Wednesday, April 26, 2006

David Parker exonerated?!?

The Companies Office have decided not to charge David Parker on breaches of the Companies Act for filing a false declaration. Their reasons for doing so was that under case law, the shares held by Russell Hyslop which were invested in the Official Assignee when Hyslop was made bankrupt, the shares did not revert back to him when he was discharged from his bankrupcy but continue to remain assigned to the Assignee. The Assignee had intended to give the shares to Parker and his father but never got around to it.

As was already known, the Official Assignee made a waiver for the audit requirement in 1997. However the Official Assignee had written (and which Parker apparently forgot about) that he was waiving the requirement to continue to seek the confirmation on a yearly basis. Such a indefinite waiver is legally dubious and the legal opinion goes out of its way to describe the waiver as "purported" and "a little inapt". The grey area is that Parker had the duty to take the resolution every year but there is no requirement that the shareholder's waiver be actively given every year. Even if the Official Assignee's waiver was legally invalid, Parker's declarations were neither false nor misleading.

So when Parker thought that he was breaking the law (for which he resigned his cabinet portfolios), he really wasn't because the declarations that he thought were false or misleading when he signed them were actually true but legally defective. I can only hope that when and if Parker is restored to his portfolios that he learn from this by a) amending both the Companies and Insolvency Acts with a view to cleaning it up and b) keeping better records.