mdroth/huggingface-course_section-5_zst huggingface dataset:
Case: Re Brambles Industries Ltd (2006) 59 ACSR 501
Outcome: cited
A concern raised in previous scheme of arrangement applications in this Court is that shareholders may be left in a position, once a scheme has become effective, where their shares have been transferred but where there is a delay in the provision of the Scheme Consideration and where their only remedy is to sue on the deed poll (see Re KAZ Group Ltd [2004] FCA 738 at [4] - [5] ; Re Tempo Services Ltd (2005) 53 ACSR 523 at [5]-[6]; Re SFE Corporation Ltd [2006] FCA 670 at [4] ; and Re Brambles Industries Ltd (2006) 59 ACSR 501 at [9]). Such "performance risk" has been addressed here by requiring that the Scheme Consideration be paid to APN before 8.00 am on the implementation date to be held by it in trust for the purpose of being paid, free of deductions, to the Scheme participants before they are divested of their shares in APN later on the implementation date. This is provided for in the Deed Poll. Disadvantages and Risks
Case: Re KAZ Group Ltd [2004] FCA 738
Outcome: cited
A concern raised in previous scheme of arrangement applications in this Court is that shareholders may be left in a position, once a scheme has become effective, where their shares have been transferred but where there is a delay in the provision of the Scheme Consideration and where their only remedy is to sue on the deed poll (see Re KAZ Group Ltd [2004] FCA 738 at [4] - [5] ; Re Tempo Services Ltd (2005) 53 ACSR 523 at [5]-[6]; Re SFE Corporation Ltd [2006] FCA 670 at [4] ; and Re Brambles Industries Ltd (2006) 59 ACSR 501 at [9]). Such "performance risk" has been addressed here by requiring that the Scheme Consideration be paid to APN before 8.00 am on the implementation date to be held by it in trust for the purpose of being paid, free of deductions, to the Scheme participants before they are divested of their shares in APN later on the implementation date. This is provided for in the Deed Poll. Disadvantages and Risks
Case: Re Mincom Ltd (2007) 25 ACLC 163
Outcome: discussed
In Re Mincom Ltd (2007) 25 ACLC 163, Fryberg J described (at [39]) a deemed warranty clause almost identical to the present one as: onerous, unreasonable and calculated to catapult unsuspecting shareholders who have not read the small print of the arrangement in the schedule to the explanatory statement into a state of breach of warranty. As will be clear from what I have said above, I respectfully disagree. At first blush the deemed warranty may appear to attract criticism along these lines, but I think the criticism disappears once it is appreciated that its purpose and effect are as I have described them. Perhaps a better way of framing the provision would have been to avoid the language of warranty, and, instead, to provide simply that if shares continue to be subject to encumbrances after transfer, the shareholder would, upon demand by INMAL, pay the amount required to discharge the encumbrance to the encumbrancee if the encumbrance remains outstanding, or to INMAL if INMAL had already discharged it. 63 On the hearing I indicated that I would require the attention of Scheme participants to be drawn to the existence of the deemed warranty in the Scheme by a specific mention of it in section 2.4 ("Assessment of the Scheme" "Other Relevant Considerations") of the Scheme Booklet. Accordingly, a new cl 2.4(c) will state: Deemed warranty Shareholders' attention is drawn to the warranties that Scheme Participants will be deemed to have given, if the Scheme takes effect, in clause 3.4 of the Scheme (see page 283).
Case: Re National Can Industries Ltd (No 1) (2003) 48 ACSR 409 
Outcome: discussed
The Takeovers Panel has had occasion to consider break fees in the context of takeovers under Ch 6 of the Act : see the discussion in Renard IA and Santamaria JG , Takeovers and Reconstruction in Australia (Butterworths, looseleaf service) at [1149], esp at 11,173 ff. Break fees were considered by the Panel in Re Normandy Mining Ltd (No 3) (2002) 20 ACLC 471; Re Ballarat Goldfields NL (2002) 41 ACSR 691; and Re National Can Industries Ltd (No 1) (2003) 48 ACSR 409 (" National Can "). In National Can , the review panel stated (at 434 [33]): We consider that a 1% fee is usually not materially anti-competitive and does not place unreasonable pressure on shareholders. This is the basis for the choice of the 1% guideline in GN7. Further, we query whether a sunk cost is anti-competitive if shareholders reject the scheme and agree with the initial panel's statement [made earlier at 418 [42]]: "In these circumstances, we do not entirely reject the notion that a fee should be payable if and when a proposal the directors endorsed was rejected by shareholders. As GN7 puts it, such a fee may be an appropriate price to secure an opportunity broadly in the nature of an option [GN7 at para 7.21]".
Case: Re Normandy Mining Ltd (No 3) (2002) 20 ACLC 471 
Outcome: cited
The Takeovers Panel has had occasion to consider break fees in the context of takeovers under Ch 6 of the Act : see the discussion in Renard IA and Santamaria JG , Takeovers and Reconstruction in Australia (Butterworths, looseleaf service) at [1149], esp at 11,173 ff. Break fees were considered by the Panel in Re Normandy Mining Ltd (No 3) (2002) 20 ACLC 471; Re Ballarat Goldfields NL (2002) 41 ACSR 691; and Re National Can Industries Ltd (No 1) (2003) 48 ACSR 409 (" National Can "). In National Can , the review panel stated (at 434 [33]): We consider that a 1% fee is usually not materially anti-competitive and does not place unreasonable pressure on shareholders. This is the basis for the choice of the 1% guideline in GN7. Further, we query whether a sunk cost is anti-competitive if shareholders reject the scheme and agree with the initial panel's statement [made earlier at 418 [42]]: "In these circumstances, we do not entirely reject the notion that a fee should be payable if and when a proposal the directors endorsed was rejected by shareholders. As GN7 puts it, such a fee may be an appropriate price to secure an opportunity broadly in the nature of an option [GN7 at para 7.21]".
Case: Re SFE Corporation Ltd [2006] FCA 670
Outcome: discussed
A concern raised in previous scheme of arrangement applications in this Court is that shareholders may be left in a position, once a scheme has become effective, where their shares have been transferred but where there is a delay in the provision of the Scheme Consideration and where their only remedy is to sue on the deed poll (see Re KAZ Group Ltd [2004] FCA 738 at [4] - [5] ; Re Tempo Services Ltd (2005) 53 ACSR 523 at [5]-[6]; Re SFE Corporation Ltd [2006] FCA 670 at [4] ; and Re Brambles Industries Ltd (2006) 59 ACSR 501 at [9]). Such "performance risk" has been addressed here by requiring that the Scheme Consideration be paid to APN before 8.00 am on the implementation date to be held by it in trust for the purpose of being paid, free of deductions, to the Scheme participants before they are divested of their shares in APN later on the implementation date. This is provided for in the Deed Poll. Disadvantages and Risks 43 Provisions for the payment of break fees are not uncommon in agreements for schemes of arrangements and in merger and takeover agreements, both in Australia and overseas. Such provisions have not been an obstacle to the making of orders under s 411(1) of the Act for the convening of meetings. In Re SFE Corporation Ltd [2006] FCA 670 at [6] - [7] , Gyles J said that he would be dissuaded from making an order by a break fee only if the amount was of such magnitude that it could influence voting or if there were some other unusual circumstances. 44 Break fees are justified by reference to: &#8226; the costs incurred by the offeror company; &#8226; the benefit that that company confers on the members of the target company by increasing its value; and &#8226; the desirability, from the viewpoint of those members, that takeover offers be made to them. 45 Clearly, a company making an approach to the board of a target company is entitled to stipulate as a term of its offer that the target company agree to a provision for a break fee. It is entitled to inform that board that if it does not agree to the break fee, the offer will not be made to the target company's shareholders, and it is entitled not to make the offer to the target's shareholders, if its board does not agree to the break fee. The question is what is the appropriate response of the target company's directors, and later of the Court.
Case: Re Stork ICM Australia Pty Ltd (2006) 25 ACLC 208
Outcome: cited
Senior counsel for the plaintiff raised the question whether I should take into account at the first hearing stage the position of creditors of APN. In the absence of unusual circumstances (none are obvious here), I do not think I should. Senior counsel acknowledged that it would remain open to the Court to consider the position of creditors as relevant to the Court's discretion to approve the Scheme at the second court hearing, as happened in Re Stork ICM Australia Pty Ltd (2006) 25 ACLC 208. 65 The Australian Securities and Investments Commission has provided the "usual letter" that it provides in relation to schemes of arrangement of the present kind, to the effect that it has had the opportunity to review the Scheme Booklet and does not propose to appear at the first court hearing. As is its practice in such cases, ASIC does not issue a "no objection" statement under s 411(17) of the Act until the second court hearing. 66 Helpfully, APN's legal advisers have provided a "checklist" that identifies the requirements of the Act and the Corporations Regulations 2001 (Cth) ("the Regulations ") with respect to information required to be included in the explanatory statement. The checklist refers to those parts of the Scheme Booklet that constitute the information required by s 411(3) and s 412(1)(a) of the Act , and by the Regulations , Sch 8, Pt 3 ("Prescribed information relating to proposed compromise or arrangement with members or a class of members").
Case: Re Tempo Services Ltd (2005) 53 ACSR 523
Outcome: cited
A concern raised in previous scheme of arrangement applications in this Court is that shareholders may be left in a position, once a scheme has become effective, where their shares have been transferred but where there is a delay in the provision of the Scheme Consideration and where their only remedy is to sue on the deed poll (see Re KAZ Group Ltd [2004] FCA 738 at [4] - [5] ; Re Tempo Services Ltd (2005) 53 ACSR 523 at [5]-[6]; Re SFE Corporation Ltd [2006] FCA 670 at [4] ; and Re Brambles Industries Ltd (2006) 59 ACSR 501 at [9]). Such "performance risk" has been addressed here by requiring that the Scheme Consideration be paid to APN before 8.00 am on the implementation date to be held by it in trust for the purpose of being paid, free of deductions, to the Scheme participants before they are divested of their shares in APN later on the implementation date. This is provided for in the Deed Poll. Disadvantages and Risks
Case: Re WebCentral Group Ltd (No 2) (2006) 58 ACSR 742
Outcome: distinguished
Clause 3.4 is not a "no encumbrances" provision of the kind considered in Re WebCentral Group Ltd (No 2) (2006) 58 ACSR 742 at [14]-[22] because it cannot give the impression to encumbrancees that their security over the shares is being adversely affected by the transfer. Indeed, it assumes that the shares may be transferred subject to encumbrances, to the detriment of INMAL. 59 In substance, the purpose of the deemed warranty is to prevent a shareholder whose shares are subject to encumbrances from receiving the same Scheme Consideration as that to be received by those whose shares are free from encumbrances, without any obligation, in effect, to refund to INMAL the amount required to discharge the encumbrance. It is not practicable for amounts secured by encumbrance to be deducted from the Scheme Consideration payable to the relevant Scheme participants on the implementation date. 60 The warranty will be deemed to have been given, not only by those Offeree Shareholders who vote to agree to the Scheme, and who, therefore, can be seen to be consenting to give it, but also those who do not vote at all or who vote against the Scheme. However, I do not think that this matters. What is important, in my view, is that the deemed warranty is no more than a device directed to ensuring that a Scheme participant whose shares are subject to an encumbrance is not unfairly advantaged. The amount of the damages payable for breach of the warranty is the amount required to discharge the encumbrance.
Case: Commissioner of Taxation v Mercantile Mutual Insurance (Workers' Compensation) Ltd [1999] FCA 351 ; (1999) 87 FCR 536
Outcome: referred to
The circumstances in which outgoings or losses will be seen as incurred in any year of income have been discussed in numerous cases. Recently, Lindgren J in Merrill Lynch International (Australia) Limited v Commissioner of Taxation [2001] FCA 1127 ; (2001) 47 ATR 611 undertook a careful analysis of the course of authority from New Zealand Flax Investments Ltd v Federal Commissioner of Taxation [1938] HCA 60 ; (1938) 61 CLR 179 to Commissioner of Taxation v Mercantile Mutual Insurance (Workers' Compensation) Ltd [1999] FCA 351 ; (1999) 87 FCR 536. Since 2001, the Full Court of this Court and the High Court has each undertaken an analysis of the relevant authorities in CityLink Melbourne Limited v Commissioner of Taxation [2004] FCAFC 272 ; (2004) 141 FCR 69 and Commissioner of Taxation v CityLink Melbourne Limited [2006] HCA 35 ; (2006) 228 CLR 1.
Case: Commissioner of Taxation v Woolcombers (WA) Pty Limited [1993] FCA 631 ; (1993) 47 FCR 561
Outcome: discussed
In particular, reliance was placed on the judgments of Lee J at first instance and of the Full Court in the Woolcombers case : Woolcombers (WA) Pty Limited v Commissioner of Taxation [1993] HCA 69 ; 93 ATC 4 ,342 (Lee J) and Commissioner of Taxation v Woolcombers (WA) Pty Limited [1993] FCA 631 ; (1993) 47 FCR 561 (Full Court) and on the Full Court judgment in Commissioner of Taxation v Raymor (NSW) Pty Limited [1990] FCA 193 ; (1990) 24 FCR 90.
Case: Ibrahim v Pham [2007] NSWCA 215
Outcome: cited
In due course, on 17 February 2006, a Judge of this Court (Goldberg J) made a declaration that the scheme was a managed investment scheme that was required to be registered under the Corporations Law and the Corporations Act 2001 (Cth), but was not registered. The Court ordered that the scheme be wound up pursuant to s 601EE(1) of the Corporations Act . The Court also ordered that an independent accountant's report be filed. The consequence of the failure to register the scheme was that a contract entered into by a person other than the offeror for the scheme to subscribe for an interest was voidable at the option of that person by notice in writing: s 601MB(1) of the Corporations Law (as at June 1999); Ibrahim v Pham [2007] NSWCA 215 ; Karl Suleman Enterprizes Pty Limited (in liq) v Babanour [2004] NSWCA 214 ; (2004) 49 ACSR 612 ; and Mier v FN Management Pty Limited [2006] 1 Qd R 339 at 345-346 [10].
Case: J Rowe and Son Pty Limited v Commissioner of Taxation (Cth) (1971) 124 CLR 421 
Outcome: referred to
These comments were made in the context of derivation of income on an accruals basis, a different though obviously cognate subject matter from the notion of incurring in s 51(1) or s 8-1. In the context of Carden's Case (Commissioner of Taxes (SA) v Executor Trustee and Agency Co of South Australia Ltd [1938] HCA 69 ; (1938) 63 CLR 108) and J Rowe and Son Pty Limited v Commissioner of Taxation (Cth) (1971) 124 CLR 421 and in the absence of evidence about business or accounting practice, von Doussa J said (at 79) that stress should be placed on the prominence given in both Carden and Rowe to there being a debt in existence . von Doussa J rejected the approach of the Administrative Appeals Tribunal which had seen no distinction between a sale and delivery and giving time to pay by way of credit, on the one hand, and a contract such as the one there to buy land to be paid for at settlement on the other. von Doussa J said at 79-80: With respect to the Tribunal, I am unable to agree that there is no difference in the present case from a Department store sale of articles on 30 days terms. In that example there has been a delivery of the articles sold. The contract of sale is no longer executory. A debt has accrued due; the debtor has become subject to an obligation to pay a sum certain in money even though the debt may not be payable forthwith: cf Carden at 127. [emphasis added] Notions of loss of dispositive power over the goods were also important: see Gasparin 50 FCR at 81. 67 In Raymor, the Commissioner argued that where an outgoing was incurred for trading stock, the stock must be on hand at the end of the year of income. This mirrored when the income was derived from disposal of trading stock: J Rowe and Son 124 CLR 421. The Commissioner argued that the outgoings were properly to be regarded as characterised as having been incurred in the year of income not for trading stock or in the purchase of trading stock, but for the right to acquire trading stock on capital account. Having referred to the principles dealing with "incurred" (see above), the Court concluded that the outgoing was incurred in the year of income, saying at 97: It follows, therefore, that at the point of time at which the respondent bound itself as a party to each of the contracts, and so became committed to pay the amount shown in each contract to MML, it incurred the respective amount, notwithstanding that its obligation could be increased or reduced under the rise and fall provisions of the contract: cl 8. Payment thereafter was strictly irrelevant to the time at which the outgoing was incurred . It merely operated to discharge in the year of income the outgoing already incurred in that year. In this sense it is strictly incorrect to speak of the payment here in question as a prepayment. A presently existing obligation had arisen and had been discharged. [emphasis added]
Case: Karl Suleman Enterprizes Pty Limited (in liq) v Babanour [2004] NSWCA 214 ; (2004) 49 ACSR 612
Outcome: cited
In due course, on 17 February 2006, a Judge of this Court (Goldberg J) made a declaration that the scheme was a managed investment scheme that was required to be registered under the Corporations Law and the Corporations Act 2001 (Cth), but was not registered. The Court ordered that the scheme be wound up pursuant to s 601EE(1) of the Corporations Act . The Court also ordered that an independent accountant's report be filed. The consequence of the failure to register the scheme was that a contract entered into by a person other than the offeror for the scheme to subscribe for an interest was voidable at the option of that person by notice in writing: s 601MB(1) of the Corporations Law (as at June 1999); Ibrahim v Pham [2007] NSWCA 215 ; Karl Suleman Enterprizes Pty Limited (in liq) v Babanour [2004] NSWCA 214 ; (2004) 49 ACSR 612 ; and Mier v FN Management Pty Limited [2006] 1 Qd R 339 at 345-346 [10].
Case: Mier v FN Management Pty Limited [2006] 1 Qd R 339
Outcome: cited
In due course, on 17 February 2006, a Judge of this Court (Goldberg J) made a declaration that the scheme was a managed investment scheme that was required to be registered under the Corporations Law and the Corporations Act 2001 (Cth), but was not registered. The Court ordered that the scheme be wound up pursuant to s 601EE(1) of the Corporations Act . The Court also ordered that an independent accountant's report be filed. The consequence of the failure to register the scheme was that a contract entered into by a person other than the offeror for the scheme to subscribe for an interest was voidable at the option of that person by notice in writing: s 601MB(1) of the Corporations Law (as at June 1999); Ibrahim v Pham [2007] NSWCA 215 ; Karl Suleman Enterprizes Pty Limited (in liq) v Babanour [2004] NSWCA 214 ; (2004) 49 ACSR 612 ; and Mier v FN Management Pty Limited [2006] 1 Qd R 339 at 345-346 [10].
Case: Perri v Coolangatta Investments Pty Limited [1982] HCA 29 ; (1982) 149 CLR 537 
Outcome: referred to
The above said, there was nothing qualified or inchoate about the promise in special condition 11 of the contract. There was no condition precedent to the coming into existence of the promise there stated. It was, from exchange of contracts, a legal obligation intended to have effect; but it is to be construed (as its words make plain) as an obligation to pay a certain time after tender of the transfer on settlement. After the contract was made, it was a promise that was part of an executory contract, but, of course, it could not be withdrawn. The point of the above authorities is that until delivery (here, of the transfer) there is no accrued obligation to pay, no debt. What exists beforehand is a promise to pay, but in one sense dependent or conditional upon delivery. Delivery can, perhaps, be seen as the condition precedent to performance (cf Perri v Coolangatta Investments Pty Limited [1982] HCA 29 ; (1982) 149 CLR 537). The use, however, of the words "conditional" or "unconditional" in this context is apt to cause confusion. A better way of expressing the analysis from the above cases is that the mutual promises (here, to build and transfer, on the one hand, and to pay, on the other) are unconditional, but dependent, and calling for concurrent performance. Neither promise was conditional on a contingency; they were mutually dependent: see generally Carter JW and Harland DJ, Contract Law in Australia (4 th ed, Butterworths, 2002) at [742], [1807] and [1808]. 51 It is necessary to seek to place this analysis into the context of the words of s 8-1 and their surrounding jurisprudence. 52 Section 8-1(1) of the 1997 Act is, relevantly, in the following terms: You can deduct from your assessable income any loss or outgoing to the extent that: (a) it is incurred in gaining or producing your assessable income; or (b) it is necessarily incurred in carrying on a business for the purpose of gaining or producing your assessable income. [emphasis added]
Case: Ruddenklau v Charlesworth [1925] NZLR 161
Outcome: referred to
The proper identification of this promise and its relationship to the payment of the purchase price is to be found in a number of cases of the highest authority. In McDonald v Dennys Lascelles Ltd [1933] HCA 25 ; (1933) 48 CLR 457 at 475-476, Dixon J (as he then was) quoted Sir John Salmond in Ruddenklau v Charlesworth [1925] NZLR 161 at 164-165 in expressing the relevant principle: If the purchaser refuses to complete the executory contract to buy the land, the vendor is not entitled to sue for the purchase money as a debt . He is entitled to sue for specific performance or for damages for the loss of his bargain. [emphasis added] Sir John Salmond continued: It is only when the contract has been completed by the execution and acceptance of a conveyance that unpaid purchase money may become a debt and can be recovered accordingly. [emphasis added] This general rule could be rebutted by clear intention in the contract for the payment of the purchase price, or part of it, on a fixed day, other than the day for completion.