Historic train comes minus name

A charitable trust lodged a tender for the Kingston Flyer before finding out its trademark is tied up. Photo / Otago Daily Times

Any new owner of the Kingston Flyer could find themselves unable to use the name, as it is subject to a trademark agreement.

Tenders closed on Friday for the Kingston Flyer portfolio, which includes the train, more than 80ha of land and various assets.

The train was put up for sale last month after its owner, Kingston Acquisitions Ltd, was placed in receivership by Prudential Mortgagee Nominees.

But it is understood Phil Kerr, of Kingston Flyer Steamtrain Ltd, has a 35-year lease on the train and its assets - and owns the trademarked "Kingston Flyer" brand name.

When contacted, Kerr said he was unable to go into the terms of the lease agreement between Kingston Flyer Steamtrain Ltd and Kingston Acquisitions Ltd.

He said he had contacted the receivers, Malloch McClean, last week regarding the tender documents and had been surprised they did not disclose leases over the properties.

Receiver Lindsay McLean said there were some issues he was trying to work through with the owners of the Kingston Flyer Streamtrain Ltd but would not elaborate on them.

"There are some issues that we don't agree with. But we are moving our way through those issues."

He was confident they would be resolved before the sale of the assets was completed. However, one Wellington charitable trust, which has lodged a tender for the category 1 protected steam train, said the name itself was worth money and if it could not be used, the asking price should reflect that.

Graham McCready, of National Mutual Trust's Computers for Schools Charitable Trust Board, said the trust lodged a tender, then found out about the trademark.

"It would be like you saying 'I'm going to go and sell food and call it McDonald's' - you can't do it. You could call it the Kingston Cabbage Train and run it, but the brand in itself is worth money.

"You've got a defunct railroad, subject to a lease trademark owned by somebody else ... they can't even advertise it as the Kingston Flyer."

If successful with its tender, the trust intends to get the train running again - and use it to benefit the community.

"Everybody's been arguing with each other and we don't want an argument. We just want to get it running."

McCready said the trust proposed to operate the train, establish a reserve fund and use the money to buy computers for schools around the area.

In May, the trust delivered 80 computers to a Mangere school which had been hit by vandals.

Expressions of interest are also thought to have been received by United States company Railmark, which has previously said it would double the number of people using the train within three years and work with developers to build condominiums and hotels on the land.

The Michigan company tried to buy the business directly from Prudential Mortgagee Nominees for $2.5 million before Kingston Acquisitions went into receivership but was turned down.

Bayleys sales consultant Barry Robertson said it would not be known how many tenders had been received for the portfolio until later in the week.

THE DEAL
* Two steam locomotives.
* Seven fully refurbished carriages.
* Tracks, station and associated buildings
* 80ha land

- OTAGO DAILY TIMES