Painting himself as a disinterested bystander seeking compensation for investors in Maat Consulting’s disastrous Nido department store syndication, Craig Priscott was primarily driven by attempts to hoover up Maat’s assets, the High Court ruled, ordering Priscott pay Maat $187,000 of its costs spent fending off his legal action.
Priscott sued Maat Consulting Ltd, its directors Neil Tuffin and Mark Hughson, plus members of their families trying to hammer them into selling up.
Any pretence that he went into battle for the benefit of Nido investors was negated by evidence that he sued only after failed negotiations to buy out Maat assets, Associate Judge Brittain said.
Maat Consulting establishes investment syndicates for purchase of commercial properties.
Considerable negative publicity followed a failed 2021 syndication in Henderson, West Auckland. Retail investors lost some four million dollars after a planned big-box retail store branded as Nido failed following a mix of construction delays, funding problems and covid-19 restrictions.
Mr Priscott complains that financial information provided by Maat to the last tranche of Nido investors prior to their investment did not disclose that the project was already in default.
This breached the Financial Markets Conduct Act, he alleged.
The High Court was told he threatened Maat and its owners with legal action over not only the alleged Nido non-disclosure but also allegations they had overcharged management fees in respect of other property syndicates.
This threat was held over their heads as detailed proposals were put forward through 2022 for all Maat syndicates to be rolled up into one entity under the ultimate control of Mr Priscott. He was offering $1.7 million compensation to Maat.
A September 2022 email presented an ultimatum: agree, or I sue as threatened.
Subsequent legal action by Mr Priscott’s company, CNP Holdings Ltd, was thrown out. Neither Mr Priscott nor CNP had any direct interest in the outcome.
Associate Judge Brittain ruled litigation was launched for an improper purpose; the intention of forcing Maat Consulting to sell up.
Both Mr Priscott and CNP Holdings were held jointly liable to pay $187,000 of the $594,000 litigation costs incurred by Maat.
While Mr Priscott personally was not party to the litigation, he was liable to pay costs as the ‘real party’ who drove the proceeding, Judge Brittain said.
CNP Holdings Ltd v. Central Park Property Investment Ltd – High Court (5.9.24 & 12.11.24)
25.031