Palmer fails to recover $400k timeshare money

MINING magnate Clive Palmer has failed his bid to make directors of a timeshare company tied to his Coolum Resort pay back more than $400,000 in consultancy fees.

Supreme Court Justice Debra Mullins found on Thursday Mr Palmer was not acting in the best interest of the President's Club when his company brought court action against the directors in May.

Mr Palmer alleged the directors breached their duties when they accepted unauthorised remuneration payments from the club after carrying out consultancy work.

The President's Club operates a time share in villas at the Palmer Coolum Resort.

In 2003, Lend Lease took control of Coeur De Lion Investments which had a 41% share in the President's Club.

In 2011, Lend Lease sold its shares to Mr Palmer making him the majority shareholder of the President's Club.

In a written judgment, Justice Mullins revealed the President's Club paid out $437,870 in consultancy fees to directors between 2004 and 2011.

Legal counsel for Mr Palmer's company, Coeur De Lion Investments, argued there was no record of board meeting minutes which showed approval for this or provision under the company's constitution.

But Justice Mullins noted the board passed a resolution in 2001, giving directors the right to claim $200 per hour for time spent on club business outside board meetings. The directors explained this included legal work done when the club tried to restrain development of the resort in 2005 without their permission.

Justice Mullins found while the directors relied on the resolution passed in 2001 to legitimise their actions, it "could not have been intended to authorise claims made up to 10 years" later.

But Justice Mullins found the consultancy pay outs were documented in financial reports for all to see and accepted until Mr Palmer came along.

In relation to Mr Palmer acting in good faith in going after the director's consultancy fees, the directors argued he simply wanted to gain control over the club.

They also argued Mr Palmer did not weigh up the benefits to the company resulting from the director's work.

Justice Mullins was not satisfied Coeur De Lion Investments showed the proceeding was in the best interests of the company.

She dismissed the application to pursue proceedings against the directors.

Topics:  clive palmer

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