Timbercorp action dismissed
High Court refuses leave to appeal, but ‘not the end of the road’
INVESTORS who borrowed money from Timbercorp Finance may still be able to recover some of their losses, despite the High Court dismissing a class action against Timbercorp.
The High Court, sitting in Melbourne last Friday, refused to grant investors leave to appeal an earlier Victorian Court of Appeal decision, effectively ending the class action.
Timbercorp had owned 1179ha of avocado, mango and citrus farming operations in the Bundaberg region – predominantly in Childers.
About 14,500 investors nationwide had borrowed a total of $477.8 million from Timbercorp Finance to invest into Timbercorp before the managed investment scheme collapsed and was placed in liquation in 2009.
Slater & Gordon professional litigation lawyer James Naughton said the High Court’s decision was not the end of the road for Timbercorp Finance investors, but warned their options were increasingly limited.
He advised borrowers to carefully consider their options after the decision and seek legal advice.
“One option may be for investors to consider whether they can recover losses against their financial planner or accountant in circumstances where the advice provided to them to invest in an agribusiness scheme was inappropriate, especially in circumstances where the risks of investing their scheme was not adequately disclosed,” Mr Naughton said.
“The strength of these claims depends on the advice provided. It is important to get an objective view on those matters before considering litigation.
“For people who borrowed to invest in Timbercorp, the debts remain outstanding and interest continues to accrue on the loans. Timbercorp was aggressively marketed, especially to people who may have had a tax liability problem in any particular tax year.
“While the scheme was sold as a solution, it has created substantial burdens ... for many people.”
Mr Naughton – who was not involved in the class action – also advised borrowers to seek advice on the time limits that may apply to any claim.
The Town & Country tried to contact Childers farmers who had sold their properties to Timbercorp, but none were available for comment.