‘Cavalier’ ex-LNP president ‘misused’ company funds

A former LNP Queensland president wrongly forced his renewable energy company into voluntary administration weeks after his business partner accused him of using company funds for ‘suspicious transactions’.

Former LNP president David Hutchinson leaving the Federal Court in Brisbane. Picture: Liam Kidston

A former LNP Queensland president wrongly forced his renewable energy company into voluntary administration weeks after his business partner accused him of using company funds for “suspicious transactions”, including transferring $500,000 in federal government grant money to his brother’s mortgage offset account.

David Hutchinson, who served as Liberal National Party president between 2018 and 2020, and his former friend and fellow LNP heavyweight Brad Carswell have been locked in a legal battle over their company Green Day Energy for months.

Federal Court judge Roger Derrington on Thursday issued a scathing ruling about Mr Hutchinson’s behaviour, describing the $500,000 payment of company money into his brother Stephen Hutchinson’s mortgage offset ­account as “impropriety” and “misusing the company’s funds”.

Stephen Hutchinson was not a director nor an employee of the company.

Justice Derrington ruled that several decisions Mr Hutchinson had made were invalid and represented a “substantial injustice”, ­including to place GDE in voluntary administration and to remove Mr Carswell – the major shareholder – as a director. The judge ordered both decisions be immediately reversed.

GDE received a government grant of more than $5m to conduct research into the production of low-emissions energy from the combustion of a weed called prickly acacia; the lucrative grant was awarded in the final weeks of the Morrison government.

Justice Derrington’s judgment states that Mr Carswell – a former LNP candidate for the federal seat of Lilley and the Senate – became “concerned” in about May about “certain large transactions” in GDE’s accounts, inclu­ding the $500,000 withdrawal.

Brad Carswell leaving the Federal Court in Brisbane. Picture: Liam Kidston

The transaction was recorded in an account submitted to the federal Department of Industry as money paid to an engineering firm controlled by another shareholder for “plant and equipment”.

“That entry was false,” Justice Derrington said.

“The money was not paid to Roundhill Engineering Pty Ltd, and it was not transferred for, or spent on, the acquisition of plant and equipment.”

Company money was also spent on two vehicles: a $36,000 Nissan Navara registered in Mr Hutchinson’s name, and a $67,145 Ford Ranger used exclusively by Stephen Hutchinson.

“After Mr Carswell raised with Mr Hutchinson his concerns about these transactions and the company’s financial management more generally, the relationship between the two directors deteriorated,” Justice Derrington said.

The purchase of the two vehicles were evidence of Mr Hutchinson’s “financial mismanagement”, he found.

“These dealings by Mr Hutchinson reinforce the view that he has been prepared to misapply the company’s funds rather audaciously for his own benefit and for the benefit of his relatives.

“Such behaviour is offensive to ordinary understandings of sound financial management.”

In the aftermath of this confrontation, Mr Hutchinson drew up company meeting minutes that purportedly sacked Mr Carswell as a director, and then placed the company into voluntary administration even though it had more than $1m in its NAB bank account.

The judge found Mr Hutchinson did not believe GDE was insolvent, or likely to become so, and forced the company into administration for the “improper purpose” of trying to exclude Mr Carswell from the company’s management.

Justice Derrington said he “found it very difficult to believe Mr Hutchinson’s evidence”.

“He was generally evasive when questioned and, when faced specifically with material that contradicted his evidence, he tended to avoid responding directly to the question put to him … his evidence otherwise strained credibility in many respects,” he said.

The judge said it appeared Mr Hutchinson breached his statutory duties as a director, had a “cavalier” and “self-interested” ­attitude, and should be removed from the company’s board.

Mr Hutchinson was revealed in 2020 to have led a failed backroom plot against then-LNP leader Deb Frecklington in the months before the state election. He was party president at the time.