Federal Court of Australia

VRG Bidco Pty Ltd, in the matter of VRG Bidco Pty Ltd [2024] FCA 1088

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to s 1322(4)(d) of the Corporations Act 2001 (Cth) (Corporations Act), the time specified by s 6(1)(m) of the ASIC Corporations (Wholly-owned Companies) Instrument 2016/786 (Instrument) for the plaintiffs to lodge with the Australian Securities and Investments Commission (ASIC), the Deed of Cross Guarantee appearing at pages 505-521 of Exhibit MSH-1 (Guarantee) and the certificate relating to the Guarantee (as defined in the Instrument) (together the Guarantee Documents), be extended to 30 September 2024.

2.    Pursuant to s 1322(4)(c) of the Corporations Act, the parties to the Guarantee and their current and former directors and officers be relieved from any civil liability in respect of any non-compliance with s 6(1)(m) of the Instrument by reason of the failure to lodge with ASIC the Guarantee Documents by 30 June 2024.

3.    Any person (including ASIC) who can demonstrate sufficient interest has liberty to apply within 7 days to vary or set aside orders 1 and 2.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

(Delivered ex tempore)

STEWART J:

1    The plaintiffs seek relief under s 1322(4) of the Corporations Act 2001 (Cth). The Court’s power under s 1322(4) includes a power to validate things done irregularly in certain circumstances.

2    The relief is sought in circumstances where, due to a communication breakdown between two different teams within a firm of solicitors, a Deed of Cross-Guarantee and associated certificate were not lodged with ASIC by 30 June 2024 so as to enable the plaintiffs to comply with s 6(1)(m) of the ASIC Corporations (Wholly-owned Companies) Instrument 2016/785. The Instrument allows for a dispensation of certain financial reporting requirements imposed by the Corporations Act. The plaintiffs also seek associated relief pursuant to s 1322(4)(c) of the Act to relieve the parties from civil liability arising from any non-compliance with s 6(1)(m) of the Instrument.

3    In my assessment, for the reasons comprehensively set out in the written submissions of Mr Hynes of counsel, the plaintiffs satisfy the requirements of s 1322(4). The relevant irregularity is essentially procedural in nature, and there is no suggestion of a failure to act honestly. Moreover, no identifiable prejudice or substantial injustice could be said to arise from a grant of the relief that is sought. In contrast, if the relief is not granted, substantial cost and effort would be required to lodge 11 financial reports by 31 October 2024 in circumstances where that is not normally done and preparations for that have not commenced. It may not be possible to do what is required within the requisite time.

4    ASIC has been given notification of this application, albeit only recently. While it did not appear at the hearing today, ASIC has requested that an order be made that it have liberty to apply, within 7 days, to set aside or vary any relief that might be granted. This is to allow sufficient time to make internal inquiries and to finalise its position. It otherwise states that in the meanwhile it neither consents nor opposes the plaintiffs’ application.

5    There are no discretionary reasons that occur to me, or that Mr Hynes has been able to identify, which would count against the relief being granted. This seems to me to be a clear case, and I will therefore make the orders in the form sought by the plaintiffs, with the addition that any person, including ASIC, who can demonstrate sufficient interest has liberty to apply within 7 days to vary or set aside those orders.

Associate:

Dated:    17 September 2024

SCHEDULE OF PARTIES