AUSTRALIAN investment manager Woodlawn Capital has repaid A$20 million to Papua New Guinea’s Motor Vehicle Insurance Limited (MVIL), following an order by the Supreme Court of New South Wales.
MVIL had applied for the funds to be unfrozen by the court after a decision by NSW Justice James Stevenson made in its earlier case against Woodlawn.
In accordance with the ruling, Woodlawn transferred A$20 million to a trust account in PNG, with K41.9 million later released to MVIL.
Woodlawn was originally entrusted by MVIL with K96,479,986 under an investment management agreement in 2009, with the funds to be invested in third party funds.
Worth approximately A$43.7 million at the time of the initial placement, the portfolio was worth only A$30.5 million when the agreements were terminated on 17 November 2011 – a fall the court heard was largely due to Woodlawn’s dealings with the portfolio.
Of that A$30.5 million, Woodlawn had repaid about A$4.2 million, claiming roughly A$23 million of the outstanding A$26.3 million was due to it for various fees.
This claim was disputed in the Supreme Court of NSW, where Woodlawn is based, with those funds frozen while the case played out.
Justice Stevenson handed down a list of reasons for a final judgement he is yet to make in October, finding that Woodlawn was only entitled to fees accrued to 17 November 2011 – when the initial agreements were terminated.
“In those circumstances the maximum amount that Woodlawn would be entitled to retain from the fund it holds can now be identified,” Justice Stevenson wrote in a December decision.
“Making every assumption in Woodlawn’s favour, that sum is a little over A$5 million,” he said.
In addition to ordering the A$20 million payout to MVIL, Justice Stevenson ordered a payout to Woodlawn of A$2.9 million, which made up funds from its accrued fees minus an adjustment, he said.
“Woodlawn submits that the quid pro quo for a payment out to MVIL of the funds it seeks is that this net sum be paid to it,” the judgement said.
With those amounts paid out, A$4.5 remains in the frozen accounts.
The matter is set to resume in the NSW Supreme court on 30 March, with questions about interest and legal costs to be heard at that time.
This initial transaction is also the subject of a challenge by the Independent Public Business Corporation, the trustee of MVIL in both the National and Supreme Court in Papua New Guinea.