Challenger class action
Maurice Blackburn commenced a class action against Challenger Managed Investments Limited on behalf of a group of investors who purchased units in the Challenger Howard Property Trust for the Penrith Mega Homemaker Centre Sydney. The claim alleged that investors subscribed for units in the trust as a result of misleading and deceptive conduct by Challenger in the course of issuing the prospectus.
Challenger Managed Investments Limited is part of the Challenger Financial Services group.
On 27 November 2002, Challenger Managed Investments Limited issued a prospectus to members of the public inviting applications for units in the Challenger Howard Property Trust for the Penrith Mega Homemaker Centre Sydney. Money invested by the public in the trust was pooled to create a fund by which to acquire the Penrith Mega Homemaker Centre, a retail centre for bulky goods in Penrith, New South Wales.
The trust failed to perform in accordance with the forecasts in the prospectus, with both distributions and the property value falling significantly below forecasts. Due to ongoing poor performance of the property, the trust sold the centre for $55 million in June 2006, $10.5 million less than the original purchase price of $65.5 million. The capital returned to investors at the conclusion of the trust was approximately 40c per unit. Based on the original issue price of $1 per unit, the loss of capital value to investors was approximately 60c per unit.
Maurice Blackburn filed proceedings in the Supreme Court of New South Wales for a group of investors in the trust.
The claim alleged that the representations in the prospectus as to forecast yield and capital gain were misleading. It also alleged that Challenger's failure to provide any information or warning in the prospectus regarding certain problems with the centre was misleading and deceptive.
If you have any questions about the class action please contact Rebecca Gilsenan at Maurice Blackburn on (02) 9261 1488 or email here.
For more information on organising a class action call 1800 810 856