A former chair’s action against Lindian Resources has dragged on in the WA Supreme Court after the latter failed to file documents by the imposed deadline.
Former Lindian Resources chair Asimwe Kabunga filed writs in the Supreme Court of Western Australia, alleging the company owes him 13 million performance rights.
Based on Lindian Resources’ share price at 79 cents on Friday, the rights would be worth about $10.3 million.
Supreme Court acting registrar Simon Millman made orders for Lindian to file its defence by August 14, the court was told on Friday.
“Unfortunately, it didn’t happen on the 14th of August and the next I heard from the defendant was that a minute of proposed orders dated 17th August… seeking time for compliance to order 1 be extended to 4th September,” registrar Millman said.
“The second plaintiff is asking for a springing order because of your default.
“Why didn’t [the defendant] inform my chambers?”
Representing Lindian, barrister Tom Porter told the court that his client needed more time to prepare the material.
“This is an instance of quite significant financial matter that will take some time,” he said.
“We’re here to say we’re working on it hard, but we need seven more days than what the plaintiff thinks we need.”
In the writs, Mr Kabunga alleged he was owed performance rights after he met market capitalisation targets from $500 million to $1.25 billion.
Mr Kabunga claimed the shares were to be issued to his investment company Kabunga Holdings, which is the second plaintiff in the proceedings.
Lindian announced that its board decided to cancel the 13 million performance rights set to be issued to Kabunga Holdings, in an ASX statement in late May.
“Our client has been over a year without his performance rights,” legal counsel for Mr Kabunga, Verauli Saragih, said in court on Friday.
Nathan Ebbs, representing the second plaintiff, said the defendant was a well-resourced client who engaged a well-resourced law firm.
“Seven days I think is reasonable in the circumstances,” he told the court.
Mr Porter said there were allegations of breach of duties, including a failure to transfer company assets back to Lindian, that his client wanted to address.
“There’s a provision in the terms that governed performance rights, to be forfeited if there was fraudulent, dishonest conduct or willful breach,” he told the court.
“A determination was made by the board and based on that determination there was an exercise of discretion that deemed the performance rights be forfeited
“In explaining that, it will involve pleading out a significant corporations’ case.”
Registrar Millman ordered Lindian to file its defence and counterclaim by September 2, ahead of another hearing in the Supreme Court on September 4.
“If the defendant doesn’t file its defence and counterclaim by 2nd September, then Mr Ebbs and his client will have comfort of knowing he will come before me [two days later],” he said.
Perth-based Lindian Resources' projects include a flagship rare earths mine in Malawi.
