Law firm Macpherson + Kelley (M+K) has launched a class action on behalf of 1700 investors in Great Southern's managed investment schemes (MIS).
A writ was filed in the Victorian Supreme Court on 27 May 2010 and covered people who invested in the schemes between 2005 and 2008, including forestry, olive, almond and cattle projects. It also included investors who paid cash to buy their interest in projects sold by Great Southern Managers Australia Limited (GSMAL).
Bendigo and Adelaide Bank, Javelin Asset Management and Great Southern Finance (which is in liquidation) have been named as defendants. Directors or former directors of Great Southern companies John Young, Cameron Rhodes and Phillip Butin are also being sued in the class action.
The Great Southern investors are seeking court declarations that the loans provided are void or unenforceable and are seeking damages to recover amounts of principal and interest paid to financiers for loans made for entry into the agribusiness MIS.
Investors also allege that the arrangement between Great Southern and GSMAL deprived them the opportunity to make an informed decision about whether or not to invest.
"The package offered to investors included a finance option. There was a very close interconnectedness between GSMAL and Great Southern Finance in the joint promotion of forestry and non-forestry projects to potential investors," M+K principal Ron Willemsen said.
Bendigo and Adelaide Bank has sued a number of Great Southern investors in recent months in an attempt to force them to repay outstanding loans in full, plus interest. Defences and counterclaims for these investors are included in this class action.
