Dick Smith executives face Supreme Court

Nick abboud, dick smithReceiver Ferrier Hodgson, on behalf of Dick Smith Holdings creditors, has taken legal action against ex-CEO Nick Abboud, ex-CFO Michael Potts, and former directors Bill Wavish, Phil Cave, Rob Murray, Jamie Tomlinson, Robert Ishak and Lorna Raine in the NSW Supreme Court.

The executives and directors have been accused of breaching their duty to exercise reasonable care ahead of the company’s financial collapse in January, 2016.

Ferrier Hodgson is seeking to recover amounts equal to Dick Smith’s 2014/2015 interim and final dividends, totalling about $28.4 million, and losses of at least $60 million from poor management of inventory.

Dick Smith’s lenders, National Australia Bank and HSBC, have brought separate legal action against Abboud and Potts in relation to the circumstances under which finance was provided to the company.

The law firm representing Murray, Tomlinson, Raine and Ishak said the four non-executive directors will vigorously defend the receivers’ allegations that they failed to put in place adequate systems to manage supplier rebates and inventory.

The statement said the directors acted at “all times conscientiously, with care and diligence”.

More to come.

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Comments

1 comment

  1. Peter posted on March 21, 2017

    If the CEO, CFO and former directors had no idea what was happening then clearly they should not have held senior positions within the company, that alone is totally negligent of their duties anyway. One wonders what they were doing to earn their huge pay packets if they were not doing their due diligence in overseeing the Dick Smith company. If the CEO,CFO and the directors do not take responsibility for this debacle then who does, afterall the company was under their leadership.

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