UK court convicts Eric Watson in contempt of ‘willingness to tell lies’ about assets

New Zealand businessman Eric Watson has been found in contempt by a London judge for deliberately hiding assets in a bitter dispute with fellow Kiwi Sir Owen Glenn.

The High Court of England and Wales ruled this month that Watson was in contempt of court by failing to comply with court orders after it was discovered that he had cheated on Glenn during their business dealings.

After a lengthy trial, Watson was found liable in 2018 for £ 43.5 million ($ 85 million) and compound interest at 6.5 per cent per annum in compensation to Glenn’s company, Kea Investments (Kea). He was ordered to pay a provisional sum of £ 25 million ($ 48.8 million) plus costs of £ 3.8 million ($ 7.4 million).

Watson, who previously owned the Warriors rugby league club with Glenn, appealed the ruling, which was thrown out by the UK Court of Appeal in October 2019.

However, Kea accused Watson of being “deliberately reluctant” to provide information about his assets as part of a strategy to thwart compensation recovery efforts.

He requested three contempt orders against Watson, which were discussed for several days in April and May, on suspicions about interests, including those of his mother Joan Pollock and a house bought in Sweden.

Now, in an Oct. 2 decision, Lord Justice Christopher Nugee said that it “demonstrated how blatantly Mr. Watson lied to the Court of Appeal” about the status of his assets.

Watson’s official statement to the Court of Appeal showed his “willingness to tell outright lies if he believes they will go undetected.”

“It is one of the clearest examples of why I consider him a witness whose evidence is almost useless.”

Judge Nugee said there were “strong reasons” to believe that Watson used the period between the end of the trial and his trial “to settle his affairs and put himself in the best position to make it difficult for Kea to enforce any judgment.”

He added that there was “inevitably a suspicion that while he pretended not to have assets, the reality is that he has made arrangements with some or all of the recipients to hold assets for himself.”

While the judge said he “had no confidence that [Watson] is telling the truth “only found him guilty of contempt for withholding a transaction statement on a” Rainy Day account “in Pollock’s name.

Watson, once one of the richest men in New Zealand, now claims to be poor. He said in a court statement that “my mother gives me the small amount that I spent in life.”

An analysis of Watson’s bank statements from September 2018 to September 2019 showed that more than £ 500,000 ($ 976,987) entered his account, much of it from the Rainy Day account.

“In other words, the available evidence is that when Ms. Pollock was asked for bank statements in circumstances where Mr. Watson said he could not provide them, she said she was not willing; but when Mr. Watson I really loved them, they came without a hitch, “Judge Nugee said.

“There is not the slightest reason to doubt that if Mr. Watson really wanted to provide them in December 2018 to comply with the [court] Order, could have obtained them just as easily. She chose to hide behind the fact that the account was in her mother’s name. “

Judge Nugee added that he strongly suspected that Pollock “may have been led to believe that it suited Mr. Watson if she refused to provide them.”

The judge also said Glenn was not pursuing the legal action “out of a desire for revenge.”

“Under those circumstances, I do not think it is relevant to know, nor am I tempted to speculate, whether Sir Owen would be glad to see Mr. Watson jailed or simply want Kea’s court debt paid.”

London-based Watson “has not voluntarily paid a penny” for what was ordered.

“Kea has managed to identify and demand payment of various assets and thus has obtained comparatively small sums for judicial debt, but the vast majority is still owed to him and has had difficulty locating, let alone enforcing, any substantial assets, “says the ruling.

A sentencing hearing will take place at a later date for what Judge Nugee called a “long-running and horrendously complex” case.

Civil contempt in the UK can result in a maximum sentence of two years in prison.

Kea had also filed a case against the Spartan Capital joint venture, which was settled.