The year-long court battle over the now-defunct Sensation Yachts is finally resolved. The High Court in Auckland, New Zealand ruled earlier today that the equipment lying unused all this time should be removed so that the property can be sold.
The ruling benefits the bank HSBC, which took over the yard last year from its owner, Ivan Erceg. HSBC loaned Erceg more than NZ$6 million (US$4.6 million) in 2007, and when he reportedly defaulted on the loan the following year, the bank began proceedings to become the mortgagee in possession.
Since acquiring Sensation Yachts last October, HSBC has been trying to have the hulls, construction equipment, computers, software, and other items—“chattels,” in legal terms—taken off the grounds so that it could sell the yard and regain its financial loss. HSBC initially filed a lawsuit to force a Sensation Yachts creditor, a firm named Balenia, to move the hulls, since Balenia had ordered the yachts. The bank stated that the hulls had nothing to do with the land and therefore the attempted sale of the property. Balenia objected, stating the fact that the megayacht hulls were each in excess of 50 meters (165 feet) made them too difficult to move. Other creditors didn’t want the hulls removed, either. A judge ruled that a trial would need to be held to resolve the issue.
While the judge was preparing his ruling, HSBC and Balenia apparently were trying to work out a deal. According to published reports, HSBC’s lawyer, James Burt, states that the two firms reached a settlement out of court, but didn’t divulge details. A hearing over the agreement is set for May 2011. As for the High Court’s ruling, it requires that all equipment except for the hulls and some items such as software and financial accounts should be removed. Anything required to be taken away needs to be done so within 20 days, with the details to be arranged between HSBC and the appropriate parties. Items that remain are to be considered abandoned and can be disposed of by HSBC.
On a side note, Erceg was not present in court.
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