Appointment type:

Joint and Several Receivers and Managers
Joint and Several Liquidators

Appointment dates:

25 February 2010
4 March 2010
30 July 2010
13 May 2011

4 November 2011

Entities in receivership:

Letten Schemes

Letten Companies

Additional Letten Schemes & Companies

Entities in liquidation:

Letten Companies: 13 May 2011

Letten Companies: 4 Nov 2011

ACN: Refer to schedule 


Damian Templeton &
Philip Hennessy 

Office: Melbourne

Australia: 1800 882 944 
International: +61 3 9838 4238

Contact email:



Letten Schemes: Information for investors and creditors 

Initial Appointment

Damian Templeton and Philip Hennessy were appointed Joint and Several Receivers and Managers of the companies and schemes outlined opposite ("Letten Schemes") by the Federal Court of Australia ("the Court") on 25 February 2010 following an application by the Australian Securities and Investments Commission.


The Court also appointed Mr Templeton and Mr Hennessy as Receivers and Managers of the Property of the SY21 Retail Scheme (to the extent it relates to the interests of investors) on 4 March 2010, and some additional Letten Schemes and Companies on 30 July 2010.



As detailed in the Circular to Investors dated 11 February 2011 it is expected that the companies associated with the Letten Schemes will ultimately be placed in liquidation. To that end, the Australian Securities & Investments Commission ("ASIC") has filed an application with the Court seeking for selected companies to be placed into liquidation and the matter was listed for hearing on 13 May 2011.


On 13 May the Court Ordered that selected companies be placed into liquidation. A copy of the Court Order and reasons for the judgement are available.


On 4 November 2011 the Court Ordered that the remaining Letten companies be placed into liquidation. A copy of the Court Order and reasons for judgement are available. All corporate defendants (but for the 17th defendant, SY21 Retail Pty Ltd) to this matter are now in liquidation.


Disclosure Reports

The Receivers and Managers have released Disclosure Reports outlining the background, current status and proposed realisation plans for each of the schemes to which they have been appointed. These Disclosure Reports, together with a Disclosure Report Overview and the LGH Companies Report are available to investors through the secure data rooms. Please review the Important Notice to Investors prior to reviewing the Disclosure Reports.


Realisation Strategies

Orders were made on 25 May 2010 and 4 June 2010 granting the Receivers and Managers the power to sell the assets of the Letten Property Schemes and Letten Operating Business Schemes respectively. Under the Order dated 4 June 2010, the sale of the Letten Operating Business Scheme assets must be conditional on further approval of the Court. We issued an updated realisation report on 16 September 2012.


Below is a summary of the status of the sale of each business and property:

Receivers and Managers’ Remuneration and Disbursements

On 12 September 2011, the Court delivered its judgement and reasons in respect of the Receivers and Managers' application for approval of its fees and disbursements for the period 25 February 2010 to 2 July 2010.


On 8 November 2012, the Court delivered its judgement and reasons in respect of the Receivers and Managers' application for approval of its fees and disbursements for the period 3 July 2010 to 31 December 2011. A copy of the order and reasons for judgement are available through the secure data room.  


Distribution to Proper Trust Creditors
The Liquidators previously notified all known and potential creditors of The Glen Centre Hawthorn Pty Ltd (Receivers and Managers Appointed) (In Liquidation) ("The Glen") and Twinview Nominees Pty Ltd (Receivers and Managers Appointed) (In Liquidation) ("Twinview") of their intention to declare a dividend on 28 July 2011.

During the proof of debt process, certain claims were received whereby the Liquidators consider it unclear whether they are proper trust creditors and are uncertain of the ability of the trustees of the relevant schemes to rely on their indemnity against trust assets to meet these claims.

In order to resolve these issues, the Receivers and Managers of the Glen Centre Joint Venture and the Twinview Joint Venture have applied to the Court for directions.

On 4 November 2011 the Court hearing in this matter took place. On 12 December 2011 the Court Order and reasons for judgement resulted in no distribution to the creditors of Twinview and the Glen Centre.  


Distribution of Funds

Orders were obtained from the Court on 11 November 2010 relating to the mechanism for distribution of surplus proceeds of sale. The Court has ordered that the Receivers and Managers are justified in distributing to Investors on a pooled basis with any surplus proceeds of sale to be paid into a common fund for this purpose. A copy of the judgement by the Court, the reasons for the judgement and a Circular to Investors dated 23 November 2010 are available.


The Receivers have previously estimated the return to Investors and is explained in detail in a Circular to Investors dated 2 September 2010 and located in the secure Investor data room. We have reviewed the assumptions underlying the estimated return and updated them taking account of information now available. On the basis of this we have updated our estimated distribution to Investors which his explained in detail in our circular to Investors dated 11 February 2011 also in the secure data room.


Investors will recall that in estimating the return to Investors we assumed, amongst other things, no capital gains tax was payable by us on the sale of any scheme asset. We have continued to engage with the Australian Taxation Office ("ATO") regarding the obligation of the Receivers and Managers to account for any capital gains tax on assets sold by them (as agents for the relevant company) during the receivership.


As a result of those discussions we lodged an application for a PBR. On 31 August 2012 the ATO issued a PBR. The ATO did, however, exclude the financial year ending June 2011 from the PBR. This is the relevant year in which a number of properties were sold. The exclusion of the financial year 2011 from the PBR is important in that capital gains tax may be payable from the Common Fund if the PBR is unchanged. We will strongly argue for this financial year to be included in the PBR. We have asked our taxation representatives to work with the ATO to amend the PBR.

The impact of the PBR (in its current form) is that the schemes subject to our receivership appointment are treated as a single trust for income and capital gains tax purposes. We are required to prepare and lodge tax returns on behalf of this single trust which is expected to result in no capital gains tax and minimal income tax being payable.

In light of the PBR we are also considering the form of general advice to be issued to investors regarding their personal tax circumstances. We will provide this once the PBR is finalised. 


Formal Proof of Claim Process
The Receivers and Managers called for all Investors to submit Formal Proof of Claim Forms (“Claim Form”). Since that time, we have received and reviewed Claim Forms from many Investors. The time for submission of the Claim Form and all substantiating evidence ended on 18 May 2012.

Investors will recall the Court’s Pooling Orders included an entitlement for Investors to claim on the Common Fund for their “total net contributions” to the Letten Schemes. In the Claim Forms submitted Investors took a number of approaches to calculate their net contribution. In particular, some Investors deducted from their claim the recurring payments made to them and others have not.


The Claim Forms submitted confirmed that some Investors received significant returns on their investments prior to the appointment of the Receivers (in some cases in excess of 100 cents in the dollar) while others received no return (i.e. zero cents in the dollar). The Claim Forms submitted confirmed that, predominantly, earlier Investors received a greater quantum of recurring payments made by the Letten Entities than later Investors. An exception is some original Investors in the Yarra Valley Golf Scheme also received no recurring payments during the life of their investment and certain later Investors also received no recurring payments.

Calculation of Investors’ entitlements from the Common Fund

The Claim Forms submitted by Investors raise a number of legal issues, including:

  • (a) Whether Investors’ are entitled to include their War Chest, Project Reserve Bond and other non-Scheme specific investments in their claim on the Investor Common Fund.
  • (b) Whether Investors are entitled to include “capital gains” declared by the Letten Entities but not paid in their claims against the Investor Common Fund.
  • (c) Whether any payments historically received by Investors in respect of their Scheme investments ought to be applied in reduction of their claims against the Investor Common Fund (or otherwise taken into account in determining Investors’ entitlements to receive a distribution from the Investor Common Fund).

We have considered the approaches taken by Investors in their Claim Forms and the legal principles underpinning these issues. There is uncertainty regarding the application of these principles. However, as a result of this analysis and the investigations that have been carried out by us to date, we have formed the view that:

  • (a) Investors ought to be entitled to include their non-Scheme specific investments in their claims on the Common Fund – as a result of my investigations, it does not appear that there is any basis for distinguishing between these investments and the specific Scheme investments.
  • (b) Investors are not entitled to include any declared “capital gains” in their claims against the Common Fund – as a result of my investigations, it appears that these declared “capital gains” did not reflect the underlying financial position of the Schemes.
  • (c) Payments historically received by Investors ought to be taken into account in calculating Investors’ entitlements to receive a distribution the Common Fund – as a result of my investigations it appears that these payments were in part funded by the realisation of assets of other Schemes and other investors’ contributions to the Schemes.

Court Application
There is uncertainty regarding the application of the relevant legal principles to the Letten Schemes in relation to these issues. The potential impact which the resolution of these issues may have on Investor returns is substantial.


Furthermore, these issues may impact different Investors in different ways. For instance, if Investors are required to account for recurring payments historically received from the Common Fund, this would likely increase the return received from the Common Fund by later Investors (who did not receive a significant quantum of recurring payments). It would, however, decrease the return received from the Common Fund by earlier Investors (who typically received significant recurring payments). Accordingly, I have applied to the Court seeking directions as to the correct approach in relation to these issues.

All relevant legal documents including the application, supporting Affidavit, preliminary submissions and contradictor submissions are available. The Receivers' report on the potential impact of the application on Investors is available to Investors through the secure data rooms.


At the Directions hearing on Wednesday 10 October 2012, the Court ordered that that Light Investments Pty Ltd be appointed to contradict the Receivers’ application. The final hearing of the matter took place on 13 November 2012. The Court has reserved its decision. Investors will be informed once a decision has been published.


A copy of the Orders of the Court are available for inspection.


Estimated Return to Investors
It is not possible to reliably estimate the impact that accounting for recurring payments might have on Investors without completing substantial work. That is in part due to a significant number of Investors having not disclosed their recurring payments received. Given the magnitude of the time and costs associated with updating this information from the Letten Schemes’ records we do not intend to undertake this task until certainty is obtained on the correct legal approach.

Interim Distribution and Timing
In light of the above, the interim distribution has been deferred pending the outcome of our Court application.

The Receivers and Managers will make distributions to Investors at the earliest possible time. A final determination regarding our ability to pay an interim distribution will be made after Court Orders are obtained.

Submission of Formal Proof of Claim
Many Investors have not yet submitted a Claim Form [PDF 69KB]. They might be excluded from a future distribution if a Claim Form is not completed and returned to us as soon as possible.


For any general comments or queries, please email

Court Documents

Appointment Orders


Disclosure Reports


Realisation Strategies


Recovery Action


Investor Distribution


Unsecured Creditor Distribution


Liquidation Process


Receivers' Remuneration


Latest news: 10 July 2014

On 10 July 2014 the Receivers notified all Investors and other claimants of their intention to declare a second interim distribution [PDF 59KB] from the Letten Schemes Common Fund.