AU$75 million court action against AET

Friday 15 Mar 2019

Backed by Australia’s leading litigation funder, IMF Bentham Limited, thousands of Australian retirees, who lost everything after investing in a forestry scheme in the 1980s, will finally get their day in court against IOOF. The Supreme Court of NSW has scheduled the hearing over eight days from 1 July.

The investors’ lawyers, Piper Alderman, allege that IOOF subsidiary, Australian Executor Trustees, failed in its duty as security trustee to protect the investors’ interests in the Southern Australian Perpetual Forests (Sapfor) scheme. Investors in Sapfor were promised a safe long-term investment into land and trees in Mount Gambier’s green triangle area, but in 2012 saw their investments reduced to nil as a string of corporate blunders allowed the scheme assets to be consumed in the insolvency of Tasmanian forestry giant Gunns.

It is claimed AET acted negligently and in breach of trust by prematurely releasing the scheme’s security arrangements before receiving sale proceeds worth AU$55m. The money was due to the investors, but never reached them – instead Gunns used it to repay its debts to bankers.

The detailed background to this particular case can be read here

Source: litigationfinacejournal

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