An “old friend” of Clive Palmer who worked as general manager of Queensland Nickel was also paid by the company to work on unrelated property schemes with the tycoon, the federal court has heard.
Ian Ferguson, who first met Palmer working together on property developments in the mid-1970s, said he worked for a year as general manager at QN without knowing who he was really working for or “how the refinery actually operated”.
But he said it was “correct” that Palmer was at the top of QN’s corporate hierarchy as the “100% owner” of the refinery, despite Palmer not being a director of the now failed company.
Ferguson took the stand on the third day of court hearings in which liquidators, including on behalf of the federal government, are probing QN’s collapse ahead of attempts to claw back about $300m in debts.
Liquidators are probing for evidence the company traded while insolvent and that Palmer acted as a shadow or de facto director, which he has denied.
Insolvent trading opens up the possibility of civil or criminal penalties against a company director.
The hearings are also probing cash outflows from QN, which included loans to other Palmer-owned companies that were subsequently “forgiven”, including Palmer Leisure Australia, which held golf courses on the Gold Coast.
QN managed the Townsville refinery in a joint venture but held virtually no assets when it was wound up in April.
The refinery assets are held by two other Palmer-owned parent companies of QN.
The court earlier this week heard that Palmer had ceased being a director of QN more than a year before its collapse but continued to exercised authority its spending decisions as the chairman of a joint-venture owners’ committee.
Ferguson said his private company, Primeland Australia, invoiced QN for his services consulting on Palmer-backed property developments, which had nothing to do with the refinery or his duties there.
This included his plan to cash in on the 2018 Commonwealth games by building 7,500 apartments on a 250-acre former Japanese wedding reception venue on the Gold Coast.
“I had a really good idea,” Ferguson said of the concept, dubbed Greenheart Gardens at Merrimac, which was to be carried out on “Mr Palmer’s properties one way or another”.
Ferguson said he knew nothing of an invoice made out to QN for $8,250 worth of engineering consulting on the project. But “under the joint venture agreement with [QN’s] two parent companies, they may have been making payments on behalf of Mr Palmer’s companies”, he said.
Cathy Muir, a lawyer acting for a special purpose liquidator appointed by the federal government – which wants to recoup about $65m it paid to cover entitlements for almost 800 sacked QN workers – asked Ferguson who was working for in his first year at QN.
“I’m not 100% sure, I thought I was working for Queensland Nickel but I realised at a later date that there was a joint-venture agreement in place,” Ferguson said.
This was when Ferguson became a director of QN and its parents, QNI Resources and QNI Metals, for 10 months in 2013.
He said his understanding of QN was that it had “no money in its own right or assets”.
Ferguson said he could not recall why he stopped being a director of the QN group companies but that “my focus was on the operations”.
Muir said: “I’m just trying to understand, Mr Ferguson – you are an experienced businessman, you take on diector’s role with all three companies and you have no idea why you ceased being about 10 months later?”
Ferguson said he imagined he had been used as a “fill-in director” and that he “probably was asked to stand down”.
He later returned as a director of the group companies for several weeks to stand in for Palmer’s nephew Clive Mensink – who ended up sole director of all the joint venture companies – went he was going through a divorce last year.
Ferguson currently works as general manager for Queensland Nickel Sales, which replaced QN as the manager of the now mothballed-refinery.
Palmer is due to be questioned under oath at the hearings on Friday.
