it is tolerably clear that Cromwell believes that it has a right to obtain such relief. 117 If "the criteria [in the equivalent provision to r 7.23(1)(b) which appeared in Order 15A of the Federal Court Rules 1979 (Cth)] are too generously interpreted, preliminary discovery could be available in advance of the commencement of virtually any proceeding": Telstra Corporation Ltd v Minister for Broadband, Communications and the Digital Economy [2008] FCAFC 7; 166 FCR 64 at [59] (French, Weinberg and Greenwood JJ). 118 If the prospective applicant already believes that there is a cause of action, discovery is not available to enable the applicant to verify that belief or otherwise to ascertain the strength of the case for the right to relief: Dyer v Hunter [1999] VSC 531 at [7] (Beach J); Pfizer at [108] (Perram J). 119 I have set out above Allsop CJ's statements in Pfizer, where his Honour emphasised the word "may" in r 7.23(1)(a). Allsop CJ stated that "[t]he belief … is about something that may be the case, not is the case": Pfizer, [8] (emphasis in original). 120 Perram J also stated at [108] in Pfizer: FCR 7.23(1) is not about giving preliminary discovery to those who believe they do have a case. Its wording unequivocally shows that it is about those who do not know that they have a case but believe that they may. In terms, it authorises what traditionally have been referred to as fishing expeditions; that is to say, evidentiary adventures in which the goal is not to find proof of a case already known to exist, but instead to ascertain whether a case exists at all. (Emphasis added.) 121 In this respect, there can be little doubt that Cromwell has already formed the view that there is in fact an association between the ARA respondents and the Tang respondents such that Cromwell is entitled to relief under ss 1324 and 1325A of the Act. 122 Mr Weightman is the Managing Director and CEO of Cromwell and, for the purposes of this application, is the relevant decision maker for determining whether Cromwell commences proceedings to obtain relief under ss 1324 and 1325A of the Act. Mr Weightman in his first affidavit relevantly deposes to the following: 52. For the reasons set out in Part G below, Cromwell believes that the ARA respondents, on the one hand, and the Tang respondents, on the other: (a) have had and continue to have a "relevant agreement" for the purpose of controlling or influencing the composition of the board of Cromwell or the conduct of Cromwell's affairs; and (b) have acted and continue to act in concert in relation to Cromwell's affairs; such that they have been, and remain, "associates" within the meaning of the Act. 53. Cromwell's belief that there was, and continues to be, the association just described is based on a range of facts and matters of which I am personally aware. Those facts and matters are set out in paragraphs 57 to 135 below. … 143. In order for Cromwell to decide whether to commence a proceeding in this Court for relief against the prospective respondents under s 1324 and s 1325A of the Act, Cromwell needs to know whether it will be able to establish that the prospective respondents are associates of one another. I have explained above how establishing that the prospective respondents are associates of one another is a necessary step in establishing liability on the part of the prospective respondents under ss 606 and 671B of the Act (and thus a necessary step in establishing an entitlement to relief under s 1324 or s 1325A). … 145. Having made the inquires to which I have referred, I believe Cromwell does not have sufficient information to decide whether to start a proceeding in this Court to obtain relief under ss 1324 and 1325A from the prospective respondents. That is because Cromwell does not have sufficient information to determine whether it will be able to establish, in any substantive proceeding, that the prospective respondents are associates of one another. (Emphasis added.) 123 Mr Weightman at [52] of his first affidavit states unambiguously that Cromwell believes that the ARA respondents and the Tang respondents have had and continue to have a "relevant agreement" for the purposes of controlling or influencing the composition of the board of Cromwell or the conduct of Cromwell's affairs. Mr Weightman deposes to Cromwell's belief that the ARA respondents and the Tang respondents have acted and continue to act in concert in relation to Cromwell's affairs such that "they have been, and remain, "associates" within the meaning of the Act". There is nothing conditional, speculative or hypothetical about Cromwell's stated belief based on the matters deposed to by Mr Weightman at [52] of his first affidavit. 124 At [143] of his first affidavit, Mr Weightman deposes to Cromwell needing "to know whether it will be able to establish that the prospective respondents are associates of one another". Cromwell is needing to know that it can establish or prove against the prospective respondents that they are associates of one another not whether Cromwell may have a right to relief against the prospective respondents. 125 At [145] of his first affidavit, Mr Weightman deposes to Cromwell not having sufficient information to decide whether to start a proceeding because "Cromwell does not have sufficient information to determine whether it will be able to establish, in any substantive proceeding, that the prospective respondents are associates of one another" (emphasis added). Again, Mr Weightman deposes to Cromwell's need to obtain information to enable Cromwell to be able to establish or prove association against the prospective respondents. 126 As Perram J observed at [108] in Pfizer, r 7.23(1) is not about giving preliminary discovery "to those who believe they do have a case". The plain meaning of the text of the rule, which Allsop CJ observed in Pfizer at [8] is "tolerably straightforward", is about giving preliminary discovery to those who do not know that they have a case but believe that they may. The rule does not permit preliminary discovery to find evidence to establish proof of a case which is known to exist. The rule only authorises preliminary discovery where the applicants' belief is that they do not know whether they have a case but believe that they may. 127 Cromwell's belief that the ARA respondents and the Tang respondents are in fact associates such that Cromwell believes it is entitled to relief under ss 1324 and 1325A of the Act is further demonstrated in Cromwell's submissions to the Takeovers Panel. 128 Cromwell has positively asserted that there is such an association in its submissions to the Takeovers Panel. In the Panel Application, Cromwell made, by way of example, the following statements: (1) "[t]here is sufficient evidence ... to … infer, based on a substantial body of evidence as set out in this application, that the ARA Group has a relevant agreement and is associated, with Ms Jialei Tang in relation to, inter alia, the conduct of Cromwell's affairs"; (2) "[t]here is sufficient evidence ... to … infer, based on a substantial body of evidence, that the ARA Group has a relevant agreement and is associated with the Tang Group in relation to, inter alia, the conduct of Cromwell's affairs"; (3) "[t]he alignment of the ARA Group, Ms Jialei Tang and the Tang Group is not merely a common approach to one matter but is part of a broader arrangement, with the intention being to pursue an agreed joint approach and that proposals will continue to be pursued jointly by them if Cromwell's directors do not submit to the demands of the ARA Group and the Tang Group. This arrangement is in breach of the Corporations Act …"; (4) "the ARA Group had an understanding (which constitutes a "relevant agreement" within the meaning of the Corporations Act) with each of Ms Jialei Tang and the Tang Group in relation to the control of, the appointment of directors to, and the conduct of the affairs of, Cromwell"; (5) "[a]lthough some of the conduct upon which this application is based occurred more than two months ago; prior to Cromwell's 2019 AGM, there was at best only a suspicion on the part of Cromwell of an understanding and association existing between the ARA Group, Ms Jialei Tang and the Tang Group in relation to the affairs of Cromwell. Indeed, until very recently there was insufficient evidence to form the basis for an application of the type now made"; (6) "Cromwell has become fully aware of the depth and seriousness of the connection that exists between (a) the ARA Group and Ms Jialei Tang, (b) Ms Jialei Tang and the Tang Group, and (c) the ARA Group and the Tang Group …"; (7) "it is the cumulative effect of both the recent and past conduct of the ARA Group, Ms Jialei Tang and the Tang Group, … that when looked at in its totality has laid bare the understanding and association that exists between the ARA Group and Ms Jialei Tang together with the Tang Group in relation to the affairs of Cromwell" (emphasis added). 129 Cromwell has made public statements that there is an association between the ARA respondents and the Tang respondents. The following statements have appeared on Cromwell's webpage: (1) "Cromwell remains concerned about the relationship between ARA, Tangs, Straits Trading and Dr Weiss. Concerns about the relationships between the parties and their path to taking Cromwell over by stealth, without paying a premium for doing so, is [sic] documented on Cromwell's website"; (2) "Cromwell struggles to accept the assertion that Ms Tang is independent of, and has no association with, her parents, despite living at home with her parents, being in her early 20's and working from the family company"; (3) a statement by Mr Weightman as follows: [The ARA respondents proposed candidate for Cromwell's board of directors,] Dr Weiss[,] is now orchestrating the same playbook on behalf of ARA, and another Singaporean family with whom they have a close business relationship, the Tangs. The relationship between them is outlined on our website and we believe their co-incidental creep and voting patterns are designed, in our opinion, to circumvent compulsory takeover rules. These types of associations are difficult to prove to the extent required by the Takeovers Panel but I'm reminded of the old saying that if it walks like a duck, looks like a duck and quacks like a duck, it's a duck[.] (Emphasis added.) (4) "votes for Dr Weiss at the 2019 AGM were almost entirely made up of ARA's securityholding and that of another Singapore based family (the Tangs), with whom ARA has a "long-standing business relationship". It is incorrect for ARA to assert that Dr Weiss had anything other than very low support from non-affiliated Cromwell securityholders"; (5) there appear to have been various statements on Cromwell's webpage which count the ARA respondents' and Tang respondents' securityholdings in Cromwell as a "combined … securityholding" in Cromwell. 130 Allsop CJ observed in Pfizer that "[o]ne must keep the words of [r 7.23] firmly in mind in examining the material that exists in order to come to an evaluation as to whether the relevant person reasonably believes that he or she may have a right to relief", and such an "evaluation may well be one about which reasonable minds may differ": Pfizer, [8] (emphasis added). 131 Having evaluated the material filed by the parties, in my view, and for the reasons set out above, Cromwell's application does not satisfy the requirement in r 7.23(1)(a).

Second limb - r 7.23(1)(b) of the Rules 132 I am also not satisfied that Cromwell "does not have sufficient information to decide whether to start a proceeding" in this Court to obtain relief from each of the prospective respondents for contraventions of s 606(1) and s 671B(1) of the Act. 133 I have set out above statements which Cromwell has made which make it tolerably clear that Cromwell believes it has a case against the ARA respondents and the Tang respondents. Notwithstanding these statements, Cromwell contends that it is entitled to preliminary discovery in order to ascertain "the extent and nature of the documentary evidence" relevant to its case. This is said to be necessary so that Cromwell can ascertain "whether it will be able to establish" that association. 134 The nature of that enquiry is directed towards assessing Cromwell's prospects of establishing an association which Cromwell has said exists. However, r 7.23 is not about assisting a party to find further "proof of a case already known to exist": Pfizer, [108]. 135 The obvious inference to be drawn from the statements by Cromwell set out above, and the affidavit material filed by the parties, is that Cromwell has already formed the view that it has a right to obtain relief on the basis of an association between the ARA respondents and the Tang respondents, and is impermissibly seeking to use the procedure of preliminary discovery to obtain evidence in order to better assess its prospects of success or perhaps bolster its pleading, prior to commencing a case it has already determined, and publicly stated, exists. That ensures Cromwell's application falls foul of rule 7.23(1)(b). 136 Cromwell relies on the following statement of Derrington J in John Bridgeman Limited v National Stock Exchange of Australia Limited [2019] FCA 1127; 139 ACSR 244 at [47]: [It was] submitted that in the application of r 7.23(1)(b) the question is whether after making reasonable enquiries the prospective applicant does not have sufficient information to decide whether they ought to start a proceeding … Importantly, the "sufficient information" includes that which might identify what defences may be available to the prospective respondent and the strength of those defences or to determine the extent of the prospective respondent's breaches … As was said by Perry J in ObjectiVision Pty Ltd v Visionsearch Pty Ltd (2014) 108 IPR 244 at [30], even where a prospective applicant may have reason to believe they have a right to relief, they may need further information to know whether the cost and risk of litigation is worthwhile and, in that respect, given its beneficial purpose, the rule should be given the fullest scope which its language will reasonably allow. (Citations omitted; emphasis added) 137 However, that passage deals with the circumstances in which a prospective applicant "may have reason to believe they have a right" to the relevant relief. It has minimal relevance to circumstances where, as here, the prospective applicant has positively asserted that the factual propositions underpinning the claimed relief in fact exist. Derrington J's statement should not be understood as meaning that a party who has already formed the view that it has a right to obtain relief is entitled to obtain, by way of preliminary discovery, documentary evidence to verify that belief or to confirm that it will succeed in proving its case, which is what Cromwell is seeking to do here. 138 Cromwell also submits that the preliminary discovery it seeks is necessary for it to form a view as to whether a proper basis exists for the making of allegations of contravention in this Court. Cromwell notes that there is a requirement that any pleading in this Court be accompanied by certification from a lawyer that there is a proper basis, on the material available, for each allegation made: Rules, r 16.01(c). Cromwell submits that, unlike Cromwell's Panel Application, any claim in this Court would be subject to the rules of evidence. 139 However, Cromwell has already made, in the Takeovers Panel, the allegations which underpin this application. There is no material before the Court which indicates that Cromwell did not know, or had a doubt about, whether those allegations had a proper basis before the Takeovers Panel. Cromwell has not identified what, if any, part of the "substantial body of evidence" it relied on in its application to the Takeovers Panel would be inadmissible in a court proceeding. It is also not clear why the preliminary discovery sought by Cromwell is needed in order for any eventual pleading to have a proper basis on the "factual and legal material available to [Cromwell]": Rules, r 16.01(c). As the Court observed in Optiver at [33], in relation to the former relevant rule, O 11, r 1B (which similarly provided that the factual and legal material available to (the practitioner) provided a proper basis for each allegation in the pleading), the certification required by a lawyer filing a statement of claim does not require the lawyer to make "some qualitative assessment of the prospects of success": Optiver, [33]. Provided that "there is some evidence and the gist of that evidence is properly pleaded and particularised, the pleading will not be merely "bare" but proper and adequate": Optiver, [33]; emphasis in the original. I am not persuaded that preliminary discovery is required for Cromwell to comply with r 16.01(c). 140 For these reasons, Cromwell's application does not satisfy r 7.23(1)(b).

Third limb - r 7.23(1)(c) of the Rules 141 Given the findings set out above in relation to rr 7.23(1)(a) and (b), it is strictly unnecessary to consider the third limb, r 7.23(1)(c). However, if I am wrong about the first and second limbs (ie rr 7.23(1)(a) and (b)), I would deal with the third limb as follows. 142 The third limb of r 7.23(1) requires a reasonable belief that the prospective respondents are likely to have, or are likely to have had, documents directly relevant to the question whether Cromwell has a right to obtain relief, and that inspection of the documents would assist in making the decision whether to commence a proceeding. 143 I am satisfied on the basis of the affidavit material filed by Cromwell that the prospective respondents are likely to have, or likely to have had, documents which evidence the extent and nature of the association, if any, between the prospective respondents. The prospective respondents are the very parties to the alleged association.

RULE 7.23(1) OF THE RULES IS NOT SATISFIED 144 For the reasons set out above, I am not satisfied that the prerequisites in rr 7.23(1)(a) and (b) are satisfied in this case. As a consequence, the discretion in r 7.23(2) is not enlivened and Cromwell's application must fail.

DISPOSITION 145 The prospective applicants' application is dismissed, with costs. I certify that the preceding one hundred and forty-five (145) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Anderson.

SCHEDULE OF PARTIES VID 513 of 2020 Respondents Fourth Prospective Respondent: MR GORDON TANG Fifth Prospective Respondent: MRS CELINE TANG Sixth Prospective Respondent: MS JIALEI TANG Seventh Prospective Respondent: HAIYI HOLDINGS PTE. LTD. Eighth Prospective Respondent: SINGHAIYI GROUP LTD. Ninth Prospective Respondent: SENZ HOLDINGS LIMITED