Industry fund adviser given 21 days to respond to breach claims
An investment adviser to four large industry funds has been given 21 days to file a defence in response to a $14 million damages suit brought against the funds and the adviser by a former property manager for the funds.
The superannuation funds — Sunsuper, LUCRF, HESTA and Commonwealth Superannuation Corporation (as trustee for Military Super) — are being sued by Ashington Property Group, which retired as manager of two property development funds in 2009 in which the four super funds had invested.
The plaintiff in the case, Mapeline Pty Ltd, of which Ashington founder Craig Anderson is a director, has claimed the conditions of the retirement agreement were breached and sought to have the fund's investment adviser — Ray King and his company Sovereign Investment Research — added as a defendant in the case.
In a hearing in the NSW Supreme Court on 2 May, King and Sovereign were ordered to lodge a defence, or commercial list response, by 23 May, effectively confirming their addition to the case as the fifth and sixth defendants.
The four super funds have already filed commercial list responses in which they have questioned whether King had authority to act on their behalf.
Mapeline has claimed that if this was the case it would represent a breach of the warranty of authority and misleading and deceptive conduct, and would lead to Mapeline seeking losses and damages against King and/or Sovereign and the super funds.
Mapeline began proceedings against the four funds in November 2013 and sought to have King and Sovereign added in March of this year with the hearings of 2 May related to King and Sovereign as fifth and sixth defendants.
Recommended for you
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
Having sold Madison to Infocus earlier this year, Clime has now set up a new financial advice licensee with eight advisers.
With licensees such as Insignia looking to AI for advice efficiencies, they are being urged to write clear AI policies as soon as possible to prevent a “Wild West” of providers being used by their practices.
Iress has revealed the number of clients per adviser that top advice firms serve, as well as how many client meetings they conduct each week.
