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:
- 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
Our offer to you
Common questions about Wickham Securities Sandhurst Class Action
- held Notes issued by Wickham Securities as at 21 December 2012; and
- have suffered financial loss as a result.
If you are eligible, you can join the class action and become a group member by signing a client agreement with Shine Lawyers and a litigation funding agreement with Litman Holdings, the litigation funder. Please contact us to do so or to get further information about the action.
You are not eligible to join the class action if you invested in other Sherwin entities, such as Astor Funds or Reacroft but did not hold notes issued by Wickham Securities as at 21 December 2012.
As the claims of all the Group Members involve many common questions of fact and law, bringing a class action reduces the aggregate cost of litigation to a client by only addressing the common issues once at trial instead of multiple times.
The lead Plaintiffs will continue to bring the class action on your behalf until the Court has determined all the common question between the Plaintiffs and the Group Members.
For this reason, we recommend that you keep your SMSF open until we can be certain that closing down your SMSF will not adversely affect your entitlement to make a claim.
We recommend that you do this and that you contact PPB Advisory directly if you require any assistance in completing the form. While the payment of the dividend will reduce the claim against Sandhurst, this is very minimal and will not adversely affect the claim against Sandhurst.
Shine Lawyers has agreed to await payment of part of the legal and other costs until the successful outcome of the action. If the class action is successful and a judgment of damages is awarded to the Group Members, then the costs and fees will be deducted from the amount of damages to be distributed to the Group Members.
It is of course in everyone’s interest to progress the claim in a way that ensures the greatest return to the investors who lost so much in the collapse of Wickham Securities.
Jan has worked for one of the largest commercial law firms in Australia, where she was involved in a number of class actions and multi-party disputes. She has also worked at one of the largest global professional services firms, as an in-house lawyer running and managing disputes involving claims worth more than $250 million.
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