Jim's Mowing founder in $5m UK 'conspiracy'

Date AddedJune 06, 2010 09:45:36 AM

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One of Australia's best-known businessmen is being sued for more than $5 million over claims he unlawfully conspired to get rid of the head of his UK operation.

A statement of claim has been filed in the High Court in London claiming Jim Penman, the owner and head of Jim's Group, and two of his business associates acted in concert to remove UK master franchisee Paul Carr last year.

Jim's Group is the second-largest franchise operation in Australia, with more than 3000 franchisees in 28 different businesses, and also has branches in the UK, Canada and New Zealand.

Mr Carr is suing Mr Penman, his former offsider Phil Maunder, former UK business partner Richard Harrison and Jim's Group itself.

Mr Penman said he would defend the claims, and counter-sue for damages.

His lawyers had already sent Mr Carr a letter claiming he has been behind websites "highly defamatory" of Mr Penman, and were expected to launch a defamation action in the Victorian Supreme Court.

Four former UK franchisees also intended to launch a class action against Mr Carr, "with our full moral and financial backing", Mr Penman said.

"We expect others to join in," he said.

Mr Carr said he was also preparing a defamation action against Mr Penman.

"I am also now, having got this far, not interested in any settlement he may eventually decide to offer," Mr Carr said.

Mr Penman earlier offered Mr Carr 80 per cent of the value of the business, which the former estimated as worth between $100,000 and $200,000.

Mr Carr's statement of claim, obtained by WAtoday.com.au, says he had a reasonable gross profit expectation of about $5 million in the next six years.

He also seeks accrued interest on the damages at 8 per cent a year.

In an e-mail to Mr Harrison, copied to Mr Penman and tendered as evidence to the court, Mr Maunder writes: "It is clear to me that Paul Carr does not have the confidence of the franchisors therefore I personally think we should organise the UK franchisors to vote out Paul Carr."

Mr Harrison later writes to Mr Penman saying "Paul Carr has always been my only reservation and if we can remove him from the equation there is no stopping us."

Mr Penman responds: "We'll do our best to get him out. He's clearly not doing his job at any level."

He told WAtoday.com.au last year that: "The attrition rate of his franchisees was many times that of others. Basically they treated him like poison and we had to find a way to get rid of him... we determined that he had not provided his franchisees with any support and got rid of him that way."

The court has already found against Mr Harrison, who did not file a defence, with further hearings to decide damages.

Mr Harrison told WAtoday.com.au the judgment was "simply an administrative issue, as we did indeed miss an initial deadline", and his solicitor was in the process of filing a defence.

Mr Penman said he was also considering suing Fairfax Media, publisher of this website, over what he claimed were "false and defamatory statements" made in a series of stories about the battle between Mr Penman and some of his Australian master franchisees.

Those franchisees tried to vote Mr Penman out as chief executive of the company, claiming dissatisfaction with his methods.

More than 84 per cent of those who voted wanted him out, but Mr Penman refused to recognise the referendum as valid, and later said he could not be forced out.