EXPLOSIVES MANUFACTURING SERVICES PTY LTD -v- PHEONEX PTY LTD (IN LIQUIDATION) [2025] WASC 553 | Case summary

[2] MacGill affidavit [5] and Attachment 'AGM-1' at pages 4 - 8.

Supreme Court of WA|2025-12-23|Before: Howard J

For the reasons I have given above, I do not accept that the recommendation made to the Meeting miscarried in the way asserted by the plaintiffs.
In those circumstances, there is no reason to interfere with the vote at that meeting.
I will dismiss the plaintiffs' application and discharge the injunction that issued on 8 December 2025.
I will hear the parties further, as needs be, on the form of the final orders, including as to costs.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

[1] Affidavit of Alec Gerard MacGill dated 9 December 2025 (MacGill affidavit) [3] - [4].

[2] MacGill affidavit [5] and Attachment 'AGM-1' at pages 4 - 8.

[3] The defendants did not consent to the restraint I intended to impose, but rather agreed on the form of the orders to be made, if such a restraint were to be ordered.

[4] I include within this defined term the amended originating process as well as the initiating document.

[5] Affidavit of Jeremy John Lawrene Wade dated 3 December 2025 (Wade affidavit) [5] and Attachment 'JW-32' at page 559.

[6] Wade affidavit [5], [47] and Attachment 'JW-32' at pages 565 - 662 (14 November 2025 Report).

[7] 14 November 2025 Report: Wade affidavit 'JW-32' at page 565.

[9] Wade affidavit [22(b)] and Attachment 'JW-9' at pages 153 - 164.

[13] 14 November 2025 Report: Wade affidavit 'JW-32' at page 567; see also ts 57.

[14] Wade affidavit [26] and Attachment 'JW-14' at pages 205 - 225.

[15] Wade affidavit [29] and Attachment 'JW-17' at pages 248 - 259.

[16] Affidavit of Marjana Kaker dated 9 December 2025 (Kaker affidavit) [4].

[17] Wade affidavit [29] and Attachment 'JW-17' at pages 250 - 259.

[18] Wade affidavit [30] and Attachment 'JW‑18' at pages 260 - 274.

[19] Wade affidavit [32] and Attachment 'JW-20' at pages 323 - 353.

[20] Wade affidavit [46] and Attachment 'JW‑31' at pages 525 - 546.

[21] Wade affidavit [49] and Attachments 'JW‑33' at pages 663 - 677 and 'JW‑35' at pages 681 - 705.

[22] Wade affidavit [55], [59] and Attachments 'JW‑38' at pages 789 - 800 and 'JW‑42' at pages 832 - 856.

[23] Affidavit of Clifford Stuart Rocke dated 9 December 2025 (Rocke affidavit) [2], [5] and [6].

[24] Wade affidavit [31] and Attachment 'JW-19' (Information Memorandum) at page 275- 322.

[25] 14 November 2025 Report: Wade affidavit 'JW-32' section [6.3] at page 574.

[26] Wade affidavit [32] and Attachment 'JW-20' at pages 324 - 353.

[27] Wade affidavit [46] and Attachment 'JW-31' at pages 527 - 546.

[28] Wade affidavit [46] and Attachment 'JW-31' at page 531.

[29] Wade affidavit [47] and Attachment 'JW-32' at pages 547 - 662.

[30] See, for example, 14 November 2025 Report: Wade affidavit 'JW-32' at page 560.

[31] 14 November 2025 Report: Wade affidavit 'JW-32' at page 567.

[32] 14 November 2025 Report: Wade affidavit 'JW-32' at page 577.

[33] 14 November 2025 Report: Wade affidavit 'JW-32' at pages 578 - 583.

[34] 14 November 2025 Report: Wade affidavit 'JW-32' at pages 593- 596.

[35] 14 November 2025 Report: Wade affidavit 'JW-32' at pages 561 and 594 - 595: the matter included voidable transactions, insolvent trading, breaches of directors' duties.

[36] 14 November 2025 Report: Wade affidavit 'JW-32' at page 562.

[37] See, for example, 14 November 2025 Report: Wade affidavit 'JW-32' at page 561.

[38] 14 November 2025 Report: Wade affidavit 'JW-32' at page 561.

[39] See, for example, 14 November 2025 Report: Wade affidavit 'JW-32' at page 561.

[40] 14 November 2025 Report: Wade affidavit 'JW-32' at page 593.

[41] 14 November 2025 Report: Wade affidavit 'JW-32' at pages 561 and 594.

[42] 14 November 2025 Report: Wade affidavit 'JW-32' at pages 561 and 594.

[43] 14 November 2025 Report: Wade affidavit 'JW-32' at pages 562 and 595.

[44] 14 November 2025 Report: Wade affidavit 'JW-32' at pages 562 - 563.

[45] 14 November 2025 Report: Wade affidavit 'JW-32' at pages 563 and 585.

[46] Which risk has, of course, come to pass.

[47] 14 November 2025 Report: Wade affidavit 'JW-32' at page 563.

[48] 14 November 2025 Report: Wade affidavit 'JW-32' at page 585.

[50] Wade affidavit [49] and Attachment 'JW-33' at pages 663 - 677.

[51] Wade affidavit [51] and Attachment 'JW-35' at pages 681 - 705.

[52] Wade affidavit [51] and Attachment 'JW-35' at pages 688 - 689.

[53] Wade affidavit [51] and Attachment 'JW-35' at pages 688 - 689.

[54] Wade affidavit [53] and Attachment 'JW-37' at pages 776 - 788.

[55] Wade affidavit [53] and Attachment 'JW-37' at page 776.

[56] Wade Affidavit [53] and Attachment 'JW-37' at pages 776 - 777.

[57] Wade Affidavit [55] and Attachment 'JW-38' at pages 789 - 790.

[58] Wade Affidavit [57] and Attachment 'JW-40' at pages 805 - 828.

[59] Wade Affidavit [57] and Attachment 'JW-40' at page 805.

[60] Wade Affidavit [57] and Attachment 'JW-40' at pages 805 - 806.

[61] Wade Affidavit [59] and Attachment 'JW-42' at pages 832 - 856.

[62] Kaker affidavit [18] and Attachment 'MK-8' at page 64.

[63] There was objection made to some parts of Mr Rocke's affidavit, but they were not pressed in the end.

[65] Plaintiffs' Submissions in support of originating process filed 9 December 2025 (Plaintiffs' OP Submissions) [3] and [4].

[67] Plaintiffs' Submissions in support of interlocutory process filed 3 December 2025 (Plaintiffs' IP Submissions).

[70] 14 November 2025 Report: Wade affidavit 'JW-32' at page 568.

[72] Vaughan J referred to Lehman Brothers Holdings Inc v City of Swan [2010] HCA 11; (2010) 240 CLR 509 (Lehman Brothers) [20] ‑ [37] and Mighty River International Ltd v Hughes [2018] HCA 38; (2018) 265 CLR 480 [8] - [14].

[73] Smith v Sandalwood Properties Ltd [63].

[75] Lehman Brothers Holdings Inc v City of Swan [2010] HCA 11; (2010) 240 CLR 509.

[77] Plaintiffs' OP Submissions [11].

[78] See the plaintiffs' minute of proposed orders filed 9 December 2025: Proposed Order 3(c).

[79] Lehman Brothers Holdings Inc v City of Swan [25].

[80] Defendants' Submissions filed 9 December 2025 [65].

[81] Plaintiffs' OP Submissions [53].

[82] Plaintiffs' OP Submissions [63].

[83] Plaintiffs' OP Submissions [65] - [69].

[84] Plaintiffs' OP Submissions [70], [74].

[85] Plaintiffs' OP Submissions [59].

[87] Plaintiffs' OP Submissions [54] - [57].

[88] See, for example, 14 November 2025 Report: Wade affidavit 'JW-32' at pages 562 and 594.

[89] Plaintiffs' OP Submissions [54].

[90] Wade affidavit [51] and Attachment 'JW-35' at page 688.

[91] Wade affidavit [57] and Attachment 'JW-40' at page 805.

[95] Plaintiffs' OP Submissions [63] and [64].

[96] Plaintiffs' OP Submissions [63] and [64]; see also ts 54 and 56.

[97] 15 November 2025 Report: Wade affidavit 'JW-32' at pages 561 and 594 - 595.

[98] Plaintiffs' OP Submissions [65] and [67]; see also ts 61.

[99] See, for example, ts 80 and following.

[101] See, for example, Plaintiffs' OP Submissions [68]; and ts 61.

[102] 14 November 2025 Report: Wade affidavit 'JW-32' at page 563; see also at page 585.

[103] I express no view on the material before me as to whether either set of interests could have brought themselves within the s 455D(2) of the Act to initiate a proceeding to set aside a DOCA.

[104] 14 November 2025 Report: Wade affidavit 'JW-32' at page 563 (emphasis added).

[105] 14 November 2025 Report: Wade affidavit 'JW-32' at page 585 (emphasis added).

[106] Plaintiffs' OP Submissions [74].

[108] Cf Plaintiffs' OP Submissions [7(c)] and as quoted in [95] above.

[110] Plaintiffs' OP Submissions [58] and [62].

[112] See, for example, 14 November 2025 Report: Wade affidavit 'JW-32' at page 562.

[114] Notwithstanding there may have been a flirtation with a suggestion that the administrators had not been independent: Plaintiffs' OP Submissions [43], no weight was put behind this by the plaintiffs and I have not considered it further.

[115] Plaintiffs' OP Submissions [78].

[116] Plaintiffs' IP Submissions [33] - [34].

[117] Plaintiffs' IP Submissions [55].

The plaintiffs say that the proposed Black Bear deed of company arrangement allowed the company to continue in existence and that 'primary' object of Pt 5.3A could only lead the administrators in this case to a recommendation in favour of the proposed deed of company arrangement.
These submissions were made against the background that the administrators reported that Pheonex generally had healthy margins in both gross and net profit for the 2024 and 2025 financial years.[70] The plaintiffs had also led evidence (from Mr Rocke) that, on a certain basis, Pheonex had traded profitably for the 2024 and 2025 financial years.[71] That evidence had been objected to by the defendants if given as an expert opinion. As noted, that objection was not pressed ultimately. In any event, in light of the administrators' assessment of profitability already referred to, I do not need to resolve that dispute as I can rely on the administrators' own assessment.
As noted by Vaughan J, as he then was, in Smith v Sandalwood Properties Ltd [2019] WASC 109; (2019) 344 FLR 278, there have been numerous detailed expositions of the scheme provided by Pt 5.3A, including by the High Court,[72] and his Honour considered 'there is nothing new I can add to those recitations'.[73] I feel more acutely in that position.
The plaintiffs placed particular reliance on Vaughan J's statement that:

EXPLOSIVES MANUFACTURING SERVICES PTY LTD -v- PHEONEX PTY LTD (IN LIQUIDATION) [2025] WASC 553 (23 December 2025)

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