On 16 May 2016, LMIM as Responsible Entity of the FMIF and the Liquidators of LMIM (Mr Park and Ms Muller of FTI), filed an Application (“the Application“) for orders concerning payment of certain costs and expenses for which LMIM claims indemnity from the assets of the FMIF.
David Whyte applied to the Court for Directions as to whether he is justified in, amongst other things, responding to the Application by raising certain matters, including the ‘clear accounts’ rule. On 30 May 2017, Burns J directed that Mr Whyte is justified in raising the clear accounts rule, in response to the Application, in relation to certain identified claims against LMIM.
The Application was heard on 19 and 20 June 2017 and the decision was reserved. Judgement was delivered on 17 October 2017 and a copy of the judgement is included below.
The Application and supporting Affidavits, the orders of Burns J, the affidavits to be relied upon by Mr Whyte in response to the application and the judgement are below:
- Application filed 20 May 2016 (0.7 MB)
- Affidavit of John Park sworn 18 October 2016 (16.5 MB)
- Order of Jackson J 16.02.17 (0.2 MB)
- Affidavit of John Park with JRP-6 sworn 08.03.17 (2.4 MB)
- Application by Respondent D Whyte 09.03.2017 (0.3 MB)
- Notice to Members of the FMIF (0.1 MB)
- Affidavit of David Schwarz sworn 16 February 2017 with DHS-1 to DHS-22 (3.4 MB)
- Affidavit of David Whyte sworn 29 May 2017 with Exhibit Volume 1 DW-39 to DW-41 (8.0 MB)
- Exhibit Volume 2 DW-42 to DW-48 to Affidavit of David Whyte 29 May 2017 (10.8 MB)
- Exhibit Volume 3 DW-49 to DW-62 to Affidavit of David Whyte 29 May 2017 (8.8 MB)
- Exhibit Volume 4 DW-63 to DW-73 to Affidavit of David Whyte 29 May 2017 (6.4 MB)
- Affidavit of Eric Leeuwendal sworn 29 May 2017 (12.1 MB)
- Orders of Burns J 30 May 2017 (0.9 MB)
- Affidavit of David Whyte sworn 7 June 2017 with DW-74 to DW-89 (5.8 MB)
- Affidavit of David Whyte sworn 7 June 2017 with DW-1 to DW-26 (16.6 MB)
- Affidavit of David Schwarz sworn 8 June 2017 with DHS-43 (9.9 MB)
- Judgement of Jackson J delivered 17 October 2017  QSC 230 (0.4 MB)
Court Application by the Liquidators of the Responsible Entity of the LM First Mortgage Income Fund (‘LMIF’) on residual powers and remuneration
TAKE NOTICE that John Richard Park and Ginette Dawn Muller, the liquidators of LM Investment Management Limited (in liquidation) (receivers and managers appointed)(LMIM) ACN 077 208 461, the responsible entity of the FMIF, and LMIM have applied to the Supreme Court of Queensland in proceeding no. 3508 of 2015 for directions and orders in relation to the extent of their powers and responsibilities as such liquidators and in respect of their remuneration as such liquidators, in relation to the winding up of the FMIF and LMIM.
The Notice to the Members of the LM First Mortgage Income Fund (Receivers and Managers Appointed) (Receiver Appointed) with respect to that Application together with a copy of the application and supporting material can be found below.
- Notice to Members of Application by J Park & G Muller (per Annexure A to Order 7 May 2015) (117 kB)
- The Original Application filed 8 April, 2015 (170 kB)
- Interlocutory Application dated 29 April 2015 and Accompanying Statement (252 kB)
- Sealed copy order of Justice Jackson 8 May 2015 regarding the Originating Application filed 8 April 2015. (125 kB)
- Affidavit of Stephen Charles Russell, filed on 8 April, 2015 (1.6 MB)
- Affidavit of John Richard Park, filed on 22 April, 2015 (332 kB)
- Affidavit of Sean Charles Russell, filed by leave on 7 May, 2015 (3.7 MB)
- Order dated 8 May 2015 regarding the original application filed 8 April, 2015 (115 kB)
- Affidavit of John Park, filed on 11 June 2015 (36 kB)
- Affidavit of David Whyte, filed on 12 June 2015 (3.4 MB)
- Exhibit 'DW1' pages 1 – 192 to Affidavit filed 12 June 2015 (50.2 MB)
- Exhibit 'DW1' pages 193 – 344 to Affidavit filed 12 June 2015 (25.0 MB)
- Exhibit 'DW1' pages 345 – 479 to Affidavit filed 12 June 2015 (31.6 MB)
- Exhibit 'DW1' pages 480 – 602 to Affidavit filed 12 June 2015 (25.9 MB)
- The Outline of the Submissions of David Whyte, Respondent, filed on 7 May 2015 (0.9 MB)
- Affidavit of Sean Charles Russell sworn 26 June 2015 and filed on 29 June 2015 (6.5 MB)
- Notice of Appearance of David Whyte, Respondent, filed on 30 June 2015 (0.3 MB)
- Affidavit of David Heiner Schwarz sworn on 29 June 2015 and filed on 30 June 2015 (1.4 MB)
- Applicants’ outline of submissions 8 July 2015, filed 15 July 2015 (0.4 MB)
- Respondent’s outline of submissions dated and filed 16 July 2015 (0.3 MB)
- Amended Originating Application dated 20 July 2015 (2.5 MB)
- Affidavits of:-
- The reasons for judgment of Jackson J dated 15 October 2015 (0.4 MB)
- Order of Jackson J dated 12 November 2015 (unsealed) (0.1 MB)
- Order of Jackson J dated 2 December 2015 (unsealed) (0.1 MB)
- Applicants’ outline of submissions dated 17 December 2015 (0.3 MB)
- Respondent’s outline of submissions dated 17 December 2015 (0.2 MB)
- Affidavit of Sean Russell filed with leave on 17 December 2015 (6.1 MB)
- Order of Jackson J dated 17 December 2015 (2.5 MB)
A Further Amended Originating Application (“the Further Application”) has been filed in the Supreme Court of Queensland proceeding 3508 of 2015, by LM Investment Management Limited (In Liquidation) (“LMIM”), and the liquidators of LMIM, John Park and Ginette Muller. The Further Application seeks orders concerning (among other things) the remuneration of Mr Park and Ms Muller.
The Further Application was heard on 22 February 2016 and 14 March 2016. The decision was reserved and judgement was delivered on 17 October 2017.
A copy of the Further Application and other material in relation to the proceedings, the Notice to members of the FMIF about the Further Application and a copy of the judgement are available below.
- Further Amended Originating Application dated 16 December 2015 (0.6 MB)
- Notice to Members in respect of Further Amended Originating Application dated 18 January 2016 (0.2 MB)
- Affidavit of John Park sworn 28 January 2016 (11.9 MB)
- Affidavit of John Park Volume 1 – pages 1 to 279 (4.5 MB)
- Affidavit of John Park Volume 2 – pages 280 to 519 (4.9 MB)
- Affidavit of John Park Volume 3 – pages 520 to 828 (10.3 MB)
- Affidavit of John Park Volume 4 – pages 829 to 1102 (12.4 MB)
- Notice to Members in respect of the Affidavit of John Park sworn 28 January 2016 (0.1 MB)
- Affidavit of David Whyte sworn 19 February 2016 (2.5 MB)
- Affidavit of David Whyte Exhibits DW-2 to DW-11 (10.0 MB)
- Affidavit of David Whyte Exhibits DW-12 to DW-34 (5.9 MB)
- Affidavit of John Park sworn 22 February 2016 (9.3 MB)
- Applicants’ Statement of Facts dated 22 February 2016 (0.6 MB)
- Affidavit of John Park sworn 8 March 2016 (0.8 MB)
- Affidavit of David Whyte sworn 11 March 2016 (2.8 MB)
- Judgement of Jackson J delivered 17 October 2017  QSC 229 (0.6 MB)
Further documentation will be uploaded to this website as it becomes available.
On 17 November 2014, the Court appointed Receiver, David Whyte (David Whyte) filed an application in the Supreme Court of Queensland to conduct a PE in relation to the audits undertaken of the FMIF. The application was granted on 27 November 2014 and the summonses were issued on 30 January 2015.
On 6 March 2015, the auditors filed an application in Court to discharge the summonses against them and to defer the production of the documents to a date following the hearing. The auditors argued that David Whyte did not have the power to conduct the PE.
David Whyte opposed the auditors application on the grounds that he has the power to conduct a PE and on the basis ASIC has granted him Eligible Applicant status to do so. The first day of the PE was on 16 March 2015 when the examinees (certain directors and former staff of LMIM and the auditors) produced a small quantity of documents. Consent orders were also made that day allowing the auditors more time to produce the remaining documents in three tranches on 2, 16 and 30 April 2015.
On 15 May 2015, the Supreme Court of Brisbane dismissed the auditors application to set aside the PE summonses. A copy of the court order can be found below.
As a consequence of the delay in the auditors producing all of the documents pursuant to their summonses, the examinees were examined under oath between 15 and 25 June 2015. Certain documents were not produced by the auditors before the commencement of the June examinations. These documents were mainly emails between the auditors and certain directors and staff of LMIM. The auditors have now produced 4 tranches of these emails.
On 14 September 2015, David Whyte filed a further application in the Supreme Court of Queensland to examine a further three parties as a result of additional investigations and knowledge gained from the PE.
David Whyte obtained further Court dates from 19 to 30 October 2015 to continue the public examinations of the examinees and the additional examinees, which will largely be focused on the compliance plan audits and finalising matters arising from the June examinations.
- Notice to Creditors of Public Examination dated 26 February 2015 (84 kB)
- Notice to Creditors of Public Examination dated 6 October 2015 (57 kB)
An application has been made to the Supreme Court of Queensland in relation to approval of the proposed appointment of Mr Whyte and Mr Fielding of BDO as PTAL’s agents in dealing with the retirement village assets. The proposed appointment will limit duplication of costs and replace LM Investment Management Pty Ltd (Receivers and Managers Appointed)(In Liquidation) as controllers of these assets. A copy of the application and supporting affidavit can be found below:
- Application of David Whyte dated 4 September 2014 (360 kB)
- Affidavit of David Whyte sworn and filed on 9 September 2014 (2.36 MB)
- Affidavit of David Whyte filed on 9 September 2014 – certificate of exhibit volume 1 of 3 (7.13 MB)
- Affidavit of David Whyte filed on 9 September 2014 – certificate of exhibit volume 2 of 3 (7.17 MB)
- Affidavit of David Whyte filed on 9 September 2014 – certificate of exhibit volume 3 of 3 (5.51 MB)
At the hearing on 15 September 2014, the court directed that the Court Appointed Receiver was justified in arranging the appointment of David Whyte and Andrew Fielding of BDO as Controllers of five retirement villages to replace LM Investment Management Pty Ltd (Receivers and Managers Appointed) (In Liquidation). A copy of the order made on 15 September 2014 can be found below: