|A Fairline Squadron, similar to the one PPB is |
worried will rot at its mooring.
On December 22, just a week after their big win in the Supreme Court of Victoria, Federal Court judge Justice Neil Walter McKerracher dismissed their application seeking to be appointed receivers to a Fairline Squadron 74, purportedly owned by the wife of absent fertiliser mogul Pankaj Oswal. And that decision is going to cost. (Read the Judgement)
Justice McKerracher - whose childhood was, one hopes, spared schoolboy renditions of the traditional Spanish folk corrido, "la cucaracha" - ruled that BFPL did not show the $2.71 million luxury motor yacht was at sufficient risk to justify such an exceptional application.
Legal precedent figured heavily in his deliberations, with the judge inserting this paragraph from a 1992 ruling by former Federal Court judge John von Doussa: "The appointment of a receiver or receiver and manager, whether in aid of a Mareva injunction or under Section 1323(1)(h) of the Corporations Legislation is a drastic step, not lightly to be taken".
PPB’s Ian Carson, Simon Theobald and David McEvoy – who were appointed receivers to BFPL on December 17, 2010 - had argued that the condition of the luxury yacht was "rapidly deteriorating", an assessment based on the views of an unnamed BFPL executive "…with maritime experience".
|Pankal and Radhika Oswal. Note Radhika's|
svelte vego abs.
That contention is disputed. The vessel was purchased with funds in a BFPL account operated by Pankaj Oswal seven weeks before PPB was appointed.
The yacht was then registered in the name of Oswal Projects Pty Ltd. While no company by that name has existed in Australia, CAMVPL was formerly called Oswal Projects Perth Pty Ltd and Mrs Oswal claims the yacht is hers.
According to the judgement, she has not yet provided proof of any consideration her company paid for the yacht and the receivers argue that the boat is held by CAMVPL on “constructive trust” for BFPL.
Radhika has launched a cross claim and given undertakings that she won’t sell, transfer or otherwise encumber the yacht. And because the receivers couldn't show the boat stern down or listing to port with a barnacle encrusted hull, those undertakings were good enough for Justice McKerracher.
For now it's a stalemate that leaves BFPL picking up the tab for the yacht's care until its ownership is decided. And it's a tab to make an insolvency expert weep.
According to Justice McKerracher the receivers first had to insure the vessel. Then there are berthing or "pen fees" which come in at $5,500 every three months.
And because no one knows better than boat builders that their creations are holes in the ocean into which owners pour money, Fairline has advised that the boat needs an immediate service at a cost $10,000, followed by ongoing work to be conducted quarterly "at a similar cost".
The Squadron 74 is the second floating plaything Carson, McEvoy and Theobald have dredged up since taking over BFPL. An Azimut 60 moored in Perth’s exclusive Mosman Bay also forms part of the disputed stable of play people’s toys.
In the grand scheme of the Burrup debacle, who owns the boat is small beer. PPB and its client ANZ should be riding high.
On December 16 the Supreme Court of Victoria threw out Radhika's application for an injunction to prevent PPB's client ANZ selling her 35% share holding in Burrup Holdings, the company that holds the key to developing a profitable commercial explosives business on the doorstep of West Australia's Pilbarra iron ore province.