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Nygard scuttled $10m Bay Street wharf sale

Peter Nygard

Peter Nygard

• Judge slams fallen Lyford Cay resident’s ‘broken promise’

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Peter Nygard scuttled the $10m sale of a prominent Bay Street property that could play a vital role in downtown Nassau’s rebirth, a Supreme Court judge has revealed.

The fallen ex-Lyford Cay resident, who was earlier this month found guilty on four counts of sexual assault by a Toronto jury, has effectively left Union Wharf’s owner, a Bahamian financial services provider and local KC ‘holding the bag’ despite the trio being awarded a collective $567,019 in damages and costs over the affair.

IPG Family Office, which specialises in estate and inheritance planning, and Gail Lockhart-Charles KC now face the task of collecting on this award given that the one-time fashion mogul likely has zero assets left in The Bahamas following the seizure and disposal of his former Nygard Cay property.

Justice Cheryl Grant-Thompson, in a November 28, 2023, ruling disclosed how Mr Nygard successfully persuaded the Supreme Court to block Union Wharf’s proposed sale via an injunction that was issued on September 30, 2022. This was granted in response to claims that he was the Nassau harbourfront property’s true owner - an assertion that was denied and heavily disputed.

However, the embattled Canadian multi-millionaire, whose fashion empire was already in disarray and ruin, failed to comply with a Supreme Court Order that he provide a $2m damages “undertaking” as part of the terms for granting the injunction. And he subsequently also failed to abide by a further Order requiring him to pay a $100,000 ‘security for costs’ bond to cover the other side’s legal and other expenses.

Mr Nygard’s non-compliance with both Orders ultimately resulted in the dismissal of his claim to be Union Wharf’s true owner. And, while the injunction was eventually discharged, its imposition triggered the “collapse” of Union Wharf’s sale to a corporate entity, Buccara Bahamas Ltd, resulting in the latter recovering its deposit.

The judge, slamming Mr Nygard for his “broken promise” on the damages undertaking, said she took “a dismal view” of his “blatant failure to deliver on any of the financial sanctions and safeguards imposed by court order”.

The Union Wharf episode is thus another example of how Mr Nygard’s toxic legacy continues to plague The Bahamas, as his efforts have delayed and tied-up the sale of a large waterfront property whose redevelopment could play a critical role in the revitalisation of downtown Nassau.

Justice Grant-Thompson’s verdict revealed that the former Nygard Cay owner initiated legal proceedings to block Union Wharf’s sale on July 14, 2022. The defendants were named as Nygard Foundation, an irrevocable charitable purpose trust whose assets were contributed by Mr Nygard, but which he no longer controlled, and IPG Family Office. The latter likely provided trustee and protector services to the Foundation.

Besides seeking damages for alleged “breach of fiduciary duties” and breach of contract, the fallen fashion mogul also sought a Supreme Court declaration that he was Union Wharf’s beneficial owner by virtue of having “paid the purchase money to Galaxy Group”. The latter is the corporate entity registered as the Bay Street waterfront’s owner.

While Mr Nygard initially succeeded in blocking the sale via the Supreme Court’s injunction, his failure to provide the required $2m damages undertaking resulted in a further March 6, 2023, Order. It stipulated hat unless he paid $100,000 in “security for costs” by 4pm on April 7 this year, his action would be dismissed.

“Peter Nygard, having failed to provide the undertaking in the amount of $2m, also failed to provide the security for costs in the amount of $100,000 as ordered by this court in an Unless Order. The substantive action was therefore dismissed due to the plaintiff’s non-compliance with these two crucial financial Orders relative to these proceedings,” Justice Grant-Thompson wrote.

The injunction was also discharged but too late to save Union Wharf’s sale. IPG Family Office, whose founder and principal is Andrew Law, a former managing director of Credit Suisse Trust (Bahamas) and also an ex-Association of International Banks and Trusts (AIBT) chair, subsequently claimed a total $656,018 in damages to cover “loss of opportunity” from the aborted sale together with legal and other costs.

Sidney Collie, the former Cabinet minister and MP who was acting as Mr Nygard’s attorney, asserted that the damages/costs claim should be dismissed but this was rejected by Justice Grant-Thompson.

Mrs Lockhart-Charles, acting for Nygard Foundation, IPG Family Office and Galaxy Group, countered that the claim “brought into sharp focus the damages which loomed, accumulating since the sale of the Union Wharf property teetered on the brink of collapse”.

Taran Mackey, IPG Family Office’s managing director, alleged in an affidavit: “The injunction order has prevented Galaxy from closing the sale of the Union Wharf property in accordance with the agreement for sale, and Galaxy has now been served with a notice to complete, which requires it to complete the sale by November 28, 2022, failing which the contract will be terminated and Galaxy will be required to return the deposit to the purchaser.”

That is exactly what happened. “The Union Wharf property was under contract for sale for the agreed price of $10m. That sale collapsed as a result of the imposition of the injunction requested by [Mr Nygard],” Justice Grant-Thompson wrote.

“Mr Mackey detailed and defined in testimony his personal involvement in the preparation of the agreement for sale, obtaining the requisite Investment Board approval, futile attempts to obtain an extension of time - when Galaxy Group was faced with a notice to complete but could not complete because of the injunction - the eventual collapse of the sale and the return to Buccara of the deposit.”

CFAL, the Bahamian investment firm, estimated “the value of loss of opportunity” to Galaxy Group from the $10m sale’s collapse at $241,842. “Due to the enforcement of the original injunction, the defendants were forced to abruptly halt the sale of the Union Wharf property, which resulted in a loss of opportunity,” Justice Grant-Thompson ruled.

“It is clear to this court that the conduct of the applicant was in fact in defiance of the court’s Orders, which resulted in damages which were a direct consequence of the granted Injunction. The respondents are fully entitled to compensation/damages.”

While accepting CFAL’s $241,842 “loss of opportunity” calculation, Justice Grant-Thompson nevertheless trimmed the $225,000 claimed by IPG Family Office for services provided to Galaxy Group by $75,000 to $150,000. And she cut a second set of billings from IPG Family Office to Galaxy Group from $114,000 to $100,000. Legal fees of $75,176 were also awarded.

“We were successful in getting the injunction set aside and the action dismissed,” Mrs Lockhart-Charles told Tribune Business, “and getting a court Order against Peter Nygard so that he pays the costs and gives compensation for the damages caused by the action he filed.”

Enforcing the damages and costs award will be the hard part. Besides a likely lengthy jail term in Toronto, the embattled 82 year-old Mr Nygard still faces similar sexual assault charges in three other jurisdictions including New York. He is presently fighting extradition to the US.

Comments

TalRussell 4 months, 3 weeks ago

But tiny glimpse into the much wider Bahamaland dealings of one Comade Peter Nygard. --- 'Tis the same Nygard who at the time when he was rich and powerful had deep reaching connections with the island colony's local ruling class, elites', politicians', the politically connected and policemans'. ---Who is most likely to die whilst jailed. --- Yes?

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Engineer 4 months, 3 weeks ago

When will we learn from the 'derelicts ' that we suck up to just because they have money. Look at how Nygard and SBF and the blond bomb shell,etc all present themselves. Wake up!

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TalRussell 4 months, 3 weeks ago

At age 82, if just handed a jail sentence of 18 years ---- He'll turn 102 before leaving prison.----- How to use jail years to pan out of a lengthy sentence.won't be good for a man reported to be in ill health. --- Yes?

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