Chameleon Mining NL v International Litigation Partners Pte Limited [2010] NSWSC 972

Reported Decision : 79 ACSR 462

New South Wales Supreme Court

CITATION : Chameleon Mining NL v International Litigation Partners Pte Limited [2010] NSWSC 972 This decision has been amended. Please see the end of the judgment for a list of the amendments.

HEARING DATE(S) : 17, 18, & 19 August 2010

JUDGMENT DATE : 31 August 2010

JUDGMENT OF : Hammerschlag J

DECISION : Plaintiff's purported rescision ineffective. Event of Default under the Charge established. Receivers validly appointed. The Funder's entitlement limited to right to immediate payment of the Early Termination Fee upon Change in Control.

CATCHWORDS : CORPORATIONS – Corporations Act 2001 (Cth) sections 761D, 761E, 763A, 763B, 763C, 764A, 766A, 766C, 765A, 924A, 925A – under a litigation funding deed ("the Deed") the first defendant agreed to fund litigation by the plaintiff on specified terms and conditions – the plaintiff purported to rescind it relying on provisions of the Corporations Act 2001 (Cth) which enable it to do so if the arrangement constitutes the issue of a financial product by a person not licensed to do so – the first defendant does not hold an Australian financial services licence – whether the arrangement is a financial product as defined – whether it is a derivative – whether under it the first defendant manages financial risk – held the arrangement is not a financial product and the plaintiff was not entitled to rescind it - CONTRACTS – construction of commercial contracts – Deed provides that on Resolution of the funded proceedings the first defendant funder is entitled to share in any Resolution Sum paid and to repayment of the Legal Costs funded ("the Funding Fee") – Deed also provides for the payment to it of an Early Termination Fee upon a Change in Control of the plaintiff – a Change in Control occurred – common cause that if the Deed is on foot the first defendant is entitled to the Early Termination Fee – whether on the proper construction of the instrument the funder is entitled also to the Funding Fee – held the first defendant is not entitled to the Funding Fee as well