17/02/2011 - 16:00

Saraceni places $1.3m in trust account

17/02/2011 - 16:00

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Besieged property developer Luke Saraceni has been ordered by the Supreme Court to place $1.3 million transferred out of Westgem Investment's accounts the day before receivers were appointed into a trust managed by his lawyers.

Saraceni places $1.3m in trust account

Besieged property developer Luke Saraceni has been ordered by the Supreme Court to
place $1.3 million transferred out of Westgem Investment's accounts the day before receivers were appointed into a trust managed by his lawyers.

KordaMentha receiver Mark Mentha confirmed Mr Saraceni had transferred the funds, which Supreme Court Justice Corboy ruled was a residual GST payment, into a trust account managed by McKenzie Moncrieff Lawyers.

"That account can't be touched without a court order now, so at least it's safely there," Mr Mentha said.

Mr Mentha said he had been requesting the return of the funds since January 14.

Mr Saraceni previously said the funds were a project management fee and that they had sat in a Saracen Properties bank account until he received guidance from a court as to who it belonged to.

Raine Square financiers Bankwest and Bank of Scotland appointed KordaMentha as receivers to the $500 million tower in January, after Westgem missed a $50 million debt repayment on December 31.

Mr Saraceni has since lodged a Supreme Court writ asserting the receivers had been appointed invalidly, because under the original financing arrangements for the project, which were entered into in April 2008, there were no Saracen Properties assets properly identified as security for Raine Square.

Mr Mentha said he was comfortable there was a charge in place and his receivership was valid.

"I see this as a great backflip that's come as a last ditch defence mechanism to the banks continuing to sell up the Saracen guarantee companies and properties," Mr Mentha said.

Justice Corboy adjourned the hearing relating to the $1.3 million until next Wednesday to allow all parties involved to properly analyse the 1,600 page attachment to Mr Saraceni's writ, which was lodged on Monday afternoon.

Mr Saraceni is due to lodge his statement of claim with regards to the validity of the appointment of the receivers March 23.

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