Belgrave Finance receivers seek $8.6m from sick developer

Photo / NZ Herald

The receivers of a failed finance firm are making a $8.6 million claim against a former director and a terminally-ill property developer.

Belgrave Finance's 2008 collapse left more than 1200 investors $22 million out of pocket.

A lawyer for Belgrave's receivers, Michael Arthur, told the High Court at Auckland today that the firm's former director, Shane Buckley, breached his duties to the company by facilitating related-party loans.

Arthur said between August 2005 and May 2008 numerous advances were made from Belgrave to interests associated with property developer Raymond Tasman Schofield, who in substance was the finance company's ultimate owner.

Arthur said these loans breached restrictions in Belgrave's trust deed, which dictates the rules on how investor funds are to be dealt with.

These loans was not arms-length and outside the terms of Belgrave's lending policy, Arthur said.

As well as its claim against Buckley, the company alleges Schofield dishonestly assisted with the director's breach of duties.

The pair's actions caused losses of $8.6 million and Belgrave is seeking judgement against Buckley and Schofield for that sum, Arthur said.

Buckley was jailed for three years in 2012 after pleading guilty to more than 20 charges brought by the Serious Fraud Office and the Financial Markets Authority.

Schofield was charged by these authorities but was granted a stay on the action he faced because of a terminal illness.

Neither Buckley nor Schofield were represented in court today.

The hearing continues this afternoon and Justice John Fogarty is expected to reserve his decision.