Bank moves to sell yacht builder's yard

HSBC wants chattels including boat hulls removed from Ivan Erceg's Sensation Yachts yard. Photo / Herald on Sunday

It's been a spectacular fall from grace for Ivan Erceg, the once-wealthy younger brother of late alcohol baron Michael Erceg, whose estate now lies in the hands of liquidators and various creditors.

Yesterday, in the High Court at Auckland, creditor HSBC pushed forward with its application to have chattels removed from Mr Erceg's former boatyard in Henderson so the bank can sell the land and recoup its $6.5 million investment.

Mr Erceg was not in court yesterday. HSBC's lawyer James Burt said he was not sure of his whereabouts but he is believed to be in the southern French town of Marseille.

Since Mr Erceg has been in Europe, he has been bankrupted and his company Sensation Yachts has been liquidated.

Mr Burt told Justice Raynor Asher yesterday that HSBC had no interest in the chattels at the 5ha boatyard in West Auckland, all the bank wanted was to have them removed.

Balenia, the Cayman Islands-based company that commissioned Mr Erceg to build three yachts, still has boat hulls at the yard reportedly worth millions.

"We simply want to properly be cleared up of these chattels," said Mr Burt.

He told the court HSBC was between a rock and a hard place as the chattels were a contractual agreement between Mr Erceg and the related parties and had nothing to do with the land that HSBC wanted to sell.

Mr Burt said selling the land with the chattels in place would be difficult. He added that if the orders were granted to remove the chattels and they remained at the site, it would be trespass.

Mr Burt said that although Mr Erceg is bankrupt, documents showed he could inherit money from his late brother's estate.

Justice Asher reserved his decision, which is expected in the next few weeks.

This is the latest case involving Mr Erceg - in February, he was bankrupted at Balenia's request. At the time he owed Balenia just under $3 million.

Mr Erceg had appealed against this decision and had until August to act on his appeal, Mr Burt said.

In January, HSBC withdraw its application to bankrupt Mr Erceg, after reaching an 11th-hour deal.

The Public Trust, which was owed $2.5 million at the time, together with Dorchester Finance filed an application to bankrupt him.

In August 2009, Mr Erceg appointed New Zealand receiver Peter Jollands from France after Sensation was forced into liquidation by the Public Trust.

The liquidators' first report showed Mr Erceg's company was believed to owe preferential and unsecured creditors more than $40 million, the second showed that there was a further $25 million in claims and contingent claims.

Mr Erceg was a winemaker and importer before he bought Sensation in 1998. He moved into boatbuilding after working on the family vineyard near Kumeu, West Auckland, with his Croatian immigrant father, Mijo, after being inspired by his brother.

Mr Erceg's brother helped formulate his plan for Sensation Yachts, which catered to the world's super rich and included a boatyard in Singapore and investments in Australia.

Mr Erceg told the Herald in 2008 that people were forgiving "if you are open and honest". He added: "If you lie and cheat, you are in trouble. Honour is very important to me."

Michael Erceg died in a helicopter crash near Raglan in 2005. His estate was worth more than $600 million but it was sold for more than $1 billion. The immediate family features on the National Business Review's rich list.