Ex-minister Pescott declared bankrupt

St George Finance yesterday obtained orders in the Federal Magistrates Court over a $291,632 debt owed by Mr Pescott, and told the court the businessman owed it a further $3.68 million under a commercial bill facility. The court was told Mr Pescott had no assets in his name.

Nick Mellos of Grant Thornton was appointed Mr Pescott's trustee in bankruptcy.

Four other creditors supported St George's move. They included the liquidator of the failed tree plantation investment group Environinvest Ltd and the accountancy firm HLB Mann Judd.

Registrar Tim Luxton heard that Environinvest's liquidator, Jim Downey, had initiated several court claims against Mr Pescott, and if these succeeded Mr Pescott might be found liable for a further $12 million.

Mr Downey recently filed a multimillion-dollar claim against Mr Pescott, two of his fellow Environinvest directors, plus Mr Pescott's wife Caroline, his brother Euan Pescott, and various companies controlled by the Pescott family.

In a statement sent to The Age yesterday through Mr Pescott's lawyer, Caroline Pescott said neither she nor Mr Pescott owns the Trawalla mansion in western Victoria where they live.

In a separate statement, Mr Pescott claimed St George's action to bankrupt him was "perplexing at best". He claimed that while he had borrowed "less than $4 million" from St George, the bank's security was "valued at around $12 million".

But this is contradicted by sworn documents by St George's senior manager of credit, John Cassar, which indicate that the three properties secured against the $3,685,000 bill facility fall far short of Mr Pescott's $12 million estimation.

In an affidavit, Mr Cassar said the $3,685,000 facility was secured against properties at Burrumbeet in western Victoria, Yarra Junction and Warburton, which St George is in the process of selling. He told the court the bank expects the sales will reap only $1.77 million to $2.45 million.

In his statement, Mr Pescott criticised the Environinvest liquidation, describing the asset sale process as "a disgrace".