Allco founder's son accusedGEOFFREY Kinghorn, son of Allco...

Allco founder's son accused
GEOFFREY Kinghorn, son of Allco Finance founder John Kinghorn, improperly used his position as a company director to gain an advantage for himself and former Allco executive David Veal, the Allco receiver has claimed.
The allegations in the Federal Court come amid last-minute jousting as the receiver, Peter Gothard, tries to complete the sale of Allco's aviation leasing assets.
Mr Gothard, a partner at Ferrier Hodgson, alleges Mr Kinghorn breached three civil sections of the Corporations Act by ''purporting'' to change the manager of a special-purpose vehicle connected with two of Allco's 68 aircraft.
Mr Kinghorn is the sole director of the special-purpose vehicle, one of many set up as off-balance-sheet entities to manage Allco's interests in the 68 planes.
The ordinary shares in the special-purpose vehicle, called RIL Aviation HL 7740 and HL 7741 Pty Ltd, are owned by a company called AAHL Pty Ltd. Until August, AAHL was called Allco Australian Holdings Ltd but despite this name it was not a subsidiary of the listed Allco group, which collapsed in November 2008.

AAHL, which remains solvent and trading, is 84 per cent owned by Mr Kinghorn and Mr Veal.
The special-purpose vehicle also has preference shares on issue, which are owned by the collapsed Allco group.
Mr Gothard wants the court to restrain Mr Kinghorn and Mr Veal from appointing as the manager of the special-purpose vehicle any entity in which Mr Kinghorn, Mr Veal or Mr Kinghorn's father has a financial interest.
Geoffrey Kinghorn could not be contacted yesterday but John Kinghorn, who founded Allco in 1979, said the case would be defended.
Mr Kinghorn snr denied attempting to frustrate the proposed sale of the aviation assets to HNA Group (Hong Kong) Co, which signed a binding sale agreement in May.
''We don't have any ability to prevent the sale at all,'' Mr Kinghorn said. However, the receiver had no ability to force the sale of the ordinary shares in the special-purpose vehicles, he said.
''We own those companies, they are our property and we are not obliged to sell them,'' he said.
Mr Gothard alleges that Geoffrey Kinghorn breached section 181 of the Corporations Act by failing to act in good faith, section 182 by improperly using his position to gain an advantage for himself and Mr Veal, and section 183 by improperly using information obtained as a director to gain an advantage for himself and Mr Veal.
The court documents describe Mr Veal, who was Allco Finance's head of aviation, as ''a person taking part in the affairs of RIL Aviation HL 7740 and HL 7741 Pty Ltd'' or acting on its behalf.
The first directions hearing has been scheduled for February.