Commonwealth Bank of Australia ACN 123 123 124, in the matter of [2005] FCA 1940

Commonwealth Bank of Australia ACN 123 123 124, in the matter of [2005] FCA 1940

Because the possible invalidity arose from gaps in ASIC relief and inadvertent non-compliance with exemption conditions, because APRA did not object and ASIC did not oppose the orders if satisfied as to future compliance, and because invalidity would cause extraordinary inconvenience to the plaintiffs and unidentifiable members of the public while no substantial injustice had been or was likely to be caused, it was just and equitable to make the validation orders under s 1322(4).

Jurisdiction
Australia
Judgment Date
12 December 2005
Procedural Posture
Application for Orders Under S 1322(4) of the Corporations Act 2001 (cth) Concerning the Operation of S 259 C / Reasons for Judgment and Orders
Outcome
Application granted; orders made under s 1322(4) declaring the relevant issues or transfers were not invalid by reason of s 259C.
Legal Topics
['validation of Share Issues or Transfers' 'controlled Entities Holding Shares in Holding Company' 'asic Exemptions Under S 259 C(2)' 'statutory Funds' 'managed Investment Schemes']
['corporations Law' 'financial Services Regulation' 'life Insurance'] ['validation of Share Issues or Transfers' 'controlled Entities Holding Shares in Holding Company' 'asic Exemptions Under S 259 C(2)' 'statutory Funds' 'managed Investment Schemes']

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Procedural Posture

Application for Orders Under S 1322(4) of the Corporations Act 2001 (cth) Concerning the Operation of S 259 C / Reasons for Judgment and Orders

Legal Issues

  1. 1 ['Whether issues or transfers of shares or units of shares of Commonwealth Bank of Australia to, or in trust for, controlled entities or relevant statutory funds were void by reason of s 259C(1) of the Corporations Act 2001 (Cth).' 'Whether the Court should make orders under s 1322(4) declaring that the relevant issues or transfers were not invalid despite gaps in exemptions or failures to comply with exemption conditions.' 'Whether the requirements in s 1322(6), including that it be just and equitable and that no substantial injustice has been or is likely to be caused, were satisfied.']

Ratio Decidendi

Because the possible invalidity arose from gaps in ASIC relief and inadvertent non-compliance with exemption conditions, because APRA did not object and ASIC did not oppose the orders if satisfied as to future compliance, and because invalidity would cause extraordinary inconvenience to the plaintiffs and unidentifiable members of the public while no substantial injustice had been or was likely to be caused, it was just and equitable to make the validation orders under s 1322(4).

Court Disposition

Application granted; orders made under s 1322(4) declaring the relevant issues or transfers were not invalid by reason of s 259C.

Orders

  • ['Pursuant to subsection 1322(4) of the Corporations Act, issues or transfers of shares or units of shares of the First Plaintiff to, or in trust for, the statutory funds of the Second Plaintiff carrying on the life insurance business of providing investment-linked benefits, including shareholders retained profits...