Legal – Global Farmer in Australia

https://upload.wikimedia.org/wikipedia/commons/a/af/Aachen_Allegory.jpg — The Triumph of Justice by Hans von Aachen.

Persistence.

The Cronin family deserve answers from Ferrier Hodgson and the National Australia Bank, answers which at the time of writing they are both either refusing to answer all questions or they are giving what can only be called puerile reasons for delaying answering our questions. The law protects the mortgagor. The law says that all the financial activities of the receiver manager and the manager in possession for the mortgagee, must be transparent and made available to the mortgagor. The National Australia Bank and their appointee Ferrier Hodgson appear to disagree with the law. So persistence is our only recourse.

The stand out feature following the publication of ‘National Bank Bastardry’ in the last issue of the ‘Global Farmer’ was the number of people, including those on Facebook, who encouraged us to keep on going with the story and wished the Cronin family all the best for Christmas and especially for a better New Year. Many identified with the Cronin’s problems, some related ‘tough’ experiences with their bank and as a result, did not want to go public with either their name or their story, except to say they had one. That is not a healthy relationship between borrower and lender – between the farmers and their banks. For every Charlie Phillott in Queensland and Cronin family in Western Australia, it appears there are many others with similar stories, which will never be told.

Smoke Screens and Threats.

Harold Cronin wrote to Ferrier Hodgson (FH), appointed by the National Australia Bank (NAB) as the receiver managers and manager for the mortgagee in possession of what was formerly Chambejo Farms, the Cronin family farming business. He asked for a copy of all (two or three) the valuations on Chambejo Farms that FH had commissioned from a firm of valuers, Opteon, and for which Chambejo Farms had paid. Harold wrote based on this advice:

The Corporations Act obliges receivers to keep financial records that “correctly record and explain” transactions they enter into while they are controlling a company. Directors and shareholders of the company have the right to inspect those records. These provisions appear in section 421 of the Act.

What follows is the body of the letter he got back from FH. It appears to be the very antithesis of section 421 0f the Corporations Act. If you don’t want to read the whole letter here is a short review, you should read the letter, because it’s a blinder:

FH wrote back to Harold and stated that they couldn’t release the information he requested because they, FH, had signed an agreement with Opteon invoking the Privacy Act 1988. Their contention was and is that the results of the valuations, paid for by Chambejo Farms as mortgagor are secret and unavailable to Chambejo Farms unless they signed an agreement, which absolved Opteon and FH from any action or proceedings based on the valuations. Even if they signed, it only meant that FH and Opteon would further consider the request; in effect they could still say no. It’s true – FH and Opteon wanted Harold and his family and their Trustee in Bankruptcy to give them an escape from possible prosecution. Why would they do that? It’s obvious isn’t it?

Continue reading “Part II of National Australia Bank Bastardry – Is Breaking the Law Legal?”

An unnecessary foreclosure by the National Bank of Australia in 2013 has left a couple who pioneered the Ravensthorpe area destitute and reliant on the old age pension. Their only possessions are their furniture, a far-from-new Jeep station wagon and their clothes. They live by ‘grace and favour’ on a friends farm. As you will see, because of a legal precedent, there is every reason to believe that National Australia Bank may have acted in contravention of the law. The question we have to ask as laymen is; is there now a case for damages against the National Australia Bank and if there is, from where do those who believe they have been damaged get the money to pursue one of the most powerful corporations in Australia, who are well known to have bottomless legal pockets?

After seizing their farms in May 2013 and putting them in the hands of Ferrier Hodgson (FH) as receiver and managers and agents for the mortgagee in possession, the National Bank of Australia (NAB), on November 11 2015, informed Harold, Barbara and Christopher Cronin, formally of Chambejo Farms Pty Ltd, that the NAB and FH, over 28 months, spent an amazing $6.0 million dollars, in what can only be called a failed attempt to recover a $6.0 million debt from Chambejo Farms.

Final returns were submitted to ASIC by FH in September 2015. If Harold Cronin had not asked the NAB and FH for the details of the costs and returns regarding the sale of the assets and properties that had comprised Chambejo Farms, recent experience has shown there is no reason to believe that the information would have been volunteered by either the NAB or FH.

On the contrary, FH and the NAB have been obstructive and repeatedly refused to provide information to the Cronins. The Cronins now know why FH did not wish to publicise what some might call their incompetence. We will show that FH were and are obliged by law, to provide detailed information to the Cronins as mortgagors.

As you will see later it is open to question, by their actions, whether both organisations abrogated their obligations under Section 420A(1) of the Corporations Act and their obligations under common law to act in good faith, particularly when it comes the family home.

It is open to speculation if this is what the NAB board and senior management really think of farmers after a couple of bad seasons? It’s certainly not their public position.

Does the NAB management not understand that farming is all about risk? The Cronins weren’t on their own after the bad seasons of 2011 and 2012. The records show many farmers in their region went deeply into debt in those two years.

“It’s ironic,” says Harold, “That 2013/14 was a very good season in the Ravensthorpe area and had we been allowed to put a crop in, it would have solved most of our financial problems.”

Continue reading “National Australia Bank Bastardry ?”