Prime Trust Action Group Unitholder Update No. 21 – 25 January 2013


ASIC Proceedings


Unitholders will recall that ASIC initiated civil penalty proceedings in the Federal Court seeking disqualification orders and pecuniary penalties against certain former APCH Directors and a declaration that APCH breached its statutory duties.  We are currently expecting that the Court proceedings in relation to this matter will commence in May 2013.


Listing Fee Compensation Proceedings


Apart from the ASIC Proceedings, there are also the Listing Fee Compensation Proceedings in the Supreme Court seeking the return of the $33m listing fee plus interest.  Although several defendants requested that the matter be stayed pending the outcome of the ASIC Proceedings, Justice Robson dismissed such requests and ordered defences to be filed.  We understand that the next Directions Hearing in this matter is scheduled to be held in February 2013.


Financial Ombudsman Service


Unitholders may recall that some unitholders had lodged disputes some time ago with the Financial Ombudsman Service (FOS) alleging that the Trust’s manager engaged in misleading and deceptive conduct.   We note that these disputes were lodged in mid 2010, well before the Trust collapsed and well before the formation of the Prime Trust Action Group.


We are pleased to report that FOS has recently issued Determinations in respect of the first two of these disputes, finding in favour of the unitholders in each case.  FOS has issued APCH with an order to pay compensation to the unitholders in respect of these disputes.   We understand that no such payments have been made at present.


Since the Determinations were issued, we have made representations to the Liquidators enquiring as to whether these decisions can now be applied to all unitholders, and asked the Liquidators to examine the broader implications of the Determinations.  We understand that the Liquidators are currently considering the issues and we will provide further information as it becomes available.  


Brentwood Village


We have a number of concerns about the recently reported sale of Brentwood Village.  We understand that this village was acquired by the Trust in 2007 at an approximate cost of $70 million and that the Trust borrowed $34 million to finance this investment.  Subsequently, we understand that the value of Brentwood Village was written-up to well over $100 million.  It is yet to be confirmed but it appears that the village was recently sold for less than the debt owing on the village and for what may be only a fraction of the valuation high-point.  We intend to provide further information to unitholders once the details of this transaction become known.


We are also concerned that Lend Lease Primelife (LLP) has been reported as the purchaser of Brentwood Village.  As unitholders will recall, we remain firmly of the view that LLP does not hold proper title to the management rights over Trust villages, having acquired such rights from an entity associated with Mr Bill Lewski which we understand did not provide good consideration for such rights.


Media Coverage


Unitholders may be interested to note that there has recently been renewed media interest in Prime Trust, and we are optimistic that a TV program will air in the near future detailing the collapse of the Trust.  We wish to acknowledge our appreciation to several individuals who have agreed to be interviewed on camera.  Should the program go ahead, we currently expect that it would be screened in the next month or two and we will provide advance notification to unitholders in due course.


Email Addresses


We have been approached by the Liquidators for a copy of unitholders’ email addresses for the purposes of facilitating electronic communications between the Liquidators and investors, and in order to preserve Trust funds.  We intend to provide this information but would like to first give you the opportunity to opt-out of this arrangement.  


Should you not wish your email address to be provided to the Liquidators, kindly notify us at [email protected] by 8 February 2013.  


Please note that you will also be able to opt-out of this arrangement in the future should you so wish.  We understand that the Liquidators intend to use email addresses as much as possible for distribution of the Trust’s Annual Report which is due for release during February 2013.


Fighting Fund


As promised in our previous update, we attach an update as to the funds currently held by us and our expenditure to date.




















We are very grateful for the contributions already received towards our fighting fund.  If you have not previously contributed, and now find yourself in a position to do so, we would welcome your contribution and are pleased to provide details of payment options in the attached document.




Thank you once again for your continued support of the Prime Trust Action Group.  


Prime Trust Action Group