It’s not over till the fat lady sings
Alan Bond’s motto
Kevin Munns knew that his best chance of catching Alan would be in the early morning, either at the office, or before he left home. But by the time he got to the Bond mansion in Dalkeith at around 7.30am, a TV crew from Channel 7 had already beaten him to it.
He sat in his car for a few minutes, hoping not to be noticed, then decided he wouldn’t get anywhere by doing that, and went to bang on the back gate. Before long, a gardener appeared and told him to push off, slamming the gate in his face, so he then asked the news crew if he could sneak into the house with them when they went inside for the interview. The reporter, Howard Gratton, was keen to film him serving the bankruptcy notice on Bond, which is why he was there in the first place, but was not prepared to smuggle him into the house by subterfuge. So that failed too.
Had Munns been allowed to push the bankruptcy notice through the letter box and leave, it would have been over then and there, because Bond was definitely in the house and would be sure to get it. But court rules say the papers have to be handed to the debtor in person, so Munns either had to talk his way through the front door or wait until Bond came out. And Alan was quite clearly going to do everything he could to avoid him.
In fact, Bond had given another firm of process servers the slip in Sydney the day before. They had staked out three five-star hotels where they thought he might be staying, and had then tried a series of different restaurants where he had booked in for dinner. But after a frustrating twenty-four hours they had discovered he was flying back west. The original bankruptcy notice, stamped by the court, had then been entrusted to a special courier service, to be hand-delivered to Munns’s home in South Perth shortly before midnight.
Now, back at the Dalkeith house, the Channel 7 crew had told Bond that a process server was waiting outside, and had passed the news to Munns that Alan wasn’t going to let him in. So, with an hour already wasted, he decided to have another go at the gardener. This time there were two large dogs to contend with, who were equally adamant that they weren’t going to let him onto the property. But just as they were all arguing the toss, a white Range Rover emerged from the nearby driveway, with the unmistakable figure of Alan Bond at the wheel, whereupon Munns jumped into his Toyota Landcruiser and set off in pursuit.
For twenty minutes the two four-wheel drives careered around the back streets of Perth at breakneck speed, playing Mad Max games with each other. Bond’s version to the West Australian next day was that he had no idea that anyone was trying to serve a bankruptcy notice on him, and that an unidentified maniac had tried to force him off the road.
I was quite concerned because I didn’t know who it was; whether it was somebody with a gun, a thug or who it might be. He had a red sort of a Toyota truck with great big bumper bars. He tail-gated me up the street and then he came alongside and tried to drive me into the actual kerb … it could have caused a very nasty accident …1
Bond could hardly have not known that it was Munns who was chasing him, because Gratton had told him minutes earlier that a process server was lying in wait outside his house, but he clearly had no intention of stopping or of letting himself be served with the papers. And if Munns is to be believed, Bond was risking life and limb to stop that happening.
He was driving rather erratically. I went up to pass him, to beckon him to pull over. As I pulled up next to him he swerved his car very heavily to the right, forcing me onto the grass verge. My car slid sideways. I again pulled up behind him, went to pass him with ample room and again he swerved violently to the right. I thought then I’d better stay close to him but stay behind him. On three occasions he slammed his brakes on, causing his car to skid, and I’ve even got photographs of the skid marks. I can only assume he wanted me to ram him in the back which would then put me in trouble with the law.2
Munns has spent most of his working life chasing people who don’t want to be caught, and being greeted with anger and abuse. But he regards this clash with Bond as one of the most difficult of his thirty-year career. As anyone who knows Bond can tell you, he can be enormously charming and persuasive when things are going his way, but he has a fearsome temper when things go wrong.
Munns says today that he still believes Bond deserves a medal for winning the America’s Cup and for transforming the port of Fremantle, but otherwise he has no time for the man at all. And it’s largely because of what happened next.
Having led the process server on a high-speed chase through the suburbs, Bond drove to the unmanned police station at Nedlands to file a complaint. Munns, who was still following him, stopped his car outside and got out to identify himself, at which point a violent argument started by the side of the road. Bond’s version in the West Australian was that he told Munns:
‘Look, you’d better come inside because I’m going to charge you for dangerous driving.’
With that, he rolled up two pieces of paper and threw it at me and said, ‘There’s your writ’, with some other adjectives to go with it.
Munns’s story is that he handed the bankruptcy notice to Alan Bond, who screwed it up and threw it in the gutter. He then told Bond he had been properly served, and started to walk back to his car. In his version, Bond then chased him and shoved him in the back:
I turned around and he shirt-collared me. A number of people, hearing him yelling and screaming obscenities at me, gathered around the vehicles. And then the television crews turned up again …
I put my hands out to protect myself, because he was quite violent at the time. He was shaking me as hard as he could with one hand up on my collar and one on my shoulder. I don’t remember the words at all but they were quite loud, aggressive, obscene.3
The Channel 7 crew caught only the end of this altercation, but their news report that evening showed Munns with his shirt collar bent up and his tie yanked halfway round his neck, so it was clear that he had been attacked. An eyewitness to the confrontation confirmed on camera that an angry Alan Bond had been the aggressor. Yet the old salesman told Channel 7’s viewers, just as he told the papers, that he had been an entirely innocent party, had not been trying to avoid service, and had merely been chased by an unidentified thug.
The same TV news report showed clips of an interview with Bond that had been recorded in Alan’s garden beforehand, in which Alan claimed that his telephone was ‘almost choked with well-wishers’. It was encouraging, said Bond with that sincere smirk that he does so well, that ‘in these difficult times for all Australians’, people understood the difficulty he was in.4
At this point, it’s important to explain why Bond was being made bankrupt in the first place, because he has implied time and again that it should never have happened. But the cause was simple, and Bond had only himself to blame. In January 1990 he had given personal guarantees for US$194 million as security for a huge new loan that three banks were about to make to his master private company Dallhold.
For the banks, it had been an extraordinary moment to be lending Bond new money, because his empire was teetering on the brink of collapse. Receivers were in control of Bond Brewing, another lot had briefly been sent into Dallhold, Bond Corporation was sinking fast, and just about every other banker in the world was trying to get his money out. But the Hongkong Bank, Tricontinental and Bank of New Zealand all stood to lose a fortune if Bond went down at that moment, because they had already lent hundreds of millions of dollars, which was secured against shares in Bond Corporation that were now worth next to nothing.
Their only chance of getting this money back was to get their hands on the one asset in Bond’s empire that was actually producing cash, the Greenvale nickel mine in North Queensland. And this is what the new loan was designed to achieve. By putting in US$300 million of new funding, they were able to both get their old loans out and take security over an asset that could be sold for a decent price if the Bond empire finally collapsed. Plus they were able to extract personal guarantees from Alan Bond himself.
But the new loan hadn’t saved Bond or his empire. And the banks had received neither a cent in interest nor a penny of principal on their US$300 million. So, in March 1991, as Bond’s businesses had begun to disintegrate, they had decided to seize the nickel mine and call in the personal guarantees, and to this end they had served notices of demand on Bond and his various companies, in Brisbane, Perth, New York and Sydney, to pay the money or be put under.
Bond and his lawyers soon made it clear that they would make it a long and difficult battle. And by arguing every point of law and exploiting every technicality, they managed to slow the process down so much that it was four months before the case even came to court. Then, on the day before the hearing was due to start, they announced that they would argue that the notices of demand had been served incorrectly.
Now there was no question that Bond and his companies had actually received the notices, because Bond’s lawyers had caused them to be served no less than three times over a space of four months. But Australian courts are so obsessed with the letter of the law that they’re perfectly capable of sending everyone back to square one just because a name is spelt wrongly on a court document or, as in this case, because a writ had been delivered successfully to Dallhold’s new offices, instead of to the old (and unoccupied) address that had been specified back in 1990.
But fortunately for the banks, the case was being heard in the New South Wales Supreme Court by a judge who was famous for his intolerance of such legal nonsense. And while Justice Andrew Rogers couldn’t stop the point from being argued, he was not likely to be at all sympathetic. Indeed, when it came to his judgement two months later, he attacked Bond’s lawyers’ tactics as ‘a gross violation of the rules’ that was in ‘flagrant contravention of the purposes and practices of this court’. And in case there was any doubt as to his views, he added that he was delighted the tactic had failed because ‘legally successful but otherwise meritless technical arguments do nothing to engender public confidence in the rule of law’.
The substance of Bond’s case, in Rogers’s view, wasn’t a whole lot better. According to Alan, the banks had demanded his personal guarantees from him but had promised not to call them for at least two years, so that he would have enough time to sell the Greenvale mine for a decent price. Bond swore black and blue that the head of the Hongkong Bank, Willie Purves, had promised this himself in his office in Hong Kong. Yet there was nothing in any of the agreements about this, and the bankers and lawyers all denied it absolutely. What’s more, as Rogers said, it was inconceivable that the banks would have been so stupid as to bind themselves hand and foot when the Bond Group was on the verge of collapse.
Bond tried hard to sell his story to the court, but Justice Rogers wasn’t buying:
The printed words of the transcript cannot give an approximation of the charm and salesmanship of Mr Bond in the witness box. Unfortunately, having seen the principal players in the witness box, in my view, the only person to whom he sold the notion that he was free for two years was himself … The circumstances cry out in disbelief at such an arrangement.5
So, on 23 September 1991, Rogers gave judgement to the banks, Bond was given four weeks to pay US$194.6 million that he didn’t have, and Kevin Munns was despatched to give him the good news that bankruptcy beckoned. But as Bond was soon boasting to the papers: ‘It’s not over till the fat lady sings’. And by the time Australians were reading about the bizarre outbreak of road rage in Perth, his lawyers were lodging an appeal.
At this stage, Bond may well have felt that he could still avoid bankruptcy altogether, for there is no doubt that he genuinely believed that the banks had dudded him. But all he succeeded in doing was keeping the bailiffs at bay for another three months, because in mid-December, Justice Michael Kirby turned down Bond’s appeal. And a week after that, Bond was denied permission to take his case to the High Court and argue all over again.
So, two days before Christmas 1991, a new bankrupcty notice was issued (remedying deficiencies in the old one) and Basil Faulkner went down to the Dalkeith mansion to see if he could do any better than Kevin Munns.
As Faulkner sat outside in his ancient Falcon station wagon, there was a fair bit of activity in the Bond household. A couple of parties were planned over Christmas, so there were marquees to put up, and chairs, tables, food and drink to be delivered. A little matter of US$194 million wasn’t going to stop the Bonds from having fun. And as a consequence, there was a steady stream of delivery vans, plying to and fro, with occasional forays by the family Mercedes or the big white Range Rover.
Occasionally, Faulkner gave chase to the Bond family cars in the hope that Alan might be driving, or lying out of sight in the passenger seat. Several times, Eileen told him firmly that Alan wasn’t there. But although he hadn’t set eyes on him, Faulkner was convinced that Bond was still hiding in the house, so for five days over Christmas he parked himself in the road outside with his thermos and sandwiches. He was not invited in for turkey.
Then, just after Christmas he got a tip-off that Bond had booked a flight and gone to Bali. Which meant, of course, that at some stage, he would almost certainly come flying back. And at 6.30am, on the day before New Year’s Eve, he did just that, walking straight into the arms of a young lawyer who had come out to Sydney’s Mascot Airport to welcome him.
It must be said that a good Hollywood scriptwriter would make more of such an opportunity than Alan and the lawyer managed to do, but it was a historic conversation nonetheless, given that Bond had been caught at last. According to the court affidavit, the exchange went like this:
‘I’m Hamish Young, a solicitor with Mallesons.’
‘Yes.’
‘I’m here to serve you with this bankruptcy notice.’
‘Thank you.’
At this point, most people would have gone quietly. But within three weeks, Alan’s lawyers were marching into yet another court, Sydney’s Federal Court this time, to have the bankruptcy notice set aside. There was no way now that they could do any more than delay the arrival of the bailiffs. But there was still $1 million to be saved if Alan could stave off bankruptcy till the end of February. So more dollars and yet more ridiculous arguments were now wheeled out in an attempt to persuade the courts that the latest bankruptcy notice was invalid.
This time, Bond’s argument was that the banks had used the wrong exchange rate to convert his US$194.6 million debt into Australian dollars. The lawyers who acted for the banks had been pretty careful in doing this, and had followed the law to the letter, by phoning three different banks to ask them what their rate would have been at 11.00am on 19 December, and then swearing a statutory declaration to the court. But they had forgotten to specify the size of the transaction, so Bond hadn’t got the best deal available. And as a result, he was being asked to pay A$252,243,451 instead of $251,738,805.
Now this extra half a million dollars would have been a serious matter if there had been the slightest possibility that Bond was going to pay any of it. But given that he didn’t have a brass razoo, the amount was entirely academic. Yet it tied up some of the best brains in the Australian legal system for another three months before Justice Morling was able to dismiss it. Then there was yet another week while Bond appealed Morling’s decision to the full bench of the Federal Court, where he lost once again. And only then was yet another bankruptcy notice issued.
But even now, the game wasn’t over. For they still had to get the notice served, and as the Sydney Morning Herald soon reported, Bond was in London lying low.6 He had been living it up in America with his girlfriend Di Bliss, watching the America’s Cup and shouting meals for friends in expensive restaurants, but had since been spotted by a journalist called Eric Ellis, sitting in the front room of 14 Selwood Place in Chelsea, which had long been one of the Bond family’s homes in the UK. He had refused to answer the door, and had then issued an angry press release, decrying his treatment by the banks and denying that anyone had told him they were trying to serve a bankruptcy notice on him.
For Bond, going back to Australia at this point was not the most attractive proposition. He was due to face trial in May 1992 on criminal charges over the Rothwells rescue that could put him in jail for a long stretch, and the Australian Securities Commission had said publicly that other charges were imminent. Now, as he saw it, he was also going to be humiliated by bankruptcy. Meanwhile, he was being sued for $23 million in the Western Australian Supreme Court, and was facing divorce proceedings in the Family Court in late April after thirty-seven years of marriage to Eileen, who had finally grown tired of his girlfriends.
At this stage, he still had a passport and was free to travel. But however tempted he may have been to do a runner and follow Christopher Skase into exile, he resolved to fly back to Perth and face the consequences. There was a minor consideration of $100,000 bail that he would lose if he didn’t.
This, however, would be the last chance he would have to flee, because on 14 April 1992, Bond was finally made bankrupt and his passports confiscated. (The court had eventually permitted the banks to serve notices on his lawyers instead.)
Bond was not in Sydney’s Federal Court to see it happen or to meet his new master, Robert Ramsay, who would be his trustee in bankruptcy. Ramsay would have the job of running Alan’s bankrupt estate and dividing his assets, but as the banks had already discovered, there was virtually nothing to share out. Crucially, Bond had held off bankruptcy for so long that almost all of the $32 million he had given to family and friends since 1986 was now safe from attack.