The welfare of a wheelchair-bound girl in Newcastle might not have been a priority for the NSW government when it expropriated coal exploration licences four years ago. But there is a growing view that it should have been.
When that decision was made, it was portrayed by former premier Barry O’Farrell as a way of removing what he said was the taint of corruption over the way the licences had been issued by his Labor predecessors.
But four years later, the true impact of that decision is becoming apparent. It has hurt the wrong people — thousands of them.
While the O’Farrell government portrayed itself as targeting corruption, the expropriation of those licences has devastated 3200 shareholders who did nothing more than invest their savings in a mining company that, as it turns out, was not corrupt anyway.
One of the victims of the expropriation is 18-year-old Eliza Harvey, who suffers from Angelman syndrome, an extremely rare genetic disorder that leaves people with developmental delays, intellectual disabilities and limited mobility.
The NSW government’s decision has destroyed her father’s long-term plan to ensure her welfare when he is no longer around.
Peter Harvey had invested an inheritance of $110,000 in NuCoal Resources with the aim of eventually buying Eliza a home of her own so she would not need to rely on taxpayers for a group home for the disabled.
“She needs 24-hour care and she is now in a home that is comfortable, but as a family of a child with a disability you want to provide, which was our plan. It has just been ripped from us,” Mr Harvey said. “The thing that annoys me the most was that O’Farrell was advised to make compensation and chose not to.”
By cancelling the licences, NSW was giving effect to a recommendation from the Independent Commission Against Corruption. But Mr O’Farrell rejected ICAC’s associated recommendation that compensation should be paid to innocent parties.
NuCoal, which was not a party to ICAC’s inquiry, obtained its licence 14 months after it had been issued when it bought the original licence holder, Doyles Creek Mining.
No accusations of wrongdoing were ever made against NuCoal and when Mr O’Farrell mistakenly made adverse remarks about the company’s directors, he issued a public apology in March 2015 and settled defamation proceedings.
Mr Harvey and other NuCoal shareholders have been seeking redress for years.
However, there is hope — and the source of that hope is the US Trump administration.
As well as destroying the investments of thousands of Australians, the expropriation also destroyed the value of US-owned interests in NuCoal worth about $131 million.
Those Americans have complained to the Trump administration that the action by NSW breaches a free-trade treaty that says any expropriation of US assets will be done by due process of law and will be followed by prompt, adequate compensation.
US officials have been engaged in three-way talks on this affair with representatives of the NSW and federal governments.
If those talks lead to a settlement with NuCoal’s US investors, Mr Harvey believes Australian shareholders should be given the same deal.
“Mum-and-dad shareholders don’t have a free-trade agreement but what we do have is ASIC and publicly listed company legislation,” he said.
“If the Americans were to get compensation and Australian mum-and-dad shareholders were to miss out, I think that would be just absolutely appalling.”
The potential bill awaiting NSW is substantial. Before the expropriation NuCoal had been valued at about $400 million. After the expropriation its capital value fell to about $20m.
Once interest is added to the value of the lost asset, NuCoal chairman Gordon Galt estimates his shareholders are owed $437m.
Legal Affairs Editor
(WTF) Used with permission