Jason and Megan Peters banned as directors

PRESS RELEASE

Jason and Megan Peters banned from acting as directors.

19 December 2008

The Deputy Registrar of Companies, Peter Barker, has banned Jason Connell Peters and Megan Mary Francis Peters from acting as company directors or managers for a period of four years effective from 28 July 2008. The maximum term under Section 385(3) of the Companies Act 1993 is five years.

The Peters’ were property developers for a number of years. The Peters’ were the directors of 114 Dominion Rd Limited, Landgroup Properties Limited, Bremen Rural Limited, and Tuuson Enterprises Limited (all in liquidation).

The National Enforcement Unit of the Ministry of Economic Development (NEU) submitted a report to the Registrar of Companies alleging that the Peters’ mismanaged the companies and contributed to their failure.

The issues of mismanagement include: reckless trading; breach of directors duties; failure to pay funds due to the Inland Revenue Department (IRD); and the inappropriate assignment of related party debts.

Examples of this include the Peters’ acting recklessly by failing to arrange finance before entering into an unconditional contract and having unreasonable expectations that they could secure finance to settle the purchase. The Peters’ claimed a GST refund on a property purchase before finance had been arranged, then paid it away from the company despite not having the means to complete the purchase.

In their defence the Peters’ submitted that the problems occurred as a result of commercial and market factors beyond their control.

Prohibition under Section 385(3) is primarily meant for the protection of the public. Mr. Barker considered the failings of the Peters’ to be serious and that there is a serious risk for creditors in the future unless a substantial period of prohibition was imposed.

In his minute Mr. Barker stated that “there is nothing that the Peters’ can say which can satisfy me that [this] is not damning conduct of the directors” and that the manner in which it was dealt with is particularly reprehensible.

Mr. Barker advised that “the reason the non payment of the IRD is serious is not because the creditor happens to be the Crown. It is because it demonstrates that the directors have either no understanding, or have deliberately ignored, their obligations to the creditors…It is a fundamental requirement of directors that the companies comply with the law and that they are worthy of the trust placed on them.”

ENDS

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