Federal Court judge summons Clive Palmer, nephew to witness box

Clive Palmer is likely to be forced into a witness box within weeks over his role in the collapse­ of Queensland Nickel.

Clive Palmer will likely appear before the Federal Court within the month. Picture: Kym Smith

Clive Palmer is likely to be forced into a witness box within a month and grilled by one of Queensland’s most feared barristers over his role in the $300 million collapse­ of Queensland Nickel.

Federal Court judge John Dowsett agreed yesterday to issue summonses for Mr Palmer, his nephew Clive Mensink and the nickel refinery’s operations manager Ian Ferguson to be publicly examined next month.

If the federal MP and resources businessman tries to avoid testifying and cross-examination by former Queensland solicitor-general turned prized silk Walter Sofronoff QC, the court can issue a warrant for his arrest.

Mr Palmer and the other two men will also be forced to turn over any personal documents — including emails from his alias Terry Smith — to the court in an attempt by liquidators to gather evidence to pursue the men and their companies for QN’s debts.

Queensland Nickel, the Palmer-owned company that ran his now-defunct Townsville nickel refinery, fell into liquidation last month under debts of $300m. Nearly 800 workers at their plant have lost their jobs since January, and are now relying on the federal government to pay out $69m of the $73m they’re owed in unpaid entitlements. The country’s largest­ rail freight operator Aurizon is owed more than $90m.

Administrator FTI Consulting alleges that Mr Palmer, acting as a shadow director, and director Mr Mensink breached their fiduciary and directors’ duties in the collapse of QN. It was allegedly used as a “piggy bank” and funnelled more than $200m to the rest of Mr Palmer’s empire, $189m of which was then written off.

Mr Palmer strenuously denies any wrongdoing and this week threatened to sue FTI Consulting for $1.2 billion.

Justice Dowsett also granted the federal government’s unusual request for PPB Advisory’s Stephen­ Parbery to act as special purpose liquidator, to claw back from Mr Palmer and his companies taxpayers’ money spent on workers’ entitlements.

Employment Minister Mich­ael­ia Cash said it was the first time the federal government had “acted in this way to protect the interests of taxpayers”.

“The … government sought the appointment of special purpose liquidators because of the unique and alarming circumstances in this case,” Senator Cash said. “Following the stripping of $200m from the company it was placed into liquidation, with over $73m worth of employee entitlements left unpaid.

“The cost … (is) being borne by taxpayers under the Fair Entitlements Guarantee … The appointment of the SPLs (is) to aggres­s­ively pursue the recovery of this money on behalf of taxpayers.”