The Daily Herald
February 5, 2002
PHILIPSBURG--For the fourth time SunResorts NV (Mullet Bay & Casino Resort) was granted protection from creditors
by the Court of Philipsburg on Monday.
The extension of the original moratorium on payments ordered by the Court on April 27, 1997, confirmed on August
25 of that same year and subsequently extended in 1998, 1999 and 2000 to allow the company to salvage the resort
badly damaged by Hurricane Luis (1995) was decided upon by the Court on request of SunResorts.
In an explanatory note to yesterday's ruling the Court notes that both the court appointed trustees A. Huizing
and R. de Pous favoured extension. The same, the Court observed, was the case with creditors eligible to vote.
As we reported following hearings of the case by the Court late January, a relatively large number of creditors
intent on voting against the extension were paid off by a "third party."
The Court further considered the request by lawyers Ronald Duncan and Jacob Cornegoor on behalf of the homeowners
at the resort to terminate the moratorium as not admissible. Individual homeowners and their association MBAA are,
pending corresponding litigation to that effect, not recognized as creditors.
Consequently they don't have the legal position to demand the lifting of the moratorium nor for that matter to
ask the Court to replace the trustees.
During the hearings last week doubts about the objectivity and accountability of the trustees were voiced by lawyers
representing parties in favour of ending the moratorium.
Arguments which apparently failed to impress the Court. In the explanatory notes it is simply stated that the Court
sees no reason to dismiss Huizing and De Pous and appoint other trustees in their place.
The Court finally observed that it sees no reason to fear that SunResorts will use the moratorium to take advantage
of the creditors. To the contrary, the Court gives as its opinion that payment of all creditors may be expected
to take place in due course.
The latest extension has been granted for 18 months.
In the meantime, legal proceedings to determine rights and responsibilities between the Homeowners and SunResorts,
the company that owns most of the land at the resort and managed the renting out of the homes, may take several
more years.
The case is now before the Court of Appeal, which will decide whether the case will be tried in New York or in
the Netherlands Antilles.
Whatever the outcome of that case in appeal, any solution leading to reconstruction and reopening of the resort
will take considerable time, unless parties arrive at an agreement in the meantime.
A not very likely scenario, as efforts to that effect ordered by the Court of New York failed after two years of
talks conducted by a Court appointed negotiator.
Barring such exceptional measures as the Government embarking on expropriation proceedings or a sudden resumption
of negotiations, it is clear that Mullet Bay Resort & Casino will remain closed until the legal proceedings
have run their course.
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