The company is said to owe several creditors more than $350,000.
A liquidator could not be identified locally as most capable of doing the job either had conflicts of interest or were unwilling.
The winding up of PSL will involve a thorough examination of the company’s financial records and assets and settling outstanding debts with creditors.
A petition filed against PSL (owners of the Tiare Taporo) by Apex Agencies and Porter Group Holdings Ltd heard on February 4 was adjourned sine die to allow for the appointment of an independent liquidator. The two companies owned by businessman Brett Porter have filed claims of $53,415 and $2,056 respectively. Before the hearing, Porter said PSL had been given as “much time as possible to try and resolve their outstanding issues.” He did not want to comment further.
Other creditors include Bank of the Cook Islands ($200,000), Tongareva Community ($75,000 to $100,000), former Tiare Taporo captain ($17,500) and a crew member ($1,500). Cook Islands News understands there are a number of other creditors including Raromart, represented by Brian Mason. Lawyer Tim Arnold is understood to be acting for an unnamed local investor. A number of other creditors do not have legal representation.
In his judgement Chief Justice Hugh Williams said the “…petitioner’s debts are not opposed and that the respondent (PSL) faces the statutory presumption of its inability to pay its debts.” CJ Williams said it appeared clear that “…any ability Pacific Schooners might obtain in the next month or so to meet its debts is conditional on it incurring further debt and paying off its current debts.”
Statements were made on behalf of the petitioners that no payment had been received from PSL in respect of either Apex or Porter Group debt.
With respect to the former Tiare Taporo captains’ claim of $17,500, which is understood to involve unpaid wages, PSL legal representative Peter Dawson submitted there could be a counter-claim for damage allegedly caused to the Tiare Taporo under the captaincy of the former skipper. Dawson was unable to give the court an amount and the claim has yet to materialise, said Williams.
The petition to wind up PSL is supported by Bank of the Cook Islands which is owed about $200,000. CJ Williams said the “security was in default as at the end of January 2017 for non-payment (other than the interest on the facility which is paid from a separate facility).
Dawson had informed the court that the security for the facility is a personal overdraft guaranteed by the directors of PSL.
Said Williams: “It is accepted that Mr (Garth) Broadhead (PSL director and shareholder) has, so far, been hampered in his efforts to organise the respondent’s defence of this proceeding...” He said this was due to Broadhead’s ill health, his presence in New Zealand and “approaches to local counsel have been declined on the basis of conflicts of interest and the like.” - Continued on page 2
Williams has ruled that until a liquidator is appointed, the status quo remains in force as far as PSL is concerned. “It continues in its ownership, management and possession of the Tiare Taporo.”
That 25 families on Tongareva were left seriously out of pocket and food supplies caused widespread concern about the capability of PSL to reimburse them, says Tongareva community legal representative, Wilkie Rasmussen. The families supplied fish to the Tiare Taporo intended for sale in Rarotonga, and the bulk of their cargo destined for Tongareva languished for months in the PSL Avatiu wharf warehouse and ship hold, much of it no longer consumable, said Rasmussen.
Most of the Tongareva people had also paid PSL for the freight of their cargo. Rasmussen says some of the more fortunate families were able to get their cargo transferred to Taio Shipping, but had to pay freight again.
Rasmussen believes the Tongareva families are owed about $80,000 – a significant sum for an isolated island of around 120 people.
“It works out that about $4,500 is owed to each person in the 25 families disadvantaged.”
PSL promised Tongareva fishermen a rewarding steady income for lagoon fish that would be sold in Rarotonga where demand is high. Rasmussen says families believing in the promises made by PSL bought fishing nets, floats and spent money catching large quantities of lagoon fish. The Tiare Taporo uplifted all the fish over four months ago and that was the last time Tongareva fishermen had any contact with PSL, says Rasmussen.
Although claiming on behalf of the Tongareva islanders, Rasmussen opposed the winding up of PSL. Before the hearing he said liquidating the company would not do his clients any favours as they would be last on the list of creditors and the northern islands needed shipping.
“The receiver will come first, then the crew and staff; we will be the last to be paid.
We from Penrhyn don’t want to buy into the politics of personality, we want shipping services and our shipping situation in the north is even more serious now by the reefing of the Taio ship.”
He says salvaging PSL would be the best option because the Tiare Taporo is a “reasonable boat.
“It’s just that management has been bad. In fact it’s been pathetic.
Our issue also is that our people want their money back and to be included on the list of creditors.”
Rasmussen said he had held discussions with PSL director Mike Henry on the winding up application and “a solution for the Penrhyn people.”
He said he had made it clear that he would still be proceeding with a statement of claim against PSL.
“I told him (Henry) we don’t want any verbal guarantees. We want to see the colour of the money so Penrhyn people can be paid.”