Pop star Guy Sebastian's former manager promised the singer a stake in his company after becoming the foundation client, before embezzling nearly $1 million from him, a jury has been told.
The Australian Idol winner began his evidence in Sydney's Downing Centre District Court on Wednesday against Titus Emanuel Day, 49, who allegedly defrauded the entertainer on 50 occasions.
Day has pleaded not guilty to 50 charges including fraudulently embezzling money allegedly owed to Sebastian through royalties and performance fees, and 50 alternative counts of larceny, or stealing.
The Crown alleges that Day - who managed Sebastian via his company 6 Degrees between 2009 and 2017 - embezzled Sebastian out of almost $900,000 between 2013 and 2020.
After Sebastian won the televised singing contest in 2003, he was signed to a five-album contract with BMG records which merged with Sony, where he met Day's wife who introduced the pair.
The singer then joined 22 Management and said he "mainly really just dealt with Titus".
"I thought it was his company for a while until he alerted me otherwise."
In 2009 and "right in the thick" of releasing his Like it Like That album, Day approached Sebastian about starting his own company 6 Degrees.
"He would refer to me as his foundation client, a client he needed to start a new company," Sebastian said.
"He would use words like ... marquee client."
At the time he had two No.1 singles and albums respectively to his name and several top-10 hits.
"I was very proud of what I had achieved at that point."
Sebastian said he trusted Day with legal documents because of his expertise in law, and allowed him to negotiate out of his old contract on his behalf.
"One of the benefits of my manager was he was a contract lawyer so I trusted that if he put something in front of me he wouldn't do so unless it was ready to be signed."
Later he was stung with contracts he did not recognise, he said, like a 2014 deal between Premiere Music for "neighbouring rights" he only discovered upon trying to sign something similar for overseas royalties in 2020.
Over the years Sebastian has penned lucrative deals with numerous brands including Bose, Toyota, Air Asia, Yamaha and Bluefin resulting in cars for his ambassadorship, a boat in return for a festival performance, and equipment.
After Sebastian sued Day for money allegedly owed, his ex-manager counter-claimed about a commission he felt entitled to from gifts the entertainer had received from sponsors, crown prosecutor David Morters SC said in his opening address.
Sebastian said he doesn't believe he paid any commission on sponsorship items or "contra" throughout his entire career.
He said it was first brought to his attention when he queried the "missing monies".
But Day's defence barrister Dominic Toomey SC told the jury in his opening address that his client has an answer to every single charge, that sometimes is so clear and obvious.
"You may wonder whether the authorities, particularly the police, were even wilfully blind to that," he said.
"Seduced perhaps, by Mr Sebastian's high profile.
"Indeed you might even wonder whether there was an ulterior purpose on the part of Sebastian and the police in the pursuit of criminal charges."
The court was earlier told no contract was ever formalised between Day and Sebastian, but after the "acrimonious and hostile" break-up between the pair, the celebrity later discovered "anomalies" related to royalty payments never remitted to him by 6 Degrees.
And Day promised Sebastian 10 per cent equity in the firm in recognition of the importance he played in the company, Mr Morters said.
The trial before Judge Peter Zahra continues.
