Doubt on Clive Palmer’s oral deal with Chinese firm for $12m

NEW documents challenge Clive Palmer’s claims about the oral agreement that he says authorised him to take $12m in Chinese funds.

NEW  documents in a legal ­action that accuses Clive Palmer of dishonesty over more than $12 million in Chinese funds challenge the tycoon’s claims about the prior existence of an oral agreement that he says authorised him to take the cash.

The civil case will return to the Supreme Court in Brisbane today as Chinese President Xi Jinping, who has ultimate control of the litigation, wraps up his visit to Australia after the striking of a free-trade agreement.

Lawyers instructed by the China-owned investment company Citic Pacific in its Supreme Court “breach of trust” case yesterday filed documents that cast doubt on Mr Palmer’s assertions that he and senior officers from his company had reached an oral agreement that could have justified siphoning Beijing’s money from a bank account.

Mr Palmer admitted three weeks ago that a written “Port Management Services Agreement”, purportedly dated and signed by him in June last year, was in fact created in about May this year, and falsely backdated by him by 11 months.

The founder of the Palmer United Party, which secured the balance of power in the Senate after being bankrolled by more than $10m of China’s funds without Beijing’s knowledge, has said the backdated document gave force to the oral agreement he says was made last year.

China’s international business entity, which describes it as a “sham transaction”, is seeking declarations from the Supreme Court that Mr Palmer acted ­dishonestly and fraudulently in siphoning the cash from an ­account set up to fund the operations of a remote port for iron ore exports. Mr Palmer has strenuously denied wrongdoing during proceedings that have produced bank account statements and cheques showing that most of the $12.167m he withdrew in ­August and September last year was funnelled into his party.

The latest documents show that Mr Palmer, in separate Federal Court proceedings last year and this year in relation to port services, had not at any time raised any suggestion of an oral port management services agreement. The documents show that in confidential and ongoing quasi-judicial arbitration proceedings in Brisbane, Mr Palmer’s company, Mineralogy, “did not lead any evidence in relation to the oral PMSA”.

Both sets of proceedings — in arbitration and in the Federal Court — required Mr Palmer or his companies to formally disclose any such agreement in existence.

“From my review, based on the description of documents in the lists and indices and the documents I reviewed, none of the documents I have reviewed in this way relate to an oral PMSA,” said Philip Blaxill, a solicitor for the Chinese company.

Mr Blaxill also disclosed parts of a preliminary finding by the arbitrator, retired Supreme Court judge Richard Chesterman QC, in which he expressed doubts about the authenticity of the PMSA. Mr Chesterman said: “The explanation (by Mr Palmer’s company) for the use of the moneys, such as it was, was subjected to severe criticism and an intimation was given that the origin of the agreement and the circumstances of its making would be subjected to a searching inquiry. (Mr Palmer’s company) then indicated that the agreement was irrelevant and would probably not be relied upon. The result is that (Mr Palmer’s company) has not said why it withdrew the money or what it did with it. A full accounting is required.”

Judge David Jackson QC, who will hear a preliminary skirmish in the civil proceedings today, has allowed three days for the trial starting November 26.

He has previously rejected Mr Palmer’s counterclaim that the ­Chinese side was trying to damage his reputation and had brought the action against him for an improper purpose.