Bendigo and Adelaide Bank now to answer Great Southern...

Bendigo and Adelaide Bank now to answer Great Southern investors' claims
In the latest hearing before Justice Clyde Croft in the Victorian Supreme Court on 11
March 2011 the investors in the 2005 and 2006 Great Southern plantation schemes
have earned the right to proceed with their claims brought against Bendigo and
Adelaide Bank under various provisions of the Corporations Act and the Australian
Securities and Investments Commission Act.
Ron Willemsen, a principal of Macpherson + Kelley Lawyers acting for the investors,
said "this very significant breakthrough now clears the path for similarly based claims to
be filed for all the scheme types sold by Great Southern through the years 2005 to
2008". Great Southern's sales revenue from just the 2005 plantation scheme alone
was $241m in its financial year ended 30 September 2005. Many of Macpherson +
Kelley's clients who invested in that project borrowed money from Great Southern
Finance Pty Ltd and are continuing to challenge the validity of all of those loans,
including those which were subsequently sold to Bendigo and Adelaide Bank or Javelin
Asset Management. Those financiers also hold many impugned loans relating to other
schemes sold in 2005 or later. According to an announcement to the ASX on 4 August
2009 the bank's exposure to borrowers in Great Southern Managed Investment
Schemes stood at approximately $550m.
Willemsen points out "those investors who are represented by Macpherson + Kelley
will now press ahead with their available claims which, if ultimately successful, could
see orders made declaring the subject loans void and requiring Bendigo and Adelaide
Bank and others to fully or partially refund money previously paid under those loans.
The outcome will depend on proof that Great Southern Finance as the company which
originated the loans acted unlawfully during the course of procuring and establishing
those loans." Cash investors are also represented in the class action and will be
looking to the directors of Great Southern Managers Australia Ltd and to that company
itself for an award of damages based on claims ordinarily covered by professional
indemnity insurance policies. The directors who are being sued are John Young,
Cameron Rhodes and Philip Butlin.