Investors in an Auckland joint venture property development got a court order freezing family trust bank accounts of fellow investor Teik Huat Ghee alleging he has wrongly misappropriated some of their profit share from a Remuera development.
Family interests associated with Auckland investors Adonis Souloglou and Peter Cossey joined with Mr Ghee in March 2020 to redevelop a site on Upland Road, in Remuera. Profits or losses were to be split 65 per cent to interests associated with Mr Ghee, 35 per cent to Souloglou/Cossey investors grouped together in a company called Upland Business Management Ltd.
The High Court was told the Upland Road redevelopment generated gross sales of $14.6 million. The level of profit available for distribution is disputed. Upland Business investors say their share is $1.8 million. Mr Ghee says it is in the range of $750,000 - $885,000. The amount of finance secured against the project requiring repayment before determining profit shares explains the difference. This difference is hotly disputed.
Upland Business investors allege Mr Ghee has dishonestly claimed his family trust stands as a secured creditor, extracting funds before determining net profits. They complain that there was no reference to funding from Mr Ghee’s family trust in their 2020 agreement and similarly there was no mention in a feasibility study attached to the agreement.
Upland Business investors allege Mr Ghee has a commercial history of moving assets between companies to defeat creditor claims. They pointed to unrelated court proceedings where Mr Ghee was described as being a director of some 65 different companies and having been director of a number of failed construction companies.
Justice Whata ordered a freeze on bank accounts held on behalf of Mr Ghee’s family trust with bank statements to be disclosed to Upland Business investors.
The level of profits owed Upland Business is yet to be resolved. To date, they have received nothing.
Upland Business Management Ltd v. Ghee – High Court (30.11.23)
24.022