Wilson Neill directors face ban

By Nick Smith

Friday 1st February 2002

Sharemarket delinquent Wilson Neill Corporation is facing losses of $11.5 million and creditors have filed winding-up proceedings, amid calls for the company directors' heads.

Bernard Montgomerie, receiver for failed internet company Yippee, yesterday called for the registrar of companies to ban Wilson Neill directors after abandoning his legal fight against the company.

Chief executive Phil Vosper, chairman Trevor Mason and Maurice Crosby were purveyors of "bullshit" and should be banned, Mr Montgomerie said.

"These guys just flout the law. They haven't filed their financial accounts and they came out with a press release [claiming] a $6.5 million profit ... the whole lot is bullshit."

If the registrar banned the trio, they would be unable to act as company directors for five years.

Also, on Wednesday Rowan Chapman, a principal at accounting firm Gosling Chapman, filed winding-up papers in the High Court at Auckland over Wilson Neill's longstanding $30,000 debt.

Mr Montgomerie has dropped legal action against Wilson Neill because he believes the company could not afford to pay any damages or costs.

The action was over Wilson Neill's decision to not go ahead with its $2.7 million deal to buy Yippee.

The Last Post was now playing for the company, he said.

"It is understood that significant losses of upwards of $11 million have been incurred by Wilson Neill Corporation," Mr Montgomerie said. "This was confirmed by [Wilson Neill subsidiary] IT Media's managing director, Tim Connell, when we advised him that we were withdrawing our [legal] action.

"It is no wonder New Zealand has got the reputation as being the wild west of the finance community. These directors should be banned."

For the third week in a row, staff at Wilson Neill's Auckland office were not answering the phones. Mr Vosper, Mr Mason, Mr Crosby and Mr Connell did not return The National Business Review's calls.

The company has still not filed its annual accounts and is under investigation by the Companies Office for breaching the Financial Reporting Act.

The Companies Office is considering prosecuting the company, as it successfully did last year, resulting in a $30,000 fine for the same offence.

Mr Montgomerie said he was disappointed at the lack of action "for the numerous breaches in various acts ... designed to protect their 9000 private investors."

He said the decision to withdraw legal action against Wilson Neill was not one taken lightly, and in return, the receivers were entitled to "all of the identifiable assets" of Yippee, he said.

Montgomerie & Associates was confident of either enforcing the agreement for the sale and purchase or the court imposing a substantial claim for damages.

"However, we were required to consider the practical position of spending a substantial amount of money on litigation in circumstances where the ability of the defendants to pay any damages or costs awarded was doubtful," he said.

Wilson Neill's major assets are Iguacu restaurant and the Cobb & Co family restaurant chain, while it also owned the now crashed FlyingPig website.

IT Media publishes New Zealand Rugby World and the New Zealand Business Times.

IT Media has also been plagued with unpaid debt, even bouncing cheques to some creditors and staff at New Zealand Business Times.

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