Bridgecorp chair 'man of honesty'

Bruce Davidson, chairman of Bridgecorp, faces charges laid by the Securities Commission. File photo / Sarah Ivey

Bridgecorp chairman Bruce Davidson is a man of honesty and integrity, a person who is always on the right side of the line, a court was told yesterday.

The depositions hearings at the Auckland District Court to determine whether Bridgecorp's five directors should stand trial for charges laid against them by the Securities Commission continued yesterday.

The hearing was scheduled to finish today but will continue for another day at the end of April.

Directors Bruce Davidson, Rod Petricevic and Rob Roest and non-executive directors Gary Urwin and Peter Steigrad are facing 10 Securities Act charges each relating to their roles in issuing a company prospectus.

Steigrad has been excused from the depositions proceedings because he admitted through his lawyer there is a case to answer.

Lawyer and witness Francis Dawson told the court yesterday he was proud to call Davidson a friend.

"If you are looking for a professional view - if a partnership ought to make more money or staff ought to be treated a certain way - Bruce Davidson was always on the side of good."

Their association goes back to 1984 when Davidson was practising as a lawyer. Dawson worked for Bridgecorp through the years as legal counsel.

Dawson said Davidson was always his "first sounding board" if he had a concern. "He was a good lawyer and understood commercial ramifications," he said.

William Martin, Bridgecorp's managing director, was also called to the stand yesterday.

Prosecutor Brian Dickey asked Martin about evidence that revealed Bridgecorp staff had suffered from the stress and strains of the company's cashflow issues.

Martin said staff were concerned about the company's inability to pay back creditors and investors.

He added he learned of Bridgecorp's receivership while listening to the radio on his way to work. When he arrived at Bridgecorp's offices security guards were present and PricewaterhouseCoopers held a meeting with staff on the receivership.

Chartered accountant Grant Graham, a partner of KordaMentha, was hired by the Securities Commission to undertake a peer review of reports prepared by David Crichton, an independent forensic accountant, also hired by the commission to evaluate Bridgecorp and Bridgecorp Investments.

In Graham's affidavit he says Bridgecorp failed to make a number of investor payments by the relevant due dates during the period from February 2007 up until the company was placed into receivership in July 2007.

Graham said knowledge the company had defaulted on payments of interest and principal was critical for investors as he doubted whether anyone would have invested in the company had they been aware it had missed payments.

Graham also said Bridgecorp's exposure to projects such as the Momi Resort development in Fiji should have been disclosed specifically in the company's investment statement.

When Bridgecorp collapsed it owed 14,500 debenture holders $459 million. The deposition hearing continues.