In the matter of Heartland Group Pty Ltd

Category: Principal judgment

Parties: Joanne Richards (Plaintiff)
Heartland Group Pty Ltd (First Defendant)
Bernley Corporation Pty Ltd (Second Defendant)
Boyded Industries Pty Ltd (Third Defendant)
Kieran Turner (Fourth Defendant)

Representation: Counsel:
M Ashhurst SC/A R Langshaw (Plaintiff)
B K Nolan (Fourth Defendant)
Solicitors:
Minter Ellison (Plaintiff)
McCabes (Fourth Defendant)

File Number(s): 2025/85638

JUDGMENT

1. By Originating Process filed on 4 March 2025, the Plaintiff, Ms Richards, seeks an order under s 249G of the Corporations Act 2001 (Cth) (“Act”) that a meeting of members of the First Defendant, Heartland Group Pty Ltd (“Heartland Group”) be called to consider and vote on specified resolutions. She also seeks an order under s 1319 of the Act that a body corporate representative of the Second Defendant, Bernley Corporation Pty Ltd (“Bernley”) constitute a quorum of members at that meeting. Ms Richards also joined two other parties, Boyded Industries Pty Ltd (“Boyded”) and Mr Kieran Turner as Defendants to the proceedings. Mr Turner is, inter alia, a director of Heartland Group, Bernley and Boyded and opposed the relief that Ms Richards sought, ultimately on narrow grounds.

Background, affidavit evidence and chronology

2. By way of background, these and earlier proceedings in 2024 (“Prior Proceedings) involve a group of companies collectively known as the Heartland Motor Group. I understand it to be common ground that Ms Richards and her sister, Ms Hooker are majority shareholders in B.G. Webb Pty Ltd (“BG Webb”), which is the ultimate holding company of the group, and Mr Turner indirectly holds a minority shareholding in BG Webb. Ms Richards, Ms Hooker and Mr Turner are also the directors of BG Webb and Bernley, which is a wholly-owned subsidiary of BG Webb.

3. Bernley (with three directors) holds 599 of the 600 issued shares in Heartland Group, and the remaining share is held by Boyded, which is itself a wholly-owned subsidiary of Heartland Group. Ms Richards and Mr Turner are the only two directors of Boyded. The articles of association of Heartland Group relevantly provides that two members comprise a quorum at a general meeting and that, if within half an hour of the time appointed for a general meeting a quorum is not present, the meeting shall, where convened upon the requisition of members, be dissolved. An EGM of the Heartland Group therefore cannot proceed if either Bernley or Boyded does not attend that EGM.

4. Turning now to the affidavit evidence, Ms Richards reads the affidavit dated 4 March 2025 of her solicitor, Ms Newbold, which refers to the structure of the Heartland Group of companies, to the prior proceedings and to the events and correspondence to which I refer below.

5. Mr Turner reads the affidavit dated 24 March 2025 of his solicitor, Mr Lacey, who refers to the parties to the proceedings and to the matters in issue in am application for leave to appeal and appeal (“Appeal”) against the orders made in the Prior Proceedings, to give effect to my judgments in Re Heartland Group Ltd [2024] NSWSC 875 and Re Heartland Group Ltd [2024] NSWSC 1029. Mr Lacey there noted (Lacey 24.3.25 [22]-[23]) that declaratory relief was sought in the Appeal in relation to the composition of the board of directors of each of Heartland Group and Boyded and (in evidence admitted as submission) that:

“It follows that if the Court of Appeal ultimately finds that [Ms] Richards was not validly appointed as a director of Boyded, or that [Mr] Anthony Turner is a director of one or more of the companies in the Heartland Group, then any governance decisions made prior to the determination of those questions – including the convening of an EGM or the purported appointment or removal of directors – may be subject of applications that they be voided or otherwise give rise to further dispute.”

6. It is now common ground that proposition is not correct, at least so far as the procedural steps which have been taken by Ms Richards to convene the EGM of Heartland Group. There is no contest as to the composition of the board of Bernley which passed a resolution to call the EGM. If the Court of Appeal determines that Mr Anthony Turner is a director of Boyded and that Ms Richards is not a director of Boyded, that would reduce the likelihood of deadlock in the board of Boyded, but not necessarily increase the likelihood that Boyded would attend the EGM, so as to allow a quorum to be achieved with the result that Mr Anthony Turner would likely be removed as a director of Heartland Group. I recognise that, in correspondence which I address below, Mr Turner’s solicitors have suggested that he, and by extension Boyded, would cooperate in conducting a quorate EGM of Heartland Group after the determination of the Appeal. I address that possibility below.

7. I now turn to a chronology of events that underpin this application, which are largely undisputed and in narrow scope. On 19 July 2024, I delivered judgment in the Prior Proceedings although the findings reached in that judgment are not evidence in these proceedings. On 15 August 2024, I made orders in those proceedings which are relevant to issues in this application, including holding that Ms Hooker has been a director of Bernley since 26 September 2022, with the result that its directors are now Ms Richards, Ms Hooker and Mr Kieran Turner; and Ms Hooker and Mr Anthony Turner are not directors of Boyded so that its directors are Ms Richards and Mr Kieran Turner.

8. On 22 October 2024, Mr Kieran Turner sought leave to appeal against aspects of the orders that I had made in the Prior Proceedings. His leave application and the Appeal have been heard together and the Court of Appeal has reserved its judgment. Consis1tent with my observations above, it is now common ground that the matters in issue in the Appeal and any decision of the Court of Appeal, would have no impact on the procedural validity of the matters that are in issue in these proceedings.

9. By email dated 25 January 2025 (Ex P1, CB 231), Ms Richards convened a board meeting of Bernley to consider whether Bernley should call an extraordinary general meeting (“EGM”) of Heartland Group to consider the appointment of Ms Hooker and the removal of Mr Anthony Turner (if validly appointed) as a director of Heartland Group, which would have altered the constitution of the board of that company as determined in the Prior Proceedings.

10. On 3 February 2025, a board meeting of Bernley was held (Ex P1, CB 245), attended by each of Ms Richards, Ms Hooker and Mr Turner. The board resolved by majority, over Mr Turner’s dissenting vote, that Bernley as a member of Heartland Group should convene an EGM of Heartland Group to consider the two proposed resolutions for the appointment of Ms Hooker and the removal of Mr Turner as directors of Heartland Group and resolved to appoint Ms Hooker as its corporate representative to vote in favour of those resolutions. Mr Turner opposed the proposed resolutions for reasons that he explained at that meeting. Also on 3 February 2025, Bernley sent notice (Ex P2) to the Heartland Group under s 249F of the Act calling the EGM of Heartland Group for 26 February 2025.

11. On 18 February 2025, Ms Richards emailed Mr Turner (Ex P1, CB 250) a signed circulating resolution and instrument of appointment providing for Mr Turner’s appointment as corporate representative of Boyded for the Heartland Group EGM that had been called for 26 February 2025 and offering alternatives to that approach for Mr Turner’s consideration. Mr Turner did not respond to that email and Ms Richards did not subsequently seek to complete the process for Boyded’s appointment of a corporate representative, for example, by calling a board meeting of Boyded to effect that appointment. It appears to be common ground that that appointment could not have been effected at such a board meeting, where Ms Richards and Ms Turner were the only two directors of Boyded; Mr Turner opposed the conduct of the EGM and the resolutions proposed at it; and there is no suggestion that Mr Turner would, at least prior to the determination of the Appeal, take any step to facilitate that meeting or the appointment of a corporate representative of Boyded to allow it to be quorate.

12. Correspondence between Mr Turner’s and Ms Richards’ solicitors followed between 19 and 24 February 2025 (Ex P1, CB 257ff). By letter dated 19 February 2025 (Ex P1, CB 257), Mr Turner’s solicitors advised Ms Richards’ solicitors that:

“Our client is concerned by the timing of the Proposed Resolutions, especially given that they, in part, directly cut across the relief sought in [the Appeal]. As you know [the Appeal is] set down for final hearing on 26 March 2025.”

Mr Turner’s solicitors also there referred to his concern, which was not agitated at this hearing, that the appointment of Ms Hooker as a director of Heartland Group could potentially place dealership agreements of that company at risk. Mr Turner requested that Ms Richards withdraw the notice of the EGM and that it not proceed and the proposed resolutions not be voted upon. Ms Richards did not agree to that request.

13. In that correspondence, Mr Turner foreshadowed seeking an injunction restraining the proposed resolutions from being put to the Heartland Group’s proposed EGM. On 25 February 2025, Mr Turner applied for and obtained orders (Ex P1, CB 298) for short service from the Federal Court of Australia in relation to an application for an injunction restraining the proposed resolutions from being put to the proposed Heartland Group EGM. He did not serve those proceedings and his solicitors wrote to Ms Richards’ solicitor on the same day (Ex P1, CB 306) indicating that he no longer pressed that relief. On 26 February 2025, the Federal Court of Australia made orders (Ex P1, CB 313) recording the discontinuance of those proceedings.

14. On 26 February 2025, Ms Richards and Ms Hooker attended at the notified time and place of the Heartland Group EGM, but Mr Turner did not attend. That was perhaps not surprising, where he had not been appointed as corporate representative of Boyded to attend that meeting. The Heartland Group EGM was then dissolved as inquorate in accordance with the Heartland Group’s constitution. This reflected the position under the articles of association of Heartland Group, to which I referred above.

15. On 4 March 2025, Ms Richards commenced this proceeding. In subsequent correspondence between the parties’ solicitors, Mr Turner has taken the position that any changes to the governance of Heartland Group should occur only after the determination of his application for leave to appeal and the Appeal.

16. By a letter dated 7 March 2025, Mr Turner’s solicitors reiterated his position that the EGM should not take place until after the determination of the Appeal, suggesting that Ms Richards convene a directors’ meeting of Boyded to consider the appointment of a corporate representative, and any EGM of the Heartland Group be convened, on a date following the determination of the appeal. There is no suggestion in that letter, and no suggestion in the position taken by Mr Turner in these proceedings, that he would contemplate voting in favour of a resolution to appoint a corporate representative of Boyded for an EGM of the Heartland Group, if that meeting were to occur prior to the determination of the Appeal. The position at present, and until the Appeal is determined, is that the board of Boyded is deadlocked and unable to appoint a corporate representative to attend an EGM of Heartland. I recognise that that position may change, if Ms Richards were to accede to Mr Turner’s wishes and defer holding of an EGM until after the Appeal.

17. By a further letter dated 18 March 2025, Mr Turner’s solicitors (Ex D1, CB 434) indicated that:

“[Mr Turner] contends that the appropriate time at which a meeting of directors of Boyded should be called for the purpose of voting upon the proposed resolution, is after determination of the Appeal. …”

18. Mr Turner’s solicitors there suggested that questions may arise as to the validity of a resolution at a meeting of directors of Boyded that took place prior to determination of the Appeal, although that position was not pressed at this hearing. Mr Turner there indicated that, at the earliest possible date “after determination of the appeal”, he would attend a meeting of directors of Boyded to vote upon a resolution that he be appointed as corporate representative of Boyded. It was again implicit in that position and in the position he adopted at this hearing that he would not take that approach if that meeting were held before the determination of the Appeal. His solicitors then confirmed that position as follows:

“[Mr Turner] does not object to an EGM of Heartland Group being convened and held as soon as possible after determination of the Appeal. … It follows that the proposal to pass a resolution at a directors’ meeting of Heartland Group ought not to proceed until such time as the Appeal [is] determined.”

19. Mr Turner’s application for leave to appeal and the Appeal were heard concurrently on 26 March 2025 and the Court of Appeal reserved its decision which has not yet been delivered.

20. By an email dated 8 April 2025 (Ex D2) Ms Richards sought to call a meeting of directors of Bernley to be held on 14 April 2025 to appoint Ms Hooker as Bernley’s corporate representative for the purposes of any general meeting that may be ordered by the Court in these proceedings.

21. By letter dated 9 April 2024 (Ex P3), Mr Turner’s solicitor again indicated that he was “willing to facilitate the convening of a general meeting following delivery of the Court of Appeal’s judgment” (emphasis added) and proposed specified terms, including for a meeting of members of Heartland Group within 7 days after judgment was handed down on the Appeal. The solicitors also noted that Mr Turner would be overseas until 27 April 2025 and suggested that meetings of several other entities to be held on mutually agreeable dates after 28 April 2025.

22. By their response dated 11 April 2025 (Ex P4), the solicitors for Ms Richards responded that:

“Regardless of the outcome of the Appeal:

(a) The composition of the Bernley board, and so the ability of the Bernley board to pass valid resolutions (including to call an EGM of the Heartland Group), to appoint a corporate representative to attend that EGM and to direct the corporate representative on how to vote at the EGM, is not in dispute on this application or the appeal; and

(b) Any change in the composition of the Boyded board (where it is a minority shareholder holding only one of 600 shares in the Heartland Group) cannot change the outcome of voting on the resolutions to be put at the Heartland Group EGM.”

As I noted above, these matters now appear to be common ground in these proceedings.

The applicable principles, submissions and determination

23. I first address the applicable principles, and I have here drawn on the comprehensive review of those principles in Beck v Tuckey Pty Ltd (2004) 49 ACSR 555; [2004] NSWSC 357 (“Beck”) and in Re Kentel Australasia Pty Ltd [2024] NSWSC 1352 (“Kentel”).

24. Section 249G(1) of the Act relevantly provides that:

“The Court may order a meeting of the company’s members to be called if it is impracticable to call the meeting in any other way.”

25. An application for such an order may be made by a director of the relevant company and Ms Richards is a director of Heartland Group and has standing on that basis. Broadly similar provisions have long been part of statutory company law for many years: Companies Act 1948 (UK), s 135; Companies Act 1961 (NSW), s 142; Companies (NSW) Code, s 246; Corporations Law, ss 251 and 1319; and see Austin J’s comprehensive review of the history of the section in Beck at [39].

26. The case law recognises that two matters generally arise in an application under this section. First, the applicant must establish that it is impracticable to call the meeting in any other way. In Re El Sombrero Ltd [1958] Ch 900 (“El Sombrero”), Wynn-Parry J observed (in an application under s 135(1) of the Companies Act 1948 (UK)) that

“it appears to me that the question necessarily raised by the introduction of that word ‘impracticable’ is merely this: examine the circumstances of the particular case and answer the question whether, as a practical matter, the desired meeting of the company can be conducted, there being no doubt, of course, that it can be convened and held.”

27. A similar approach has been taken in later case law, including Re Totex-Adon Pty Ltd and the Companies Act [1980] 1 NSWLR 605, Jenashare Pty Ltd v Lemrib Pty Ltd (1993) 11 ACSR 345, Favretto v Eagland (1995) 18 ACSR 196 and in Beck. In Laine Commodities Pte Ltd (recs apptd.) v CS Agriculture Pty Ltd [2021] FCA 635 at [31], O’Callaghan J in turn observed that it is well established that, for the purposes of s 249G of the Act, it is “impracticable” to conduct (or call) a meeting of a company where it is likely that those in a position to render the meeting inquorate will do so, and Nixon J followed that approach in Kentel.

28. Secondly, where such impracticality is established, the Court has a discretion to make or refuse the order sought: Beck at [38]; Kentel at [28]ff. In the latter case, Nixon J reviewed the case law including El Sombrero and In re H R Paul & Son Ltd (1973) 118 Sol J 166 and my decision in Re Statewide Office Furniture Pty Ltd [2015] NSWSC 142 at [19], where I noted that:

“… it seems to me that there would be strong reason to make that order, where [a shareholder’s] non-attendance at that meeting would, in effect, allow a minority shareholder to frustrate the exercise of the majority's power to pass a resolution to remove or elect a director and amend the Company's articles.”

29. In Kentel, Nixon J in turn observed (at [49]) that

“It is well established that one situation where it may be appropriate to exercise the discretion under s 249G to order that a meeting of members of the company be convened is where a quorum requirement is being used by a minority shareholder to frustrate the ability of the majority shareholder to convene and conduct a meeting of the company by other available means.”

30. Section 1319 of the Act in turn provides that:

“Where, under this Act, the Court orders a meeting to be convened, the Court may, subject to this Act, give such directions with respect to the convening, holding or conduct of the meeting, and such ancillary or consequential directions in relation to the meeting, as it thinks fit.”

31. In Kentel at [36], Nixon J noted that:

“The power under s 1319 is enlivened in circumstances where the Court orders a meeting to be convened under a provision of the [Act]. The Defendants did not dispute that, as a matter of power, s 1319 can be used to make an order to the effect that, at a meeting which the Court has ordered to be convened under s 249G of the [Act], a single member of the company will constitute a quorum. Orders to that effect were made, in respect of a meeting ordered to be convened under s 249G, in, for example, Statewide Office Furniture, Laine Commodities, and Sheref v UFC Trading Enterprise Pty Ltd [2024] WASC 344.

32. I do not understand these well-established principles to be in dispute in this case. Turning now to the parties’ submissions, Mr Ashhurst, with whom Mr Langshaw appears for Ms Richards, points to a deadlock in the board of Boyded. I accept that deadlock presently exists, where it is plain that Ms Richards seeks to have a corporate representative of Boyded appointed so as to attend an EGM of Heartland Group, and allow a quorate EGM to proceed so that the resolutions that she propounds will be passed by Bernley’s vote at that meeting. Mr Turner does not support that position, as a director of Boyded or generally, at least until after the determination of the Appeal. Mr Ashhurst also submits, and I also accept, that the deadlock in the board of Boyded has frustrated the attempts of Bernley to convene a quorate general meeting of Heartland Group to consider the proposed resolutions, and that rendered it impracticable to convene a general meeting of the Heartland Group without the Court’s intervention. That position presently subsists, notwithstanding the possibility that Mr Turner will, as he has foreshadowed, take a different view at some point in the future, following the determination of the Appeal.

33. As I noted above, it is plain, from the consistent position put by Mr Turner’s solicitors in correspondence on his behalf and in these proceedings, that he does not support the appointment of a corporate representative of Boyded to attend an EGM of Heartland Group prior to the determination of the Appeal. His present position, as articulated in his solicitor’s correspondence, is that he would support the appointment of a corporate representative of Boyded to attend an EGM of Heartland Group after the determination of the Appeal. However, I recognise that the present intentions of parties may change as events develop. I am satisfied that it is presently impracticable to call a quorate meeting of the Heartland Group without Mr Turner’s cooperation and while Boyded’s directors are deadlocked. I do not understand Ms Nolan, who appears for Mr Turner, to contest that position, At least prior to the determination of the Appeal. That position may change after the determination of the Appeal, as Mr Turner has indicated through his solicitors, or it may not. That is sufficient basis to make the orders sought under s 249G of the Act, subject to issues as to the Court’s discretion as to which I now turn.

34. Mr Ashhurst relevantly submits that:

“The purpose of s 249G is, relevantly, to provide the Court with a means to address, and remove, obstacles which are operating to obstruct or frustrate, in a practical sense, the ability of members of Heartland Group to convene a general meeting and to conduct business at that meeting using the processes otherwise available under Heartland Group’s articles of association or the Act: Kentel at [39]-[40].

That purpose will be furthered in the present case by the making of an order under s 249G. The members of Heartland Group, and particularly Bernley which holds 99.8% of the issued shares in Heartland Group, are being held out of their undisputed rights as members to convene a general meeting and to propose resolutions as to the appointment or removal of directors of Heartland Group. For the reasons set out above, it should be inferred that this state of affairs exists now, will continue for the immediate future and will likely continue longer. Those are important rights, and it would accord with the purpose of s 249G for the Court to exercise its discretion to make an order convening a general meeting that is otherwise unable to occur.

It is well-established that it may be appropriate to exercise the discretion under s 249G to order that a general meeting be convened where a quorum requirement is being used by a minority shareholder to frustrate the ability of the majority shareholder to convene and conduct a general meeting of the company, see: Kentel at [49] and the authorities subsequently cited. Materially the same position as considered in Kentel has arisen in the present case, although here it is one of the two directors of the minority member (i.e. Boyded), and the consequent deadlock in the board of the minority member, that has and continues to frustrate the ability of Bernley to convene a quorate general meeting of Heartland Group.”

35. Ms Nolan now resists the orders sought by reference to discretionary considerations. She submits that the Court should exercise its discretion not to make those orders because a more “cooperative” approach would be taken by the parties after the determination of the Appeal. In opening submissions, she submits that:

“in the exercise of discretion the Court should:

a. decline to intervene at this stage, in the exercise of its discretion. Mr Turner has proposed a clear and workable alternative under which the members of Heartland Group would convene a meeting within seven (7) days of the delivery of judgment in the pending Appeal. That proposal, if accepted, would resolve the present dispute without the need for any judicial intervention and would render the relief sought by the Plaintiff unnecessary;

b. alternatively, the Court should direct that any such meeting be held no earlier than seven (7) days after the Court of Appeal delivers judgment in the Appeal. The Court should also decline to make any direction under s 1319 varying quorum requirements.”

36. Ms Nolan also submits that:

“The Court is not concerned with the merits of the proposed resolutions, nor is it generally appropriate to assess the potential outcomes of the meeting: Kentel at [104]. However, where the convening of a meeting is proposed during the pendency of appellate proceedings concerning the legitimacy of the board, the timing and structure of the meeting become matters properly considered under the Court’s discretion.

Mr Turner does not oppose the holding of the meeting. However, he contends that any such meeting should occur after judgment in the Appeal, which addresses the very governance questions that underpin the Plaintiff’s Originating Process.”

I have noted above, and Ms Nolan now accepts, that the Appeal does not, in fact, address and will not determine the matters that are to be addressed at the EGM or any matter relevant to the validity of the steps taken to convene it.

37. Ms Nolan in turn submits:

“The purpose of s 249G is to enable the Court to overcome procedural obstacles to the holding of meetings of members: Kentel at [38]–[40]. In circumstances where, on Mr Turner’s case, no such obstacle exists following the determination of the Appeal, and where a meeting will be facilitated within a short and defined period thereafter, it is difficult to see how the making of orders at this stage remains necessary or appropriate.” [my emphasis]

38. Mr Ashhurst responds that the position put by Mr Turner is “ill-conceived” and that:

“No justifiable reason exists to preclude the members of Heartland Group from exercising their rights as members pending determination of that application for leave to appeal. Kieran has not sought a stay of the orders made at first instance of the Prior Proceeding, nor any injunction in aid of his application for leave to appeal. Had he done so, he would be required to establish that his application for leave to appeal had sufficient prospects of success to warrant such relief and to proffer an undertaking as to damages. Having eschewed that course, it lies ill in the mouth of Kieran to now instead seek to achieve that result by abusing his position as a director of Boyded so as to prevent it appointing a corporate representative for a general meeting, and thus to frustrate the convening of a general meeting of Heartland Group. The Court should reject any invitation by Kieran to join in that course.

If the Court is otherwise satisfied that it can and should exercise its power under s 249G, the power under s 1319 is enlivened, including power to make an order to the effect that a corporate representative of Bernley will comprise a quorum at the general meeting of Heartland Group convened by the Court. Such an approach has been repeatedly adopted, see: Kentel at [36] and the authorities there cited. Indeed, as identified by Nixon J in Kentel (at [41]), there is inherent logic in making such a direction in circumstances where the matter that has enlivened the Court’s power to convene a general meeting under s 249G arises from a quorum requirement. The present case is otherwise on all fours with the decision in Kentel in that regard.”

39. I do not accept Mr Turner’s contention that the Court should not exercise its discretion to make the orders sought by Ms Richards. First, as is now common ground, the determination of the Appeal has no factual or legal relationship with the steps taken by Ms Richards that are in issue in these proceedings, and taking Mr Turner’s approach would undermine the procedures established by the Heartland Group’s constitution for the exercise of shareholders’ voting rights in an EGM. Second, it seems to me that the Court should exercise its powers under s 249G of the Act by reference to the position which now exists rather than not doing so on the basis that a shareholder (Boyded) or its director (Mr Turner) will be or may be more cooperative in the conduct of an EGM at the time of their choice, after the Appeal is determined.

40. Third, as I have noted above, there can be no certainty that the position will in fact change following the determination of the Appeal, since Mr Turner would be free to alter his present intention to support the appointment of a corporate representative to Boyded at that point, where he plainly does not support the removal of Mr Anthony Turner or the appointment of Ms Hooker as a director of the Heartland Group. He has not, for example, offered undertakings to Ms Richards or the Court that would bind him to cooperate in the conduct of any appointment of a corporate representative to Boyded or the conduct of an EGM of Heartland Group at that point. Fourth, to the extent that Mr Turner considers that the steps that Ms Richards seeks to take will give rise to commercial disadvantages to the Heartland Group, or to the basis of a claim for oppression, these are matters which can be addressed after they have occurred, where Mr Turner did not pursue his earlier application in the Federal Court of Australia to injunct such a meeting.

41. Ms Nolan also submits:

The Court has consistently expressed caution in exercising its powers under s 249G in circumstances where a meeting may be convened cooperatively. In Beck at [51], Austin J observed that the discretion to refuse relief may properly be exercised where the company is not in general deadlock and the parties have shown a willingness to negotiate their differences ,,,

42. Ms Nolan similarly submits, as to the Court’s power under s 1319 of the Act, that:

“In the circumstances of this case—where appellate clarification is imminent, and the Mr Turner has offered a cooperative path forward—there is no basis for varying the quorum requirement.”

43. I do not accept that position subsists here. First, the board of Boyded is in fact presently in deadlock as to these matters and Ms Richard’s and Mr Turner’s “willingness to negotiate their differences” is limited, where each insists on their respective positions that the EGM be held promptly, in the case of Ms Richards, or after determination of the Appeal, in respect of Mr Turner. Mr Turner’s present position is not a “negotiated outcome” but simply his preference that the AGM not proceed until after the determination of the Appeal. There is no suggestion that the parties are advancing any wider resolution of their differences.

44. Ms Nolan also prepared “Speaking Notes” for the hearing and, with the aid of that document, made brief oral submissions. I do not address matters addressed in her speaking notes which turn on the proposition, now not pressed, that the determination of the Appeal would have any impact on the validity of the steps which have been taken to call the EGM or the resolutions ought to be passed at the EGM. Ms Nolan submits that the Court would not “lightly override” the quorum provisions for the EGM. While I accept that submission, the case law recognises that Court will make an order under s 1319 of the Act to override quorum provisions where, as here, it is apparent they will not be satisfied, at least as matters stand, by reason of the deadlock between Boyded’s directors so that it will not appoint a corporate representative to attend the EGM, unless Mr Turner changes his approach after the determination of the Appeal.

45. Ms Nolan in turn submits that:

“Beck stands for the principle that judicial discretion under s 249G should not be used to entrench one faction’s advantage where negotiations or judicial processes may soon resolve the underlying issue. That principle is squarely engaged here.”

46. Again, I do not accept that submission. The making of an order under s 249G of the Act will not “entrench one faction’s advantage”, beyond the advantage that inevitably arises at a shareholder meeting from holding the majority of shares, which is a necessary consequence of corporate structures. Such an order will simply give effect to the rights of Bernley as a shareholder, albeit in circumstances that Ms Richards and Ms Hooker now constitute a majority on Bernley’s board and Mr Turner a minority, and Bernley is the holder of nearly all the shares in Heartland Group. As I have noted above, there is no suggestion that “negotiations” will resolve the underlying dispute between the parties and there is also no suggestion that the Appeal or other pending “judicial processes” will do so.

47. I have not neglected, but need not further address, Mr Ashhurst’s submissions in replay.

Orders

48. For these reasons, I will make orders substantially to the effect sought by Ms Richards. I note that Ms Richards proposed that meeting be convened for 29 April 2025, immediately after the date on which Mr Turner’s solicitors had indicated he would return from overseas. Ms Nolan, without instructions, sought a longer period for the meeting to be convened, to allow a “grace” period until Mr Turner’s return from overseas. On balance, I should allow a slightly longer period than proposed by Ms Richards, and I will order that the meeting be convened on 2 May 2025, with information as to a videolink to be made available for that meeting to be provided by 29 April 2025. I will adopt the location proposed by Ms Richards for that meeting, although I am conscious that it may not be a neutral location, where the opportunity for a corporate representative of Boyded to attend by a video link will be available. There is no reason not to permit attendance in that manner, which is now widely used. Ms Richards has been successful and Mr Turner has been unsuccessful in the proceedings, and he must pay Ms Richards’ costs of the proceedings, as agreed or as assessed.

49. I otherwise make orders in the form proposed by Ms Richards, as follows:

50. Order that a meeting of the members of the First Defendant, Heartland Group Pty Ltd, be convened at 10:00am on 2 May 2025 at Room Cahill 2, Dexus Place, Level 15, 1 Farrer Place, Sydney and using online video link technology, for the purpose of considering and voting on the resolutions set out in Annexure A to the Originating Process.

51. Order that:

a. the members of the First Defendant be permitted to attend the meeting convened pursuant to Order 1 using online video link technology;

b. the Plaintiff is to give notice in writing to the Defendants by 5:00pm on 29 April 2025 of the online video link that may be used to attend the meeting; and

c. a corporate representative of the Second Defendant, is to constitute a quorum of members of the First Defendant at that meeting.

3. The Fourth Defendant pay the Plaintiff's costs of the proceeding, as agreed or as assessed.

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