Two of ANKURA’s finest appear to have been drawn into a real life drama in their capacities as administrators of Kentel Australasia Pty Limited (Kentel) after one of the company’s founders sought judicial review of their conduct.
iNO readers may be aware that Kentel, the entertainment company behind the Luxe Listings Sydney reality television program, has been rent in recent years by a legal dispute in the NSW Supreme Court between founders Ben Scott and James Kennedy.
Scott was the instigator the litigation, claiming Kennedy derived unjust enrichment by utilising the program for product placements that Scott argues benefitted Kennedy’s chain of Rolex and Patek Philippe outlets. Scott also alleges misappropriation of funds.
Kennedy has defended the claims, asserting that his initial investment in Kentel was by way of a loan and not seed capital as Scott contends.
The dispute, which was finalised last week, has led to the amassing of costs in search of an adverse order, Kennedy’s resignation as a director in 2022 and closure of the cheque book he’d been using to help keep the business solvent.
In late 2024 Kennedy used his majority 70 per cent shareholding to install Norm Ashton and Rod Sutton as independent directors.
Despite their independence Ashton and Sutton voted to sack the lawyers Scott had retained to prosecute his and the company’s Supreme Court proceedings against Kennedy after they obtained legal advice which rated the claims as weak.
Funded by a loan Kennedy provided to the company Ashton and Sutton retained A & O Shearman and sought to discontinue the proceedings.
On March 27 this year, just before the Supreme Court proceedings were due to return, Ashton and Sutton held a meeting during which they resolved to pay themselves $66,700 each in director’s fees and appoint Olde and Healey as voluntary administrators (VAs).
In their S439A Report ahead of the second meeting Olde and Healey said: “As an indirect result of the ongoing dispute, court orders were made in separate but related proceedings which led to the appointment of two (2) independent directors following a shareholders meeting”.
In their DIRRI the ANKURA duo declare that Ashton and Sutton are known to ANKURA, that they “maintain a professional relationship with Ankura and have previously worked with Ankura or been involved with matters in the past”. Cosy.
At the second meeting Kennedy’s DoCA, which was recommended by Olde and Healey and has the attraction of offering unsecured creditors 100 cents in the dollar, got over the line with help from the votes of Ashton and Sutton whose proofs for the remuneration were admitted.
A week later Scott commenced proceedings in the Federal Court seeking a judicial review of the administrators’ decision to admit the proofs of debt submitted by Kennedy, Ashton and Sutton and the matter came before the court for the first time yesterday.
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