Dave Henderson‘s business career is under scrutiny in an inquisition in the High Court in Christchurch.
Christchurch businessman Dave Henderson says payments to his credit card worth $91,000 while he was bankrupt were loans or gifts from a trust and not income.
Henderson, 60, is under public examination in the High Court in Christchurch before Associate Judge Rob Osborne to decide if he can be discharged from bankruptcy.
Henderson was adjudicated bankrupt in November 2010, with self-acknowledged debts of about $142 million.
The Official Assignee (OA) objects to his discharge and alleges he has not disclosed income and not co-operated with the OA during the bankruptcy.
Henderson maintains the OA refused to engage with him and just wanted to “smack him up” after his files were transferred from Christchurch to Hamilton.
To questions from Jacinda Foster, for the OA, it was revealed payments from three companies were made to the card during a period from November 2010 to December 2011, when the card was cancelled.
Henderson said the card was held in his name but was a trust card and used for domestic and other expenses, some relating to companies. Documents show he referred to the payments as loans, gifts and distributions form a trust.
The payments were authorised by trustee company, FTG Trustee Services Ltd. Henderson’s wife Kristina Buxton was the director of the company and she had delegated to him the ability to effect the payments, Henderson said.
To Judge Osborne, who suggested Henderson’s position appeared to be that the payment decisions were independent despite being made by the recipient of the payments, Henderson said that satisfactorily represented the situation.
He agreed money had gone from a company, of which he was director, to his wife’s company and then paid to the credit card. The arrangement was not intended to avoid the OA detecting his use of the credit card, he said.
Surpluses from accommodation businesses he was associated with were for the benefit of a trust and business manager Daniel Godden approved the payments as far as cash flow allowed. He said he would have regarded a large distribution (such as $500,000) to him from a trust as something he needed to disclose to the OA.
Judge Osborne asked if he believed the $60,000-$70,000 a year he seemed to be getting “would have to be disclosed?”
“I never turned my mind to it,” Henderson said.
The trust accounts existed but he did not know where they were.
Judge Osborne also probed Henderson about him signing in September 2009 a deed of acknowledgement of debt to Strategic Finance ($2.3m) when Strategic was seeking summary judgment of the debt. Henderson went on to resist the summary judgment proceedings.
Foster accused Henderson of manipulating Strategic Finance to delay the court action but Henderson said he was trying to come up with a practical solution.
Source: Story by Martin Van Beynen. Published 5/08/15