Judge freezes developer’s assets

A developer has had assets frozen after a judge found it was ‘‘seriously arguable’’ that he was attempting to shift assets to a Cook Islands company in a bid to avoid paying debts.

Andrew Fonagy, an Aucklandbased developer who headed nowdefunct plans for a $20 million hotel in Christchurch, had the freezing orders placed on any proceeds he or his company Fontur Trustee Ltd might make from the sale of two properties worth more than $1 million.

The order was made by Justice Peter Churchman in the High Court at Christchurch last month. It was sought by Primary Services New Zealand Ltd, which had sought judgment for $850,000 plus interest and costs from Colombo Projects Limited, which had Fonagy as sole director and Fontur as majority shareholder.

Fonagy and John Payntor had been guarantors of the loan, on which Colombo had defaulted.

The claim is still before the courts.

In seeking the order, Primary Services became aware that another of Fonagy’s companies, 22 O’Shannessey Ltd, was advertising to sell a commercial building in Auckland, which had a CV of $1m. In late 2018 the full shareholding in the company was

Andrew Fonagy transferred from Fontur Trustee Ltd to the Cook Islands-based Ora Trustees Ltd. Ora Trustees’ Cook Islands office is the registered office of Ora Fiduciary (Cook Islands) Ltd, which advertises Cook Island trusts as ‘‘an ideal vehicle with which to preserve and protect assets against risks arising from the ownership of those assets’’.

Fontur Trustee also had interests in Ponsonby 235 Ltd, which were transferred to Ora Trustees around the same time.

Justice Churchman said an affidavit from Primary Services indicated ‘‘it is seriously arguable that Mr Fonagy is . . . attempting to dispose of assets and/or put them beyond the reach of the New Zealand Courts in an attempt to avoid liability under his guarantee on the loan from Primary Services New Zealand Limited to Colombo Projects Limited’’.

He made an interim freezing order on Fonagy’s shareholding in Fontur and any proceeds of sale he may become entitled to.