On 22 December 2017 a deed of settlement was entered into between the parties. The settlement is subject to court approval, which if given is unlikely to occur until about March 2018.
Group members have been informed as to the outcome of the class action. If you believe you are a group member and have not been contacted or received any information from us since 22 December 2017 please contact Jan Saddler or Melissa Obrist who will provide you with further information.
Wickham Securities Limited (in liquidation) was a Brisbane based company that raised funds from the public by issuing unsecured deposit notes to provide mezzanine loans to property developers.
A mezzanine loan is money that is lent after the first ranking mortgagee, such as a bank, will not loan further funds for a project. While the interest rates on the mezzanine loans were high, they were typically secured by a second ranking mortgage, increasing the risk of default. Wickham Securities went into liquidation in February 2013, with PPB Advisory appointed as liquidator. More than 300 self-funded retirees were left about $27 million out of pocket, many of whom lost their life savings.
The class action
In order to try and recoup the millions of dollars lost, in July this year Shine Lawyers’ clients and self-funded retirees, Graeme and Marion Clarke (the lead Plaintiffs) commenced a class action against Sandhurst Trustees Limited (Sandhurst) in the Federal Court of Australia on behalf of a group of people who held notes issued by Wickham Securities(the Group Members).
Sandhurst's alleged conduct
Under the Corporations Act 2001 (Cth) (the Act), Wickham Securities was required to appoint a trustee and enter into a trust deed before it could raise funds from the public. In June 2005, Wickham Securities appointed Sandhurst as the trustee for noteholders and entered into a Trust Deed with Sandhurst.
Sandhurst’s obligations as trustee under the Act and the Trust Deed, included exercising reasonable diligence to ascertain whether Wickham Securities had enough funds to repay amounts deposited by noteholders as they became due and to oversee compliance of the Trust Deed and the Act on behalf of Wickham Securities noteholders.
We believe that had Sandhurst exercised reasonable diligence in discharging its obligations as trustee, Sandhurst would have discovered Wickham Securities' breaches of the Trust Deed and the Act much earlier. This would have resulted in timely action and the noteholders would not have suffered any financial loss.
Click to view the following documents:
- Court Orders - 11 April 2018
- Further Amended Statement of Claim
- Defence to Further Amended Statement of Claim
- Reply dated 23rd June 2017
- Statement of Claim dated 17 July 2015
- Order of Justice Greenwood dated 27th July 2015
- Defence dated 7 September 2015
- Reply dated 15 September 2015
- Order of Justice Greenwood dated 6 October 2015
- Notice of a Representative Proceeding (Notice of Commencement)
- Order of Justice Greenwood dated 23 November 2015
- Order of Justice Greenwood dated 7 December 2015
- Order of Justice Greenwood dated 27 April 2016