Scheuer (Trustee) v Endless Solar Corporation Limited

• Jurisdiction: Australia Federal only
• Court: Federal Court
• Judgment Date: 29 March 2023
• Neutral Citation: [2023] FCA 299
• Date: 29 March 2023

Federal Court of Australia

Scheuer (Trustee) v Endless Solar Corporation Limited [2023] FCA 299

File number(s):	VID 187 of 2023
Judgment of:	O'BRYAN J
Date of judgment:	29 March 2023
Date of publication:	3 April 2023
Catchwords:	CORPORATIONS – application to restrain the conduct of a purported meeting of the shareholders of the third defendant and for the creation or correction of the share register of the third defendant ; PRACTICE AND PROCEDURE – interlocutory application to restrain the conduct of a purported meeting of the shareholders of the third defendant – prima facie case that the notice of meeting not sent to all of the shareholders of the third defendant, that insufficient notice given of meeting and defects in the proxy forms sent to shareholders – balance of convenience favours meeting being restrained – injunction granted
Legislation:	Corporations Act 2001 (Cth), s 105, Div 2, Pt 1.2AA, ss 110E, 110F, 168, 201M, 231, 249F, 249G, Div 3, Pt 2G.2, ss 249H, 249J, 250B, 442A, 601AB, 601AH
Cases cited:	Australian Broadcasting Corporation v O’Neill (2006) 227 CLR 57 Australian Competition and CONSUMER Commission v IVF Finance Pty Limited (No 2) [2021] FCA 1295 Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618 Bradto Pty Ltd v Victoria (2006) 15 VR 65 Central Exchange Ltd v Rivkin Financial Services Ltd [2004] FCA 1546; 213 ALR 771 McLaughlin v Dungowan Manly Pty Ltd [2010] NSWSC 187 Samsung Electronics Company Ltd v Apple Inc (2011) 217 FCR 238
Division:	General Division
Registry:	Victoria
National Practice Area:	Commercial and Corporations
Sub-area:	Corporations and Corporate Insolvency
Number of paragraphs:	45
Date of hearing:	29 March 2023
Counsel for the Plaintiff:	O Bigos KC with P E Annabell
Solicitors for the Plaintiff:	Altus Lawyers
Solicitor for the First Defendant:	R J True, Quinn Emanuel Urquhart & Sullivan, LLP

ORDERS

		VID 187 of 2023
BETWEEN:	NATHAN JOSEPH (NICK) SCHEUER (IN HIS PERSONAL CAPACITY AND IN HIS CAPACITY AS TRUSTEE OF THE ASHER & WALD TRUST) Plaintiff
AND:	ENDLESS SOLAR CORPORATION LIMITED (ACN 122 708 061) First Defendant ; HARVARD NOMINEES PTY LTD (ACN 006 419 601) Second Defendant ; SPEEDPANEL AUSTRALIA LTD (ACN 107 723 240) Third Defendant

order made by:	O'BRYAN J
DATE OF ORDER:	29 March 2023

THE COURT NOTES the undertaking of the plaintiff given by its counsel:

1. to submit to such order (if any) as the Court may consider to be just for the payment of compensation, (to be assessed by the Court or as it may direct), to any person, (whether or not that person is a party), affected by the operation of order 1 or any continuation (with or without variation) of the order; and

2. to pay the compensation referred to in (a) to the person affected by the operation of the order or undertaking.

THE COURT ORDERS THAT:

1. Until the hearing and determination of this proceeding or further order, the first and second defendants, whether by themselves, their officers, servants or agents, be restrained from arranging to hold, holding or purporting to hold the general meeting of the third defendant which is scheduled for 30 March 2023 at 11am.

2. This proceeding be case managed together with NSD 172 of 2023 (Reinstatement Proceeding).

3. This proceeding and the Reinstatement Proceeding be listed for further case management on a date to be fixed and notified to the parties.

4. Costs be reserved.

5. There be liberty to apply.

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

REASONS FOR JUDGMENT

O’BRYAN J:

Introduction

1. On 28 March 2023, the plaintiff (Nathan Joseph (Nick) Scheuer, in his personal capacity and in his capacity as trustee of the Asher & Wald Trust) filed an originating process seeking relief against the first defendant, Endless Solar Corporation Limited (Endless Solar), and the second defendant, Harvard Nominees Pty Ltd (Harvard). The relief concerns the third defendant, Speedpanel Australia Ltd (SPA). In broad terms, Mr Scheuer sought the following orders:

1. interlocutory and final injunctions restraining Endless Solar and Harvard from arranging to hold, holding or purporting to hold a general meeting of SPA which was scheduled for 30 March 2023 at 11am;

2. interlocutory and final injunctions restraining Endless Solar and Harvard from arranging to hold, holding or purporting to hold any general meeting of SPA unless and until the register of members of SPA has been created or alternatively corrected;

3. a declaration that the purported notice of meeting of the members of SPA given by Endless Solar and Harvard on or about 9 March 2023 was invalid;

4. a declaration that there is no register of members of SPA; and

5. orders for the creation, or alternatively the correction, of the register of members of SPA, as revealed by, and as a result of, a proper investigation by forensic accountants engaged by SPA, or otherwise as found by the Court.

2. On the same day, Mr Scheuer also filed an interlocutory process seeking an urgent interlocutory injunction restraining Endless Solar and Harvard from arranging to hold, holding or purporting to hold the general meeting of SPA which was scheduled for 30 March 2023 at 11am. The interlocutory application was supported by:

1. an affidavit sworn on 28 March 2023 by Mr Scheuer; and

2. an affidavit sworn on 28 March 2023 by Brendan Peter Swift of Altus Lawyers, being Mr Scheuer’s solicitor.

3. Mr Swift’s affidavit annexed the first affidavit affirmed on 1 March 2023 by Robert James True, a solicitor employed by Quinn Emanuel Urquhart & Sullivan, LLP, the solicitors for Endless Solar, which had been read in proceeding NSD 172 of 2023. In that proceeding, Endless Solar sought and was granted orders reinstating the registration of SPA (Reinstatement Proceeding).

4. Mr Scheuer also filed written submissions in support of the interlocutory application prepared by his counsel, Dr Bigos KC and Mr Annabell.

5. The interlocutory application was heard by me on 29 March 2023 in the Commercial and Corporations duty list.

6. Mr True appeared on behalf of Endless Solar at the interlocutory hearing to oppose the interlocutory relief sought by Mr Scheuer. Mr True informed the Court that both Endless Solar and Harvard are companies associated with Mr David Craig, who provides instructions to Mr True’s firm, Quinn Emanuel Urquhart & Sullivan, LLP. However, as at the time of the hearing, Mr True did not hold a retainer from Harvard. Endless Solar tendered the following further affidavits which had been read in the Reinstatement Proceeding:

1. the affidavit sworn on 1 March 2023 by David Harold Allen Craig, a director of Endless Solar;

2. the second affidavit affirmed on 1 March 2023 by Mr True; and

3. the third affidavit affirmed on 1 March 2023 by Mr True.

7. At the hearing on 29 March 2023, I granted the interlocutory relief sought by Mr Scheuer and made orders for the further case management of the proceeding. These are my reasons for making those orders.

Background

8. The proceeding involves an unusual set of circumstances. The evidence on the interlocutory application discloses the following facts.

9. SPA was originally registered on 22 January 2004, having been founded by Mr Scheuer. Its business comprised products for the construction of walls, using...