COURT: The ad agency, phoenixing, an inside friend and misappropriation of funds
A Federal Court testing allegations of asset stripping and “improper” conduct against industry figure Mark Fishwick was told how a “friend” at the then APN Outdoor helped switch a valuable sales agent contract out of a failing advertising agency.
This movement from Ambient Rail of the contract to sell billboard space for NSW Rail and Metro Trains Melbourne (MTM) amounted to phoenixing, the Federal Court was told in the first day of an action against Fishwick and Captive Vision Outdoor.
The Australian Tax Office describes phoenix activity as when a company is liquidated, wound up or abandoned to avoid paying its debts. “A new company is then started to continue the same business activities without the debt.”
Ambient Rail liquidator Brad Tonks, a partner at insolvency specialists PKF, has brought the Federal Court action, seeking to recover funds which he argues should have been due the advertising agency which went into administration in 2014.
Executives at what was then APN Outdoor (and now JCDecaux Australia) facilitated moving the agreement from Ambient Rail, the court was told.
One of them, Andrew Hines, currently chief operating officer at JCDecaux, was an “old friend” of Fishwick’s, the court was told.
On the first day of the hearing, Barrister Steven Golledge, SC, described moving the valuable contract with APN Outdoor from Ambient to another company as a phoenixing scheme.
The court was told that the scheme to move the contract followed Ambient Rail director, Milan Bosic, misappropriating $1.2 million from the company.
Steven Golledge, SC, representing the liquidator, said the Fishwick side in the court case argued that this was a “fatal” wound to the company.
However, he described this as a red herring, a distraction.
Golledge: “Mr Fishwick, in company with his old friend Mr (Alan) Conder (Captive Vision), initiated a plan … to secure transfer of these valuable licences.”
They then asked APN Outdoor to end the Ambient contact and to create another with a new company, eventually ending up with Captive Vision Outdoor, the court was told.
Then followed a “flurry of activity within APNO to accommodate Mr Hine’s old friend Mr Fishwick,” Golledge told the court.
Captive Vision is part of Venetian Media Group (VMG), founded by Mark Fishwick and his son Michael.
Proceedings against Alan Conder, shown on LinkedIn as the managing director of Captive Vision Pty Ltd, were dismissed by the Federal Court last week. But he and Lynn Conder must pay their own costs.
The court was told Monday that Conder has been uncontactable since, reportedly overseas on holiday.
This said, Fishwick’s barrister, Mark Costello, SC, could cause a “grave injustice” to his client if he could not access Conder’s evidence.
Fishwick and Captive Vision Outdoor are defending the long-running action, with costs now running at more than $1 million.
The Federal Court judge, Justice Markovic, in a summary of the case: ” … the plaintiffs claim that the defendants engaged in a scheme whereby the business of Ambient Rail was removed from it in the period prior to its winding up as part of an alleged deliberate strategy to strip it of its assets during and after a dispute between Mr Fishwick and his fellow shareholder, Milan Bozic.”
The Ambient Rail liquidator alleges Fishwick engaged in “improper” conduct, and breached his fiduciary and statutory duties and “misused” his position as a company director.