Agent fails in bankruptcy bid over luxury Italian tiles

A former beauty queen linked to Terry Serepisos, who was attempting to bankrupt a Wellington lawyer over thousands of luxury Italian tiles, has had her case thrown out.

Paula Muollo, who is a real estate agent and former runner-up in the Miss New Zealand pageant, attempted to take over bankruptcy proceedings against Wellington lawyer Michael Garnham after the Inland Revenue Department settled its claims against him.

However, in a High Court decision, Justice Helen Cull ruled Muollo could not be substituted for Inland Revenue, and quashed her proceedings.

Muollo claimed Garnham had taken 2530 basaltina tiles – claimed to be worth about $541,000 – that belonged to her. Basaltina is a lava stone exclusive to Italy.

According to her lawyers, Muollo took ownership of the tiles after Serepisos, who is a former host of The Apprentice and founder of the Wellington Phoenix, was unable to repay $300,000 she had lent him in 2011.

At the time, Muollo was Serepisos’ property manager.

The tiles were being held in three shipping containers in a Petone warehouse.

When Serepisos defaulted on his loans to Muollo, she wanted to claim her right over the tiles.

She alleged the tiles, which are worth $186 each, were removed from the original site in Petone at the direction of Garnham.

Therefore, Muollo claims he is in possession of her tiles, and subsequently, the debt is now with him.

Garnham was linked to the 2016 sale of a pristine beach in the Abel Tasman as part of a multimilliondollar claim by the Bank of New Zealand against his father-in-law, in proceedings separate to the Inland Revenue claim.

In her decision, Judge Cull said there was no enforceable debt or security against Garnham or the company in which he had an interest. The security of the $300,000 loan was only enforceable against Serepisos, the judge said.

‘‘Although [Muollo] has security for $300,000 taken in the form of tiles with a retail value of $541,167, the security is enforceable against Mr Serepisos, not Mr Garnham.’’

Muollo could potentially establish a claim against Garnham for the tiles, but that would not be enough to satisfy the criteria for the current case, Judge Cull said.

Last year, Garnham was named as a party in BNZ’S attempts to recoup debts against his father-inlaw Michael Spackman.

As part of the process, Spackman sold a beach he owned at the Awaroa Inlet near the Abel Tasman National Park.

The sale gained national attention, with the beach eventually purchased by the New Zealand Government following a nationwide crowdfunding campaign.