DNZ bid on Argosy meeting rejected

Photo / APN

DNZ Property Fund lost its court action against Argosy Property Trust after Justice Raynor Asher in the High Court at Auckland rejected its case.

The two NZX listed businesses went head-to-head over holding a special meeting of investors which DNZ wanted but Argosy's independent directors rejected the idea.

The judge said Argosy had not breached its trust deed or statutory duty in failing to agree to hold the meeting.

Argosy had argued all along it did not want the event because its annual general meeting was due soon.

"The decision made by Argosy and supported by the Guardian Trust to not call a special meeting and rather to put the resolutions at the annual general meeting has not been shown to be capricious or irrational or beyond the bounds of reason.

"Indeed I go further and observe that it is an understandable decision in the circumstances. It is not a failure to carry on the trust in a proper and efficient manner," the judge said.

DNZ wanted an injunction to force Argosy to hold the meeting so resolutions could be put to it. DNZ owns .09 per cent of Argosy, which has a proposal to put to unit-holders about selling its management contract, now owned by ANZ Bank's OnePath.

Julian Miles, QC, for DNZ argued that Argosy needed to call the meeting but the judge said Argosy had not refused to call any meeting.

"It is prepared to put the resolutions at the pending annual general meeting," the judge said. "Indeed it became clear ... that on DNZ's proposed course of action, the manager would have to call three meetings in short succession.

"First, there would be the meeting to consider DNZ's proposed resolutions. Secondly, there would be the annual general meeting. Thirdly, there would be the meeting to consider the internalisation proposal and the substance of any proposal from DNZ or any other party. ... over a two-month timeframe."