Krukziener's date with creditors arrives

Andrew Krukziener’s date with creditors has arrived.

The Auckland developer, $47 million in debt, is expected to give evidence at the High Court at Auckland today as seeks to avert bankruptcy.

The hearing began yesterday when the court heard details of his proposal to repay creditors $350,000 in instalments over four-and-a-half years.

The IRD, which claims it is owed $6.67 million by Krukziener, is opposing the proposal and wants to press ahead to have him declared bankrupt.

Eighteen other creditors have accepted the proposal.

Among the four that voted against the proposal was law firm Hucker and Associates and Wilson Parking.

Judge Rob Osbourne yesterday asked the court for a realistic estimate of the minimum and best scenario recovery for creditors.

Trustee Meltzer Mason Heath would administer the payments if Mr Krukziener’s proposal was approved.

Insolvency specialist Jeffrey Meltzer estimated $320,000 would be available to creditors when expenses and trustees’ fees were deducted from the $350,000

Mr Krukziener’s lawyer Bruce Stewart, QC, said it was in the interest of creditors and the Auckland business community that Mr Krukziener continued in business

Mr Krukziener has previously spoken out about inland Revenue’s opposition to his proposal and claimed the IRD was trying to bankrupt him to stop him fighting a “lifestyle” tax avoidance case.

Earlier this year he lost a High Court appeal against a Taxation Review Authority ruling that $5 million of loans he received between 1991 and 2002 should be assessed as taxable income.

Mr Krukziener said the failed tax appeal wouldn’t impact the proposal because the full amount of the judgement had already been factored in to the numbers.

IRD lawyer Nick Whittington said it would send the wrong message if the department allowed Mr Krukziener to walk away from the tax obligations.

Former Auckland City Mayor John Banks was among the more than 40 businessmen who had provided written character references for Mr Krukziener, the court heard

The case is set down for four days.