Farepak Directors Trial Day 8 – 1 June 2012

Unfairpak unfortunately have nothing to report as to today’s proceedings.

Court went into recess today at 4.30 p.m. as it is the end of Term and it shall reconvene on Tuesday, 12 June 2012 at 10.30 a.m.

The Insolvency Service on behalf of the Secretary of State [Vince Cable] are still giving evidence and shall continue to do so on 12 June 2012.

Unfairpak have ascertained however, that the defendants have split into different groups due to the fact that although the Secretary of State is seeking to have them disqualified alleging “unfit conduct”, some defendants have more importance placed on them than others and accordingly face more serious allegations.  We cannot elaborate further at this stage.

COURT DETAILS FAREPAK DIRECTORS TRIAL DAY 5 – 30 MAY 2012

http://www.justice.gov.uk/courts/court-lists/list-chancery-judges

COURT 26
Before MR JUSTICE PETER SMITH
Wednesday, 30 May 2012
At 10 o’clock
FOR JUDGMENT
INTERIM HEARINGS LIST
HC12A01404 Quayle v Rothman Pantail & Co
 
 
Not Before half past 10
GENERAL LIST
Part Heard
584 of 2011 In the matter of European Home Retail plc and in the matter of Farepak Food & Gifts Ltd

TRIAL OF FAREPAK DIRECTORS – DAY 4 29 MAY 2012

Today brought a mixture of emotions to Unfairpak.  We have been frantically trying to find out why no one is reporting on this case and we have actually had responses from newspapers stating “I was not aware……………”!  Hopefully now they are aware they will realise the importance of this case and start reporting on same.

The trial is running behind by approximately one day which has shifted the schedule a little and the schedule may shift again.  Unfairpak have ascertained and can confirm that the Directors will each give evidence for approximately 3 days each and there are 7 Directors to hear from.  Accordingly, the Directors’ evidence alone will amount to 21 days.  This highlights the scale of this actual case.  The Insolvency Service will be giving evidence into the latter part of June and Stevan Fowler will be the first Director to take the stand once the Insolvency Service rest their case.

Unfairpak have further ascertained that to obtain the transcripts of this trial would be extremely cumbersome and extremely costly.  Accordingly, we need reporters in court tweeting the evidence out to the general public.  There was a court reporter in court today but we are unsure as to whether there were any journalists or not.

The Directors do not need to be in court until they give evidence but they have been coming and going from court. 

Could anyone who suffered loss as a result of Farepak and would be willing to talk to the media, please email our National Campaign Co-ordinator, suzy@unfairpak.co.uk

We hope that we will be in a position to report a little more tomorrow.

 

 

COURT DETAILS FAREPAK DIRECTORS TRIAL 29 MAY 2012 – DAY 4

http://www.justice.gov.uk/courts/court-lists/list-chancery-judges

COURT 26
 
Before MR JUSTICE PETER SMITH
 
Tuesday, 29 May 2012
 
At half past 10
 
GENERAL LIST
 
Part Heard
 
584 of 2011 In the matter of European Home Retail plc and in the matter of Farepak Food & Gifts Ltd

Farepak Directors Trial Day 3 – 28 May 2012

The hearing of evidence began today and we at Unfairpak are very disappointed to report that we called the court and spoke to Mr Justice Peter Smith’s clerk who advised us that she would ask Mr Justice Peter Smith to announce to the court whether reporters were allowed to tweet or not and for us to call back for confirmation.

We did call back for confirmation and were told by Mr Justice Peter Smith’s clerk that he announced that reporters are allowed to tweet but unfortunately, again as advised by the clerk, there were no reporters in court today.

We understand that there are quite a few high profile cases ongoing but we would have thought that at least one reporter would be following the case especially given the fact that the hearing of evidence began today.

If journalists are reading our blog and/or forum, we would implore you to start reporting on this case.  The creditors of Farepak deserve to know the facts of the case and it is only by journalists reporting same that these facts will become public.  This is a very important case as it affected so many people on low incomes and effectively ruined Christmas 2006 for over 100,000 people.

 

The Times 17 February 2011 written by our National Campaign Co-ordinator

To have been given a chance to write an article for the Times regarding Farepak is something I would never have dreamed of. However, that is exactly what happened and here is the finished, printed, published article.

 

Suzy Hall

February 17 2011 12:01AM

On October 13, 2006, some 123,000 people had Christmas ripped from their hands when Farepak went into administration, taking with it £40 million of savers’ money. I was one of them. My family lost £1,000, but others fared even worse.

But at long last, all of us who, month after month, deposited our money with the Christmas hamper company might have something to celebrate. This week, the Insolvency Service began formal disqualification proceedings against nine former Farepak directors. These people are not fit to run a company; they deserve to be struck off.

The campaign group Unfairpak has fought continuously to have the directors brought to account for their incompetent, greedy, selfish and irresponsible actions. I firmly believe that the directors did not expect for one second that there would be an uprising of savers calling for justice. But now we can say that the voices of the “little people” have made a difference.

On August 23, 2006, the shares of European Home Retail, the parent company of Farepak, were suspended. Despite this obvious sign that the company was in serious trouble, the Farepak directors continued to take customers’ money — and ultimately the Christmases of thousands of children. Knowing that some of the directors must have been aware that Farepak was facing liquidation makes us savers feel even more that we were regarded with utter contempt by them.

During the weeks after the collapse, while Farepak savers were worrying about how we were going to pay for our families’ presents, we were subjected to images on TV and in the papers of the directors leaving their million-pound homes, even jetting off on luxury holidays. But the portrayal of savers as simply “poor people” or “financially illiterate” was wrong. Farepak savers were prudent. They planned ahead in order to avoid debts at Christmas. Despite this prudence, at the moment we are to get back no more than 15p for every £1 lost, although we hope that figure will rise.

The outcry over politicians’ expenses and bankers’ bonuses shows that society is no longer willing to sit back and let the “fat cats” get away with it any more. We are becoming a classless, less deferential society and the Farepak fightback is another example of how the voices of the “little people” will be heard. If any good can come from the debacle, this could be it. This week a loud message has been sent: no one is above the law and, though it may take time, justice will prevail.

 

Suzy Hall is national campaign co-ordinator of Unfairpak

Trial of Farepak Directors Day 2 – 25 May 2012

It was a very quiet day today which Unfairpak were completely surprised about given the fact that the directors written submissions were being set out in court.

All we got in the way of submissions were very basic and lacklustre.

However, the written submissions that we do have are as follows:-

Both William Rollason and Stevan Fowler who are, as we reported yesterday, being represented by the same firm, stated in written submissions that the government’s case “is heavily dependent on hindsight” and “is both misconceived legally and incoherent factually”.

Nicholas Gilodi-Johnson’s written submissions stated “There was at all times a reasonable prospect of avoiding an insolvency. The directors made the right decisions at the right time.”

Sir Clive Thompson and the three non executives written submissions claim that when examined in context: “each of them did as much as should reasonably been, and be, expected of them”.

The hearing of evidence begins this Monday, 28 May 2012.

FAREPAK DIRECTORS’ TRIAL DAY 1 – 24 MAY 2012

As advised by Unfairpak, the trial is set down for 6 to 8 weeks.

It got off to a slow start today, 24 May 2012, with the Secretary of State giving opening submissions before Mr Justice Peter Smith and advising him that he had the power to disqualify them from being directors from between 2 to 15 years.

In written submissions, Malcolm Davis-White QC, acting on behalf of the Insolvency Service stated “The proceedings, seeking disqualification orders, are brought against directors of the holding company European Home Retail and its subsidiary Farepak Food & Gifts. They concern approximately the last year or so of trading of Farepak and the group.”  Mr Justice Peter Smith was also told that the directors had traded at an “unreasonable risk” and that the collapse of Farepak Food & Gifts Limited had not came “out of the blue”.

Accordingly, the Insolvency Service are making “allegations of unfit conduct” and are arguing that the directors of European Home Retail (hereainafter referred to as “EHR”) or Farepak Food & Gifts Limited allowed or caused said companies to “trade at the unreasonable risk of its creditors”.

As Unfairpak exclusively revealed to the Sunday Herald on 12 February 2012, two former directors of Farepak Food & Gifts Limited have already taken voluntary disqualification.  Joanne Ponting and Stephen Hicks both took voluntary disqualification in 2011.

Michael Johns who was a non executive director at the time of the collapse is a senior partner with the London firm K&L Gates and is being represented by said company.  Neil Gillis and Paul Munn, Farepak directors and Sir Clive Thompson, former chairman are also being represented by said firm with Paul Girolami QC of Maitland Chambers instructed as counsel.

Richard Highley dispute resolution partner of DAC Beachcroft is acting for William Rollason and Steven Fowler with Michael Green QC of Fountain Court alongside.

The commercial dispute resolution partner of Nabarro has instructed Philip Jones QC of Serle Chambers to act for Nicholas Gilodi-Johnson, Farepak Food & Gifts Limited’s former managing director.

Lawyers for the Insolvency Service also pointed out that prior to the collapse on Friday 13 October 2006, “about £1 million a week” was coming in from Farepak savers who had “no inkling” of “any serious risk”.

Mr Davis-White also pointed out that company financial forecasts in November 2005 “identified a risk” that Farepak Food & Gifts Limited would not have enough monies to pay Choice Gift Vouchers, their main supplier.  Choice Gift Vouchers Limited entered administration on Tuesday 31 January 2006 having being paid approximately half of the £12.1 million owed to them by Farepak Food & Gifts Limited.

“With alarming cashflow projections available from early April 2006 warning of a lack of sufficient cash in the group from October 2006 onwards, various unsuccessful attempts were made by the group to find a solution to the funding crisis,” Mr Davis-White added.

“Throughout this period, savers’ weekly payments (amounting by October to some £2million per week) continued to be collected by Farepak and swept up daily into the group account, unprotected by any trust account or similar arrangement.”

“By the time Farepak ceased to accept savers’ money on October 11 2006, it had ordered no vouchers for Christmas 2006. On October 13 2006 European Home Retail and a number of its subsidiaries including Farepak entered (variously) administration and administrative receivership.”

Mr Davis-White also went on to point out that Farepak’s creditors were also savers.  He further went on to state that “we say you have to look at the overall financial position and the risk.  We say it is relevant that your creditors are savers. It should help you shape more carefully how you deal with things. It is all very well saying ‘they are creditors like any other’ but, in our respectful submission, they are not simply creditors like any other.”

Counsel will deliver opening submissions on behalf of the defendants tomorrow, 25 May 2012 and the court will begin hearing evidence on Monday, 28 May 2012.

 

 

 

VOLUNTARY DISQUALIFICATION

Instead of answering each email individually, we feel it is better to put a post here to explain the situation regarding voluntary disqualification.

At the present moment in time, two former directors of Farepak have taken voluntary disqualification and we have a post regarding this on our blog.

As far as we are aware, no other directors of Farepak have taken this route and the trial is still set down to go ahead this Thursday 24 May 2012.

However, it is possible for the directors to even get to the court on Thursday and decide there and then that they will take voluntary disqualification.  Unfairpak cannot comment whether or not this will in fact happen.  All we can say is that it is a possibility.

If directors take voluntary disqualification, they are likely to be dealt with more leniently by the court.

We shall keep you informed regarding any further information we receive but at this moment in time, 7 directors are still facing trial.

TWITTER

For some unknown reason our @unfairpak account has been suspended.  We have contacted Twitter but reading Google regarding suspended accounts suggests we may have to wait a while until the matter is resolved.

Until we can get @unfairpak back up and running, you can follow our National Campaign Co-ordinator, Suzy Hall @scotsgirlie as she is following all the up to date news regarding the trial of the Directors of Farepak and providing information regarding the liquidation of Farepak Food & Gifts Limited.

Unfairpak would like to apologise to our followers and we hope that Twitter can resolve the issue as soon as possible.  We shall inform you as soon as we are up and running again.