Action filed against Petrocorp sate

Press, 20 February 1988, Page 2

Action filed against Petrocorp sate

PA Wellington A chambers hearing was held in the High Court at Wellington yesterday after a Petrocorp shareholder filed an action against the Government to try to stop the $BOO million sale of the company, the Auckland “Sun” reports. The action came just three days after the Government announced it had clinched a deal with British Gas to sell its 70 per cent stake in the State oilexploration company. The High Court imposed strict orders on the parties not to seek publicity over the action, but the “Sun” reported that the case was filed by a Wellington lawyer, Mr Francis Fox, who holds a mere 1000 shares. Mr Fox is a partner in the firm, Brandon Brookfield, which also acts for Brierley Investments, which has 100 million Petrocorp shares.

Mr Fox filed a case at 2.15 p.m. before Mr Justice Quilliam seeking an interim order against the Government to prevent any sale until after March 31, without consulting the

Petrocorp board and holding a shareholders’ meeting. Mr Fox will claim in the case that the Government has broken its commitment in the Petrocorp prospectus not to sell any further shares in the company this financial year. Mr Justice Quilliam adjourned the case until February 25 after a halfhour hearing in chambers. The Minister of Finance, Mr Douglas, who holds 45 million Petrocorp shares on behalf of the Crown, is first defendant in the case. The Minister of Energy, Mr Butcher, who holds 405 million shares, is second defendant.

The Attorney-General, Mr Palmer, is named as third defendant and Petrocorp’s managing director, Mr Bill Falconer, together with a Petrocorp director and former Labour Minister, Mr Warren Freer, are joint fourth defendants. It is believed Mr Fox will claim the Government has breached section 9 of the Fair Trading Act which says that no person shall, in trade, en-

gage in conduct that is misleading or deceptive, or is likely to mislead or deceive.

A statement by the Government in the Petrocorp prospectus says: “This sale will not take place this financial year. The timing and nature of the sale will be determined in full consultation with the Government’s advisers and the company.” Before an interim order would be granted, Mr Fox would be required to file an undertaking guaranteeing any losses to the Government should his final action be unsuccessful. Meanwhile, the Minister for State-Owned Enterprises, Mr Prebble, has reaffirmed that the Government’s solicitors have not conducted negotiations aimed at stopping Taranaki Maoris from seeking an injunction against the sale of the Government’s Petrocorp holding. Mr Prebble said yesterday it would be inappropriate for the Government to comment on the proceedings, other than to say it intended to “vigorously oppose” the action.