Bonham v Iluka Resources Limited [2015] FCA 713

Bonham v Iluka Resources Limited [2015] FCA 713

The application for preliminary discovery failed because the evidence and available inferences did not establish an objectively reasonable basis for Mr Bonham to believe that Iluka's 8 May 2012 guidance was misleading or deceptive, was made without reasonable grounds, or that Iluka breached continuous disclosure obligations before the relevant disclosure on 9 July 2012. The matters advanced amounted to conjecture, suspicion or hindsight reasoning rather than reasonable belief. The Court also found that the application would have failed because evidence did not establish Mr Bonham's own requisite belief, and discretionary considerations arising from ACA Lawyers' public statements would in...

Jurisdiction
Australia
Judgment Date
15 July 2015
Procedural Posture
Application for Preliminary Discovery Under R 7.23 of the Federal Court Rules 2011 (cth) / Judgment on Application
Outcome
Application dismissed.
Legal Topics
['preliminary Discovery' 'reasonable Belief of Right to Relief' 'misleading or Deceptive Conduct' 'representations as to Future Matters' 'continuous Disclosure Obligations' 'shareholder Class Action' 'discretion to Refuse Preliminary Discovery']
['practice and Procedure' 'corporations Law' 'consumer Law' 'securities Litigation'] ['preliminary Discovery' 'reasonable Belief of Right to Relief' 'misleading or Deceptive Conduct' 'representations as to Future Matters' 'continuous Disclosure Obligations' 'shareholder Class Action' 'discretion to Refuse Preliminary Discovery']

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Procedural Posture

Application for Preliminary Discovery Under R 7.23 of the Federal Court Rules 2011 (cth) / Judgment on Application

Legal Issues

  1. 1 ['Whether the prospective applicant reasonably believed that he may have the right to obtain relief in the Court against Iluka.' "Whether an objectively reasonable basis existed to believe that Iluka's 8 May 2012 market guidance was misleading or deceptive or made without reasonable grounds." 'Whether an objectively reasonable basis existed to believe that Iluka breached continuous disclosure obligations before the prospective applicant purchased shares or before 9 July 2012.' "Whether evidence of the prospective applicant's own belief was required under r 7.23." "Whether discretionary considerations, including statements by the prospective applicant's solicitors implying that a class action would be commenced, warranted refusal of preliminary discovery."]

Ratio Decidendi

The application for preliminary discovery failed because the evidence and available inferences did not establish an objectively reasonable basis for Mr Bonham to believe that Iluka's 8 May 2012 guidance was misleading or deceptive, was made without reasonable grounds, or that Iluka breached continuous disclosure obligations before the relevant disclosure on 9 July 2012. The matters advanced amounted to conjecture, suspicion or hindsight reasoning rather than reasonable belief. The Court also found that the application would have failed because evidence did not establish Mr Bonham's own requisite belief, and discretionary considerations arising from ACA Lawyers' public statements would in...

Court Disposition

Application dismissed.

Orders

  • ['The application for preliminary discovery be dismissed.' "The prospective applicant must pay the prospective respondent's costs in respect of these proceedings."]