m+k great southern class action struck out, page-2

Front page todays Bendigo Advertoser Newspaper:

......................................................
BENDIGO BANK CLASS ACTION STRUCK OUT
PETER KENNEDY
21 Oct, 2010 09:09 AM
A MULTIMILLION dollar class action brought against the Bendigo and Adelaide Bank by lawyers acting on behalf of investors in the failed Great Southern Plantations managed investment schemes has been struck out.
Bendigo and Adelaide Bank managing director Mike Hirst yesterday welcomed the court decision to strike out the amended statement of claim in the first class action brought against the bank on behalf of investors, who collectively still owe the bank more than $450 million over the failed investment schemes.

Justice Croft of the Supreme Court of Victoria yesterday struck out the amended statement of claim in the class action initiated by the law firm Macpherson + Kelley on behalf of investors in the Great Southern Plantations 2005 and 2006 managed investment schemes.

While Justice Croft has left the door open for Macpherson+Kelley to bring a new argument, in a statement released late yesterday, Mr Hirst said the judgment had delivered a damaging blow to the case being alleged against the bank.

Macpherson+Kelley has spent the past 15 months preparing its claim, which one could assume it believed was its strongest argument against the bank. However, that argument has failed and now it will need to think of new arguments if it is to pursue a class action on behalf of its clients.

While it is still possible for Macpherson+Kelley to mount new legal arguments, this latest development must be seen as a significant setback.

Mr Hirst said the bank would now write to borrowers to inform them of this development and urge those borrowers not making loan repayments to consider recommencing repayments.

If borrowers have discontinued repayments pending the outcome of the class actions, todays judgment supports our view that the loans are valid, so now is the time for them to consider the benefits of bringing their loan up to date.

Mr Hirst said the bank had worked hard in the best interests of borrowers to secure value from the agricultural assets owned by Great Southern, noting that many of these schemes are under new management.

Equally, the bank expected borrowers to meet their commitments.
We have an obligation to all our stakeholders to recover monies loaned to investors in these schemes and we will set out to do so, Mr Hirst said.
The Bendigo Advertiser understands further action against the Bendigo and Adelaide Bank initiated by Sydney-based law firm DC Legal is ongoing.
Mr Hirst has previously described the claim document presented by DC Legal as hopelessly inadequate.
Macpherson + Kelley Lawyers principal Ron Willemsen said it was important to note that the court had not been prepared to excuse the Bendigo and Adelaide Bank from answering the case.
Mr Willemsen said the court did strike out the current version of the Statement of Claim but had given permission to the investors to submit a fresh version of the claim.
Macpherson + Kelley will be filing the new version as soon as is needed, he said.
The case returns to court tomorrow.