Former rich-lister released from bankruptcy

Property developer Jamie Peters outside the High Court at Auckland. Picture / Chris Gorman

Former rich-lister Jamie Peters has been released from bankruptcy by a High Court judge.

Peters, an Auckland property developer who was declared insolvent in 2009 owing more than $100 million, fought an application by the Official Assignee to keep him bankrupted until October 2015.

Peters, now in his early 40s, brought his own application to be immediately discharged from bankruptcy and underwent a public examination before Associate Judge David Abbot in the High Court at Auckland during June and July this year.

The Official Assignee, which administers all bankruptcies, argued Peters' pre-bankruptcy conduct - which included allegedly giving false information to creditors and giving personal guarantees without assets in his own name to back these up - showed a lack of concern for the others people's financial interests.

The OA also argued that since being declared bankrupt, Peters had continued to conduct business (through entities under the nominal control of others but under his ultimate control) and had concealed assets in which he appeared to have a beneficial interest.

The Assignee also considered the pattern of Peters' behaviour warranted further condemnation and that he would pose a risk to the business community if he were to be discharged from bankruptcy.

During the examination, the High Court heard that Peters had entered into a finance agreement for a Mercedes-Benz r500 and was a guarantor on a finance agreement for a Bentley Continental GT during a period when he was unable to pay debts when they fell due.

The court also heard that in 2010 the bankrupt's then-fiancée received $62,000 for a "substantial round-the-world trip" from a company Peters once directed.

More than $300,000 from the sale of a $2 million luxury yacht, which Peters had personal use of before his bankruptcy, ended up with a company directed by his father-in-law, the court heard during the examination.

But Associate Judge Abbot in his decision yesterday, said the evidence relied upon by the Assignee lacked detail when probed closely.

"...the evidence on which the Assignee relies is largely circumstantial, calling for inferences to be drawn to allow findings on conduct which would warrant further extension of the bankruptcy...most of these inferences are inconsistent with the direct evidence of Mr Peters' witnesses, tested in cross-examination," the judge said.

While the "demeanor of some of the witnesses allows doubt on some details" the judge said the evidence "taken as a whole supports the arguments advanced for Mr Peters".
Peters acknowledged there had been breaches of his obligations as a bankrupt but said these were minor. He said he would not pose a risk to the business community.

In reaching his decision yesterday, Associate Judge Abbot did not believe there was sufficient reason to impose sanctions on Peters or that his discharge now would create "an unmanageable risk to the business community".

"The Assignee has been unable to establish the primary matters on which he relies as conduct warranting further extension [of the bankruptcy]," the judge said.

"To the extent that the matters advanced by the Assignee have not been answered sufficiently by Mr Peters' witnesses, Mr Peters has already been sanctioned for his conduct by an extension [of the bankruptcy] approaching fifteen months," Associate Judge Abbot said.

Peters was due to automatically come out of bankruptcy in October last year but this did not happen because the OA opposed his discharge.

If any insolvency breaches warranted further sanction, the judge said the OA was open to take action.

While there were insufficient grounds to extend Peters' bankruptcy, the judge considered the OA was justified in opposing Peters' application for discharge.

Peters appeared on the National Business Review's Rich List in 2005 as being worth $40 million and in 2006 with $45 million.