Aorangi investors to fund Hubbard case
Aorangi Securities investors will pay up to $7500 each court day for Jean Hubbard to defend herself against their bid to claim ownership of $60 million in assets.
The High Court has ruled Hubbard's legal costs over a five-day hearing set down from May 20 to determine the ownership of the assets will be paid out of Aorangi Securities funds.
Justice Chisholm ruled that Hubbard's counsel would be paid $5000 per day and "there will be provision for one extra counsel at half that rate".
Additionally statutory managers Grant Thornton and their legal advisers have been ordered to pay an additional $9117 on top of $37,500 for wasted costs after they misplaced 72 boxes of crucial documents.
The original trial was set down for October 29 last year but two weeks beforehand the statutory managers asked the court for an adjournment after they rediscovered the boxes.
The late Allan Hubbard had originally put the $60m into trusts for the benefit of Aorangi Securities investors to make up for a shortfall and put out a prospectus.
Statutory management was imposed before these were complete and Grant Thornton subsequently unwound the transactions, with the High Court now required to determine who owns them as Jean Hubbard has claimed she now owns them.
The statutory managers have been paid $450 an hour for Christchurch-based partners Trevor Thornton and Graeme McGlinn and $495 an hour for Wellington partner Richard Simpson since they were appointed by the Government on June 20, 2010.
In his judgment Justice Chisholm said Hubbard had asked that her legal costs be met by access to the assets in dispute through the proceeding as she was the legal owner or by the statutory managers, who in turn argued unsuccessfully she fund her litigation.
"I do not accept that any of the alternative funding methods suggested by the statutory managers provide an answer to the application before the court," the judgment stated.
"Until now Mrs Hubbard has been represented by skilled counsel who have undoubtedly acquired considerable knowledge about the case.
"Their contribution at the substantive hearing is likely to be significant and self representation is not a feasible option."
Investor liaison group spokesman Noel Macpherson said it was more salt in the wound for investors. "It is ironic we should be paying for both sides.
"We are paying for the statutory managers to fight for something they let go of contrary to the advice we gave them, which was not to unwind the transactions.
- © Fairfax NZ News