Dourado Resources Limited v Aurium Resources Limited

BARKER J: 1 On 9 December 2016, I made orders in terms of the formal orders appearing in the orders page above. These are the reasons for doing so. 2 The plaintiff seeks to be relieved of its failure to lodge within seven days after the date a bidder's statement was lodged in the course of a takeover, an appendix 3B applying for admission to quotation of the shares offered under the bidder's statement. 3 The circumstances in which the application for such relief is made are as follows. 4 On 22 September 2016, the plaintiff announced to the Australian Stock Exchange (ASX) that it had entered into a merger implementation agreement with Plus Connect Limited (Plus Connect) and intended to make the takeover offer to acquire Plus Connect on the terms agreed with Plus Connect. 5 On 17 November 2016, the plaintiff lodged the bidder's statement with the Australian Securities and Investments Commission (ASIC) and the ASX. The bidder's statement was sent to shareholders of Plus Connect on 22 September 2016. 6 On 18 November 2016, the company secretary of the plaintiff, Mr Ramon Lauck Soares, was advised by a solicitor at the firm of solicitors acting for the plaintiff that the plaintiff was required within seven days after the date that the bidder's statement was lodged with ASIC to provide the ASX with an appendix 3B applying for admission to quotation of the 180 million shares offered under the bidder's statement. 7 On 23 November 2016, Mr Soares received an email from the solicitor enclosing a draft copy of an appendix 3B. The email accompanying it notified Mr Soares that the appendix 3B needed to be disclosed on the ASX announcement platform that day. 8 On 25 November 2016, another solicitor at the firm of solicitors acting for the plaintiff telephoned Mr Soares to query why he had not released the appendix 3B to the ASX the day before. 9 At that point Mr Soares realised his mistake in not lodging the appendix 3B on time. 10 His explanation for his mistake, which I accept, is that he had intended to lodge the appendix 3B on time. This was, however, the first takeover offer he had been involved with and he did not realise the failure to lodge the document would require orders from the Federal Court to cure the failure to do so. 11 He further explained that on 23 and 24 November 2016 he was distracted by a number of urgent matters, including organising a plaintiff board meeting and its annual general meeting and he forgot to consider the lodgement until the evening of 24 November 2016, by which time the ASX announcements platform was no longer releasing announcements. He assumed there was no utility in lodging the appendix 3B at that time, and decided to do it first thing the following day. 12 Mr Soares accepts that his failure to prepare and lodge the appendix 3B was his alone and he should have prioritised the lodging of it over other things he was doing. 13 In all the circumstances, the Court accepts that this is an appropriate case in which to exercise its powers, pursuant to s 1322(4)(d) and s 1325A of the Corporations Act 2001 (Cth), extending the time for the making of an application for the admission to quotation of securities to eight days, rather than the required seven. 14 There is no doubt about the power of the Court under s 1325A(2)(i) to make the orders sought. See FE Limited v Padbury Mining [2010] FCA 1207; Dourado Resources Limited v Aurium Resources Limited [2010] FCA 1208; Re Grain Corp Limited [2008] FCA 996; Re McMahon Holdings Limited [2008] FCA 1079 and Re Venturex Resources Limited (2009) 177 FCR 391; [2009] FCA 677. 15 There is no apparent prejudice to any party, including Plus Connect's shareholders, in the making of this order to correct the mistake made. 16 On the other hand, if the orders are not made, there will be prejudice to the plaintiff in not being able to issue the shares to Plus Connect's shareholders and there will be wasted costs relating to the implementation of the takeover offer because conditions to the offer will not be able to be satisfied. 17 I accept that, having realised his mistake, Mr Soares has acted expeditiously to instruct lawyers to make this application. 18 For these reasons, the orders set out above should be made. I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Barker.