Archive | Wise Lass Residential

Raymond back in firing line

Affidavit seeks interim liquidator for Shuttleworth development group

Thrice-bankrupt property developer Graeme Raymond’s nemesis, Richard Downey, has filed a 17-page affidavit in the High Court, arguing that Mr Raymond has control of a fresh batch of property companies, including one which has just seen its Waiuku subdivision fail to sell at mortgagee auction.

Mr Downey’s affidavit was in support of an application for an interim liquidator of that company, Wise Lass Residential Ltd, and another eight companies of which Deborah Shuttleworth is director.

But of instead of appointing an interim liquidator on an ex parte basis, Master Faire said the affidavits had to be served on Wise Lass and has put the company in the High Court’s regular Thursday liquidation list this week.

Mr Downey said in his affidavit that various creditors of Wise Lass had asked him to present evidence he had obtained on their behalf, which led them to believe an interim liquidator should be appointed urgently to control Wise Lass’ affairs.

He said this evidence showed Wise Lass was insolvent, Mr Raymond was demonstrating control and management of the company, its assets were in jeopardy and there was a risk that Ms Shuttleworth would place it in voluntary liquidation — reminiscent of the situation two years ago, when Mr Downey fought to overturn the decision by Mr Raymond to place his main development company, First Investments, in voluntary liquidation.

That appointment was overturned and a court-ordered liquidator appointed in his place.

The Waiuku subdivision, on Constable Rd, was taken to mortgagee auction as an abandoned development a fortnight ago by Reeves Moses Hudig Mortgage Nominee Co Ltd, but was passed in with a top bid of $825,000. The mortgage is for $1.2 million.

Wise Lass also has a Te Atatu subdivision, 31 terraced homes on Harbour View Rd, and built 24 commercial/residential units for another Shuttleworth company, Tironui Developments Ltd, on Tironui Station Rd West, Takanini.

Mr Downey said creditors of Wise Lass were owed about $1.5 million.

Mr Raymond, now 37, was bankrupted two years ago. He will face a one-day depositions hearing in the Auckland District Court on 18 August on five charges relating to that bankruptcy, laid by the Ministry of Commerce (now the Ministry of Economic Development).

Raymond has been charged with perjury, making a false statement, contributing to his insolvency by gambling and extravagant living, concealing property and making misleading statements to the Official Assignee.

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Fight for control of Wise Lass documents sees OA as liquidator

Raymond named as collapsed company’s controller

A peculiar game was played out in the High Court this week, as three-times-bankrupt developer Graeme Raymond’s nemesis, Richard Downey, rose once more in pursuit.

Mr Raymond wasn’t to be seen, but his name cropped up in allegations that he has been controlling the affairs of Wise Lass Residential Ltd, a residential subdivision company which has been placed in liquidation twice this week.

The company’s sole director and holder of its 1000 shares is Debbie Shuttleworth, according to Companies Office files, although documents prepared for the voluntary liquidation on Monday showed three shareholding signatories.

A Wise Lass subdivision at Waiuku was abandoned and taken to mortgagee auction in July by Reeves Moses Hudig Mortgage Nominee Co Ltd, which signed up for a $1.2 million mortgage but could get only an $825,000 top bid. Mr Downey reckons the company’s creditors are owed at least $1.5 million, with the prospect of payout unknown.

Mr Downey pursued Mr Raymond through the courts two years ago, when Raymond apartment projects turned sour. Mr Raymond blamed Mr Downey for his business collapse, but the collapse seemed well on the way before Mr Downey got stuck in.

Among the Raymond companies to fall over in that round were Rock Investments and First Investments. At the end of it, Mr Raymond was bankrupted for the third time, when he was still only 35. He also faces Companies Act charges relating to his bankruptcy, with a depositions hearing in the Auckland District Court on Friday 18 August.

As all the cards collapsed in 1998, First Investments went into voluntary liquidation. That move was opposed by the Auckland commercial affairs division of the Commerce Ministry, which went to court to overturn the appointment and get a neutral liquidator appointed.

A similar event has happened with Wise Lass. The appointment of accountant Clive Johnson as liquidator was made on Monday and announced in the NZ Herald’s public notices on Thursday. In the High Court on Wednesday, Master Faire refused to allow an ex parte application to appoint an interim liquidator, giving instructions that the company and its officers were to be served with notice of the application.

Come Friday afternoon and Mr Downey, lawyer Chris La Hatte and insolvency practitioners Bernie Montgomerie and Bill Ferguson were still trying to get the appointment of an interim liquidator not appointed by the company and not predisposed to its or Mr Raymond’s interests.

Mr La Hatte said the liquidator appointment documents presented by Wise Lass’ counsel, George Bogiatto, had the date but not the time on them, as nowadays they should, so it could not be ascertained that Mr Johnson had signed a consent before being appointed.

Master Faire accepted that if that were the case, the appointment would be void. Mr Bogiatto proposed a creditors’ meeting at short notice, which would allow creditors to decide who should be liquidator. Meanwhile, he said the Montgomerie-Ferguson team was unacceptable, and for a while also ruled out the Official Assignee, who might pass the work on to Messrs Montgomerie and Ferguson.

At 4.25pm, the lawyers reached consent, the OA was appointed interim liquidator and a creditors’ meeting is to be held within seven days.

The legal footwork seems pedantic and a world from modern-day reality, but was essentially about securing of documents in safe hands, with the two sides viewing safe hands very differently.

Appointment of the OA was odd, because the government agency has worked hard at getting out of handling liquidations, passing the work on to private practices, and its ability to handle any liquidation work was questioned. However, in this case the office was considered an independent arbiter.

But the consent order left the status of Mr Johnson’s appointment unresolved, although the order meant he lost his job. It was not clear whether Master Faire would have had the power to remove Mr Johnson, which in the end became unnecessary. Nor was it clear that there was a proper basis for the appointment of the OA, because Mr Bogiatto had challenged the status of the creditor seeking the appointment, Jim Bull, who he said had settled with Ms Shuttleworth.

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