Bakers in legal stoush to try to recover assets from former not-for-profit research body

Businesses in the baking, milling and grain industries launched legal proceedings yesterday to recover assets from a $90 million property portfolio they claim was appropriated by members of a research body.

The businesses have grouped together to form Grain Technology Australia, a charitable corporation made up of industry stakeholders, wheat-grower Bruce Schwartz, Manildra Flour Mills and Bakers Delight.

GTech commenced proceedings against Rosewood Research Pty Ltd, its subsidiaries and directors, Graham McMaster, Allan Murphy and Laurance Gullick.

They claim Rosewood appropriated not-for-profit organisation the Bread Research Institute and turned it into a privately owned property company.

The BRI dates back to 1947 and was supported by substantial funding and contributions from government through the Commonwealth Scientific and Industrial Research Organisation, the Grain Research and Development Organisation and through a levy on milled flours.

In a statement, GTech described this as “over 60 years of building up assets for its charitable purposes”.

Rosewood has conceded that it holds all of its assets on a charitable trust.

“The aim of the action is to secure the proper use of charitable trust assets of about $40 million, which have been diverted from their educational and research purposes in connection with the grain, milling and baking industries in Australia for the public benefit,” GTech said.

The group claims the assets held on trust by Rosewood are not being used for charitable purposes and the benefit of the public, but instead have been mismanaged by McMaster, Murphy and Gullick by winding back education and research activities and engaging instead in property development.

GTech claims the directors managed to engineer the removal of all members and directors of BRI other than themselves so that they were able to control Rosewood and the use of its assets.

“The aim of the legal action is to secure the proper use of these assets held on charitable trust for the benefit of the Australian public,” GTech’s directors Bob Orth, Michele Alland and Mark Allison said in a statement.