Court throws out Salim Mehajer's appeal in minutes

Salim Mehajer outside the Downing Centre Local Court on Wednesday Photo: David Moir
Salim Mehajer outside the Downing Centre Local Court on Wednesday Photo: David Moir

It must be among the shortest Court of Appeal hearings in history.

On Wednesday a team of lawyers assembled in a portrait-lined courtroom on level 12 of the Supreme Court building in Sydney as Salim Mehajer sought to challenge a ruling that administrators were validly appointed to two of his companies.

Within minutes of the 10.15 am starting time, the colourful property developer's appeal had been dismissed following a blunt question from the bench.

"What are we doing here?" Justice Anthony Meagher said.

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Justice Meagher, who was hearing the appeal with Acting Chief Justice Margaret Beazley and Justice Fabian Gleeson, received a frank reply from Mr Mehajer's barrister.

James T. Johnson, from Sydney's Frederick Jordan Chambers, conceded the appeal could not succeed on a crucial point.

He agreed it should be dismissed and Mr Mehajer should bear the legal costs of the administrators.

Acting Chief Justice Beazley, the president of the Court of Appeal, thanked the parties for resolving the case with such efficiency.

The lawyers filed out of court shortly after 10.30am.

On June 30 Mr Mehajer lost an urgent court bid to remove administrators appointed to two of his companies, Sydney Project Group and S.E.T Services.

The Supreme Court heard the companies owed almost $100 million to creditors and had just $32,000 in the bank.

Justice Stephen Robb said it was "highly likely" the companies were insolvent but noted there was "evidence that the companies have been engaged in a very substantial property development that may be relatively near completion".

Mr Mehajer, the former deputy mayor of the now-defunct Auburn Council, had argued the administrators were not validly appointed by the companies' former director, Kenneth Lee, on June 16 because he removed Mr Lee at a meeting at 5.31am that day.

But Justice Robb said he was "simply not persuaded ... that the minutes were prepared at the time claimed... in the absence of corroboration" from other witnesses such as his solicitor.

He made it clear he was not making "any direct findings concerning the truthfulness" of Mr Mehajer's evidence.

The appeal turned on provisions under the Corporations Act which set out assumptions company administrators are legally entitled to make when they are appointed.

Justice Meagher's line of questioning made it clear the provisions were fatal to the appeal.

The companies' administrators, Michael Hogan and Christian Sprowles, will hold a second creditors' meeting in Sydney on Thursday.