A number of Australian banks embroiled in a legal battle with ASIC over links to Storm Financial have failed in their attempt to have a Federal Court judge dismiss or alternatively shelve the proceedings against them.
According to court documents dated 1 March, the banking groups – Bank of Queensland (BOQ), Senrac and Macquarie Bank – have called for an end to their Sydney-based proceedings based on the existence of two sets of allegedly concurrent Storm proceedings already before the Federal Court in Brisbane.
The supposed concurrent proceedings involve ASIC’s action against Storm founders Emmanuel and Julie Cassimatis, with the second proceeding involving ex-clients suing Macquarie.
The urgings, initially made in writing to the court by Macquarie, have since been echoed by BOQ and Senrac, the owner and franchisee of the BOQ’s North Ward branch in Townsville.
“One of the objections to ASIC’s case raised by [the banks] is that this proceeding should not be permitted by the court to remain actively on foot because there are two sets of proceedings instituted in the Queensland Registry of the Court which raise similar factual and legal issues,” the court documents said.
“Macquarie, in particular, argues that this proceeding should be dismissed or permanently stayed because of the existence of the concurrent proceedings. However, Macquarie suggested that its claim for a permanent stay and its claim for summary dismissal . should be adjourned to a date to be fixed because the progress of the concurrent proceedings may have some impact on the relevant questions of concurrency affecting the present proceeding.
“I understood that BOQ and Senrac took the same position as Macquarie on this point. ASIC did not object to this course and I propose to accede to it.”
All parties remained in agreement that the banking groups should have the opportunity to “press those claims” for relief, should they wish to do so, the documents said.
Despite this, the presiding judge, Justice Foster, eventually found in favour of ASIC and denied the banks’ call for dismissal and also to strike out all or part of the corporate regulator’s proceedings against them.
The banking groups had been ordered to pay ASIC’s costs to date, the regulator said in a statement.
However, if the court does decide to address the issue of concurrent proceedings, a hearing date is likely to be set at the next directions hearing on 27 April.
“The [banks] are to file and serve their defences and any submissions with respect to the concurrent proceedings issue by 6 April 2012,” ASIC said.
In December 2010, ASIC commenced proceedings against BOQ, Senrac and Macquarie on behalf of two former Storm clients.
Financial advisory group Storm collapsed in early 2009 with $3 billion in investment losses.
