French dressing down for Henderson

Christchurch developer Dave Henderson has failed to overturn a $2 million summary judgment over mortgage guarantees he provided for his mate Alan Duff.

High Court justice Christine French dismissed Mr Henderson's attempt to overturn the summary judgment.

She described his defence arguments as “implausible” and “nonsensical.”

Mr Henderson had claimed he was approached by Strategic in December 2007 over the arrangement. Strategic took over the property via mortgagee auction and nominated Mr Henderson’s company, Cleaver Factors, as the buyer.

It was funded by a Strategic advance of just over $2 million secured by a first mortgage plus “all obligations” unlimited guarantees from Messrs Henderson and Duff.

Mr Henderson claimed he had been induced into the guarantee after Strategic’s chief executive officer, Kerry Finnigan, told him he would have no personal liability. He claimed he had only subsequently signed a deed of acknowledgement of the debt on the basis Strategic would withdraw its summary judgment.

Strategic denies any such agreement and denies Mr Finnigan ever made any representation, supported by affidavits.

“… it simply does not make sense … it is contrary to the conduct of both parties. If what Mr Henderson was saying were true, why was the summary judgment application adjourned at least three times by consent? Had the assertion he is now making been correct, once he signed the deed he would have been insisting on the summary judgment application being withdrawn, rather than adjourned … his assertion is inherently implausible, because it is nonsensical. Even if the application for summary judgment had been withdrawn, the deed would still have enabled Strategic to immediately obtain judgment by default,” Justice French says.

Furthermore, Justice French dismisses Mr Henderson's claims that he was approached by Strategic.

“The affidavits sworn by Messrs Henderson and Duff give the impression that Mr Henderson only became involved with attempts to help Mr Duff in late-2007.

In fact, the documentary evidence, including a letter from Mr Henderson’s own solicitors, shows otherwise. It shows that Mr Henderson had been involved well before that, as early as June 2007; that proposals were initiated by him or his agents; and that from the very beginning of his proposed involvement with refinancing the property it was always contemplated he would be undertaking personal liability.

“Mr Henderson also deposes that it was at the meeting on 7 December with Mr Finnigan that Strategic asked him to become involved with the purchase of the property.

"However, this is at odds with an email from his agent and accountant, Mr Angus.

The email of 28 November shows that in fact it was Mr Henderson who was proposing he become involved with the purchase of the property. The email was sent some eight days before the Finnigan meeting.”

Justice French confirmed the order for summary judgment of a total of $2,650,147.79, which comprises the amount lent at 23% interest.