AUSTRALIAN Wool Innovation has admitted it had no legal advice allowing or later disallowing a joint nomination form proposed by New South Wales grower Chick Olsson in the lead up to the 2019 director elections.
In the 2019 AWI election, Mr Olsson had sought permission to collect shareholders signatures on a joint nomination form with Professor Peter Windsor and Dr Dominique Van Der Saag, claiming precedents from previous elections.
Mr Olsson was initially allowed by AWI company secretary Jim Story to collect signatures for the joint nomination form and then was told he could not, forcing him to nominate on his own. AWI eventually ruled Mr Olsson did not collect the required 100 valid shareholder signatures by a deadline to support his nomination.
Despite commitments made at a 23 March Estimates hearing, AWI CEO Stuart McCullough initially failed to provide legal advice that company secretary Jim Story referred to in a text to Mr Olsson, allowing him to run a joint nomination ticket. Nor did Mr McCullough provide legal advice which an unidentified company spokesman told Sheep Central Mr Story subsequently used to disallow Mr Olsson’s multiple candidate nomination form proposal.
“That decision was based on legal advice and in consultation with Link Market Services,” the AWI spokesman told Sheep Central.
But in a letter to the Senate Rural, Regional Affairs and Transport Legislation Committee and in evidence to an Estimates hearing yesterday, Mr Story admitted that there was no written advice in relation to allowing a joint ticket or later disallowing it.
No rules to say I couldn’t – Olsson
Mr Olsson told Sheep Central after the hearing that Mr Story’s evidence reinforced his belief that he should have been able to continue with a multiple candidate nomination form.
“I totally believe that’s the case, absolutely. There were no rules to say that I couldn’t.”
Mr Olsson said he has been told that there were no records of the multiple candidate nomination forms he claims were used in previous elections.
“They’ve got rid of the whole lot, they are not available.
“That’s what I’ve been told,” he said.
“It’s very very convenient.”
Mr Olsson has told Sheep Central that multiple candidate nomination forms were used in the 2007 AWI election for a Roger Fletcher-Olsson ticket, and in 2008, for the collection of signatures for Laurence Modiano, on a ticket that also included Meredith Sheil, George Falkiner and David Webster.
AWI updated election rules and procedures
In a 21 May letter to the RRAT committee, Mr Story admitted that AWI’s external lawyers confirmed that the Rules and Procedures Governing the Election of Directors (“Rules”) did not specially deal with a circumstance of a candidate wanting to have multiple persons named on a nomination form.
“They also confirmed that the Rules have a general provision allowing the company to take such action and give such directions as it considers necessary in order to ensure that no irregularities occur in or in connection with an election or to remedy any inconsistency or inadequacy that arises,” Mr Story wrote.
AWI has subsequently updated its Rules and Procedures (January 2020) to state that: “A nomination form must pertain to one candidate only. It is not permissible for a nomination form to relate to multiple candidates.”
McCullough qualifies evidence to committee
When asked why Mr McCullough had told a previous Estimates hearing that AWI’s legal counsel had advised the AWI board that Mr Olsson could not run a joint nomination form, Mr McCullough said he was “rightly” kept out of the nomination process “and the board is kept away from this process as well.”
Mr McCullough told the 23 March Estimates hearing: “I’ll have to check what was written to Mr Olsson, but certainly the advice back from our legal counsel was no.”
Mr McCullough yesterday said he was aware that there was a note sent to Mr Olsson when he requested permission to use a joint nomination form.
“I certainly didn’t say written legal advice, I said legal counsel if I remember, Jim is legal counsel, but Jim sought external legal advice by way of a phone call.”
Mr McCullough said he found this out after he returned from the 23 March hearing.
“I didn’t know if it was verbal or written at that point.”
Senator Glenn Sterle said he was perplexed that the committee did not get the explanation around the legal counsel “straight away.”
“It is a little bit alarming that the clarity was not there,” he said.
“Point taken, I should have taken it on notice,” Mr McCullough said.
Mr Story said “different facts emerged” between the time Mr Olsson’s joint nomination form request was allowed and then disallowed.
He said Mr Olsson asserted he was allowed to use a joint nomination form in previous elections.
“It perturbed me a bit to hear that because it creates a not level playing field between candidates, if that’s the case.”
AWI rules ‘silent’ on joint candidate nomination forms
Mr Story said he came up with nothing to either substantiate or negate Mr Olsson’s assertion, but AWI’s lawyers told the secretary that AWI’s rules and procedures were “at that time, silent on the point” of joint candidate nomination forms.
“The rules simply didn’t envisage someone going down this course, there was though, a provision in the rules allowing the company to deal with procedural irregularities should they arise.”
Mr Story said the advice to Mr Olsson that he referred in the text to Mr Olsson was “my own, somewhat buttressed I suppose, by a verbal conversation with our lawyers.”
“It was a verbal conversation only senator because I just didn’t need further advice from them.
“They were telling me what I already knew to be the case anyway about what the Rules and Procedures say, so there was no need to seek a more fulsome advice from them,” he said.
“So that’s why nothing else has been produced to you by way of legal advice about that, that’s what occurred.”
No evidence supporting Olsson’s claims – Story
Mr Story said there was no evidence “for or against” Mr Olsson’s assertion that multiple candidate nominations forms had been allowed in previous AWI elections.
“My view of that irrespective of what I thought about whether this was fair or not was that, in good faith, we need to honour the apparent precedent.
“That’s the context in which I wrote that note (23 June 2019 text) to him Senator.”
However, Mr Story said a few weeks later he spoke to the previous AWI company secretary Chris Chapman who told him “No, it didn’t happen.”
“And further, if he had gotten any wind of anyone attempting a multi-person nomination form then he would have put a stop to it right there.”
However, Mr Story agreed with a proposition by Senator Bridget McKenzie that the same 100 signatures could be applied to the nomination of another candidate.
Senator McKenzie later pointed out that it wasn’t in the Rules and Procedures operating at the time of the 2019 election “that you couldn’t have two people on the same (nomination) form.”
“It wasn’t in the rules, you didn’t allow it, but it wasn’t disallowed at the time.”
AWI director Jock Laurie said the board needed to “sharpen the pencil” and “tidy some of this stuff up.” Mr McCullough said Mr Story prepared a 164-page report on the treatment of Mr Olsson during the election to assure the board that “this process that Mr Story went through with Mr Olsson was fair.” Mr McCullough said he would table the report.
Mr Story later said Mr Olsson could not use the signatures of shareholders he collected in 2019 to support a subsequent election nomination, and “that is there in the Rules and Procedures document and has been at all times.”
Click here to read Mr Story’s 21 May response letter.