A mutual insurance company limited by guarantee may lawfully demutualise through a scheme of arrangement under s411 of the Corporations Law; there is no legal principle inherent in 'mutuality' that precludes demutualisation if members so decide. Conditions subsequent in schemes of arrangement are permissible provided there is clarity, certainty and fairness, and the scheme is self-executing. A proxy appointment created by a scheme of arrangement and signed by an agent invested with authority by the scheme is valid and effective under ss250A(1) and 250B(1) of the Corporations Law. At the convening stage, the court's role is limited to prima facie satisfaction as to legality, proper disclosure, and likely approval — it does not substitute its commercial judgment for that of members.
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