Crafar drops damages claim

Allan Crafar says he won't be pursuing a claim against the receivers and the banks for damages, but maintains he has the financial backing to buy back the farms.

The former head of New Zealand's biggest private dairy operation was given until 5pm today to front up with $50,000 as security for costs so he that could continue his claim for damages against the receivers and the banks.

However told nzherald.co.nz this afternoon he wouldn't be pursuing the claims - which included allegations of mismanagement of the farms and ill-treatment of animals, because he didn't have the money.

"Obviously if you haven't got the money, you haven't got any justice in New Zealand," he said.

Crafar filed the statement of claim in the Auckland High Court last month at the same time he applied for an urgent interim injunction to halt the sale of the farms.

The injunction bid was thrown out of court and Justice Harrison said it was doubtful whether the Crafar's claim against the banks and the receivers had any legal factual basis, but to "preserve the Crafars' rights" he would adjourn proceedings.

A telephone conference had been set down for September 15, to discuss the claims, but KordaMentha lawyer Bruce Stewart said it was doubtful now whether this will go ahead.

Stewart said once the claim was stayed the defendents could apply for it to be "struck out".

On top of all this Crafar finds himself without a lawyer.

"When you have not got any money they do not like to work for you for long," Crafar said of Dan Parker, who was acting for him on the case.

Parker had resigned from his post, because he was worried he was "running up the hours and wouldn't be paid", Crafar said.

Asked whether he had paid Parker for his any of his work to date, Crafar said he had paid him the "minimum".

In the meantime Crafar said that a deal with his financial backers to buy the farms was "imminent".

The Crafar farms went into receivership last October owing more than $200 million to PGG Wrightson and banks.

KordaMentha has signed a conditional sale and purchase agreement with UBNZ to sell the portfolio of 16 farms, for a rumoured $213.2 million plus stock.

The agreement is subject to Overseas Investment Office approval, and can be overtaken by a better offer.

Asked whether receivers would accept an offer from Crafar, KordaMentha said it would look at all offers - but this was before tenders for the farms closed on July 7.

The Crafars have offered $216 million to "redeem or purchase" the farms - being the amount of the "alleged bank debt".

The Crafars said they could pay 10 per cent of the purchase price by the end of last month and the balance by October 30 and had financiers who were willing to help.