Lawyers representing a group of companies owned by Winnipeg fashion mogul Peter Nygard say their clients’ debt has been paid and are asking Manitoba’s Court of Queen’s Bench to discharge the receiver.
A receiver — which is an independent third party — is appointed to take possession of a company’s assets and sell them off so the business’ creditors can be paid.
Richter Advisory Group has been in control of nine Nygard companies since it was appointed by the court in March to recoup a loan worth more than $25 million US owed to American lenders White Oak Commercial Finance and Second Avenue Capital Partners.
Toronto based lawyer Fred Tayar, one of the lawyers who represents the Nygard companies, summarized his arguments to a Winnipeg court of Queen’s bench judge on Nov. 9.
He said the lenders have received roughly $66 million.
“It’s unclear to me how much more … needs to be paid,” he said, pointing out that White Oak Commercial Finance has been paid in full.
Two Nygard properties have been sold under receivership: the Toronto headquarters on Niagara street and a property in Winnipeg on Notre Dame Avenue.
“The aggregate proceeds of these sales were approximately $19.6 million, which sum has been paid to the Lenders,” the brief filed with the Court of Queen’s bench reads.
Tayar said Nygard Properties Ltd. also wants to inject $1 million in cash to “sweeten the deal” for the unsecured creditors.
Court heard the Inkster property is also pending sale. Tayar argued the receiver had the authority to look for offers and get a realty broker, but doesn’t have the authorization to negotiate, accept and firm up a sale.
He pointed out that Nygard Properties Ltd. is solvent, has many assets and no creditors. As the sole owner of the Inkster property, it does not want its property “disposed of,” Tayar said.
Tayar is asking the court to deny the Inkster sale, and wants to see an unredacted copy of the proposed purchase. Lawyers for the Nygard companies are also asking the court to not approve the sale of any more properties.
In the accompanying brief, Nygard companies’ lawyers argue the receiver has been paid $7 million. They called the fees it’s charged as “excessive,” and vowed to challenge them.
Arguments are expected to continue on Friday morning, when some of Nygard’s landlords are set to speak.
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