CIY 0.00% 3.6¢ city pacific limited

interesting article

  1. 67 Posts.
    February 29, 2008 11:00pm

    CITY Pacific's website has plenty of glowing rhetoric - and a few omissions - about the business expertise of founder and chief executive Phil Sullivan.

    For instance, visitors learn that he "has been actively involved in property investment and development for over 30 years across many sectors of the property market".

    However no mention is made that Mr Sullivan spent three years as a bankrupt.

    And nothing is said about the fact that the 64-year-old South African-born businessman faces allegations of selling over-priced investment properties in a legal battle which may go to trial this year.

    Insolvency records show that Mr Sullivan was bankrupt between October 1986 and October 1989 after his building company, Sullivan Property Developments, collapsed owing nearly $220,000.

    His trustee concluded that there was a "very remote" chance of money flowing back to creditors since the company's only asset was a debt from another firm without any real assets. Mr Sullivan has declined to comment about his former bankruptcy.

    Ironically, one of the unsecured creditors is listed as Maldon, the Sullivan family trust which is now the biggest single stockholder in City Pacific with 28.8 million shares.

    Mr Sullivan, who was paid $450,000 last year and drives a $240,000 Mercedes AMGE55, has also amassed a personal fortune in real estate.

    Mr Sullivan launched City Pacific in 1997, the same year that former clients now allege he defrauded them in the sale of investment units in the Radisson Palm Meadows Resort and Conference Centre on the Gold Coast.

    In three separate cases filed in Brisbane District Court in mid-2006, investors allege that Mr Sullivan, his development company Equititour and his marketing outfit Capeglen sold them units priced at $171,900 – or $100,000 over true market value.

    Carlson Hotels and a sales agent have also been named as respondents.

    The plaintiffs allege that they were guaranteed a 36 per cent return in the first five years and a $107,606 return in the next five years, a plan which purportedly collapsed when Radisson did not renew rental pool leases in late 2002. Each is seeking $250,000 in compensation.

    Mr Sullivan denies the allegations. He and the other respondents are expected to seek a judgment in court next week that key statutes of limitation have expired.

    A Supreme Court judge ruled in favour of Mr Sullivan and his co-respondents on precisely that point last October in a similar case involving a former client seeking $880,000 compensation for his failed investment in the Radisson. Mr Sullivan predicted "the same result will eventuate" this time.

    However solicitor Graeme Hancock said his clients were offered longer rental guarantees and he expects his cases to go to trial.

    Profile


    Name: Philip Keith Sullivan

    Age: 64

    Born: Durban, South Africa

    Home: A six-bedroom, seven-bathroom riverfront mansion at Broadbeach Waters, bought for $4.75 million in 2004

    Business: Started City Pacific in 1997 and listed on ASX in July 2001


 
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