Clive Palmer to sue QLD Nickel administrators

Clive Palmer is seeking $1.2 billion in damages from the administrators of QLD Nickel “in respect of their administration of Queensland Nickel and the illegal diversion of the Queensland Nickel Joint Venture Funds and assets”.

Palmer announced he will indulge in one of his self-confessed favourite hobbies, litigation, stating that he and two of his companies will serve a claim against administrator FTI, its senior managing director John Park, and his colleagues.

He claimed causes of action “include aiding and abetting a breach of trust and causing serious breaches of the Queensland Nickel Joint Venture Agreement by Queensland Nickel.”

This is the latest development in the long running saga of the now collapsed Queensland Nickel business.

It comes after the Federal Government attempted to use its position as a creditor to impose a special purpose liquidator for the failed business, and was driven in part by a report from administrators that Palmer could be held liable for the failed business due to his role as a ‘shadow director.

It appears to be a tit-for-tat move after FTI claimed Palmer may have broken the law by acting as a ‘shadow director’, accusing him of acting recklessly in the management of the company.

“Our observations indicate Mr. Palmer, a former director of the company, appears to have acted as a shadow/de-facto director of QN at all material times from February 2012 up to the date of our appointment on 18 January 2016”, except when he held tenure as a director, FTI’s report states.

Palmer was a director from July 31, 2009 to January 30, 2013, April 17, 2013 to April 5, 2014, and January 22, 2015 to February 16, 2015.

“Mr. Palmer’s official roles have otherwise been limited to his directorship and shareholdings in related entities and their subsidiaries.”

Yet, Palmer was a current signatory on three bank accounts in the company’s name, with the capacity to authorise transactions on these accounts independent of other authorised signatories

“Mr. Palmer formed part of QN’s expenditure approval process committee as ‘chairman’ and held the highest level of authority. This level of approval is required for all expenditure requests with a value greater than $10,000.”

The report says that from May 2014 and at all material times up to January 18 this year – excluding his third period as an appointed director – Palmer exercised powers in controlling the decisions of the company including by approving or rejecting spending requests, and dealing with company staff in day-to-day operational matters.

However Palmer has now hit back, shifting the blame to the administrators, claiming they engaged in criminal activity and rejected the appointment of the government’s special liquidators to hide their actions.

“Park has opposed the appointment of a special purpose liquidator by the Commonwealth to cover up his wrong doing and has sought to convince the creditors’ committee of Queensland Nickel to oppose it,” Palmer said.

“John Park has done this for one purpose only and that is to hide his criminal actions and diversion of joint venture funding from a new liquidator.

“In short, Park lied in his report as administrator to creditors including the Commonwealth.”

Palmer stated Park was behind the closure of Queensland Nickel, and that the “special purpose liquidator should commence proceedings against Mr Park to recover the worker entitlements caused by his closing down of the refinery and sacking the workforce in breach of the Queensland Nickel Joint Venture Agreement”.

He added the refinery would still be running if Park had not made the workforce redundant and shutdown the operation.

“It was John Park who caused an unlawful breach of trust and contract disregarding the lawful rights of joint ventures to close the refinery and dismiss the workforce causing social upheaval to fill his own pockets,’’ Palmer said.

“Park knows that if he had acted in accordance with the law, the closure and dismissal of the workforce didn’t have to happen. Park and FTI need to be brought to account for their actions.”

He went on to call for Park’s resignation.

“The role of an administrator should be to do everything possible to preserve, protect and defend a business and to keep it operating, not to destroy it as Park has done,” Palmer said.

“John Park and FTI have a serious conflict of interest. He should resign as liquidator of Queensland Nickel in favour of the Commonwealth Government nominated liquidator.”

FTI Consulting has been contacted, but was unavailable for comment at the time of publishing.

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