Maurice Blackburn

Trilogy Funds Management Limited as Responsible Entity for the Pacific First Mortgage Fund:

Investigation into City Pacific Ltd (Receivers & Managers Appointed) (In Liquidation)

Maurice Blackburn is investigating the possibility of conducting a class action for the benefit of unit holders in the Pacific First Mortgage Fund (PFMF).  Maurice Blackburn acts for Trilogy Funds Management Ltd (Trilogy), the responsible entity for the Pacific First Mortgage Fund (PFMF).  Maurice Blackburn is conducting examinations into the affairs of City Pacific Limited (receivers and managers appointed) (in liq) (City Pacific).  Balmain Trilogy Investment Management Ltd (Balmain) has been appointed by Trilogy as the investment manager for the PFMF.

City Pacific was the former responsible entity of the PFMF.  From 13 July 1999 the PFMF was a managed investment scheme registered under s.601EB of the Corporations Act 2001.  The PFMF provided investors with the opportunity to invest into the fund, which had a portfolio of registered mortgages secured over real property located in Australia. There are in excess of 10,000 unit holders in the PFMF.

In March 2008 redemptions by unit holders in the PFMF were effectively 'frozen'.  On 7 July 2009 City Pacific was removed as Responsible Entity of the PFMF and Trilogy was appointed as the new Responsible Entity.  Subsequently, on 3 August 2009, receivers and managers were appointed to City Pacific. On 28 August 2009 City Pacific was placed into liquidation.

In the final year that City Pacific was responsible entity of the PFMF, impairment losses exceeded $514 million, which resulted in a 52% decrease in the unit price of the PFMF to $0.48. On Trilogy's appointment as responsible entity, over 86% of the mortgage portfolio was in maturity and interest default.

Following a grant of eligible applicant status by the Australian Securities and Investments Commission (ASIC), Trilogy commenced investigations into the examinable affairs of City Pacific, pursuant to Part 5.9, Division 1 of the Corporations Act 2001, instructing Maurice Blackburn to commence an action in the Supreme Court of NSW.  The action sought the issue of summonses to various individuals, requiring them to attend to be publicly questioned under oath in relation to their knowledge of the affairs of City Pacific.  Various orders for the compulsory production of documents were also sought, directing individuals and companies to produce materials to the Supreme Court of NSW relating to the affairs of City Pacific.

A public examination of Mr Philip Sullivan, former Managing Director and CEO of City Pacific, was conducted on 2 and 3 February 2012.  Mr Sullivan was questioned in relation to various loan transactions the PFMF entered into during 2008 and 2009.  Mr Sullivan was also questioned about his personal financial position.

An order requiring Mr Sullivan to produce documents relating to his financial position was also made by the Supreme Court of NSW.  Prior to the hearing on 2 February 2012 Mr Sullivan produced some documents to the Court.  Mr Sullivan is required to produce the remaining documents by 24 February 2012.

Further examinations are scheduled to be conducted in the Supreme Court of NSW on 19, 20 and 21 March 2012.

Once all examinations and investigations have been concluded, Trilogy proposes to determine the best course of action to seek to recover funds on behalf of PFMF unit holders, in light of the information obtained.

The investigations and examination hearings are being conducted by Maurice Blackburn on behalf of Trilogy and are being funded by the publicly listed litigation funder, IMF (Australia) Limited.