Hardie compo fund faces liquidation 06:00 AEDT Thu Nov 25 2004
James Hardie's compensation foundation will on Thursday apply for provisional liquidation, saying it would have no choice but to reject a last-minute transfer of money that could have kept it operational.
To accept the funds would mean the foundation would lose the ability to potentially sue James Hardie in the future.
The decision by the Medical Research and Compensation Foundation (MRCF) means some victims of James Hardie asbestos products could face reduced payments, while future victims could miss out altogether.
The MRCF confirmed that it would ask the NSW Supreme Court to appoint a provisional liquidator, with a hearing set down for Thursday of next week.
That's despite a last-minute transfer of $31.5 million to the MRCF, with another $57 million to come next Tuesday - enough money to allow the foundation to pay claims for up to two years.
James Hardie had placed the money into a former subsidiary company known as ABN 60 in early 2001 - designed to be released in small increments over the coming decades - but earlier this month it said it had arranged to unlock the money.
ABN 60 director Don Cameron said the money had been unlocked, with the first instalment of $31.5 million electronically dropped into the MRCF's bank account.
However he said that the money remained attached to the original conditions under which it had been put aside in 2001 - including that the MRCF would not sue James Hardie or ABN 60.
But an MRCF spokesman said that was unacceptable.
"The (MRCF) directors have received their own legal advice that they cannot sign away the rights of future victims to sue James Hardie or ABN 60," a spokesman said.
"(If) those unacceptable conditions remain... the foundation will have no option but to refuse to accept the money and will simply send it back."
ABN 60's Mr Cameron said he was amazed and dismayed that the MRCF would reject the money.
"I don't know what games they are playing," Mr Cameron said.
"If they start sending money back, whose interests are they looking after?
"Our main interest is getting this money across to make sure they can continue to pay claims."
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