Capital + Merchant collapsed in 2007 owing more than 7,000 investors $167 million.
It's understood there has been a settlement of a compensation claim brought by the receivers of collapsed finance company Capital + Merchant against trustee Perpetual Trust just before a High Court trial on the matter was due to be heard in Auckland.
High Court staff said a settlement had been
reached in the case that was set down for this morning though neither of the parties involved could be reached for comment.
Receiver KordaMentha filed an action claiming $94 million in damages against the trustee and law firm Stace Hammond in 2013 alleging breach of contract and negligence and are paying for it through litigation funder, Australian-based Litigation Services.
The receiver has since reached a settlement with the law firm for an undisclosed sum with the payment being held in trust pending the outcome of the Perpetual case and has previously said the current trial is the only remaining potential avenue of recovery for investors.
Perpetual said in its annual accounts that the firm had lodged a claim with its insurer and the directors were confident the company's exposure (if any), whether by settlement or adverse award, is not expected to exceed the limit of the company's insurance. They said it was impossible for directors to make a reliable estimate of the likely cost.
