Finding Easybook roots no easy task

By MICHAEL FOREMAN

Cuckoos are best known for their habit of laying eggs in other birds' nests. Once the cuckoo chick hatches it is fed by its unsuspecting hosts, and legend has it that a young cuckoo will remove any rivals from the nest.

When Brian Mears read a recent Business Herald article about a promising internet travel booking company called Easybook Tours, he believed he was the victim of the business equivalent.

Mr Mears, a public accountant based in Birkenhead, was concerned because he was owed money by a similarly named company, Easybook New Zealand, which he had recently been told was dead on its feet.

Mr Mears had been introduced to Easybook NZ, which was then run by businessman Tony Laughton, in 1997.

The company published a printed directory of tourist accommodation, but unlike competing publishers such as Jasons Travel Media and AA Guides, Easybook NZ would arrange itineraries and make bookings on behalf of its clients.

Not only was Easybook drawing subscription revenue from its advertisers, it was also earning the usual travel agency commission on any bookings it made.

Mr Mears could see the potential, and he bought a half share in a debenture worth $79,000 as well as becoming a director of the company. "It seemed like a good business opportunity," he said.

But Easybook ran into cash flow problems as it struggled against its more established competitors.

So the following year when Bert Queenin, formerly a US manager with the New Zealand Tourism Board, wanted to buy the business, Mr Mears agreed it would be a good time for him to bow out.

"Mr Queenin came in and said a printed directory had had its day and the internet was the way to go," Mr Mears said.

Mr Mears resigned his directorship, but the financial health of Easybook did not allow his $39,500 debenture share to be repaid in full. Mr Mears agreed to accept interest only at a rate of 15 per cent and payable weekly until such a time as it could be.

These payments - worth $114 a week - continued until June 1 this year, after which date the payments suddenly stopped. Mr Mears said he received a letter from Mr Queenin which told him the position of Easybook NZ did not allow payments to continue, but promised he would be repaid in full.

Mr Mears waited patiently, but when he saw the Business Herald article portraying Easybook Tours as a healthy concern, he became suspicious.

"Easybook Tours is trading from the same premises as Easybook NZ and using the same telephone numbers and the same web address," he said.

"Tour operators couldn't tell the difference as the company has continued to answer the phone simply as 'Easybook' throughout. In reality nothing has changed, but legally, everything has changed," said Mr Mears.

"If this was a bona fide sale, surely the value of the [accommodation] database, the [internet] domain name and the telephone numbers would have had a value - but no consideration has been paid."

Companies Office records show that NZ Easybook Tours is ultimately controlled by Mr Queenin and his business partner Donald Saunders through a complex tree of holding companies.

At the top of the tree the records for Easybook Tours show no previous company names and no unsatisfied debentures.

Mr Mears suspects that Mr Queenin and Mr Saunders have started the new companies so that they can trade with a clean balance sheet.

"It's obvious they are trying to start with a clean slate. The concept is excellent but where do these clients of Easybook stand if this is how they have treated me?"

Mr Mears has been advised by his lawyer, Robert Brennan at Blackwells, that he has a right of action under section 301 of the Companies Act 1993 if Mr Queenin has been instrumental in diverting the assets and business of the company to Easybook Tours but only if Easybook NZ is put into liquidation.

Mr Mears fears the legal costs of this course would be prohibitively high. When contacted, Mr Queenin said he was "in the throes of negotiating" with Mr Mears.

He said that Mr Mears' debenture would be satisfied and there had been no attempt to avoid addressing it.

Mr Queenin said all debts of the original company had been settled bar the debenture, but the true financial position of Easybook NZ was "now being looked at by accountants".

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