I am delighted that the Court of Appeal has today completely vindicated me, and ordered costs in my favour, in the proceedings brought against me by ASIC.
This affirmation of my innocence on all matters is the culmination of proceedings commenced almost 2½ years ago. That ordeal has involved a difficult struggle for me to clear my reputation, not only through the Courts, but also in the public arena, against the substantial weight of a well-funded regulator and public scepticism spawned by certain critics in the media.
Throughout this trial, I am grateful to have had the devoted support of my wife and family, and the unwavering encouragement of my friends. This has been essential to my determination to continue the fight in often very difficult circumstances.
I would like also to record my special thanks for the unstinting efforts of my legal counsel.
I am relieved that I can now put ASIC’s accusations behind me, and get on with my life. I hope that today’s judgment will enable the public to recognise, at last, that I am completely innocent of the wrong-doing alleged against me.
The ASIC proceedings against Mr Whitlam involved 2 separate allegations:
1. The first allegation arose in connection with a voting irregularity which occurred at the 1998 annual general meeting of NRMA.
At that annual general meeting, Mr Whitlam voted a proxy form which he had failed to sign. That proxy form was directed against the relevant resolution and made the difference between the success and failure of that resolution. Legal advice was received at the meeting that the unsigned vote could not be counted. Accordingly, the vote was not counted because it was not signed. The particular resolution was declared as having been passed, whereas if the proxy vote had been counted, as it should have been, the resolution would have been lost.
Within 48 hours of the annual general meeting, Mr Whitlam sought a formal legal opinion on the matter from Queen’s Counsel. That new advice was that the unsigned vote could, and should, have been counted. The correct course should have been for the returning officer to count the unsigned proxy. Acting on that advice, Mr Whitlam gave instructions to reverse the relevant resolution, with the result that the resolution was finally declared as having been lost.
Mr Whitlam’s omission had no consequence for NRMA or for him personally. No damage resulted to anyone from the course of events. NRMA did not lose any money. No person received any personal benefit as a consequence.
ASIC alleged that Mr Whitlam intentionally failed to vote the relevant NRMA proxy form in contravention of Section 250A of the Corporations Act 2001 and Section 232 of the Corporations Law 1998. That allegation failed.
2. The second allegation arose in connection with a procedural issue related to a 2000 board meeting of IAG (formerly NIGL).
Mr Whitlam amended certain draft minutes of a meeting of the IAG board. Those amended draft minutes were circulated to all board members prior to the next board meeting, with mark-ups showing his proposed changes.
At the next board meeting, there was discussion concerning the amended draft minutes, and certain of Mr Whitlam’s proposed amendments were further amended. This different formulation of the minutes was ultimately adopted by the board.
Mr Whitlam’s action had no consequence for IAG or for him personally. No damage resulted to anyone from the course of events. IAG did not lose any money. No person received any personal benefit as a consequence.
ASIC alleged that Mr Whitlam improperly amended the draft IAG minutes without a reasonable basis for doing so in contravention of Sections 180, 181 and 182 of the Corporations Act 2001. That allegation failed.
In mid-1998, the NRMA boards took the first steps on the road towards the demutualisation of NRMA Insurance. Mr Whitlam was the central figure in that process. There were a number of vigorous and vocal detractors to the demutualisation process. However, the overwhelming will of the members ultimately prevailed. The demutualisation was successfully completed in July 2000, resulting in over 2 million Australians receiving shares worth more than $4 billion, on average about $2,000 worth of shares for each member.
The separated NRMA companies continue to prosper. Both the demutualised IAG and NRMA are pre-eminent in their respective industry sectors, with well- capitalised , thriving businesses. Mr Whitlam is pleased to have played a vital role in establishing the platform for both companies to flourish.