Auckland property developer Peter Louis Chevin has been banned as a director for four years because of reckless trading which contributed to a string of corporate failures, says the Registrar of Companies.
Chevin, who built the narrow 18-level Columbard tower on Wyndham St in the CBD, has drawn strong censure from the National Enforcement Unit of the registrar.
Chevin said yesterday he planned to appeal the decision, saying his situation was far more complicated than the registrar had explained.
The registrar said Chevin's mismanagement had caused or contributed to a string of companies failing.
"Peter Louis Chevin has been prohibited from acting as a director or in the management of companies under section 385 Companies Act 1993 for a period of four years from February 8. The maximum term of prohibition provided for under section 385 Companies Act 1993 is five years. The prohibition relates to Mr Chevin's mismanagement of the companies," the registrar said in a statement.
The companies were involved in property development, management and sales as part of a wider group of companies and trusts related to Chevin that operated under the brand name Columbard. Chevin's mismanagement caused or contributed to the failure of the four companies due to reckless trading, unsubstantiated inter-company fees and excessive advances to related parties, the registrar said.
"In prohibiting Mr Chevin from acting as a director or in the management of companies, the deputy registrar of companies found that Mr Chevin had acted recklessly in his management of Gridlock and Wyndham. He allowing Gridlock to enter into an unconditional contract to buy an $18 million property when he had not secured finance for the purchase, and then immediately advancing a resulting $2.25 million GST refund away to other related parties. The purchase ultimately failed. In Wyndham, Mr Chevin incurred debt on behalf of other related entities without observing legal requirements or Wyndham's interests.
"The deputy registrar also found that Mr Chevin entered a highly questionable transaction to retrospectively amend Columbard's financial statements to avoid paying income tax. The deputy registrar stated that the aspects of good faith and reasonableness on the part of Mr Chevin are absent. Mr Chevin could not rely on his accountant's advice to absolve himself of responsibility.
"Prohibition is meant primarily for the protection of the public. Despite Mr Chevin undertaking to operate differently in the future, the deputy registrar noted that he still believed that entering an unconditional $18 million contract without finance was a legitimate business risk. The deputy registrar also referred to Mr Chevin's lack of co-operation with liquidators following the company failures."
Chevin said an affluent Auckland property investor had unconditionally contracted to buy the Columbard but defaulted on the agreement which caused irreparable damage. Replacement funding could not be found and litigation ensued, he said.
He defended Columbard. "Columbard is an outstanding success story with 95.4 per cent occupancy over 2.5 years which is a statistic to be proud of," he said.
He is vowing to carry on in business.
"I look forward to the opening of the new Columbard building at Scotia Place in Auckland and Columbard on Victoria St in Wellington early next year."
GONE, GONE, GONE
Mismanaged companies were:
* Wyndham Construction Ltd: In liquidation.
* Columbard Management (NZ) Ltd: Struck off.
* Gridlock Ventures Trustee Ltd: In liquidation.
* Columbard Wyndham St Ltd: Formerly in receivership, has since changed hands.