Receivers refused entry to company office

Press, 19 April 1985, Page 8

Receivers refused entry to company office

There was a “Wild West stand-off’ when the receivers attempted to take possession of the chattels of Sovereign Gold Mines, Ltd, from the company’s premises in Tainui Street, Greymouth, and two directors barred the doors and windows and barricaded themselves inside the building, Mr Justice Roper was told in the High Court yesterday. Philip Anthony HydeHarris and Keith Clarence Hunt, described as company directors, of Christchurch, have been ordered to hand over to Sovereign Gold Mines office furniture and other items valued at $24,083.

The question of damages and costs against HydeHarris and Hunt was reserved by his Honour. Mr D. H. Hicks appeared for Sovereign Gold but Hyde-Harris and Hunt were not represented. Wynton Gill Cox, an accountant with Deloitte, Haskins and Sells, a national accounting firm, said that on June 29, 1984, he and Kelvin Nicholas Curnow were appointed receivers and managers of Sovereign Gold by the A.N.Z. Banking Group. Mr Curnow died on December 3, 1984, and Mr Cox said that he carried on on his own until Oliver William Pitcaithly was appointed to replace Mr Curnow on February 21, 1985. They were also appointed as receivers and managers by Barclays New Zealand, Ltd, on March 4, 1985. On June 30, 1984, witness and Messrs Curnow, Pitcaithly, and Stephen Tubbs, a chartered accountant employed by his firm, travelled to Greymouth where Sovereign _ Gold’s registered

office was at 110 Tainui Street. There was a loose understanding that Sovereign Gold occupied the premises on a rent-free basis provided that the company paid for leasehold improvements. Sovereign Gold paid $14,645 for improvements. “There was no formal agreement to lease and as far as I could establish no agreement to pay rent, and none has ever been paid by the company since the date of its inception as a public company in May, 1983,” Mr Cox said. A full investigation was made into the company’s position in the weeks after their arrival in Greymouth and in spite of attempts by Hyde-Harris to be obstructive, they gained control of the company’s operations and the majority of its assets. Because of the difficulties being encountered it was decided to remove the registered office and all the records and assets from the premises of Hyde-Harris and Hunt in Tainui Street to another location in Greymouth.

Then on July 17, 1984, Hyde-Harris and Hunt issued a notice ordering the receivers not to remove any articles from the Tainui Street premises. On the same day they sent an account for rent On the morning of July 20, 1984, a meeting was held with Hyde-Harris and Hunt but they refused to discuss matters or to allow witness access to the premises except to remove wages records, a computer, and some software. When the two refused to discuss matters they were handed a formal letter outlining the position. “From that time I have been unable to get possession of the company’s property retained by HydeHarris and Hunt,” said Mr Cox. On leaving the meeting he approached the Greymouth police and informed them that Hyde-Harris and Hunt had ptisession of property which was the legal entitlement of the company. Later that morning he informed both defendants that he. would return to the premises at 1.15 p.m. that

day to uplift company records and to discuss the question of other assets in their possession. At that time he went to the building accompanied by Messrs Pitcaithly, Tubbs, North, three other men, and a truck from a local carrying company. The Greymouth police were nearby. “The Tainui Street premises were locked and the doors and windows barricaded. Taped to the door was a handwritten notice informing the receivers that they were trespassing,” Mr Cox said. After inquiring what was happening, the police entered the building and spoke to Hyde-Harris and Hunt and their legal representative, Mr Neil Thinn. “The police informed us that if we entered the premises forcibly those inside would lay a complaint which would have to be investigated. After consulting my legal adviser I decided not to proceed with a forced entry to gain access to the company’s assets,” said Mr Cox. Mr Thinn came out of the building and there was a

discussion. He was asked to convey a compromise to Hyde-Harris and Hunt: that the assets be removed after a personal undertaking was given by the receivers that their claim for rent, which was allegedly in arrears, would be determined by the Court. An alternative, that the assets and company records be removed and held in police custody, was also put to Hyde-Harris and Hunt but they refused to accept both offers. After further discussion the defendants allowed witness to enter the barricaded premises on his own to find company records and uplift them. “This was done with great difficulty and at one stage the police had to intervene to restore some sanity and attempt to allow me to gain access to the documents as previously agreed by the defendants, but not all records were removed because of the haphazard nature of the operation. None of the physical assets of the company could be taken,” said Mr Cox. From that time the

receivers had been unable to get the company’s property or other records possibly held by Hyde-Harris and Hunt, apart from a limited number of items obtained by Mr Brian Boustridge, a former director of Sovereign Gold, who had been employed as operations manager by the receivers since June 30, 1984. The Tainui Street property owned by Hyde-Harris and Hunt had been sold under a mortgagee sale. They had removed all or some of the items claimed by the company. On September 25, 1984, a meeting was held between witness and Mr Curnow and the directors of Sovereign Gold. Hyde-Harris and Hunt were present and agreed to hand over the assets which were the subject of the present proceedings. The two defendants wanted satisfactory arrangements made in respect of plant belonging to the company at Addisons Flat near Greymouth and he believed that was done, Mr Cox said.