This article is from the Australian Property Journal archive
INVESTORS in failed property company Fincorp have reached a settlement, after a two-year court battle.
An estimated 5,100 investors, who were mum and dad as well as retirees, launched a class action following Fincorp’s collapse in 2007 owning around $290 million.
The year 2007 was the period of property investment schemes collapses, some 13,000 investors lost over $1.02 billion, including 2,000 investors owed $400 million by Westpoint and 7,000 investors owned $330 million by Australian Capital Reserve and the Estate Property Group.
Lawyers for the class action, Slater & Gordon have struck a settlement against Fincorp’s trustees Sandhurst Trustees Limited to recoup the investment losses.
Although the settlement amount was not revealed, it is believe to be around $100 million.
The proposed settlement is subject to sufficient member participation and approval of the Federal Court.
But Slater & Gordon executive director Ken Fowlie said the settlement was last week overwhelmingly supported by the investors.
Slater & Gordon also did not reveal how much compensation each investor would get.
Fowlie said the work in progress and disbursements in the matter have been funded by the firm since the start of the matter since 2009.
“If the settlement is approved by the Court, this will result in the payment to the company of professional fees and disbursements incurred in the matter,” he added.
In other words, the settlement will first pay for the legal costs before the leftover is distributed to 5,100 investors.
Some of Fincorp’s assets have been sold to Becton Property Group for $175.82 million.
Australian Property Journal
