Receiver tells judge sale of Nygard warehouse must proceed

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This article was published 17/12/2020 (1469 days ago), so information in it may no longer be current.

A court-appointed receiver is fighting to proceed with the sale of one of Peter Nygard’s flagship business properties after the transaction was put on hold in advance of an appeal by Nygard to have the receiver discharged.

Last month, Court of Queen’s Bench Justice James Edmond approved the sale of Nygard’s Inkster Boulevard warehouse by receiver Richter Advisory Group, with a set closing date of Jan. 18, 2021.

The Nygard Group of Companies was placed in receivership last March to repay a US$25-million debt to American lenders White Oak Capital and Second Avenue Capital Partners.

Nygard lawyers argue that debt has been paid in full and have filed an appeal with the Manitoba Court of Appeal to have the receiver discharged. No date has been set for the appeal hearing, which has effectively put the brakes on the Inkster Boulevard warehouse sale.

On Thursday, lawyers for Richter Advisory Group argued a motion before Court of Appeal Justice Janice leMaistre to quash the stay of the sale, arguing any further delay could jeopardize the real estate deal with Mist Holdings Inc.

“This was a hard-fought agreement,” Richter lawyer Bruce Taylor said, adding Mist Holdings was the only potential buyer to make an offer since the property went on the market last April.

The proposed purchase price remains sealed by court order until the sale is finalized. 

Taylor said any proceeds from the sale will be preserved, should Nygard Group wish to lay claim to them in its appeal.

“If we don’t close the deal, the purchaser is allowed to walk away from this agreement,” Taylor said. “All we are doing is turning a building, which has no unique characteristics, into cash.”

Nygard lawyer Colby Linthwaite argued Nygard Properties Ltd. — the owner of the Notre Dame Avenue warehouse, and one of nine companies controlled by the Nygard Group — has satisfied its debts and can’t have its assets sold to pay the debts of other companies in the Nygard Group.

“The reality of the situation is that my client, NPL, is the owner of the property… and owes nothing more to the lender,” Linthwaite said.

Allowing Richter to move ahead with the sale deprives NPL of its property rights, Linthwaite said.

“A pile of cash is not the same as property,” Linthwaite said.

Richter disputed Nygard’s assertion its debt to White Oak and Second Avenue Capital Partners has been satisfied.

“It’s a fact that the lender hasn’t been fully paid out at this point,” Taylor said. “There are certain obligations alleged by the lenders that have not yet been paid.”

LeMaistre reserved her decision.

Peter Nygard, 79, was arrested and taken into custody in Winnipeg Monday on a U.S. extradition warrant to face racketeering and sex offences that allegedly took place over decades.

Ten months ago, a class action lawsuit was filed in the U.S., alleging a decades-long pattern of sexual abuse involving dozens of women and girls.

Nygard maintains his innocence, alleging he is the target of a vast conspiracy. He remains in custody and is expected to apply for bail pending extradition proceedings. 

dean.pritchard@freepress.mb.ca