WA’s Supreme Court backs Empire to recover $1 million owed

By Meagan Evans. Published at Jun 27, 2018, in Small Caps

The Supreme Court of Western Australia has backed WA gold producer, Empire Resources Ltd (ASX:ERL), in its bid to recover $1 million owed to it by its JV partner in the Penny's Find Joint Venture.

ERL holds a 60% interest in and acts as Manager for the Penny's Find Joint Venture that owns and operates the Penny's Find gold mine, located 50km northeast of Kalgoorlie in Western Australia. The remaining 40% mine interest is held by private company Brimstone Resources Ltd.

ERL today announced that it will exercise its rights under the mortgage and security documents held by it, and other means available to it, to recover the approximately A$1 million owed to it by Brimstone. This follows Brimstone failing to make the repayment to ERL that was due on or before June 6.

On June 7 ERL reported that Brimstone had sought an injunction from the Supreme Court of Western Australia to prevent ERL taking action under the mortgage and security documents it holds over Brimstone's interest in the Penny’s Find JV and other property. This followed Brimstone's failure to pay more than $1 million owing to ERL for the open-pit mining outcomes.

Brimstone’s application for this injunction was dismissed by a judge of the Supreme Court of WA on 18 June. This decision was subsequently appealed by Brimstone to the Court of Appeal. This new appeal matter was heard before the Court of Appeal yesterday, where it was dismissed and costs were also awarded against Brimstone.

ERL Managing Director, Mr David Sargeant, welcomed the court findings, “The latest court ruling reinforces the belief of the Empire Board that the court applications by Brimstone, which has related party interests currently seeking to remove the entire Empire Board of Directors – have been nothing short of deliberately obstructive.

“On all observations, Brimstone’s actions were designed to both delay its $1 million plus mine payment obligations and, create smokescreens around the incumbent Board.

“Thankfully, the WA Supreme Court has ruled on the true balance of the issues at hand and found in favour of Empire. It is a ruling which has to now draw into question the relevancy and alleged purpose of the dissident Brimstone-related shareholders in pushing for a shareholders’ vote late next month, seeking a spill of the entire Empire Board.”

Empire will now exercise its rights under the mortgage and security documents to appoint a receiver to Brimstone's interest in the PFJV and other means available to it to recover approximately $1 million from Brimstone.

Overall this is an early stage play and as such any investment decision should be made with caution and professional financial advice should be sought.

Penny’s Find has recently completed its initial open-pit gold mining operation and awaits a final investment decision around whether the mine will make the transition to an underground gold mining operation.


Where to invest $1,000 right now

When the experts at Next Investors have a stock pick, it may pay to listen.

The Next Investors have been investing in ASX small cap stocks for years, with their best small cap picks yielding returns of 1,200%, 1,120%, 900% and 678%.

They have just revealed their hand-picked, FY2021 stock portfolio of high conviction long-term investments.

Click the link below to see what they are currently investing in.


SEE THE PORTFOLIO

S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

Conflict of Interest Notice

S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.

Publishers Notice

The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.

Australian ASX Small Cap stocks | Why Finfeed.com is Australia’s leading small cap publication

Founded seven years ago, Finfeed.com is Australia’s leading and longest standing website for investor and finance news, education and expert opinion.

Published by StocksDigital, Finfeed was created to report daily on the comings and goings of ASX listed stocks in the small cap market.

As the first digital publication dedicated specifically to this space, Finfeed soon became the most trusted publication in the market, quickly garnering over two million page views – a number that continues to rise.

Finfeed.com provides its readers with informative articles that tackle the latest in market moving #ASX small cap news, plus exclusive content you won’t find anywhere else. It is aimed at those with an interest in investing, market education, company performance, start-ups and much more.

Finfeed.com is the only media organisation operating under the strength of a Financial Services License and is backed by leading journalists and analysts all with brands of their own.

The website aims to inform, educate and entertain with content that drills down into the heart of financial matters.

Finfeed is a leading source of investor and market information, with everything investors need to know about how to invest written in a way that anyone can understand. 

Over the years, the website has expanded beyond exclusively reporting on small caps, to profile Australia’s leading ASX listed small, mid and large caps as well as some of the country’s most successful CEOs and business leaders to find out what makes them tick.

Every day you will find fresh content covering:

Fast Facts

Over 4,000 articles published

Over 2.3 Million Page Views and counting

Over 10,000 followers on social media

Subscriber list growing by 2% monthly

Thanks for subscribing!

X