Jon Adgemis seeks to block probe into $1.8 billion bankruptcy

Failed pub baron Jon Adgemis has made a last-ditch bid to dodge a public examination into the $1.8 billion collapse of his hospitality empire.

Lawyers for the former KPMG partner argued that a seven-day examination into Adgemis’ financial affairs, which kicked off in the Federal Court on Thursday, would amount to an abuse of process. They also sought to block public access to the hearings.

Federal Court registrar Susan O’Connor referred the matter to be heard by a duty judge on Friday morning, further delaying the prospects of getting answers about how Adgemis’ businesses unravelled.

“What you’re asking for is exceptional,” she said.

A colourful business identity known for his lavish lifestyle, glamorous girlfriends and luxury toys, including a yacht once owned by Shirley Temple, Adgemis created Public Hospitality Group in 2021 with designs on becoming a hospitality mogul.

He bought 22 properties across Sydney and Melbourne including The Norfolk in Redfern and Alexandria’s Camelia Grove Hotel in a debt-fuelled pandemic-era buying spree.

But the business, which relied on cheap cash and high-interest private credit loans, quickly began to struggle with repayments, and teetered on the brink of collapse before it was rescued in the form of a $400 million lifeline from Deutsche Bank in early 2024.

In October last year, Adgemis declared himself bankrupt, with debts of $1.8 billion, leaving behind a lengthy list of creditors including hundreds of former hospitality staff, Monaco-based businessman Richard Gazal, Deutsche Bank and the Australian Taxation Office.

Thursday’s hearings would have given both Adgemis’ liquidators and his bankruptcy trustee, Andrew Yeo of Pitcher Partners, an opportunity to pick through the wreckage of Adgemis’ business and personally question him about his financial affairs.

Ahead of the examination, the Federal Court published orders requiring a lengthy list of former associates, lenders and ex-girlfriend model Cheyenne Tozzi to produce documents in the hearings.

Also named in the order are billionaire Alex Waislitz, Adgemis’ former chief financial officer and Woollahra councillor Alexander Andruska, prominent racehorse owner and MaxCap founder Brae Sokolski, music pioneer Tom Misner, and Adgemis’ former business partner Ben Madsen.

But on Wednesday night, a Federal Court registrar made an order that a summons to appear in the action brought by the bankruptcy trustee “be adjourned to a date to be fixed”. While the liquidators’ examination was slated to begin on Thursday, that process was also frustrated.

Dressed in a tailored navy suit and wearing tinted sunglasses indoors, Adgemis spent just minutes on the stand and did not face a single question, before his lawyers requested a lengthy adjournment.

When the matter resumed, his legal team, led by Miles Condon SC, requested that the hearings be held in secret – a move which was tentatively supported by lawyers representing liquidators – with ERA Legal director Blake O’Neill telling the court that his client wanted “to get on with things”.

Later, Condon told the court that Adgemis’ team contended that the entire examination constituted an abuse of process. They are also seeking to stop ERA Legal from acting for the liquidators.

The abuse of process application will be heard by a Federal Court judge on Friday morning. If that fails, Adgemis’ team will seek to have the examination held in secret. Lawyers representing media outlets including this masthead are set to oppose that application.

The Tax Practitioners’ Board is also opposing attempts to keep the examination secret. The court adjourned the examination proceedings until next week.

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