Lendlease tax fight with whistleblower Tony Watson settled
A confidential settlement has been signed in the Lendlease whistleblowing case which Tony Watson was at the centre of.
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Tax whistleblower Tony Watson has settled his case against property giant Lendlease and his former accounting firm, putting to bed years of litigation that cost him his house.
Court filings reveal Mr Watson, a former partner at tax firm Greenwoods & Herbert Smith Freehills, ended his case on Friday as it approached a final hearing originally set down for June.
Documents lodged with the Federal Court showed Justice Elizabeth Raper dismissed the case by consent, with cost orders made, concluding the marathon fight first lodged in June 2022. The settlement is confidential.
Mr Watson, who lost his lawyers in April after exhausting his fighting fund, said he and his wife could move forward: “Sue and I are glad this is behind us,” he said.
The Federal Court denied Mr Watson’s request for referral of possible pro bono legal representation after 21 appearances.
Mr Watson had alleged he was removed from Greenwoods & Freehills over his role providing tax advice to Lendlease, where he challenged the property developer’s treatment of the sale of several chunks of its retirement living assets.
The veteran tax lawyer had cautioned Lendlease it was exposing itself to a massive tax bill after attempting to “double dip” on the assets.
Mr Watson later turned whistleblower and went to the Australian Taxation Office over the matter, after repeatedly trying to warn Lendlease’s board and executives over their tax dealings.
Lendlease has already faced a $112m amended tax assessment from the ATO over the scandal, and the property giant’s final bill could be north of $300m.
Its first bill has since been revised down to $95m after the ATO waived some costs.
“I am looking forward to resuming my practice as a tax lawyer,” Mr Watson said.
“I will continue to advocate for whistleblower law reform in Australia.”
PwC Australia supplied the advice Lendlease relied on to back its tax treatment.
The audit and consulting giant, revealed to have systematically abused confidential government tax information in a bid to benefit its technology clients, acquired Greenwoods & Freehills and folded the firm into PwC.
A PwC spokeswoman noted “the dismissal of the proceedings commenced by Mr Watson against Greenwoods & Herbert Smith Freehills and Lendlease in the Federal Court of Australia”.
Lendlease continues to challenge the ATO’s amended assessment, with a spokeswoman advising the firm “maintains its position that our tax treatment on these matters is consistent with the law and that we have acted and continue to act with integrity in relation to our tax affairs”.
“No admissions were made by any party,” she said.
“Mr Watson ceased advising Lendlease in October 2014. Mr Watson does not have accurate knowledge of Lendlease’s tax affairs post that date.”
Originally published as Lendlease tax fight with whistleblower Tony Watson settled
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