Bublitz wins six-month trial delay with $500,000 litigation loan
A “central defendant” in the failure of two finance companies has successfully sought a six-month delay to his trial on 49 charges brought by the Financial Markets Authority.
Last month, Paul Bublitz made an “unpopular” plea to delay the 12-week trial so as he could wait for funding from a current property development he is involved with in Queenstown.
Mr Bublitz, along with Bruce McKay and Richard Tim Blackwood, faces charges brought by the FMA relating to the collapse of Viaduct Capital and Mutual Finance.
The charges include theft in a special relationship and making false statements in a prospectus.
Charges against Lance Morrison and Peter Chevin relate to Mutual only. Both Viaduct and Mutual held deposits insured by the government’s retail deposit guarantee scheme when they collapsed, owing a total of approximately $17 million.
Mr Bublitz, who was also a former director of Strategic Finance, last month argued before Justice Geoffrey Venning in the High Court at Auckland that he had been unable to privately fund lawyers for his defence since January, and in February was declined legal aid.
His former lawyer, Nathan Gedye, QC, then withdrew in April, before another lawyer took on the case, only to withdraw again in September.
The trial was due to begin in February next year but Mr Bublitz sought a delay saying he would not be able to pay for legal representation before then, when a number of sections in a Queenstown property development are due to be settled.
Yesterday, Justice Venning agreed to delay the trial of the five defendants by six months, saying there is “reasonable prospect” he will receive the funding.
The judge had given Mr Bublitz a week following his application in October to provide further disclosure about his financial position, after the Crown had questioned the delay on the grounds no certainty was provided around the future date for any funding, and it would not be the first property development in Queenstown to fail.
A $500,000 litigation loan
The decision, released to the media today, says Mr Bublitz has “no personal or real property” and lives in rented accommodation.
He is involved in a development in Queenstown through an entity called the GEP Trust, the discretionary beneficiaries of which are two trusts linked to Mr Bublitz, as well as John Babington and Chris Cook.
The two trusts are in a joint venture with LF Services, which Mr Bublitz contracts his services to, and which GEP has agreed to advance $500,000 to to meet litigation services.
Mr Bublitz says he has been working for GEP since the time he was charged, a company which had been “working to rebuild itself” after an Albany property and Kingston settlement fell through.
He is managing the development of 10 sections on its behalf, specified as “high-end houses,” of which four are due for completion by Christmas.
Mr Bublitz says he is also working for another developer in Queenstown, independently of GEP, which is building at least 25 houses, six of which are due to be completed in February next year.
“There is some force in the submission made for the Crown that despite the further information the position of whether Mr Bublitz will be able to fund representation is still far from certain,” Justice Venning says.
“The inter-relationship with various parties, the fact that the funding is still contingent on the further developments and is also dependent on the action of entities such as LF Services which Mr Bublitz has no direct control over remain of some concern.”
But the judge says the further evidence does show it is at least advanced, and there is a “reasonable prospect” he will receive the funding.
“He is the central defendant in the trial.
“I accept that Mr Bublitz has not sat on his hands.”
The charges against the defendants carry maximum sentences of seven and 10 years jail respectively.
Charges were withdrawn against a sixth defendant, Nick Wevers, following his sudden death in March last year.
Read the decision here.
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