Clive Palmer loses bid to avoid testifying at QN collapse case
Palmer’s wife and nephew did deal for QN to buy $135m worth of shares in coal mine 5 days before company failed, court hears.
Clive Palmer’s wife and nephew did a deal for Queensland Nickel to buy $135 million worth of shares in a coal mine he wanted to build five days before the company failed, a court has heard.
At the time the deal was signed, on January 13 last year, Queensland Nickel was less than a week away from being placed in voluntary administration over debt concerns.
It is now in liquidation, with creditors owed about $300 million and 800 Townsville refinery workers out of their jobs.
Lawyers for FTI have today been quizzing the nickel company’s former chief financial officer Daren Wolfe about the January 2016 deal involving Mr Palmer’s wife Anna and nephew Clive Mensink.
At the time, Mrs Palmer had just become the sole director of her husband’s China First company, which had plans for a new coal mine in Queensland’s Galilee Basin.
Mr Mensink was the sole director of Queensland Nickel.
The agreement committed the nickel company to buying $135 million shares in China First, and gave that company recourse to go after the assets of Queensland Nickel and its parent companies if the money wasn’t paid.
Mr Wolfe told the court he had no idea the deal was being negotiated until Mr Palmer asked him to show up at the offices of a Gold Coast law firm. When he arrived, Mr Palmer asked him to witness the deal, which he did despite not having time to read it properly.
Five days later Queensland Nickel was in administration, and liable for the $135 million owed to Mr Palmer’s other company.
“I only became aware of this agreement at the time I witnessed its execution,” Mr Wolfe told the court.
Mensinck to testify
Meanwhile, Mr Palmer’s gallivanting nephewhas promised to cut short his year-long overseas holiday to testify at the Federal Court this month.
There are two summonses requiring Mr Mensink to come home and give evidence before the public examination into the collapse of Queensland Nickel.
One required him to turn up to the Federal Court in Brisbane today, but he was a no-show.
He avoided the court issuing a warrant for his arrest — as it has the discretionary power to do — when his lawyer Sam Iskander told the court Mr Mensink had agreed to return to Australia to give evidence.
Registrar Murray Belcher adjourned Mr Mensink’s summons to February 20, when he will be cross-examined by liquidator FTI Consulting’s barrister Walter Sofronoff QC.
He has also agreed to comply with a summons issued by special purpose liquidator PPB Advisory to be examined two days later.
Mr Iskander said: “There (are) some negotiations as far as expenses and so forth.”
The Australian reported today that Mr Mensink said it was unreasonable for him to return before his holiday was scheduled to finish in June.
His solicitors had asked liquidators to pay for flights back from London for Mr Mensink, as well as hotels, and other expenses.
Earlier today, the Federal Courth public examination into the collapse of Queensland Nickel heard evidence regarding millions of dollars being funnelled out of the company into Mr Palmer’s empire.
The man ordered to funnel the money, chief financial officer Daren Wolfe, said he never considered whether the transactions would hurt the company.
Mr Wolfe also dodged accusations he’s acting as an “advocate” for Mr Palmer rather than telling the truth.
The company failed last year, leaving nearly 800 workers jobless and $300m owed to creditors.
Administrators have previously identified that QN acted as a “cash cow” for the rest of Mr Palmer’s empire to the tune of more than $200m, but most of the loans were never repaid.
Mr Wolfe, as CFO, said he was regularly sent text messages by Mr Palmer ordering that money be paid from QN’s bank account to other Palmer companies. The court was told of an instance in February 2015, in which Mr Wolfe arranged for $375,000 to be paid from QN to Mr Palmer’s Gold Coast golf courses for “working capital”. It was not paid back.
Barrister Walter Sofronoff QC, for liquidators FTI Consulting, suggested to Mr Wolfe that as CFO he did not consider whether the cash transfers were to the benefit or detriment of Queensland Nickel.
“Privilege,” Mr Wolfe answered, indicating that he was seeking privilege against self-incrimination. “That’s correct.
Earlier, during a heated exchange between Mr Wolfe and Mr Sofronoff, the barrister asked: “Are you here to advocate for Mr Palmer rather than tell the truth?”
Mr Wolfe answered: “I am trying to answer the question.”
Mr Palmer’s nephew Clive Mensink — the sole director of QN when it collapsed in January 2016 — has not turned up to court to answer his summons.
His absence has not yet been mentioned in court.
The hearing continues.
Palmer must testify
A Federal Court judge has slapped down Clive Palmer’s argument that it would be “oppressive and inconvenient” for him to testify about the collapse of his company, Queensland Nickel.
Justice John Reeves today rejected an application by the founder of the now-dormant Palmer United Party to cancel or adjourn his testimony in the Federal Court public examination about the company’s failure.
Mr Palmer had been due to appear in court today, but liquidators agreed his appearance could be delayed until Wednesday next week because he has to attend a funeral tomorrow.
But Mr Palmer lodged a last-minute application to dodge a summons to produce documents and turn up.
Justice Reeves strongly rejected the request today, slamming Mr Palmer for a “lack of any satisfactory explanation” for his arguments.
Former chief financial officer of QN Daren Wolfe will give evidence today.
Regular updates will be published on The Australian.