Mystic Mountain sale needs green light from court, lawsuit drags on | Company

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There is no immediate end in sight yet for the continued litigation involving Mystic Mountain Limited, MML, in bankruptcy, despite the Supreme Court ruling last week that receiver Wilfred Baghaloo can move forward with the planned sale of the company’s assets, provided that the sale agreement is expressly approved by the court.

As the decision requiring court approval of the pending sale was issued in the Commercial Chamber of the Supreme Court by Presiding Justice David Batts on November 11, a date of February 23, 2023 was set by the judge to hear a action filed by MML trustee Debbie-Ann Gordon asks Baghaloo to disclose financial and other information regarding MML’s estate.

The assets relate to the equipment and operations of the Mystic Mountain Rainforest Adventures attraction, which remains open and continues to welcome visitors to Ocho Rios. The condition attached to the sale followed Batts’ effective green light to the transaction planned a week earlier with the rejection of a request for an extension of a temporary injunction, which was obtained on September 14, halting the sale process. actives.

The temporary injunction had been obtained by the majority shareholders of MML, who had alleged improper procedures on the part of the receiver regarding the proposed sale.

In court, through his attorney, Dr. Christopher Malcolm, and in comments to the financial gleaner, Gordon said his motive was not to prolong litigation in the case, which has been before the court at various times and for a number of reasons since bankruptcy proceedings began in January 2021.

“As an officer of the court, I have a fiduciary duty to all creditors and shareholders of Mystic Mountain Limited to see to the realization of their interests through the best possible result in this matter. To do that, the Insolvency Act requires me to do certain things,” Gordon said.

“I need to have a full account statement and I also need to make sure that all creditor claims on the estate are proven. This includes secured and unsecured creditors. I have to respect the rules of the law. Failure to do so could make me personally liable for the entire estate,” the trustee told the financial gleaner in an interview on the sidelines of last week’s hearing.

Meanwhile, Baghaloo, through his lawyers, has informed the court that the trustee’s requests for information have been met. Baghaloo was appointed receiver in February by secured creditor and bondholder Sky-High Holdings Limited, and for a few months until August also served as MML’s estate trustee. The former trustee appointed by MML, Caydion Campbell, had been removed from office by the company’s creditors.

Following concerns about a possible conflict of interest with him in the two roles, Baghaloo, the managing director of PricewaterhouseCoopers Jamaica, resigned as trustee and Gordon was recently appointed by creditors to fill the role.

The trustee, who was named as a respondent in the injunction suit, had not expressed a position on whether the court should have lifted or extended the injunction.

However, his requests for information and the last filing in court at the suggestion of the judge, who refused to hear all the arguments relating to his requests for information during the injunction hearing, are considered by some creditors as an extension of the legal process and a delay in the potential sale and realization of money to pay MML’s debts.

Baghaloo hopes that requiring the court’s seal of approval for the sale will speed up the process and add to its transparency.

“I sincerely expect this to make the selling process much easier, reducing unnecessary ‘noise’ surrounding the sale,” he told the financial gleaner in the comments via email this week.

While continuing to decline to name the preferred negotiating bidder to buy the assets, Baghaloo said the process to secure the sale agreement in court was being led by attorneys for the receiver and the buyer. The financial gleaner has learned that amusement operator Dolphin Cove Limited, whose lawyers were present in court for the hearing of the injunction case, is seeking to buy Mystic Mountain.

“I hope it will happen quickly, but the lawyers will have to agree to the language to be inserted into the sale agreement, as recommended by the judge,” Baghaloo said, also declining to give a timetable for the agreement to be placed before. . the court for approval.

Regarding the action brought by the syndic and its requests for information, Baghaloo indicated in its response to the financial gleaner a willingness to cooperate.

“I am unsure of the specific details of the trustee’s current request(s). We will continue to work with the current administrator ensuring a prompt response to their inquiries/communications. Obviously, it is in our mutual interest that we ensure a smooth process. We are fully available to help 100%, according to the needs of the trustee and the creditors concerned. Once the specific request(s) have been made, we will comply in a timely manner,” he said by email.

“I hope that once the substantive court cases are behind us, we can complete the sale, subject to court directions, to the satisfaction of all parties involved, including the secured creditor(s). s), employees and (other) creditors. It has been a difficult few months for them. I thank them for their patience in this matter,” Baghaloo added.

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