A multimillion-dollar stoush between former media executive Mark Jamieson and Westpac is headed for Queensland's highest court, after both sides appealed an earlier ruling.
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The case comes amid political turmoil over the performance of financial planners, with the Senate expected this week to overturn the government's roll back of consumer protection laws.
In a Supreme Court ruling in March, judge David Jackson found that Westpac had erred in its advice to Mr Jamieson, when he was CEO of APN News & Media and estimated to have assets of $6.6 million. Mr Jamieson is now the mayor of the Sunshine Coast.
Justice Jackson said that Westpac had understated the amount of money Mr Jamieson and his wife Lorrell Jamieson had at risk - more than $1.125 million - by about half.
Justice Jackson ruled that it was a breach of contract and negligent of Westpac financial planner Robert Tindall to fail to adequately explain the "highly complex" financial products he was selling.
"Quite apart from any statutory obligation to do so, it seems to me that it was incumbent upon the bank, in recommending such a complex product, to provide copies of the relevant documents to the client, so that the risks and benefits could be assessed by the client," Justice Jackson said. "That conclusion is not affected by the level of Mr Jamieson's experience or his skills as an astute businessman."
The Jamiesons sought financial advice in the first half of 2007, just before the financial crisis that rocked sharemarkets. They were estimated to have $13.2 million in assets - comprising four properties, shares, employee options, superannuation and investments in managed investment schemes - and liabilities of $6.58 million.
Mr Tindall advised the Jamiesons to borrow $5 million from Macquarie Bank, to be invested in a managed investment scheme known as "MQ Gateway Trust".
The couple was also advised to borrow $600,000 from Westpac to make substantial contributions to a new self-managed super fund which would invest in risky self-funding instalment warrants. The couple borrowed $700,000.
Both strategies were unsuccessful.
The Jamiesons sought damages to "restore them to the position as if no borrowing or investment had been made". They claimed damages for alleged breaches of contract, negligence and contraventions of statute in preparing and giving advice.
The bank denied any breach of contract, negligence or contravention of statute. It also denied that it caused the couple any loss that they would not otherwise have suffered.
Justice Jackson directed the parties to submit a calculation for damages. No payment has been made ahead of appeal.
But Justice Jackson said Mr Jamieson's claim for damages "should be reduced on the basis that he would have made an alternative investment in agribusiness in 2007 in the global amount of $200,000".
Westpac said: "Both parties are appealing the judgement and as a result we won’t be commenting on matters that are before the court.” Mr Jamieson did not respond to a request for comment.
In his ruling, Honourable Justice David J Jackson noted that there were "numerous factual disputes between the parties" and he had "formed the view that significant parts of his [Mr Jamieson's] evidence were a regurgitation of the contents of the documents, against which he had reconstructed what he believes happened".
