Judge finds Drever personally liable for Grocer’s Market mess
A High Court judge has ruled Aaron Drever, the businessman who tried to resurrect a failed Nosh outlet as The Grocer’s Market, personally liable for almost half a million dollars.
Liquidator Damien Grant made the High Court application on Wednesday morning, arguing Mr Drever should be personally liable to creditors and for his liquidators’ fees.
Mr Drever did not appear in court to defend the action brought by Mr Grant, who was appointed liquidator in February this year of the reborn Mt Eden Nosh store, TGM Trading.
The store lasted just five months as The Grocer’s Market and the business assets were bought from the receiver by rival chain Farro Fresh, which reopened it as its sixth Auckland store.
Mr Grant had been the receiver of Nosh Group, which sold the fitout and assets to TGM Trading. Nosh Group had six upmarket grocery stores that collapsed in July 2017.
Justice Peter Churchman heard on Wednesday that Mr Drever had not filed any defence in relation to the claim or other correspondence.
How much at stake
Mr Grant’s lawyer Joshua Wong told the court Mr Drever should be personally liable for about $488,000. The bulk of that, about $444,000 is owed to creditors, with the rest covering Mr Grant’s liquidator’s fee.
Mr Wong told the court Mr Drever should be held personally responsible because he had failed to keep proper accounting records as required by the Companies Act, and that and other such failures had impeded the liquidation.
The court heard there was no accounting software to record day-to-day transactions, although there was an MYOB account for staff pay and some GST returns had been filed.
In an oral decision, Justice Churchman said the facts of the case showed not only were there no proper accounting records but bank accounts were intermingled and that the savings account for The Grocer's Market was used for the trading entity.
While that had been described as an ''accounting oversight,'' Justice Churchman said that was an understatement.
The judge said he was satisfied that Mr Drever ''failed egregiously'' in his responsibilities as a director and should be personally liable.
Justice Churchman said there were no defences that Mr Drever could have raised if he had appeared in person to defend himself.
In November last year real estate agent Mr Drever confirmed he paid no upfront cash to the receivers when he set up The Grocer’s Market but the arrangement was subject to a confidential contract approved by Nosh director Andrew Phillips.
It is understood Mr Drever provided collateral for the purchase from assets held by a family trust.
Mr Drevers licence to act as a real estate agent was cancelled in November 2016 by the Real Estate Agents Disciplinary Tribunal for repeated misconduct.
According to the most recent liquidators’ report from March this year, Old NGL, formerly Nosh Group received $8.8 million in unsecured claims, with $7.4m coming from shareholder Veritas.
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