Further to Clayton’s judgement,

…duded again; how the memories flood in!
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Justice Gordon of the Federal Court handed down her judgment on 20 June 2011
with reasons published on 1 July 2011. Her honour found that changes to the
PIF constitution made without unitholder approval by the responsible entity of PIF,
Wellington Capital Limited (“Wellington”), were adverse to members’ rights and
therefore contrary to the Corporations Act. The amendments were made to enable
Wellington to undertake a capital raising at a price that was different to the price
that would be arrived at under the pre-existing pricing provisions in the constitution.
Ability to change pricing provisions Findings Her Honour found that, in the context
of the PIF constitution, members had a right to have additional units issued in the scheme
(to themselves or others) only at the fixed price specified in the constitution (ie $1 or NAV).

In this context, a change to enable the responsible entity to issue units at a different price was
a change in rights, and Wellington needed to be satisfied that that change was not adverse.
In her Honour’s view, this was not a case where the responsible entity had a broad-ranging
discretion to issue units at a particular price - and merely amended the constitution to record
an exercise of its discretion.
Rather it was a change to the right to have units issued in accordance with pricing provisions
in the constitution. Her Honour made orders preventing the issue of units under the rights issue
(which had not yet completed at the time proceedings were brought).

However, she refused to exercise her discretion to order that units that had been
issued under the placement were cancelled. Doing so would impact on the rights
of third parties (who had bought some of the newly issued units on market).
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So let's take stock of these "favourable judgements":

1. J Dowsett; meeting of members invalid as some very youthful & able actors were missing on Member Register;
   MR being inaccessible  was not an excuse to the learned Judge

2. J Gordon: Yes, PIF were wronged, but I will allow third parties @ $0.10

3.. CJ French,  Js Crennan, Kiefel, Bell, Gageler: In Specie to the dust bin,
but leave the original stuff-up hanging there.

4. J Perram; will this be a circuit breaker for PIF???

Regards,