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Entrepreneur and former AFL player Joel Macdonald cannot be found and has not been served with court documents almost a year after a former teammate accused him of misleading and deceptive conduct.
Macdonald is the defendant in a Supreme Court writ filed in August last year by former Demons player James Strauss, who alleges his former business partner denied him a multi-million-dollar windfall from a technology company they founded together.
Former AFL players James Strauss and Joel Macdonald were teammates at Melbourne, then business partners before their relationship went sour.
Strauss, who played 24 games with the Demons, claims Macdonald’s actions caused him to miss out on as much as $15 million from the sale of shares in the scandal-plagued company GetSwift.
However, Strauss’ legal team says it has been unable to locate Macdonald to serve him with the writ, despite social media posts of the former GetSwift director relaxing by a pool in Florida last year and attending a wedding in Mexico in January.
Last month, Strauss’ lawyer applied to the Supreme Court of Victoria for substituted service, which would have allowed them to deliver the court documents to Macdonald by email, SMS or to his residential address in the US.
Lawyer Michael Hazell, acting for Strauss, told the court he had engaged in a “game of cat and mouse” with Macdonald, after making several unsuccessful attempts to locate him.
Hazell said he had made inquiries with Macdonald’s former solicitor, GetSwift’s Australian liquidator, and law firm Phi Finney McDonald which was running a class action against GetSwift that has now settled. He had also contacted another former teammate, who was thought to have lived with Macdonald in Florida.
However, Justice Matthew Connock said he could not be persuaded that “one or more of the proposed service methods will likely bring the service documents to the attention of the defendant,” according to a judgement handed down on May 1.
Justice Connock denied Strauss’ bid for substituted service, although decided not to dismiss the application and allowed more time for his legal team to find Macdonald.
Given Macdonald cannot be located to accept service of the writ, it is unknown if, and on what basis, he intends to defend the claim.
GetSwift was co-founded by former AFL footballer Joel Macdonald.Credit: Christopher Pearce
Hazell told The Age he was confident he would eventually track down Macdonald.
“Whilst I understand why the court reached its decision, it’s frustrating that after so much effort from so many people we have been unable to locate him. That said, I’m confident we will get there,” Hazell said.
Macdonald, who played 126 games with Melbourne and Brisbane before making a fleeting appearance on the BRW Young Rich List, started an alcohol delivery business called Liquorun in 2013 with Strauss and another Melbourne footballer, Rohan Bail.
Strauss resigned as operations manager of Liquorun in 2015 but maintained his shares in the business, which shifted its focus to logistics software before changing its name to GetSwift.
Strauss claims that in September 2016 Macdonald told him that Strauss’ 8 million shares in GetSwift would be placed in escrow – a type of legal holding – as a condition of the company’s ASX listing, which would prevent him from selling the stock for two years.
According to the writ filed in August last year, Strauss was also told he had a three-month window in which he could offload his stake, which prompted him to sell more than 4 million shares for $250,000 just a month before the float.
More than 3.3 million of those shares were bought by Macdonald for $200,000, or 6¢ a share.
Macdonald would later tell Strauss, according to the writ, that he had negotiated with the ASX for the escrow period to be reduced to one year because he was never a director or employee of GetSwift.
Just days before the float in December 2016, Strauss signed an agreement prepared by GetSwift that stopped him from selling the stock for 12 months for “the purpose of complying with chapter nine of the ASX listing rules,” according to the writ.
The value of GetSwift shares surged from 20¢ to more than $4 within 12 months of listing, but plummeted when the company became embroiled in series of scandals over breaches of its disclosure and reporting obligations.
In February 2018, the company announced that fewer than half the contracts it had been spruiking were actually generating revenue.
When Strauss’ shares were eventually released from escrow – almost three months after the agreed date – he was forced to sell them at significantly reduced prices.
He would later learn from correspondence with the ASX that it had never imposed an escrow requirement on his shares, which were only ever subject to a voluntary arrangement, according to court documents.
Macdonald did not respond to requests for comment from The Age.
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