Originally published August 20, 2008
THE First Mildura Irrigation Trust bitterly accepted its fate, backing down from an unwinnable legal battle with the Victorian Government.
Victoria's oldest and last grower-elected irrigation authority was formally wound up and merged with rival Lower Murray Water at a minute past midnight, ending its 112 years of existence.
On advice of the trust's legal counsel, chairman Jim Belbin and deputy chairman Frank Dimasi decided to withdraw their planned Victorian Supreme Court injunction against Water Minister Tim Holding to prevent the merger.
"It's a terrible day," Mr Belbin told Sunraysia Daily.
Mr Belbin said the injunction application had been withdrawn after Mr Holding undertook to consider all documents presented to him by FMIT, and all other relevant matters, including the independent analysis of the trust's finances by accounting firm WHK Horvath.
The trust commissioned the Horvath review to counter what it claimed to be many inaccuracies in the earlier Deloitte analysis, commissioned by the Department of Sustainability and Environment.
"Our legal counsel told us that once the minister had undertaken to consider all documents submitted to him by FMIT, there was no prospect of us getting an injunction to restrain him from proceeding with his determination.
"Basically he accepted settlement by consent.
"But I believe we won a moral victory, because the threat of the injunction forced Mr Holding to make a statement to the court, saying he would grant us due consideration.
"Mr Holding's undertaking not to go after us for court costs is, in my view, a tacit admission that we had a legitimate claim for procedural fairness.
"The fact that he was forced to make that statement before the court is pretty challenging for him, but that's putting the best face on what ultimately is a terrible and tragic result.
"In reality, it's pretty hollow."
Mr Holding defended his decision to merge FMIT with Lower Murray Water, denying it violated a government promise not to force such a takeover.
Mr Holding said FMIT was being taken over because it faced an uncertain financial future and because its board had lost $2 million in an unlawful investment in the US sub-prime mortgage market.
In the state government's 2003 white paper on water, then-premier Steve Bracks and former water minister John Thwaites gave an assurance there would be no forced takeover of FMIT -- and that both boards would have to approve any merger.
But Mr Holding said that decision could not stand in light of the trust's current financial position.
In November 2012, the Lower Murray Urban and Rural Water Corporation was ordered to pay almost $300,000 in damages to four former First Mildura Irrigation Trust board members it defamed by the publication of a letter by the then Water Minister Tim Holding.
In a judgment handed down in the Supreme Court, Justice Stephen Kaye also ordered LMW to cover legal costs incurred by the plaintiffs.
Three of the former board members -- Jim Belbin, Frank Dimasi and Don Marciano -- were each awarded $70,000 in damages, while Nancy Prevedello was awarded $85,000.
The claim related to a letter by Mr Holding and published on the LMW website in 2008 and republished two years later.
The letter, which was sent to all LMW irrigators including former FMIT irrigators, was published soon after Mr Holding sacked the FMIT board and merged the trust with LMW in September 2008.
