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No adjournment for Mike Pero case

Mike Pero Mortgages Ltd’s attempt to get proceedings in their legal dispute with Mike Pero adjourned has failed and the scheduled hearing will go ahead next month.

Tuesday, August 28th 2018, 6:00AM

by Miriam Bell

The battle between Mike Pero and the companies that bear his name has been wending its way through the courts for many years now.

Yet recently Mike Pero Mortgages Ltd (MPM), which owns Mike Pero Real Estate (MPRE) in a 50/50 joint venture with Pero, petitioned the Auckland High Court for the adjournment of their next scheduled trial date.

MPM’s lawyer, Greg Blanchard, sought the adjournment on multiple grounds, including that an inadequate discovery of documents on Pero’s part meant that MPM was unable to properly prepare for the trial.

A two day hearing on the issue left presiding judge, Justice Alisa Duffy, expressing frustration at both parties inability to agree on anything.

Justice Duffy has now handed down her decision and she has found in favour of Pero, whose lawyer said he was ready for the proceedings to go ahead, and dismissed the application for an adjournment.

The scheduled court fixture will now proceed on 3 September.

Justice Duffy said that one reason for her decision was the length of time MPM took to bring up the document discovery issue.

They had left the complaint until late in the day and it was too late now for them to complain about inadequate discovery, she said.

“Further, I have concerns about the merits of the defendant’s complaints, some of which appear to seek information that extends beyond the bounds of the current pleading.

“Discovery is not a fishing exercise or a means by which the defendant can enforce disclosure obligations owed outside of this proceeding.”

But Justice Duffy also ordered that the upcoming hearing be used to address the impasse the parties have arrived at over the central issue of MPRE’s failure to declare a dividend.

Pero wants MPRE to declare a dividend and if not, for shares in MPRE to be sold. He is also happy either to divest his shareholding or to acquire MPM’s shareholding.

MPM will not agree to payment of a dividend until audited financial accounts are available and sees the sale of its MPRE shares as a last resort.

Rather than having MPRE shares sold, MPM wants Pero and the companies he controls to be “brought into line” with the shareholders’ agreement and good corporate governance and company law.

Pero’s lawyers argue that MPRE’s shareholders are deadlocked and they want to engage the arbitration provisions of the shareholders’ agreement.

MPM contends there is no deadlock which means the arbitration provisions of the shareholders’ agreement are not engaged.

Justice Duffy said she is satisfied there is enough relevant information known to all parties for them to be able to argue whether the deadlock provision in the shareholders’ agreement is engaged or not.

“It may now be too late and, in the time allocated, not possible to deal with all the parties’ complaints against each other in their respective proceedings.

“However, I can see no reason why the parties cannot argue the question of whether they are deadlocked in a way that the arbitration provisions in the shareholders’ agreement are triggered.

“This seems to me to be a discrete issue that is capable of resolution within the five-day fixture time.”

Justice Duffy added that it is an issue that must be resolved before the Court can consider the remaining claims raised by either of the opposing parties.

“The Court’s jurisdiction to determine those other matters hinges on whether the arbitral process has been engaged or not.”

Read more:

Judge discharges order against Mike Pero

Mike Pero v Mike Pero companies – the battle continues

Tags: disputes financial advisers Lawyers Mike Pero mortgages

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AIA 4.55 2.55 2.69 2.79
ANZ 4.44 3.15 3.25 3.39
ANZ Special - 2.55 2.69 2.79
ASB Bank 4.45 2.55 2.69 2.79
Bluestone 3.49 3.49 3.49 3.49
BNZ - Classic - 2.55 2.69 2.79
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 3.15 3.29 3.39
BNZ - TotalMoney 4.55 - - -
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China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
First Credit Union Special 5.85 3.35 3.85 -
Heartland 3.95 2.89 2.97 3.39
Heartland Bank - Online - - - -
Heretaunga Building Society 4.99 3.85 3.95 -
HSBC Premier 4.49 2.45 2.60 2.65
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 3.69 2.55 2.65 2.79
Kainga Ora 4.43 ▼2.93 ▼3.07 ▼3.24
Kiwibank 3.40 3.30 3.54 3.54
Kiwibank - Offset 3.40 - - -
Kiwibank Special 3.40 2.55 2.79 2.79
Liberty 5.69 - - -
Nelson Building Society 4.95 3.45 3.49 -
Pepper Essential 4.79 - - -
Resimac 3.39 ▼3.35 2.99 3.35
SBS Bank 4.54 3.05 3.19 3.25
Lender Flt 1yr 2yr 3yr
SBS Bank Special - 2.55 2.69 2.75
The Co-operative Bank - Owner Occ 4.40 2.55 2.69 2.79
The Co-operative Bank - Standard 4.40 3.05 3.19 3.29
TSB Bank 5.34 3.35 3.49 3.79
TSB Special 4.54 2.55 2.69 2.99
Wairarapa Building Society 4.99 ▼3.55 ▼3.49 -
Westpac 4.59 4.15 4.09 4.49
Westpac - Offset 4.59 - - -
Westpac Special - 2.55 2.69 2.79
Median 4.55 3.05 3.13 3.12

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