Citic case against PUP leader Clive Palmer dismissed

A judge has found in Clive Palmer’s favour in civil proceedings brought by Chinese corporate giant Citic Pacific.

Clive Palmer was accused of fraudulently siphoning more than $12 million to bankroll his political party and other private interests.

A judge has found in Clive Palmer’s favour that there was not a formal legal trust underpinning a bank account from which the tycoon is alleged to have fraudulently siphoned more than $12 million to bankroll his political party and other private interests.

However, Queensland Supreme Court Justice David Jackson, QC, in his reasons today found there was “an apparent attempt (by Mr Palmer) to manufacture evidence to show that there was a written contract”, which the federal parliamentarian later chose to abandon as part of his legal defence.

He found that Mr Palmer knew that a $10m payment he made to his own company, Cosmo Developments, from the Chinese funds “was not an authorised payment”, and that a $2,167,000 payment made directly to a Brisbane advertising company involved in his electoral campaign, Media Circus, “was not an authorised payment”.

Justice Jackson said that until November 26 last year, Mr Palmer and his company, Cosmo Developments, “had persisted in an apparently unsustainable and possibly deliberately false plea” that the payments were made under an oral contract between the tycoon’s companies for port management services.

Justice Jackson said the allegations of fraudulent conduct that were levelled against Mr Palmer had a reasonable basis for being made, adding “although it has not been necessary to decide some of them”.

The decision by Justice Jackson that there was not a trust means that the civil proceedings brought in Queensland by the Chinese Government-owned investment company, Citic Pacific, will not lead to findings about whether the Federal parliamentarian had acted dishonestly and fraudulently.

Justice Jackson found that contributions of more than $20m made by the Chinese to a National Australia Bank account controlled by Mr Palmer for the purposes of running a port “were not held on trust” by his company, Mineralogy.

Justice Jackson said: “It is not necessary to make a specific finding of dishonest or fraudulent design by Mineralogy, through (Mr Palmer) or of dishonest assistance with the knowledge by (Mr Palmer).”

Mr Palmer’s use of the funds for his own purposes and his attempted explanations and his production of an alleged “sham document” to justify the payments were partly dealt with in the findings today.

“His allegation and withdrawal of the allegation that there was a contractual basis for the payments or that they were made for port management services are completely unexplained,’’ Justice Jackson stated.

“There is circumstantial evidence to support the finding by inference, which I make, that (Mr Palmer) knew that the payments were made in breach of Mineralogy’s promises to pay only the authorised costs and reimbursements (under deeds relating to the operation of a remote iron ore port).”

The case brought against the Palmer United Party leader sought formal orders including that he dishonestly procured the funds, $10m of which was funnelled into the PUP during the 2013 federal election campaign.

Fraud squad detectives in Western Australia and Queensland have been investigating the allegations since a formal complaint was authorised in Beijing and lodged late last year. Mr Palmer denies wrongdoing.

Justice Jackson ruled against Mr Palmer’s counter claim that the Chinese side had “unclean hands” and had brought the case with an illegitimate purpose to damage his reputation and strip him of royalties from iron ore tenements.