The liquidator of Sonray Capital Markets will appeal against elements of a Federal Court ruling regarding the treatment of shares and assets involving the failed broking group.
In an affidavit in support of Ferrier Hodgson's appeal for leave, Ferrier Hodgson representative George Georges said the liquidator would appeal against directions that called for Sonray clients to be treated in the same way as a third-party entity, Efax Pty Limited, in regards to their Saxo shares and settlement entitlements.
As part of the appeal, Ferrier Hodgson will seek amendments to the orders to clarify the separate position of Sonray clients and that of Efax.
Efax had also sought amendments to the orders to give "clear effect" regarding its entitlements to the shares in BHP Biliton, the affidavit, dated 24 February, said.
"Ferrier Hodgson calculations have found 68 per cent of the total value of claims and 67 per cent of the total number of claimants against the funds will be better off if the Saxo shares, acquired under the same circumstances as that in which the shares in BHP Billiton Pty Ltd claimed by Efax, are pooled," Georges said.
"Of course, investors in the same position as Efax will be worse off."
If the proposed appeal succeeded, the net average increase in return for each investor would be 11 cents in the dollar, he said.
"In preparing this calculation I have assumed that the anticipated costs (including liquidators' fees) of an appeal will be $500,000 and that all Saxo shares will be returned directly to relevant Sonray investors," he said.
"I am concerned about the orders made in respect of the Saxo shares, including, amongst other things, that the orders do not treat investors on the Saxo trading platform consistently with the investors on the Interactive Brokers trading platform."
In a bid to address his concerns, Georges met with the committee of inspection in late February to gauge reaction to launching an appeal. Committee members voted in favour of the appeal.
Georges said the Saxo shares were being held by Saxo in the name of its custodian.
As at 14 February, the value of physical shares acquired on Sonray clients' instructions and presently held by Saxo was $18.06 million, he said.
Since 22 June 2010, the value of shares that has been sold is $1.09 million and the value of dividends earned on the shares in that period is $1.14 million, giving a total value for the Saxo shares of $20.29 million.
The concern regarding the classification of entitlements could also come into play when it came to Saxo and HLB Mann Judd (Victoria)'s $18.5 million in settlement money, Georges said.
"There are 29 versions of client agreements used by Sonray and I have not yet determined whether any of the differences between the different versions will mean that some Sonray investors will be in a different category from Efax," he said.
Saxo and HLB Mann Judd (Victoria) were expected to pay the settlement money "imminently", he said.
Ferrier Hodgson raised its concerns regarding the court orders in a letter to Sonray clients last month.
