A claim by the receiver of failed lender Capital + Merchant Finance against its former trustee, Perpetual Trust, and legal firm Stace Hammond has been delayed.
Media were kept out of court this morning as lawyers for KordaMentha's Grant Graham and Brendon Gibson and Perpetual and Stace Hammond, which acted for Capital + Merchant met Justice Raynor Asher.
Messrs Graham and Gibson had filed statements of claim saying the trustee and lawyers breached duties they owed to the finance company.
Later today Justice Asher released a minute which says it was the defendants who wanted the case delayed. According to the minute, the receiver's lawyer, Robert Stewart QC, did not consent to delaying the case but could not get advice from his client to oppose it. (see the minute attached)
The judge decided the case could not move forward today and asked counsel for a progress report next week.
The receivers say this is probably the only remaining potential avenue of recovery for the 7500 Capital + Merchant investors owed approximately $167 million at the date of receivership.
The company holds no further assets that have a realisable value.
The claim follows a High Court decision last year to remove Perpetual as trustee for Capital + Merchant and appoint state-owned Public Trust as a trustee of last resort.
In June Capital + Merchant’s former auditor, BDO Spicers, agreed to an $18.5 million settlement of a claim against it from the Official Assignee appointed as liquidator to the failed lender.
NBR ONLINE understands Litigation Lending Services, the firm also involved in the “Fair Play on Fees” bank fee claim, is externally funding KordaMentha’s claim against Perpetual.
Perpetual Trust was owned by Pyne Gould Corporation at the time of Capital + Merchant’s demise but the trustee business has since been sold to interests associated with London-based investor Andrew Barnes.
Following Serious Fraud Office proceedings, Capital + Merchant founding directors and beneficial owners Wayne Douglas and Neal Nicholls were both jailed for seven and a half years, the longest sentences given to failed finance company bosses to date.
They were also sentenced to further time on Securities Act charges brought by FMA.
Former chief executive Owen Tallentire was also jailed for five years after being convicted on SFO charges and had another year added on FMA charges.
Victoria Young
Thu, 25 Sep 2014
Thu, 25 Sep 2014
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Capital + Merchant Finance case delayed
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