FEDERAL COURT OF AUSTRALIA

One Funds Management Limited, in the matter of One Funds Management Limited [2025] FCA 475

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to subs 411(1) and s 1319 of the Corporations Act 2001 (Cth) (Corporations Act):

(a)    the Plaintiff convene and hold a meeting (Scheme Meeting) of the Scheme Creditors (as defined below) to consider and, if thought fit, agree (with or without modification) to the scheme of arrangement, the terms of which are contained in Annexure B (Scheme Terms) to the explanatory statement (Exhibit MS-3 of the Second Affidavit of Michael John Sutherland sworn on 5 May 2025 (Second Sutherland Affidavit) (Explanatory Statement)), between the Plaintiff and the Scheme Creditors;

(b)    the Scheme Meeting be held on 30 May 2025 at 11:00am (AEST) and to be conducted electronically through an online platform (without the Scheme Creditors being physically present), which can be accessed in accordance with the instructions set out in the notice of meeting in relation to the Scheme substantially in the form of Annexure J to the Explanatory Statement (Notice of Meeting);

(c)    The following documents (which together form the Scheme Meeting Materials) are approved for distribution to Scheme Creditors in the manner provided for in Order 3 of these orders:

(i)    The Explanatory Statement;

(ii)    A Notice of Meeting;

(iii)    A voting proof of debt form which contains pre-populated personalised information for each Scheme Creditor including the Scheme Creditor's name, investment identification number, email and / or postage address and estimated admitted scheme claim, and is otherwise substantially in the form of the pro forma contained in Annexure K of the Explanatory Statement (Personalised Voting Proof of Debt Form);

(iv)    A proxy form which contains pre-populated personalised information for each Scheme Creditor including the Scheme Creditor's name, investment identification number and email and / or postage address, and is otherwise substantially in the form of the pro forma contained in Annexure L of the Explanatory Statement (Personalised Proxy Form);

(v)    A letter in respect of the Scheme Meeting substantially in the form of that contained in Exhibit MS-4 of the Second Sutherland Affidavit (Cover Letter); and

(vi)    A Mandarin translation of sections 1, 2, 5, 7, 8, 10, 11 and 15 of the Explanatory Statement, the Notice of Meeting, the pro forma voting proof of debt and proxy forms and Cover Letter, together substantially in the form contained in Exhibit MS-3 of the Second Sutherland Affidavit (Translated Documents).

2.    Pursuant to s 1319 of the Corporations Act the Court directs that:

(a)    Barry Kogan, or failing him, Jonathan Henry, be chairperson of the Scheme Meeting (the Chairperson);

(b)    The Chairperson has the power to adjourn the Scheme Meeting in his absolute discretion to such time, date and place (including as to whether an adjourned meeting should be simultaneously held online) as he considers appropriate;

(c)    Scheme Creditors may vote at the Scheme Meeting by attending the Meeting electronically via the online platform or by proxy or by an attorney under power;

(d)    a poll must be taken to decide the resolution put to the vote at the Scheme Meeting;

(e)    The Chairperson may, at his absolute discretion, determine that only proxy forms and proof of debt forms in relation to the Scheme Meeting that are received by the registry (via email: ofmlscheme@mcgrathnicol.com or via the Scheme Website at https://events.miraqle.com/ofml/) (Registry) by no later than 5:00pm on 28 May 2025 are valid;

3.    By 7 May 2025, the Plaintiff make available to each Scheme Creditor a copy of the documents substantially in the form of the Scheme Meeting Materials by:

(a)    In the case of Scheme Creditors for whom the Plaintiff's unitholder register includes a current email address (Email Creditors), by:

(i)    sending an email to that address which encloses the Cover Letter containing a hyperlink to a microsite set up by the Scheme Company at https://events.miraqle.com/ofml for the purpose of providing Scheme Creditors with access to the Explanatory Statement and other information relating to the Scheme (including, amongst other things, a Personalised Voting Proof of Debt Form, a Personalised Proxy Form, and the Translated Documents) (Scheme Website); and

(ii)    Also sending the Cover Letter containing the hyperlink to the Scheme Website by registered post addressed to the last known address recorded in the Plaintiff's register; and

(b)    In the case of any Scheme Creditors for whom the Plaintiff's unitholder register does not include a current email address and whose registered address is in Australia (Domestic Creditors), by sending the Cover Letter which contains a hyperlink to the Scheme Website by registered post addressed to the last known address recorded in the Plaintiff's register.

4.    Despatch of the Scheme Meeting Materials in accordance with the terms of paragraph 3 of these orders, shall be taken to be sufficient notice of the Scheme Meeting.

5.    The appointment by a Scheme Creditor of a person as a proxy must be by the Personalised Proxy Form or a pro forma version of the proxy form contained in Annexure L of the Explanatory Statement (each a Proxy Form).

6.    The time by which Proxy Forms must be returned or lodged in accordance with the instructions given on the form is 5:00pm (AEST) on 28 May 2025.

7.    Subject to Order 8, pursuant to rule 3.3(2) of the Federal Court (Corporations Rules) 2000 (Cth) (Rules), the Scheme Meeting be convened, held and conducted in accordance with the provisions of Pt 2G.2 of the Corporations Act that apply to members of a company (with references to 'members' in Pt 2G.2 modified to read 'creditors') and the provisions of the Plaintiff's constitution that are not inconsistent with the Corporations Act and these orders.

8.    Pursuant to r 1.3 of the Rules, Div 75 of the Insolvency Practice Rules (Corporations) 2016 (Cth) (IPR) applies to the Scheme Meeting as prescribed or modified (as the case may be) in the following respects:

(a)    The following rules apply:

(i)    Rule 75-85(1), (4);

(ii)    Rule 75-100(1), (2), (3);

(iii)    Rule 75-150(1), (2); and

(iv)    Rule 75-155(1).

(b)    Rule 75-85(2) shall apply to the Scheme Meeting as modified to read: "Subject to subsection (3), each creditor is entitled to vote and has one vote".

(c)    Rule 75-85(3) shall apply to the Scheme Meeting as modified to read: "A person is not entitled to vote as a creditor at a meeting of creditors unless his or her debt or claim has been admitted wholly or in part by the Chairperson and he or she has lodged with the Registry, a formal proof of debt".

(d)    Rule 75-100(4) shall apply to the Scheme Meeting as modified to read: "A decision by the Chairperson to admit or reject a proof of debt or claim for the purposes of voting may be appealed against to this Court by an application filed within the Court within 48 hours of the decision, such appeal to be heard concurrently with the second Court hearing".

(e)    Rule 75-150(3) shall apply to the Scheme Meeting as modified to read: "A person is not entitled to speak or vote as proxy at the meeting unless the instrument of appointment (or a copy of that instrument of appointment) has been given to the person named in the notice convening the meeting as the person who is to receive the instrument or with the Chairperson".

(f)    Rule 75-155(2) shall apply to the Scheme Meeting as modified to read: "A person claiming to be to the attorney of a person entitled to attend and vote at a meeting is not entitled to speak or vote as attorney at the meeting unless: (a) the instrument by which the person was appointed attorney has been produced to the Registry; or (b) the chairperson is otherwise satisfied that the person claiming to be the attorney of the person entitled to vote is the duly authorised attorney of that person".

2.    Pursuant to r 3.4 of the Rules, the Plaintiff to publish an advertisement in respect of the second Court hearing in The Australian newspaper containing the substance of the matters set out in Form 6 of the Rules by no later than 28 May 2025.

3.    Pursuant to s 411(16) of the Corporations Act, all further proceedings, actions or other civil proceedings by or on behalf of any of the Scheme Creditors against the Plaintiff (whether directly or indirectly) be restrained except by leave of the Court and subject to such terms as the Court imposes.

4.    Pursuant to subss 37AF(1) and 37AG(1)(a) of the Federal Court of Australia Act 1976 (Cth) (Federal Court Act), and to prevent prejudice to the proper administration of justice, Confidential Exhibit MS-5 is, for the period specified in Order 13, or until further order of the Court:

(a)    to be treated as confidential;

(b)    to be sealed on the Court file in an envelope marked "Not to be opened except by leave of the Court or a Judge" and are not to be published or made available and any electronic version thereof is to be treated in an analogous fashion; and

(c)    not to be disclosed to any person other than:

(i)    the Court;

(ii)    the legal representatives of the Plaintiff;

(iii)    the Australian Securities & Investments Commission.

5.    Subject to further order, pursuant to s 37AJ(1) of the Federal Court Act, Order 11 above is to operate for two years from the date of order.

6.    The further hearing of the Originating Process in respect of the Plaintiff's application is adjourned to 9:15am on 5 June 2025 before Justice Jackman.

7.    The Plaintiff have liberty to apply on 2 days’ notice.

Definitions

Scheme Creditors means the unitholders of the following managed investment schemes:

a. the Glen Waverley Fund;

b. the JY Hotel Fund;

c. the Cornerstone New SIV Bond Fund; and

d. the Cornerstone Bond Fund

other than i-Prosperity Capital Group Pty Ltd (in liquidation) ACN 610 840 018, iProsperity Underwriting Pty Ltd (in liquidation) ACN 619 068 969, i-Prosperity Australia Pty Ltd (in liquidation) ACN 162 090 146, the Class B unitholders in the JY Hotel Fund, the plaintiffs in Supreme Court of Victoria proceedings no S ECI 2021 00105 and S ECI 2021 01578, the plaintiff in Supreme Court of NSW proceeding no 2020/77068 and any other plaintiff in a proceeding that has released its claims against the Scheme Company.

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

REASONS FOR JUDGMENT

JACKMAN J:

Introduction

1    One Funds Management Limited (OFML) seeks to propose a revised creditors' scheme of arrangement between itself and the unitholders of four managed investment funds of which OFML is the trustee: the Glen Waverley Fund, the JY Hotel Fund, the Cornerstone New SIV Bond Fund and the Cornerstone Bond Fund (together, the Funds) (Revised Scheme).

2    The Revised Scheme is being proposed as a means of resolving claims brought by unitholders of the Funds against OFML and its Related Entities (as defined in the Scheme Terms and at s 9 of the Corporations Act) arising out of the collapse of the iProsperity group of companies (the IPG). Each of the Funds was established to service investments made by investors under the Australian Federal Government's “Significant Investor Visa” (SIV) scheme. Entities within the IPG were appointed as the investment managers of the Funds and large sums were on-lent to the IPG entity, iProsperity Underwriting Pty Ltd (in liquidation) (IPU). That entity was wound up on 19 August 2020, with the monies it received having apparently been dissipated.

3    Various unitholders in each of the Funds have brought eight separate proceedings against OFML (in its own capacity and as trustee for the Funds) and against former and past directors and officers of OFML (the Proceedings). Five of the Proceedings have settled on confidential terms and three are ongoing. A further three unitholders have recently foreshadowed the possibility of further proceedings against OFML and its Related Entities in connection with loss of investments arising from the same transactions.

4    OFML first proposed a scheme of arrangement in September 2023 (the First Proposed Scheme) as a means of compromising all claims by unitholders in the Funds (who constitute scheme creditors) against itself, its Related Entities and officers, as well as OFML's insurers. In exchange for releases, Scheme Creditors would have received a distribution from a Scheme Fund (defined below) (with the monies to be contributed by a related entity of OFML and certain of its insurers (the Participating Insurers)).

5    I considered the First Proposed Scheme at the Court hearing on 29 September 2023: One Funds Management Limited, in the matter of One Funds Management Limited [2023] FCA 1212 (the 2023 Judgment).

6    A meeting of the scheme creditors was convened and held on 31 October 2023. While a majority of creditors in number (61%) agreed to the First Proposed Scheme, only 65% of creditors by value agreed, with the result that the 75% of creditors by value requirement was not satisfied. As such, the resolution did not pass, and the proposal was therefore unsuccessful.

7    OFML now seeks to propose the Revised Scheme, based on similar terms to the First Proposed Scheme but with a number of changes, including the size of the Scheme Fund and its allocation between Scheme Creditors. The Revised Scheme provides for a materially larger Scheme Fund: if the Revised Scheme is effected, Scheme Creditors will be entitled to receive a distribution of 15 cents in the dollar in respect of their admitted scheme claim (as compared to an estimated distribution of between 9.2 and 10.4 cents in the dollar under the First Proposed Scheme).

8    By originating process filed 24 April 2025, OFML seeks orders including pursuant to s 411 of the Corporations Act for:

(a)    the convening of a meeting of creditors for the purpose of considering, and if thought fit, agreeing to, the Revised Scheme;

(b)    the approval of the draft Explanatory Statement for the Revised Scheme for distribution to the Scheme Creditors; and

(c)    a stay of the Proceedings, which is further addressed below.

9    OFML relies on the following affidavits:

(a)    Mr Sutherland’s Affidavit dated 24 April 2025 (addressing the Proceedings brought against OFML, the First Proposed Scheme, a summary of the Revised Scheme, the Explanatory Statement and the independent expert report);

(b)    Mr Sutherland’s Affidavit dated 5 May 2025 (addressing verification and despatch of the Explanatory Statement and other Scheme Meeting materials, related party voting, the contributions to the Scheme Fund and other Proceedings against OFML) (Mr Sutherland’s Second Affidavit);

(c)    Mr Prestwich’s Affidavit sworn 5 May 2025 (addressing provision of the Explanatory Statement to ASIC and subsequent communications, the willingness and ability of the Scheme Administrators (defined below) and Chairperson and alternate Chairperson to act and a proposed stay of the Proceedings); and

(d)    Mr Prestwich’s Affidavit also sworn on 5 May 2025 (annexing ASIC’s “usual letter” indicating that it has been given at least 14 days’ notice of the hearing and does not propose to appear to make submissions or intervene to oppose the Revised Scheme at the first Court hearing, and annexing a conditional waiver of paras 8201(c) and 8203(a) of Pt 2 of Sch 8 to the Corporations Regulations 2001 (Cth)).

10    At the first Court hearing for the Revised Scheme, on 6 May 2025, I granted leave to four of the Revised Scheme creditors to appear as interested parties. Three of them were represented by Mr Hewitt SC and one by Mr Hall. Mr Hewitt SC sought to have the first Court hearing adjourned, on the basis that his clients were not ready to put their arguments opposing the convening of the Scheme Meeting and would not be ready until the period from 26 to 29 May 2025. I note that OFML seeks a second Court hearing on 5 June 2025. Mr Hewitt SC outlined in broad terms the arguments which his clients wish to advance, relating to issues concerning: (1) class composition, (2) disclosure, (3) bona fides and propriety of purpose, (4) fairness, and (5) whether the Revised Scheme is in substance a compromise or arrangement. Mr Hall did not oppose the orders sought by OFML.

11    In the ordinary case, it may well be appropriate to deal with issues such as class composition at the first Court hearing on a final basis. However, in circumstances where the objectors need further time to prepare their argument, and will not be ready until just before the second Court hearing, in my view, the preferable course is to refuse the adjournment and not to determine any of those matters on a final basis until the second Court hearing. Accordingly, the reasons which I give now should be understood as expressing no more than preliminary views as to whether there is a sufficient basis to justify convening the Scheme Meeting and approving the Explanatory Statement. I am not to be taken as finally determining the matters sought to be raised by Mr Hewitt SC, nor am I able, at this stage, to take into account fully the matters for which Mr Hewitt SC’s clients will later contend, even on a preliminary basis, in light of their lack of readiness to present the argument at this stage. I do not see that any prejudice is occasioned to Mr Hewitt SC’s clients by that course.

Preparation of the revised scheme proposal

12    OFML has engaged with unitholders to ascertain the reasons for the failure of the First Proposed Scheme and has also engaged with other stakeholders regarding a possible revised proposal. In that regard:

(a)    OFML has engaged a lawyer based in Melbourne who is fluent in Mandarin to identify the reasons for the failure of the First Proposed Scheme and ascertain whether a sufficient number of Scheme Creditors would likely be willing to support a Revised Scheme;

(b)    OFML has negotiated a higher contribution from the Participating Insurers to the Scheme Fund, which has resulted in the total contribution of the Participating Insurers being increased by $1,000,000, from $8,250,000 to $9,250,000 in total; and

(c)    the related entity of OFML that is contributing on OFML's behalf to the Scheme Fund has agreed to increase its contribution, from $5,000,000 to $9,800,000 in total, as well as meet the costs of administering the Revised Scheme (rather than those costs being paid out of the Scheme Fund).

The key features of the Revised Scheme

13    The key features of the Revised Scheme are as follows:

(a)    the Scheme is proposed between OFML and a single class of its creditors, being unitholders in the Funds (ie the Scheme Creditors). As explained below, certain unitholders are excluded from the definition of Scheme Creditors;

(b)    the Scheme Creditors will release OFML from all “Claims” (as defined in the Scheme Terms);

(c)    the following third-party releases will also be provided by Scheme Creditors:

(i)    a release of OFML's Related Entities; and

(ii)    a release in favour of the Participating Insurers. The Participating Insurers will also receive releases from OFML (as well as the other insured entities under the relevant policies of insurance). The releases would be given in connection with any “Insured Claim” (as defined in the Scheme Terms);

(d)    a Scheme Fund totalling $19,050,000 (up from $13,250,000) will be established (Scheme Fund), comprising:

(i)    $9,800,000 contributed by One Investment Group Pty Ltd (OIG), OFML's ultimate holding company; and

(ii)    $9,250,000 contributed by OFML's Insurers (Participating Insurer Contribution);

(e)    the Participating Insurers have entered into deeds containing their commitment to contribute those funds. There is no contractual arrangement in place for OIG to make its contribution, but OFML intends to lead evidence regarding the availability of the funds and OIG's unconditional commitment to paying those funds into the Scheme Fund at the second Court hearing;

(f)    the Revised Scheme will prescribe the manner in which each Scheme Creditor's scheme claim is to be calculated. There is some complexity to those calculations, but they reflect the loss that each unitholder suffered as a result of Fund monies having been paid to IPU, and which were unable to be recovered. The proposed calculation for each of the Funds is at section 7.1 of the Scheme of Arrangement and is explained in section 10 of the Explanatory Statement. Unlike under the First Proposed Scheme, Scheme Creditors will not receive a separate payment for any legal costs that they have incurred (as is explained in more detail below).

Scheme mechanics

14    If orders are made at the second Court hearing approving the Revised Scheme in accordance with s 411(4)(b), and the Scheme becomes effective upon lodgement of those orders with ASIC pursuant to s 411(10) of the Corporations Act, the following will occur:

(a)    Barry Kogan and Jonathan Henry of McGrathNicol (Scheme Administrators), will be appointed as the attorney and agent of each Scheme Creditor, with authority to execute a deed poll providing releases in favour of OFML, its Related Entities and the Participating Insurers (the “Scheme Creditor Deed Poll of Release”);

(b)    a deed poll executed by OFML and certain of its officers and Related Entities will come into effect, providing releases in favour of the Participating Insurers (the “One Group Deed Poll of Release”);

(c)    each of the extant Proceedings will be discontinued with no order as to costs;

(d)    the Scheme Fund will be established, to be administered by the Scheme Administrators;

(e)    the Scheme Administrators will assess, determine and notify each Scheme Creditor of the amount of any Scheme Creditor's admitted scheme claim, and pay any distribution within six months of the effective date; and

(f)    in the case of “Foreign Scheme Creditors”, to be entitled to a distribution for any admitted scheme claim, they will be required to execute the “Foreign Scheme Creditor Ratification Deed Poll”, ratifying and approving the execution of the Scheme Creditor Deed Poll of Release.

General principles

15    The Court will order the convening of the scheme meeting and approve the explanatory statement if it is satisfied of the following matters:

(a)    the Plaintiff is a Pt 5.1 body;

(b)    the proposed scheme is an arrangement within the meaning of s 411 of the Corporations Act;

(c)    the scheme booklet will provide proper disclosure to scheme creditors;

(d)    the scheme is bona fide and properly proposed;

(e)    ASIC has had a reasonable opportunity to examine, and make submissions in respect of, the terms of the scheme and the scheme booklet and has had 14 days’ notice of the proposed first Court hearing date;

(f)    the procedural requirements have been met; and

(g)    the scheme of arrangement proposed is of such a nature and cast in such terms that, if it received the statutory majority at the scheme meeting, the Court would be likely to approve it on the hearing of a petition which is unopposed.

See, in the context of a creditors’ scheme, Re Boart Longyear Ltd [2017] NSWSC 567; (2017) 121 ACSR 328 at [75]–[76] (Black J) and the 2023 Judgment at [9].

16    Each of the preconditions to the exercise of s 411(1) of the Corporations Act is met in the present case, noting the qualifications referred to above that this is a preliminary, not a final, decision, and that the arguments sought to be raised by certain potential objectors will be heard and decided at the second Court hearing.

17    First, the Plaintiff is a Pt 5.1 body, and the Revised Scheme is an "arrangement” or "compromise" between the Plaintiff and the Scheme Creditors.

18    Second, on 17 April 2025, the Plaintiff provided ASIC with a draft copy of the Explanatory Statement and its attachments, together with a cover letter which indicated that the Plaintiff would be requesting a first Court hearing date in early May. The originating process was filed on 24 April 2025, and the first Court hearing date was confirmed on 30 April 2025. On the same day, the Plaintiff served a sealed copy of the originating process on ASIC together with a cover letter confirming the date of the first Court hearing. ASIC has been given more than 14 days' notice as required under s 411(2) of the Corporations Act.

19    Third, the Explanatory Statement has been subject to a verification process which is set out at paras [6]–[17] of Mr Sutherland’s Second Affidavit.

20    Fourth, the procedural requirements under the Federal Court (Corporations) Rules 2000 (Cth) (Rules) have been met, namely:

(a)    as required by r 2.4(2) of the Rules, the company search for the Plaintiff was carried out no earlier than 7 days before the originating process was filed on 24 April 2025;

(b)    as required by r 3.2 of the Rules, Mr Barry Kogan of McGrathNicol has confirmed his willingness to act as chair and has addressed the matters in r 3.2(b);

(c)    as required by r 3.3(1) of the Rules, the draft orders convening the Scheme Meeting identify the Revised Scheme;

(d)    as required by r 3.4 of the Rules, the draft orders include the publication of notice of the second Court hearing in “The Australian” newspaper, proposed to be published no later than five days before the second Court hearing. (OFML proposes newspaper publication in this case because it does not have its own website and Scheme Creditors are unlikely to access that of its parent).

21    An independent expert report has been prepared by Barry Kogan of McGrathNicol (Expert Report). Mr Kogan opines that:

(a)    following the implementation of the Scheme, OFML will be solvent;

(b)    if the Revised Scheme was not put into effect and OFML was to be wound up within six months, it is estimated that Scheme Creditors would receive a distribution of between 0.11 and 0.38 cents in the dollar or between $0.0011 and $0.0038 per dollar of their estimated claim against OFML; and

(c)    if the Revised Scheme is effected, Scheme Creditors will be entitled to receive a distribution of 15 cents in the dollar in respect of their admitted scheme claim (as compared to an estimated distribution of between 9.2 and 10.4 cents in the dollar under the First Proposed Scheme).

22    Mr Kogan is also proposed to be the Scheme Administrator and Chairperson of the Scheme Meeting, and Jonathan Henry is proposed to be a Scheme Administrator and alternate Chairperson of the Scheme Meeting. The proposed appointment of Mr Kogan as one of two Scheme Administrators is a relatively minor future engagement that has been disclosed to Scheme Creditors in the scheme booklet and, as such, does not compromise the independence of his expert report: Re Atlas Iron Ltd [2016] FCA 366; (2016) 112 ACSR 554 at [61] (Gleeson J) and Re Boart Longyear Ltd [2021] NSWSC 982 at [52] (Black J); Explanatory Statement sections 6.9 and 14.2.

23    There is no apparent reason why the Revised Scheme should not, in due course, receive approval if the necessary majority of votes is achieved.

24    The reasons for voting for or against the Revised Scheme are set out in sections 7 and 8 of the Explanatory Statement respectively. Scheme Creditors may be expected to prefer the Revised Scheme for reasons including the following:

(a)    Scheme Creditors will receive a superior financial return under the Revised Scheme than in a scenario where the Scheme is not effected and in the event of insolvency of the Plaintiff;

(b)    the Revised Scheme provides greater certainty than the alternative (eg lengthy, costly and uncertain litigation); and

(c)    funds are being provided by OFML's Related Entities and the Participating Insurers that may not otherwise be available for the benefit of the Scheme Creditors.

25    Regardless of whether the Revised Scheme is approved, Scheme Creditors (as unitholders) will retain their units in the relevant Funds and their rights to any future distributions made from the assets remaining in the Funds. If the Revised Scheme is approved, OFML expects that it will be able to wind up each of the Funds and distribute the remaining assets within the following 12 months.

26    Some particular issues which are worthy of comment at this preliminary stage are as follows.

Third Party Releases

27    The Revised Scheme is conditional upon releases in favour of the Plaintiff's Related Entities and the Participating Insurers (together, Third Parties). After the Revised Scheme becomes effective:

(a)    each Scheme Creditor, acting through the Scheme Administrator as its duly appointed agent and attorney, releases the Plaintiff's Related Entities (as defined) from all “Claims” and those claims are extinguished;

(b)    OFML, its Related Entities and Scheme Creditors will release the Participating Insurers in respect of any “Policy Period Claim”, being a claim that could be made in connection with the relevant contracts of insurance held by OFML; and

(c)    the Scheme Creditors (through the Scheme Administrator as their appointed agent) covenant not to bring or pursue any claim against the Third Parties in respect of any matter which is the subject of the release.

28    The Plaintiff submits, and I accept, that the releases in favour of the Third Parties (and the mechanism for giving them) are permissible under s 411: see Fowler v Lindholm; Re Opes Prime Stockbroking Ltd [2009] FCAFC 125; (2009) 178 FCR 563 at [69], [72] and [73] (Emmett, Gordon and Jagot JJ) (Fowler v Lindholm) ; the 2023 Judgment at [21].

29    Two related requirements emerge from the authorities:

(a)    first, there must be a sufficient nexus between a release by the creditor of the claims against the third party and the relationship between the creditor and the scheme company: Fowler v Lindholm at [68] to [73] per Emmett, Gordon and Jagot JJ; and

(b)    second, there must be some element of give and take such that the creditors receive something in return for the benefit conferred on the third party: Fowler v Lindholm at [69]; Lift Capital Partners Pty Limited (In Liquidation), in the matter of Lift Capital Partners Pty Limited (In Liquidation) [2009] FCA 1523 at [35] per Emmett J; Bacnet Pty Ltd v Lift Capital Partners Pty Ltd (in liq) [2010] FCAFC 36; (2010) 183 FCR 384 at [144]–[145] (Keane CJ and Jacobson J).

30    As to the first requirement, there is a clear "nexus" here between the release in favour of the Third Parties and the relationship between the Scheme Creditors and the Plaintiff:

(a)    certain scheme creditors have commenced Proceedings against the Plaintiff, in its capacity as trustee of the Funds, and certain of its Related Entities. Other scheme creditors have also foreshadowed claims. The claims against the Plaintiff and the Related Entities largely (and in many cases completely) overlap. Claims against some of the Related Entities include claims of procurement or inducement of or knowing assistance in the alleged breaches of trust by the Plaintiff and breaches of directors' duties;

(b)    the release provided in favour of the Participating Insurers means that no claims can be made against the Participating Insurers that may fall under relevant policies of insurance held by the Plaintiff or its Related Entities with the Participating Insurers: Re Lehman Brothers Australia Ltd (in liq) (No 2) [2013] FCA 965; (2013) 95 ACSR 685 at [78]-[81] (Jacobson J); Re Lehman Brothers Australia Ltd (in liq) [2013] FCA 486; (2013) 94 ACSR 528 at [26]–[32], [75] (Jacobson J); and

(c)    compromising the interrelated claims against the Third Parties is necessary for finality in the Proceedings and in relation to claims which have been threatened to be commenced.

31    As to the second requirement, the Scheme Creditors are receiving contributions from certain of the Third Parties in exchange for the releases:

(a)    the Participating Insurers have agreed to provide an amount of $9,250,000, in exchange for releases. This is done on a without admission basis and (with the exception of one Participating Insurer), the Participating Insurers have not confirmed liability under any insurance policy held by the Plaintiff or its Related Entities with respect to the claims made in the Proceedings. The Participating Insurers would not have agreed to make that payment if they were not receiving the releases provided for under the Scheme. Absent the Revised Scheme, there is no certainty that the Scheme Creditors would receive any benefit from any insurance policy held by the Scheme Companies or its Related Entities. OFML is also satisfied that there is no materially better offer that the Participating Insurers would be willing to put; and

(b)    OIG has agreed to provide a contribution of $9,800,000 to the Scheme Fund in exchange for the releases in favour of the Related Entities. Absent the Revised Scheme, if the claims against it were to succeed, the Plaintiff has no entitlement to require any other group entity to assist it to meet its liabilities.

32    OFML in various trustee capacities is itself a Scheme Creditor under the Scheme. Like other Scheme Creditors, OFML would be releasing individuals who are its officers under the Revised Scheme.

33    OFML submits that no issue under s 199A(1) of the Corporations Act arises from that circumstance:

(a)    Section 199A does not prevent a company from giving a release as part of the bona fide compromise of a disputed claim, as distinct from a “blank cheque” or blanket exemption in advance of a disputed claim being compromised or even identified, as the authorities concerning the predecessor to s 199A, namely s 241 of the Corporations Law 1990 (Cth), establish: 2023 Judgment at [26] (citing Eastland Technology Pty Ltd v Whisson [2005] WASCA 144; (2005) 223 ALR 123 at [39] (McLure JA, with whom Malcolm CJ and Steytler P agreed); Miller v Miller (1995) 16 ACSR 73 at 88 (Santow J); Selim v McGrath [2003] NSWSC 927; (2003) 47 ACSR 537 at [152] (Barrett J)); and

(b)    Re BIS Finance Pty Limited [2017] NSWSC 1713 at [43]–[44] is an example of the Court convening a meeting in relation to a scheme which provides for releases in favour of former directors, officers and employees where creditors received something in return for the benefit conferred on the third party. Black J remarked (at [44]) that it is not necessary for the Court to assess the commercial merits of third-party releases, which are a matter for scheme participants, and issues of fairness can be addressed at the second Court hearing.

34    I considered this issue at [20]–[26] of the 2023 Judgment. No different approach is required in respect of the Revised Scheme.

Single class of creditors

35    OFML proposes that there be a single class of Scheme Creditors.

36    The class test was authoritatively summarised by the New South Wales Court of Appeal in First Pacific Advisors LLC v Boart Longyear Ltd [2017] NSWCA 116; (2017) 121 ACSR 136 at [80] (Boart Longyear) (Bathurst CJ, with whom Beazley P and Leeming JA agreed). The test directs attention to whether creditors have different rights or rights differently affected by the scheme, and whether those differences make it impossible for the creditors in question to consult together with a view to their common interest. In considering classes of creditors, the Court should adopt a practical business-like approach and should not be too assiduous in identifying classes as that could end up with any number of classes, thereby conferring on each class a power of veto: Re Opes Prime Stockbroking Limited [2009] FCA 813; (2009) 179 FCR 20 at [66] (Finkelstein J).

37    Each of the Scheme Creditors is a unitholder with a possible damages claim against OFML, and their rights will be affected under the Revised Scheme in the same way. Those claims all arise in similar circumstances. Each Scheme Creditor holds units in a fund that was established under the Australian New SIV Scheme, was managed by an IPG entity and of which OFML was the trustee. Monies from each of the Funds was invested (either directly or indirectly) with IPG.

38    To the extent that the rights of Scheme Creditors are different (eg as a result of how far advanced their claim against OFML is), those differences do not make it impossible for the Scheme Creditors to consult together. Eight separate Proceedings have already been brought against OFML and others, and an additional three unitholders have foreshadowed commencing similar claims. There is no reason to consider that other unitholders would not have equivalent claims. That is apparent from an examination of the claims made in the Proceedings, which demonstrate that they arise from the circumstances in which each investment was made by the Funds, either directly or indirectly with IPG, rather than arising from any particular attribute unique to a unitholder.

39    OFML (which holds units in a trustee capacity and is itself a Scheme Creditor) is in no different position to other Scheme Creditors. Equititrust Ltd (in liq) v Equititrust Ltd (in liq) (No 4) [2017] FCA 1133 (Jagot J) provides an example of how OFML in its capacity as trustee of a different trust could prosecute a claim against itself for the benefit of the unitholders of that trust. As a matter of principle, there can be no objection to a trustee entering into a contract or other transaction with itself in a different capacity, provided that no impermissible conflict of duty or interest arises. It is similarly sound, in principle, for the trustee to make a claim (in court or otherwise) pursuant to such a contract or transaction: 2023 Judgment at [31].

40    I considered this issue at [27]–[31] of the 2023 Judgment. No different approach is required in respect of the Revised Scheme.

No separate payment for legal costs (in contrast to the First Proposed Scheme)

41    Although the First Proposed Scheme would have provided for Scheme Creditors to recover 25% of the legal costs incurred, the Revised Scheme does not provide for any separate payment for legal costs. Rather, all Scheme Creditors will be entitled to receive the same distribution of 15 cents in the dollar in respect of their admitted scheme claim.

42    Although the Scheme Creditors who have commenced the Proceedings will have incurred more legal costs than those who have not, OFML submits, and I accept, that that does not result in the Scheme Creditors being divided into separate classes:

(a)    First, the costs of legal proceedings are in the discretion of the court; until an order for payment of costs is made, there is no obligation or liability to pay them, there is no right to recover them, and they do not constitute a contingent claim: Glenister v Rowe [2000] Ch 76, 83–84 (Mummery LJ); Foots v Southern Cross Mine Management Pty Ltd [2007] HCA 56; (2007) 234 CLR 52 at [35]–[36] (Gleeson CJ, Gummow, Hayne and Crennan JJ). Boart Longyear requires a consideration of the Scheme Creditors’ rights. Neither the mere expectation of legal costs nor the fact that Scheme Creditors would be required under the scheme to release that expectation gives rise to a relevant difference between the rights of those Scheme Creditors that have commenced proceedings and those that have not; and

(b)    Second, despite the change in approach from the First Proposed Scheme, the Revised Scheme continues to treat all Scheme Creditors equally in relation to legal costs they have incurred (whether in connection with a Proceeding or otherwise). The result of the decision not to make a separate payment for legal costs is that there is a larger pool of money available in the Scheme Fund to be distributed equally to all Scheme Creditors according to their admitted scheme claim, and it is ultimately a commercial matter for the Scheme Creditors to decide whether that is a term they are willing to accept.

Powers of attorney granted to OFML (not present in the First Proposed Scheme)

43    Four Scheme Creditors, who were plaintiffs in two of the Proceedings and who settled on a confidential basis, retain units in two of the Funds, and have appointed each Director of OFML (jointly or severally) as their attorney to vote at the Scheme Meeting on their behalf, provided that the Revised Scheme is approved on terms no less favourable than those to which they would have been entitled under the First Proposed Scheme.

44    The above matters are disclosed at section 14.5 of the Explanatory Statement. OFML proposes to “tag” the votes cast at the Scheme Meeting and report the outcome including and excluding the votes of those Scheme Creditors and how the relevant powers of attorney have been exercised at the second Court hearing.

45    The proposed approach of “tagging” the relevant votes is consistent with that adopted in other schemes: Re Boart Longyear Ltd [2017] NSWSC 567; (2017) 121 ACSR 328 at [70] (Black J).

Plaintiff and Related Entity votes

46    OFML has brought to my attention that OFML, in its capacity as trustee for various managed investment funds (the OFML Trustee Entities), holds units in several of the Funds estimated to collectively comprise 17.02% of the total amount of Scheme Creditor claims. Under the terms of the relevant trust deeds, OFML has a discretion in relation to how it will vote its scheme claim. Should the Revised Scheme be approved, any distribution of the Scheme Fund received by the OFML Trustee Entities will be distributed to the relevant beneficiaries in accordance with the terms of the applicable trust deeds.

47    In advance of the scheme meeting, the OFML Trustee Entities will write to these unitholders explaining that they intend to vote their scheme claims in favour of the Revised Scheme, and invite unitholders to provide their views.

48    The above matters are disclosed at section 14.4 of the Explanatory Statement and I am satisfied that Scheme Creditors will be voting “with their eyes open”: Re NRMA Ltd [2000] NSWSC 408; (2000) 34 ACSR 261 at [30] (Santow J).

49    To mitigate any potential unfairness associated with the OFML Trustee Entities participating as Scheme Creditors, the Plaintiff intends to tag these votes cast at the Scheme Meeting and report to the Court at the second Court hearing as to the outcome including and excluding these votes. This is consistent with the approach adopted in other schemes: Re Boart Longyear Ltd [2017] NSWSC 567; (2017) 121 ACSR 328 at [70] (Black J).

50    I considered this issue at [35]–[37] of the 2023 Judgment. No different approach is required in respect of the Revised Scheme.

Excluded Scheme Creditors

51    The following unitholders are excluded as Scheme Creditors and therefore are not eligible to participate in the Scheme or the distribution of the Scheme Fund (Excluded Scheme Creditors) as disclosed at section 9.5 of the Explanatory Statement:

(a)    I-Prosperity Capital Group Pty Ltd (In Liquidation), IPU; and I-Prosperity Australia Pty Ltd (In Liquidation) (IPG Unitholders);

(b)    Class B unitholders in the JY Hotel Fund;

(c)    each of the plaintiffs in the following proceedings brought in the Supreme Court of Victoria against One Funds Management Ltd and others, which have been settled on confidential terms:

(i)    proceeding no S ECI 2021 00105, and

(ii)    proceeding no S ECI 2021 01578;

(d)    the plaintiff in proceeding no 2020/77068 brought in the Supreme Court of NSW against Blue Whale Entertainment Pty Ltd; and

(e)    any other plaintiff in a Proceeding that has settled its claims with the Scheme Company.

52    No difficulty arises from this exclusion. It exists because the definition of Scheme Creditors uses the term “unitholders”. However, these particular unitholders would not be able to establish a claim against OFML and are expressly excluded for clarity:

(a)    the IPG Unitholders formed part of the same group as the IPG entities which were the investment managers which made the impugned investments. They could scarcely formulate a claim against OFML for its role in the making of those investments;

(b)    the Class B unitholders in the JY Hotel Fund hold an interest akin to equity in the JY Hotel Fund, would not have received a return on their investment and therefore have not suffered any loss that could be claimed against OFML;

(c)    the plaintiffs in the Federal Court Proceedings who have entered a confidential settlement agreement with OFML are no longer Scheme Creditors in respect of their unitholdings in the Glen Waverley Fund and the JY Hotel Fund, although they retain their claims against OFML to the extent they arise from units held in either the Cornerstone Bond Fund or the Cornerstone New SIV Bond Fund; and

(d)    the proceeding brought against Blue Whale Entertainment Pty Ltd has been heard and finally determined by the Supreme Court of NSW, with the result that the plaintiff in that proceeding is no longer a Scheme Creditor.

53    I considered this issue at [33]–[34] of the 2023 Judgment. No different approach is required in respect of the Revised Scheme.

Material interest of directors

54    Under the terms of the Revised Scheme, the directors and officers of OFML and its related bodies corporate will receive releases from Scheme Creditors, including in relation to ongoing Proceedings. Several of these directors and officers are named defendants in the Proceedings. This has been disclosed at section 14.1 of the Explanatory Statement.

55    I considered this issue at [38] of the 2023 Judgment. No different approach is required in respect of the Revised Scheme.

Treatment of units in the JY Hotel Fund (not present in the First Proposed Scheme)

56    The JY Hotel Fund has different classes of units and the question of priority to the funds remaining available for distribution has been the subject of proceedings. In 2024, the Court of Appeal of the Supreme Court of Victoria held that the Class C unitholders have priority in respect of the remaining funds in the JY Hotel Fund (Shao v One Funds Management Limited [2024] VSCA 231 (Shao)).

57    It became apparent during the course of the Shao proceedings that there is an unresolved issue as to whether the redemption date of the Class C units was validly extended by a resolution and, if not, the status of the Class C units issued after the date of that resolution.

58    OFML wishes to avoid any further dissipation of the funds remaining available for distribution or further delay in the distribution of those funds. OFML proposes to treat all Class C units as though they have the same redemption date for the purposes of the Revised Scheme and to treat the assets in the JY Hotel Fund accordingly, with the Revised Scheme providing a corresponding release. This would avoid the need to expend further funds on this issue and enable the remaining funds to be distributed quickly and equally among Scheme Creditors.

59    These issues and the proposed approach have been disclosed in section 13 of the Explanatory Statement. OFML submits, and I accept, that this issue does not result in Class C unitholders being in a different class for voting purposes. It does not impact the return which they would receive in their capacity as a Scheme Creditor. Like all other Scheme Creditors, the Class C unitholders release all claims which they have against the Scheme Company (and the claims that unitholders have are unlikely to be uniform in any event).

Distribution of the Scheme Meeting Materials

60    The Plaintiff seeks orders for the despatch of the Scheme Meeting Materials by 7 May 2025 (proposed order 3). The materials are comprised of the Explanatory Statement, Cover Letter, Notice of Meeting, Personalised Voting Proof of Debt Form and Personalised Proxy Form (proposed order 1(c)).

61    Noting possible foreign language difficulties, the Plaintiff proposes to provide each Creditor with a personalised form with their details pre-populated. The Plaintiff also proposes to indicate to each Scheme Creditor, on the personalised Proof of Debt form, what its calculation is of the Creditor's admitted scheme claim, but to include language making clear that the Creditor can change that amount on the form if they disagree with OFML's calculation. In the First Proposed Scheme, the forms were not personalised to this extent.

62    The Plaintiff's orders propose to make the Scheme Meeting Materials available to Scheme Creditors via a microsite, the link to which will be provided to Scheme Creditors in correspondence despatched electronically and by post. This method of despatch is different from the First Proposed Scheme, which did not use a microsite (but rather sent copies of the Scheme Meeting Materials to Scheme Creditors in hard and soft copy).

63    The Plaintiff's orders (proposed order 3(a)) contemplate that the link to the microsite will be made available to Scheme Creditors via the following methods of despatch:

(a)    in the case of Scheme Creditors who are recorded in the Plaintiff's register of unitholders as having an email address and have been receiving communications from OFML by a nominated email address, by:

(i)    sending an email to that address which contains a link to the microsite containing the Explanatory Statement and scheme documents. In that regard, the unitholder application forms held by the Plaintiff for Scheme Creditors only record email as the preferred method of communication for 55% of Scheme Creditors. The remaining 45% did not state a preference. The terms of the application forms state that, where a preference is not ticked by the unitholder, all communications will be sent by post. However, since the inception of the first of the four Funds (Cornerstone Bond Fund) in 2016, it has been the Plaintiff's customary practice to communicate with Scheme Creditors via email, including in relation to the First Proposed Scheme; and

(ii)    also sending a letter to the postal address provided by the Scheme Creditor, which contains details of how to access the microsite containing the Explanatory Statement and scheme documents; and

(b)    for the single Scheme Creditor who has not provided an email address, by sending a letter to the postal address provided by the Scheme Creditor which contains details of how to access the microsite containing the Explanatory Statement and scheme documents.

64    The Plaintiff's orders contemplate that Scheme Creditors will have the option to complete and submit their Personalised Voting Proof of Debt Form and Proxy Form on the microsite, or to download and email the forms to the Registry.

65    Having regard to Re Vita Group Limited [2023] FCA 400; (2023) 165 ACSR 576 at [36], the Plaintiff has commendably not adduced evidence of the proposed procedures to be followed by OFML and its registry to despatch the Scheme Meeting Materials and other materials because the orders sought are self-explanatory.

66    OFML intends to provide Scheme Creditors with Mandarin translations of key sections of the Explanatory Statement and the other materials in full due to the existence of a substantial proportion of Foreign Scheme Creditors (proposed order 1(c)).

Interim Suppression Order

67    The Plaintiff seeks orders under subss 37AF(1) and 37AG(1) of the Federal Court Act that Confidential Exhibit MS-5 to the Second Sutherland Affidavit be suppressed on an interim basis (proposed orders 11–13).

68    Confidential Exhibit MS-5 contains the terms on which the Participating Insurers have committed to provide the Participating Insurer Contribution (Participating Insurer Terms).

69    The Participating Insurer Terms impose a confidentiality regime as follows:

(a)    the disclosure that OFML can make about the Participating Insurer Contribution is limited in scope and confined to Scheme Creditors, ASIC and the Court; and

(b)    without the written consent of the Participating Insurers, OFML is further restrained from disclosure to any party (including Scheme Creditors, ASIC and the Court) of the identities of the Participating Insurers, the terms of the underlying insurance policies and/or the premium paid under the underlying insurance policies.

70    While the Participating Insurers have consented to the Plaintiff tendering the Participating Insurer Terms as evidence of the various commitments it has obtained, that consent is subject to OFML seeking orders at the first Court hearing to otherwise maintain the confidentiality regime imposed.

71    The following principles are relevant to the Court's consideration of whether to grant a suppression order:

(a)    the threshold which a Plaintiff must satisfy is high and there is a heavy onus of persuading the Court to make the order: Australian Competition and Consumer Commission v Valve Corporation (No 5) [2016] FCA 741 at [8] (Edelman J);

(b)    mere embarrassment, inconvenience, annoyance or unreasonable or groundless fears will not suffice to found a suppression or non-publication order: Australian Competition and Consumer Commission v Cascade Coal Pty Ltd (No 1) [2015] FCA 607; (2015) 331 ALR 68 at [30] (Foster J); and

(c)    once the Court is satisfied that an order is necessary, it would be an error not to make it. There is no exercise of discretion or balancing exercise involved: Hogan v Australian Crime Commission [2010] HCA 21; (2010) 240 CLR 651 at [32]-[33] (French CJ, Gummow, Hayne, Heydon and Kiefel JJ) (in relation to the previous s 50 of the Federal Court Act).

72    Commercial in-confidence material may form a sufficient basis for the grant of a suppression order on the ground that such an order is “necessary” to prevent “prejudice to the proper administration of justice”: ss 37AG(1)(a) and 37AF(1)(a) of the Federal Court Act; Clime Capital Limited v UGL Pty Limited (No 2) [2020] FCA 257 at [15] (Anastassiou J), and the authorities there cited.

73    In this case, a suppression order is necessary. It is sought in circumstances where the arrangements between the Plaintiff and the Participating Insurers are by their very nature confidential, and maintaining that confidentiality was necessary to OFML obtaining the Participating Insurer Contribution.

74    While there is a high bar to the Court suppressing evidence, the scope of the suppression order sought is narrow. It attaches to one confidential exhibit and would remain in place for a period of two years (subject to further order).

75    I considered this issue at [45]–[48] of the2023 Judgment. No different approach is required in respect of the Revised Scheme.

Stay of Proceedings

76    The Plaintiff seeks an order under s 411(16) of the Corporations Act that all further proceedings, actions or other civil proceedings, by or on behalf of, any of the Scheme Creditors against the Plaintiff (whether directly or indirectly) be restrained, except by leave of the Court and subject to such terms as the Court imposes (proposed order 10).

77    A Court's power to order a stay of proceedings is discretionary. As stated by Black J in Re Boart Longyear Limited [2021] NSWSC 982 at [53]:

“…[S]uch an order restrains any proceedings whether by action or other civil proceeding against the company the subject of the scheme of arrangement, whether or not such action or proceeding has already been commenced, and the purpose of such an order is to promote the orderly and efficient consideration of a scheme of arrangement: Re Glencore Nickel Pty Ltd (2003) 44 ACSR 210; [2003] WASC 18 at [67]; Re Boart Longyear Limited (2017) 318 FLR 226; [2007] NSWSC 537 at [11].”

78    A number of factors are relevant, including whether:

(a)    the scheme has been proposed, and how progressed it is;

(b)    the scheme has been disclosed to at least some of the affected creditors;

(c)    at least some scheme creditors would be better off if the scheme were approved than if it were not;

(d)    not granting a stay would result in the proceedings frustrating or seriously prejudicing the prospects of the scheme being considered and approved; and

(e)    the Pt 5.1 entity can demonstrate majority creditor support.

See Re Boart Longyear Limited [2021] NSWSC 982 at [53]–[54].

79    In the present case:

(a)    there is a genuine proposal in advanced form which warrants the Court restraining the exercise of creditors’ rights: Playcorp Pty Ltd v Venture Stores (Retailers) Pty Ltd (1992) 7 ACSR 193;

(b)    the Plaintiff has disclosed the existence of the Scheme to many of the Scheme Creditors who would be affected: Re GAE Pty Ltd [1962] VR 252, 255–256 (Sholl J). On 1 May 2025, solicitors for OFML wrote to the legal representatives of the Scheme Creditors who have present Proceedings on foot against it and its Related Entities. The correspondence to each plaintiff law firm gave the Scheme Creditors the opportunity to consider the Revised Scheme and to object to the seeking of a stay by OFML. Neither of the law firms have opposed the stay which is sought;

(c)    the Revised Scheme has the potential, if approved, to bring about a significantly better return than a winding up and to restore the company to solvency: Re Boart Longyear Limited [2017] NSWSC 537; (2017) 318 FLR 226 at [15]–[16];

(d)    timetabling orders have been made in the three extant Proceedings for the plaintiffs to put on evidence. In the event that the Revised Scheme is agreed to by the Scheme Creditors and approved by the Court, the stay would avoid those Scheme Creditors incurring costs that would ultimately be wasted; and

(e)    the stay will preserve the status quo while Scheme Creditors consider, and vote, on the Revised Scheme and, as a result, it does not cause material prejudice to any person. The stay operates on an interim basis only and does not permanently resolve any rights or interests (proposed order 10).

80    I considered this issue at [49]–[53] of the 2023 Judgment. No different approach is required in respect of the Revised Scheme.

Scheme Meeting Rules

81    Proposed order 7 seeks that, pursuant to r 3.3(2) of the Rules, the Scheme Meeting be convened, held and conducted in accordance with:

(a)    the provisions of Pt 2G.2 of the Corporations Act that apply to members of a company (with references to “members” in Pt 2G.2 modified to read “creditors”); and

(b)    the provisions of the Plaintiff's constitution,

that are not inconsistent with the Corporations Act and the orders.

82    The Plaintiff intends for the application of Pt 2G.2 of the Corporations Act to the Scheme Meeting to be subject to proposed order 8 which seeks, pursuant to r 1.3 of the Rules (and notwithstanding r 75-1 of the (IPR)), the application of specified meeting rules contained in D 75 of the IPR as prescribed or modified (as the case may be).

83    I considered this issue at [54]–[55] of the 2023 Judgment. No different approach is required in respect of the Revised Scheme.

Associate:

Dated:    13 May 2025