Shipley, Tilby and Gomm appeal Mainzeal ruling

Former Mainzeal Group directors Jenny Shipley, Clive Tilby and Peter Gomm are appealing the High Court judgment which found them liable to pay up to $6 million each towards a $36 million award to creditors.

“The directors do not agree with the High Court judgment and believe they have strong grounds to challenge the decision,” they say in a statement from their lawyers, Chapman Tripp.

Jack Hodder, QC, will be available to brief media later today but otherwise the directors will make no further statement, it says.

Yesterday, another director of the failed construction company, Richard Yan, appealed the judgment which made him liable for the bulk of the $36 million.

Today is the deadline for appeals following Justice Francis Cooke’s ruling released on Feb. 26.

Liquidator BDO, appointed after Mainzeal collapsed in early 2013, could also choose to appeal on the grounds that the sum awarded to creditors is only a third of the approximately $110 million they are owed.

BDO has 10 working days from yesterday to cross-appeal.

Justice Cooke ruled that the directors were reckless, “had adopted a policy of trading while insolvent,” and “used money owed to trade operators, particularly sub-contractors, as working capital.”

The directors also relied on assurances from Mainzeal’s China-based parent, Richina Pacific, headed by Yan, that the millions of dollars Mainzeal had lent Richina would be paid back if Mainzeal got into trouble.

(BusinessDesk)

NOTE: please be advised to read full articles from Business Desk Website, you will have to pay a subscription fee on their website.