Auckland developer Greg Olliver ran into legal difficulties trying to pick and choose how best to extract money claimed from his failed Auckland property development.
A Waimarie Street project in Auckland suburb St Heliers had to be restructured in 2009 when Mr Olliver ran into financial difficulty. A multitude of court cases followed involving Mr Olliver, his then spouse Sarah Sparks and secured creditor Bank of New Zealand. A rising property market helped. A decade on: the Waimarie properties were sold to Oceania retirement group for $20.5 million; BNZ was repaid in full; and liquidators of CIT Holdings Ltd (former owner of the Waimarie site and the vehicle established in 2009 to steer around Mr Olliver’s then financial difficulties) are holding some $3.8 million available to pay unsecured creditors who between them claim $5.8 million. Mr Olliver has been shopping around, to identify the best way to benefit from this $3.8 million.
The High Court was told Mr Olliver is owed $836,000 for earthworks carried out on Waimarie Street prior to CIT’s liquidation. Initially, Mr Olliver used BBG Holdings Ltd (a company he controlled) to make the $836,000 claim against CIT. This claim as an unsecured creditor was accepted by CIT liquidators after receiving paperwork in support. One year later and before CIT liquidators had made any payment to unsecured creditors, BBG Holdings itself was in liquidation with insolvency practitioner Damien Grant appointed liquidator. Mr Olliver told Mr Grant BBG owed him some eight million dollars. Mr Grant required proof. He did not accept as sufficient evidence accounting spreadsheets supplied by Mr Olliver. Detailed documentation with formal proofs of debt were required.
Mr Olliver changed tack. He said BBG had carried out the earthworks when it had no right to be on site. He contacted CIT liquidators telling them the $836,000 unsecured claim put in by BBG Holdings should be rejected. As a consequence, Mr Olliver would likely achieve a higher payout, the High Court was told. Mr Grant responded with a High Court order that BBG’s claim against CIT Holdings for $836,000 stand.
Associate judge Sussock ruled a contract did exist between CIT and BBG for the earthworks. As an unpaid creditor, BBG was entitled to claim $836,000 in CIT’s liquidation.
JG Civil Ltd, owned by Orewa contactor Joel Giddy, in turn claims $836,000 as an unsecured creditor in BBG’s liquidation; it carried out the earthworks at Waimarie Street under contract to BBG Holdings.
BBG Holdings Ltd v. CIT Holdings Ltd – High Court (23.07.21)
21.126