The High Court has ordered two independent observers to keep tabs on Perpetual Trust's cash management and mortgage funds amid concerns over related party loans, and ahead of a substantial hearing early next month.
Judge Paul Heath yesterday made an interim order for Pyne Gould subsidiary Perpetual to appoint Vivian Fatupaito and Christopher Duffy of WHK to oversee the activities of the two funds, according to his judgment.
Perpetual will also have to get an independent valuation for five properties put up as security by Torchlight Fund No 1 LP, which is managed by Pyne Gould principal George Kerr. The order was made at the request of Trustees Executors, the funds' statutory supervisor.
"Sensible arrangements have now been made for interim orders to be put in place pending a substantive hearing on 3 August 2012," the judgment said.
Perpetual yesterday froze repayments of its $56.2 million mortgage fund after a surge in redemption requests after details of the cash fund's $28 million loan to the Torchlight fund emerged.