Failed bid to buy Tamworth's Longyard golf course at centre of legal action against three directors of Kingdom Developments

ACM is aware of several groups of investors considering legal action in the wake of the company's dramas - which include projects ending up in the hands of receivers, or lenders taking control of projects and reselling them.

The result is project shareholders not only in Australia but places like Malaysia, Japan and the United States have lost the hefty amounts they invested.

The bulk of the 20 projects Kingdom had been touting have now collapsed with combined investor losses likely to be well over $20 million.

However, the first court case to have papers lodged comes from a vendor - and is against the three directors Andrew Bodnar, Samuel Hamrosi and Mazen Kabarra.

The company itself is not listed as a respondent.

At the core of the case is the failed purchase of the Longyard Golf Club in Tamworth.

Kingdom put down a $1.2 million deposit for the 18-hole golf course in January 2022 and was due to complete the sale by December.

However, Kingdom needed more time and asked vendor John O'Rourke for an extension, which was granted.

As part of the original sale the ACM understands there were personal guarantees from the three directors that the purchase would go ahead.

The request for an extension came with a damages clause, also agreed to by Kingdom.

However, with Kingdom projects falling over, the company decided it couldn't go through with the purchase.

Instead, they asked for vendor financing - where the vendor loans the purchaser money for the sale - to which Mr O'Rourke refused.

Read more: Kingdom Developments director loses house, office and can't pay the bills

Ultimately, the struggling company walked away; leaving the $1.2 million deposit from investors' money on the table.

While Mr O'Rourke declined to comment on the court case, he had last month expressed his displeasure at Kingdom's decision.

"The Kingdom guys are going to be in a world of hurt by the time this thing's complete," Mr O'Rourke said last month.

"We hold an unconditional contract with director's guarantees for specific performance, so you can't just pull out of a contract because you feel like it.

"It was not subject to finance or anything else, anything at all. It is an unconditional contract."

Two of those directors are also dealing with issues around the sales of their own properties.

Earlier this week, Mr Bodnar told shareholders he had lost his own "personal property" due to it being repossessed and sold earlier this month.

The property in question is not the home in Middleton Grange that is listed as his address in Australian Securities and Investment Commission (ASIC) documents.

That home is in his wife's name and Mr Bodnar said he had "never put a dollar towards that".

His repossessed property is not a house at all but a long 1.91-hectare block of land backing onto the Hume Motorway in Bardia, just south of Liverpool.

That was sold under auction on March 4 for an undisclosed price - property records show Mr Bodnar had paid $2.3 million for it in May 2021.

Mr Hamrosi also has a property on the market - his stylish three-storey waterside home, which has been listed since November.

The luxury home, on the shores of the Parramatta River in the inner west Sydney suburb of Wareemba, is listed on Kingdom documents lodged with ASIC as Mr Hamrosi's residence.

The property - built in 2021 - went on the market on November 11 last year, just a month before Kingdom's dominos started toppling with the lender taking control of a Gladstone Avenue, Wollongong, property and selling it.

The property listing comes without a price tag, but Wareemba is an expensive suburb for real estate with the median house price of $2.8 million.

The three-storey four-bedroom home - built as a duplex - boasts four bathrooms, a gym, media room, home theatre and extra guest room.

"Showcasing striking interiors, this designer home exudes a wonderful sense of space, while clean lines and a minimalist aesthetic are enhanced by panoramic water views ... and bespoke design collaborations of two leading architectural designers, Anthony Maiolo and Kana Hioki," the listing stated.

Ms Hioki is Mr Hamrosi's wife.

"This home has been created with a very clear and concise focus on premium quality technology, a high attention to detail and an attitude of 'only the best will do'," the agency listing stated.

Mr Hamrosi was listed on ASIC documents as a director of a number of the company's projects that have either gone into receivership or been taken back by lenders.

However, in recent weeks ASIC records show fellow director Mr Bodnar has lodged papers removing Mr Hamrosi as director, and replacing him with himself, from all of those projects.

Mr Bodnar said the move was "just an idea that we're trying" as Kingdom looks to refinance and restructure - a move which he has said may also include rebranding.

He said the aim was, in the event of successfully securing that finance, that it may allow Mr Hamrosi and others to act as borrowers and guarantors going forward - rather than having all directors go bankrupt.

"He may still end up being bankrupt from the whole situation because we've taken his name off too late, we didn't take it off earlier in the piece," Mr Bodnar said.

"You may be a situation where he was a borrower previously and the lender still comes down hard on us regardless.

"But we're hopeful that we can protect some names and have people that we trust to move forward and help grow again.

"At the end of it lenders will look at what position he was in at the time of the loan.

"If he was a borrower and guarantor at a time and the property sold at a loss below the debt then he will still be liable."

By putting himself forward as the sole director on all Kingdom's projects - including those in receivership - Mr Bodnar is staring down the barrel of bankruptcy.

Were that to happen but Kingdom survive - even under a different name - Mr Bodnar hasn't ruled out working for the company in some capacity.

His logic is that it is better to go out and find work rather than wait for the prescribed period of bankruptcy to pass and start a new company.

"I have a moral responsibility in my view to grow again as quick as possible," he said.

"If that means I have to have a job and be just doing the skills that I'm good at doing - which is finding the properties, doing sales and marketing, organising the builders - and I can't be a borrower or a guarantor then I'll work my ass off to try and do what I can to do that.

"If I can have an opportunity to work and do what I'm good at and that's considered an employee then I have to be an employee.

"If it's considered I can be a director in three years or seven years because I've served the period of time, then I'd love to have the opportunity to be at the front as well."

As late as December, when the projects started collapsing - Gladstone Avenue in Wollongong was one of the first - a shareholder said they were "smashed" with emails and texts from the company asking them to sell more shares in various projects to their friends.

"For the last six months they've been trying to get us to sell more shares to get more money," the shareholder said.

"I was getting smashed with the emails, smashed with texts - 'we've got three for two specials on shares'. Thank God none of my friends were interested - that would have just been devastating for me."

Emails seen by the ACM show investors were asked to offer their friends share deals of three shares for the cost of two, or seven shares for the cost of four.

Mr Bodnar confirmed that as late as December, project shareholders were being asked to sell shares to their friends.

He said it was driven by the belief the company was about to secure finance that would save the properties and that the responsibility as a borrower at that point was to ensure the projects went ahead.

However, he said the $60 million loan never happened.

"We had the belief that we were not going to be let down," he said.

"We had no idea this was going to happen. At the time we believed the lenders were real and they were going to come through."

He had previously told investors he had spoken to "a detective" about the circumstances of the failure of the lender to provide the funds.

However that person turned out to be a retired Queensland detective in his 60s and not a serving police officer.

"I just needed to get advice from someone who had experience in that field," he said.

However, Mr Bodnar told the ACM the matter had been reported to Liverpool police.

"I'm waiting to see what documentation we can get from this lender because he's still stringing us along by the way," Mr Bodnar said.

"He hasn't said 'we're not giving you the loan', they're saying 'can you give us this, can you give us that?'"

Free "bonus shares" were handed out for Kingdom's Wollongong project among others.

The Gladstone Avenue land - where an apartment tower was planned - was sold by the lender in December.

ASIC documents show there were 101 shares issued for the project.

However not everyone paid for their shares, which were originally advertised for $65,000 each.

Mr Bodnar said Nick Bassett, who found the site in Wollongong, was given 10 shares as a reward - without having to pay for them.

"We gave away lots of bonus shares to help raise money, to help reward those people who found those projects and managed the projects," director Andrew Bodnar said.

"We also gave plenty of bonuses to people who were helping raise the funds because that was cheaper than paying for marketing and I did a lot of referral bonuses as well."

Mr Bodnar estimated between $2 million and $2.5 million was raised by those shareholders who stumped up their cash.

From there Kingdom borrowed the remaining 50 per cent of the purchase price.

When the lender took control of the project and sold it, the presence of a second mortgage meant there was no money left for shareholders, Mr Bodnar said.

"In the end because we had other properties going into receivership, and other projects that were also having their challenges we had lenders that were chasing us for the shortfall and putting caveats and second mortgages on properties and claiming anything that was left over, if there was a surplus."

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