Not only was the fine print in the agreements hard to read, but the misleading and deceptive statements baout beneficial ownership on the website and in the marketing brochures meant it was totally impossible to fully understand.
Clients on legal seesaw with Opes, ANZBrought to you by Font Size: Decrease Increase Print Page: Print Susannah Moran | April 17, 2008
TWO Opes Prime clients were successful yesterday afternoon in stopping the ANZ Bank from selling millions of shares they say belong to them, just hours after a judge had ruled the bank could dispose of the stock.
An appeal will be held tomorrow to decide if ANZ can sell the shares ahead of a final hearing into whether Melewar Steel Ventures and Conquest Mining managing director John Terpu were misled by Opes.
Mr Terpu told The Australian yesterday he believed he had a trading account with Opes and had never borrowed any money against the 7 million Conquest Mining shares now held by ANZ.
"I have not even transacted on the account, and I have lost it all," Mr Terpu said.
NSW Supreme Court judge William Windeyer yesterday morning ruled ANZ could sell 8.5million shares in Gindalbie Metals and 14 million shares in Conquest Mining, saying that monetary damages would be an adequate remedy if Melewar and Mr Terpu were ultimately successful in their claim that Opes had engaged in misleading and deceptive conduct.
Justice Windeyer said there was a serious case to be tried. "There is no doubt the documents are difficult to understand," he said.
"Terms such as lender and borrower would appear to an unsophisticated person to refer to the party to which they do not refer - in other words the lender is the lender of shares, not the provider of funds."
However, Justice Windeyer said that the documents, if read carefully, state that the transfer of legal title is involved.
But even after closely reading the documents a "lender" "could well be surprised" to find that Opes and ANZ could then lend - but really transfer - the shares on to others to enable them to short-sell shares in the company "with the intention of running down the value of shares so as to make a profit", he said.
"Such a person would, no doubt, be even more surprised, if that were possible, to realise that the result of this short-selling ... was intended to drive down the (share) price with the inevitable result that a liability, equivalent to a margin call, would result."
The judge said he did not think, at this stage of the case, that it was in the "best interests of justice" to move the case to Victoria, where the Federal Court is hearing matters relating to Opes and ANZ.
ANZ had wanted the case moved to Victoria.
Justice Windeyer's ruling meant ANZ was free to sell the shares from 2pm yesterday, but at about 1.15pm, Court of Appeal president Keith Mason extended the orders banning ANZ from selling the shares until Friday.
The bank's lawyers had argued that it was concerned about the "volatility" of the stock market, but conceded it did not know of any particular volatility relating to the stocks in question.
Mr Terpu said yesterday he was pleased his lawyers had been able to stop the share sale, as it kept the shares off the market.
"We believe we are under real threat of a possible takeover," Mr Terpu said.
