“…what is most disappointing is seeing the State Government throw their long held environmental credentials out the window in favour of the bully boy thuggery of a union dispute.”
Author: Michael Brennan
It’s always gratifying to get feedback on how you are doing on a job and feedback comes in many forms. Wednesday, was a new high (or low) for me when the Deputy Premier of Qld tried to smear my professional reputation under the protection of Parliamentary Privilege.
As an insolvency practitioner, being thrust into the mess left behind in an insolvent business is a challenge. We all go about it by picking through the pieces, carefully considering how best to deal with the detritus left behind and then recycling the assets back into the economy. Doing so requires a strong and unique set of skills and a thick skin.
We are always held to account for the success or otherwise of our assignments.
On the flipside we have our political class. Invariably, they have little to no subject matter background knowledge, yet they wield incredible power. In Queensland that power is basically unfettered. Politicians also get the benefit of Parliamentary privilege where their empty vessels can make as much sound as they like without the need to worry about being correct or to worry about any damage to anything other than their own ego. Parliamentary Privilege can be a good thing but like most powers, is open to abuse when used to further political or commercial gain.
Some Context
For the past four years as one of the Liquidators of the Port Hinchinbrook Development I have worked hand in glove with the State and Local Government trying to stop a catastrophe on the doorstep of the Great Barrier Reef.
The history of the development is well documented and a tale of woe.
For the first two and half years of the liquidation, the State and Council steadfastly refused to entertain the Council acquiring the assets. In all honesty, you could see why they were reluctant. Cardwell as a township, is on septic sewerage. The Port Hinchinbrook development of 147 homes has a fully reticulated sewage treatment plant (STP). The economics of a small Council running the STP do not stack up.
Despite the economics, we were all left a basket case that everyone knew would end up eventually in the lap of the Council funded by the State. It was equally obvious to me, how part of this journey would go when two years ago, the State asked me to transfer the assets to them for nothing. I actually laughed out loud when the staffer told me because I thought he was making a joke. Seems he was not.
Once the Council and State changed tack and decided to acquire the assets, they telegraphed their plans like a punch-drunk boxer. The only weapon they had in their arsenal was the Department of Environment and Science (DES) and threats of personal liability against the Liquidators.
In March 2021, the Cassowary Coast Regional Council fired the first shot. The Council refused to maintain the STP from 1 July 2021 unless the State gave them funds. They knew the State would refuse that request. The State obligingly refused saying that if the Council didn’t run the STP, it was the responsibility of the Liquidator. The State knew full well there were no funds in the liquidation. The fix was in.
Where was the money coming from? The Lot Owners refuse to contribute as they knew that the taxpayers were going to foot the bill. Lot owners owe just over $1.6M for use of the assets but they refuse to pay. It’s free flushes for all in Port Hinchinbrook!
The game was now afoot. Enter the DES. Like a well-trained attack dog let off the leash by their masters, notices and EPOs followed like clockwork. All of which were met with grace, dignity and professional cooperation. At numerous meetings we asked DES what was plan B? When the fines to the insolvent company and an unfunded liquidator don’t miraculously make money appear. Who will fix the problem?
Over the past five months. A game of brinkmanship has ensured. The sewerage system runs down, the residents flush for free then cry foul (literally) when poo hits the street and the Council steps in to clean up the mess. Wipe. Flush. Repeat.
During all of this mess, we have tried to negotiate a sensible compromise, where the assets all get transferred to the Council and they pay what they are worth. Nothing more, nothing less. If the valuer says they are worth nothing, happy days for them. If they aren’t worthless – then that is the price they pay.
The State and Council refuse to agree to having an independent expert assign a value to a very specific set of assets. They want them for free and nothing will move them from that. We are nearly ready to quote The Castle here! It really is the vibe.
Every single time I refuse to capitulate in discussions with the Department of State Development, a phone call or email from DES follows. Last week the Government sunk to lows that in my mind were tantamount to extortion. That’s not a claim I make lightly. On Thursday at 9 am, I spoke to the Department of State Development and was told that there was zero chance of State paying for the assets in question. If I didn’t agree to their offer of $0.00 (GST Inclusive) I would be held personally responsible for any damage to the environment.
Within three hours I was contacted by the Principal Investigator from the DES who wanted to meet to “have a chat”.
We met on Friday where I was served a notice to attend an interview under the coercive powers contained within the Environmental Protection Act. To the investigator’s credit, he seemed a bit sheepish about the matter but told by that the instruction for the investigation into the conduct of the Liquidators came “from dizzying heights”
After our meeting, the pressure was piled on further when I was advised by phone that the DES was going to issue further notices against the Liquidators to rectify the STP. I had had enough by then. My only choice was to make a complaint to the Crime and Corruption Commission in relation to the misuse by the State of the DES to gain a commercial benefit.
So how high is dizzyingly high? I only had to wait five days to find out
Yesterday, after a Dorothy Dix question in Question Time from the Member for Hinchinbrook, the Deputy Premier doubled down on the threat against me via DES by attacking my professional reputation. My crime, refusing to capitulate to a bunch of bullies. The first I heard about Miles’ comments came late in the afternoon when contacted for comment by the media.
There were two options. The first was to say nothing and continue to take the professional highroad and let the empty vessels fill the void. The cost to that course of action was my professional reputation. The other option was to climb down into the gutter with Miles and come out swinging. Below is the release we sent to the media.
STATEMENT- PORT HINCHINBROOK
17th November 2021
“Today the Deputy Premier of Queensland Steven Miles has misled the Queensland Parliament and announced the unprecedented use of the powers of the Co-Ordinator General to bully and intimidate after a complaint was made to the Crime and Corruption Commission in relation to his Department’s stand-over tactics regarding The Passage Holdings Pty Ltd (the Company), which is the owner of the Port Hinchinbrook Development.
Last Friday, the Liquidators made the State aware that a complaint to the Crime and Corruption Commission had been made alleging extortion by the Queensland Government. It is by no coincidence that some five days later, Mr Miles has made false claims under Parliamentary Privilege and exerted the power of the Co-Ordinator General in an unprecedented manner.
The Liquidator has been in co-operative negotiations with the Cassowary Coast Regional Council and the Queensland Government since its appointment in 2017. There is a significant body of correspondence which supports this.
Over recent months, DSDILGP has stalled negotiations considerably. Each time this has occurred, the Department of Environment and Science (DES) has been stood up to exert pressure on the Liquidator with sudden and varying claims of environmental obligations.
When the State compulsory acquires assets, it is required to compensate the asset owner at market value. Seeking to weaponize the potential for environmental harm to leverage a better commercial outcome is extortion. The Corporations Act also obliges the Liquidators to obtain value for all assets of the Company disposed of or the Liquidator is in breach of the Act.
Last week, discussions between DSDILGP and the Liquidator stalled when DSDILGP applied pressure on the Liquidator to transfer the assets of Port Hinchinbrook for no commercial return. Three hours after that impasse, the Liquidator was contacted by the Principal Investigator of the DES who initiated a meeting.
When the Liquidator arrived at the meeting, he was served with a Notice under S.465 of the Environmental Protection Act. The Principal Investigator proceeded to tell the Liquidator that the investigation had come about at the direction of people he described as being “from dizzying heights”. The weaponization of the DES in this manner is a complete abuse of power.
The use of the Co-ordinator General to resume the land and associated tenures just five days after the State was made aware that a Crime and Corruption Commission complaint had been lodged is further cause for concern.
Furthermore, baseless claims made today by Mr Miles that the Liquidator has been offered a ‘commercial arrangement’, has ‘been obstructive’ and ‘not met their obligations’ are false and misleading to the Queensland Parliament. The Liquidator will be making a formal complaint in relation to this matter.”
In a further telegraphing of punches, I have since been advised by DES to ensure that my Lawyers advise me on my inability to claim privilege against self-incrimination. I am going to bed early so that interview comes around sooner! In all fairness, I have to say that the local DES staff I have dealt with have been nothing but professional and as collaborative as their marching orders allow them to be.
This situation has nothing to do with protecting the environment. The State could protect the environment now whilst this complicated transaction is worked through.
This whole sorry saga is about the fact that a cash constrained State Government, has done a politically expedient deal with a minority party to broker favour and they don’t have the funds to complete the project that they have committed to. They need to pay nothing to acquire the assets because they don’t have the budget to fulfill their announcement. That set of facts is not unusual these days at any level of government and in any State. What should be unusual, and what is most disappointing is seeing the State Government throw their long held environmental credentials out the window in favour of the bully boy thuggery of a union dispute.