Omni Bridgeway funds appeal to recover tens of millions of dollars for 1000 Halifax victims
More than 1000 Halifax investors may recover tens of millions of dollars more of their funds caught up in the collapse of the stock-broking platform.
Omni Bridgeway, a leading dispute resolution finance company, said in a statement today it has agreed to fund appeals over recent Australian and NZ court judgments regarding Halifax Investment Services Pty Ltd and Halifax New Zealand Limited, which are both in liquidation.
The appeals are brought by Choo Boon Loo, a “category 1 investor”, for the benefit of all Halifax investors recognised as category 1, who are investors whose investments will be higher if valued at a date later than the administration date.
Danielle Funston, an insolvency specialist at Maddocks Lawyers, will be acting in the appeals for the more than 1000 category 1 investors, who held $82m in investments when Halifax went into administration in November 2018.
Omni Bridgeway’s statement said the value of the investors’ investments has since substantially increased in line with the performance of financial markets.
At June 30 last year 2020, the value of investments held by category 1 investors had risen to about $138m. By April 30 this year, the value was estimated at almost $170m. The value of investments by some other categories of investors in Halifax has fallen since the administration date.
The liquidators of Halifax, Morgan Kelly and John Quinlan of KPMG, have sought directions and advice on several questions about the distribution of funds held on trust by Halifax for its investors. The proceedings have been held concurrently in the Federal Court of Australia and the High Court of New Zealand.
In judgments in May, both courts concluded it was appropriate to value investors’ investments, including category 1 investors, as at the administration date in November 2018, rather than a later date, which would have taken into account changes in the value of category 1 investors’ investments.
The appeals to the Full Court of the Federal Court and the NZ Court of Appeal concern one discrete question: Whether the courts were correct in concluding that the liquidators were justified in valuing investors entitlements to the funds held on trust as at the administration date?
Omni Bridgeway has also registered a managed investment scheme with the Australian Securities and Investments Commission for the purpose of funding the representative.
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