The Supreme Court has refused an application to remove Debbie-Ann Gordon as trustee of Mystic Mountain Limited, MML, an adventure park operator that’s in bankruptcy; but the judge also approved five inspectors who represent the pool of unsecured creditors that have claims on MML.
Mystic Mountain receiver Wilfred Baghaloo said the decision cleared the way for hearings over the sale of the adventure park that overlooks the resort town of Ocho Rios. Those hearings began on Tuesday.
“I have offers and I made a recommendation and applied to the court for guidance,” said Baghaloo.
He is expecting the court to make a pronouncement on the process to be utilised for the sale of Mystic Mountain when the hearings continue. The case was expected to wrap up today, May 12, but there there were indications last night that it might be pushed back to a later date.
“The receiver is very happy with the court’s intent to have the sale process addressed in earnest for the benefit of the creditors. The shareholders’ matters are of little interest to the receiver,” Baghaloo said in the wake of Monday’s decision regarding the trustee case.
“The matter of the current trustee is of little interest to me and is really between committee of inspection and the trustee,” he said.
Baghaloo was appointed receiver after Sky High Holdings Limited, the secured creditor for MML, exercised a denture to take over the company. Sky High holds $1.1 billion of MML’s senior secured bonds, on which the adventure company defaulted on payments in 2020. The default happened at a time when tourism and hospitality companies were all under pressure due to fallout from the coronavirus outbreak.
MML failed to make principal and interest payments on the bonds, resulting in the full amount becoming due in January 2021. Subsequent meetings failed to secure a resolution and the company was later placed in receivership.
Different sources, who declined to be identified, because matters related to MML were still winding their way through the court, said a pool of inspectors representing MML creditors was initially appointed in February 2022, but some members of the group were said to be terminated months later, in November, in the wake of the appointment of the trustee.
The court application to have Gordon herself removed as trustee was said to be made by a subset of disbanded inspectors. They wanted her removed as of March 28, 2023.
But while denying their application, Batts, who heard the case from May 1 to 8, also handed a victory to the claimants by approving five inspectors. The five were said to be representatives of Jamaica Bauxite Mining; Weigand Rides, an equipment manufacturing company in Germany; Tax Administration Jamaica; food and beverage supplier Mystic Dining; and financial institution Sygnus Capital.
In response to Monday’s decision denying the claim, Gordon, who is a lawyer by profession, said the ruling allowed her to continue her work uninterrupted.
“The administration of the estate is therefore being steadfastly pursued in the interest of all stakeholders, in spite of the limited resources available to the trustee,” she said.
The inspectors have indicated that they will be appealing Batts’ ruling regarding Gordon’s removal.
Prior to the hearing of the case, Gordon had taken out an advertisement in the newspaper, in which she charged that she had faced obstacles gaining access to the books and records of Mystic Mountain, but also noted that as trustee, she had “engaged auditors to deal with the process so that credible claims can be finalised and admitted for immediate payout at a verified value, once funds are in the hands of the trustee for distribution or as ordered by the court”.
Gordon is also challenging the debenture held by secured creditor Sky High and wants the court to disallow the security. Those hearings began Thursday, May 11, and were expected to continue today.