Event and Time
Event Description
- Parties involved: ASSK Investments (Vendor) and AMA Group Limited (Purchaser).
- Date of Binding Heads of Agreement (HOA) execution: 31 October 2019.
- Initial discussions regarding the potential sale of businesses began in April 2018.
- A sequence of communications and due diligence activities took place between April 2018 and January 2020, culminating in AMA's cessation of the acquisition.
Application and Claims
- ASSK Investments claims that AMA is bound by the HOA to complete the purchase of the NSC businesses.
- AMA contends that completion of the sale was subject to certain conditions precedent, particularly Board approval, which was ultimately withheld.
Judicial Decisions
1. Appeal allowed. 2. Orders of the primary judge set aside; proceedings dismissed with costs. 3. Parties instructed to submit written submissions regarding the proportion of costs attributable to the appeal.
Dispute Points and Legal Basis
Dispute Points
- ASSK Investments (Vendor):
- Claims the HOA mandates AMA to proceed with the acquisition. - Argues that AMA’s Board approval requirement is not an unconstrained privilege and should not be used capriciously. - Contends that the promises in the HOA constitute binding obligations.
- AMA (Purchaser):
- Argues that HOA contains a clear condition precedent requiring Board approval for the transaction. - Claims the consideration provided for the HOA was illusory due to the lack of a fully executed Business Sale Agreement. - States that the primary judge's interpretation lacks commercial common sense, as it overlooks the necessity of thorough due diligence and Board confidence before proceeding with binding commitments.