Bankruptcy is for cowards, says Henderson

David Henderson says property market collapses come with the job. Photo / Chris Skelton

David Henderson, the Auckland property mogul who created about $1 billion of real estate, says agreeing to bankruptcy would be "cowardly" and way too easy.

The Princes Wharf developer, who this week faced down creditors including Inland Revenue seeking $166 million, said he would fight for his corporate life.

"Putting your hands up, paying your $50 and being bankrupted is a cowardly way to end your business career. If you can put some money back into the pot, that's the more honourable thing. I'm in the same situation as most property developers. Unfortunately, with the collapse of the secondary money market and the fall of finance companies, there's just not enough liquidity around.

"But I've been here before. This will be the third crash I've seen in property. It's just part of being in this industry. Unless you're a huge corporate with endless funds, you survive on a knifepoint.

"You make friends and enemies. It's not the end of the world," he said after the meeting deferred voting on his debt proposal for a month.

The high-living developer with a $10 millon quarter-acre apartment above Hilton Auckland said a former wife was now claiming $7 million, on top of money already received and he described this as "nuisance value".

In 2005, Henderson declared he had been divorced three times.

On Wednesday, Henderson met creditors at the Northern Club and put a proposal to them under the Insolvency Act to give himself more time to find money.

Marc Lindale, an executive director of Strategic Finance (in receivership), attended the meeting and Henderson said yesterday Lindale was claiming about $1 million via one of his companies.

Henderson has put forward a scheme to drip-feed unsecured creditors about $1.5 million over three years although those claiming money from him are yet to agree.

The High Court noted that this deal was being proposed under part five of the Insolvency Act 2006 and would mean creditors, including IRD, would be forced to delay moving against him to claim money for personal guarantees he made, particularly over Princes Wharf leasing deals.

IRD wants Henderson declared bankrupt, a move he is fighting.

Henderson said this week that he wanted to stay in business "for various reasons, including because of my business in Australia. I'm not going to go away and hide in a corner. I will reinvent myself in some other way," he vowed.

Creditors had full access to his financial accounts, he said, and he was taking an "open book" approach.