Aussie founder and executive chairman John Symond (pictured) is suing Gadens Lawyers for A$11m.
The home loan services company accuses the national law firm of providing "negligent, misleading or deceptive tax advice" during the 2003-2004 restructuring of parent company AHL Holdings. Aussie's lead lawyer in the case, Baker & McKenzie partner Bruce Hambrett, said that Gadens had incorrectly advised that redeemable preference shares issued to - and redeemed by - Symond would not be subject to tax. The matter was put to rest after a lengthy 2007 Australian Tax Office (ATO) investigation, where Aussie paid a "substantial" confidential settlement.
Gadens, which has acted for Aussie since inception in 1992, played down the claim as nothing new. "It's just an ordinary incident that law firms deal with, and we are handling it through our insurers. The partner in question, Ross Seller, left Gadens 4-5 years ago and took the transaction with him," said former chief operating officer Jon Denovan.
Despite the action, Gadens has continued to advise Aussie on other matters. Denovan said the firm had not been offended by the allegations.
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