Most of the farmers paid out of the failed live-export company Genetic Development (NZ) Exports Limited Partnership have joined an appeal against a High Court ruling that they must return more than $9 million in insolvent transactions, while a handful have chosen to pay the money back. Last month the High Court at Hamilton found for the liquidators in a representative case against Southern Dairies Ltd for $266,570.

The liquidator has since issued repayment notices to everyone who was paid in the belief they were secured creditors: 96 farmers who were paid in full, while 47 more farmers sit in a pool of over 100 unsecured creditors owed a further $11.3 million. Feed companies, quarantine properties and the Irish-based Purcell Brothers SPV, which took almost $750,000 in commission for brokering the Allied Irish Bank finance behind the Ocean Ute cattle shipment to China in May 2022, are also being asked to repay.

Malcolm Hollis of Teneo Advisory Services, the liquidator, said that at the close of the appeal period on 20 September the lawyers for SDL and about 50 supporting farmers confirmed they would appeal, arguing the payment was between Purcell and the farmers rather than GDX and the farmers. "It's tactical, buying time while incurring more cost," he said; the appeal will be heard in 2027. Justice Rachel Sussock had held that SDL could not rely on a no-reason-to-suspect-insolvency defence when suspicion about GDX's finances was the very reason the payment was routed around GDX. "It remains our view that it's a strong judgement and the Court got it right," Hollis said. Farmers owing smaller sums are settling, he added, because "they're not wanting to waste money on legal fees", and have been offered a discount.

Financier Patrick Purcell told Farmers Weekly he saw nothing wrong in the deal: "We were approached by a third party to please help so the farmers get paid. We had no connection with GDX or Dave Hayman, never have; we had no view of the accounts." Livestock companies on the fringe of the deal said they believed they had been misled: "The undertone at the time was GDX had solved its problems, but obviously not; if there'd been even a sniff this was going on those cattle would never have gone on the boat."

Photo: Bahnfrend / Wikimedia Commons (CC BY-SA 4.0)

Source: Farmers Weekly NZ