Wed | Jul 8, 2020

Arc Systems case to continue in October

Published:Sunday | September 22, 2019 | 12:31 AMNeville Graham - Business Reporter

Closing arguments in the Arc Systems case began in the Supreme Court on Thursday but won’t conclude until the end of October due to time constraints and scheduling conflicts.

Justice David Batts is hearing an application from Exclusive Holidays of Elegance for the winding up of Arc Systems Limited over $25.8 million of debt allegedly owed for construction steel supplied in 2008. Arc Systems is fighting the case.

At Thursday’s hearing, lead attorney for Arc Systems, Dr Lloyd Barnett, revived a previous argument that the court had already ruled against, on whether Exclusive or its directors had a right to bring an action against his client, given that Exclusive itself had previously been placed in liquidation.

Barnett urged the court to consider whether Exclusive first needed to get the court’s permission to bring an action subsequent to the May 2014 liquidation order against it and whether Exclusive’s directors were in a position to initiate and pursue the claim against Arc Systems.

Similar arguments were made in part by Arc’s attorney, Debbie-Ann Gordon, who argued back in July that the Fred Smith-led Exclusive Holidays of Elegance, having been subjected to liquidation orders twice, was in no position to petition the court for the winding up of Arc Systems for outstanding debts.

Exclusive’s attorney, Gordon Robinson, countered then that there was no evidence that his client had been notified of the 2014 liquidation order, as required by law, and that the order was never effected. The first liquidation order against Exclusive in July 2003 was stayed by the court three months later.

Justice Batts dismissed Arc’s claim after hearing submissions from the two sides, a point that Exclusive’s attorney, Gordon Robinson, made on Thursday in counter to Barnett.

Robinson argued that the general thrust of Barnett’s submissions was that if a company is sued for monies owed and decides to use stalling tactics, then after some time, they can be free of their obligations.

He submitted that at all material times in every submission there was an admission that the $28.5 million was owed. He added that the effect of Batts’ July 12 ruling was that Exclusive had a right to proceed with its winding-up case, or at the very least, commence the action.

Robinson is expected to conclude his submission when the case resumes on October 31.