Resort owners want liquidator replaced

Another group of creditors of a failed company is trying to get rid of convicted fraudster John Gilbert as liquidator.

The Herald reported on Wednesday that angry creditors of collapsed printing and publishing group Retail Media had taken legal steps to remove Gilbert as receiver and liquidator of the companies involved.

Gilbert was sentenced to 3 years jail in the early 1990s for defrauding his clients and was struck off the register of chartered accountants.

Owners of units in a Far North resort development are also battling Gilbert over its administration.

Crystal Waters was built by the interests of Dan McEwan, a now bankrupt property developer who was convicted under the Securities Act earlier this year.

It is a development of 25 apartments and one management unit at Cable Bay, near Mangonui.

The development ran into trouble and two associated companies were placed in liquidation last year. The shareholders appointed John Gilbert as liquidator of the management company, Crystal Waters Management, on July 2.

In a High Court decision out this week, Justice Rhys Harrison said "two unusual events" surrounded Crystal Waters Management (CWM).

One was the "inflated" 30-year management contract which required the development's body corporate to pay Crystal Waters Management $100,000 a year to act as little more than a caretaker. CWM also rented the units, getting 14 per cent of the gross rental.

The second was John Gilbert's insistence on trying to continue the business, rather than winding it up as a liquidator would do.

Justice Harrison said Gilbert had tried to sell CWM's assets - which were only the manager's unit, and the management contract.

Unit owners "became increasingly dissatisfied with Mr Gilbert's performance from late 2008".

The body corporate held a meeting in March and unanimously agreed to cancel the management contract.

Gilbert went to court to challenge this, but this week Justice Harrison threw out his application saying he had no right to act for the company.

The judge suggested the parties go their separate ways: "Mr Gilbert is aware of the reality that the unit owners have no trust or confidence in him."

The unit owners are still owed rental income and the Herald understands they are determined to see Gilbert replaced.