Eric Watson has lost another round in his long-running legal battle with Sir Owen Glenn, with an English court dismissing an appeal over interest on the £43 million ($87m) he was ordered to pay.
The appeal arose out of a July 2018 judgment which ruled Watson had engaged in fraudulent misrepresentation in a joint venture with Glenn. The decision saw Glenn regain control of the £129m he had contributed to the venture called Spartan Capital.
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At the heart of the case was a struggle for control by Glenn of his fortune, particularly the proceeds his OTS Logistics business sold in 2012 to an Egyptian family for US$350m.
Justice Christopher Nugee found Watson had obtained Sir Owen's investment in Spartan by deceit, despite their former friendship.
"In the course of the events with which the trial is concerned [Mr Watson] resorted to deliberate deception; and that he not only did so himself but also recruited those who worked with him to do so as well."
The UK High Court ordered that Glenn's company Kea Investment was entitled to up to £43.5m in compensation from Watson, as well as interest compounding at 6.5 per cent per annum.
Watson appealed over the interest rate and if successful the compensation awarded would have dropped by about £20m. Watson argued the rate should have been fixed by reference to borrowing or deposit rates and the rate should have been no higher than 3 per cent over base rate.
Last week, a Court of Appeal judgment handed down by Lord Justice McCombe, Lord Justice Hamblen and Sir Bernard Rix sided with Kea's argument that Spartan's position was analogous to that of a defaulting trustee.
On that basis, and given that at the relevant time Kea was itself a trust-owned investment vehicle, the judge held that the interest rate should be fixed by reference to the likely investment return on proper trustee investments over the relevant period.
Last December, Watson told the High Court at Auckland that he was unable to pay the sums ordered by the English court as he did not have the assets to do so.
Farrer & Co partner Toby Graham, who acted for Kea on the appeal, said Glenn and Kea were delighted by the result, which further vindicates their position.
"They are disappointed that Mr Watson has not satisfied the judgment. They do not accept his explanations that he has no money. They are engaged in claims against third parties holding assets on his behalf and are determined to ensure that justice is done."
In March, Watson lost another long-running dispute with Inland Revenue, with a High Court judge ruling companies he owns were liable for $51.5m in back-taxes plus interest and penalties.