Interim receiver now controls everything Arlan Galbraith owns
Tuesday, November 11, 2008
by BETTER FARMING STAFF
© Copyright AgMedia Inc
Today in London, Ontario Superior Court of Justice in Bankruptcy and Insolvency Deputy Registrar Robert Stevens appointed BDO Dunwoody Limited as interim receiver of Arlan Galbraith’s assets.
Galbraith is the founder of Pigeon King International, Inc., a Waterloo, Ontario-based company that sold pigeon breeding pairs for as much as $500 and bought back offspring for up to $50 each. Last summer, he placed the business in bankruptcy leaving roughly 1,000 investors in Canada and the United States with worthless pigeons.
While dealing with the Pigeon King International Inc. bankruptcy, BDO trustee Susan Taves identified approximately 450 breeders who may have had contracts with Galbraith personally and who weren’t included as creditors in the corporate bankruptcy.
London lawyer Frank Highley, who is representing a PKI creditor in an action to declare Galbraith bankrupt, was the hearing’s sole delegate. Galbraith did not attend the hearing, which lasted less than 10 minutes.
Highley requested the appointment, telling Stevens that it was apparent Galbraith had appropriated “many hundreds of thousands of dollars from the corporation (PKI) and used them for his personal benefit including building a home” near Cochrane, Ontario, worth between $200,000 and $300,000.
Highley also observed proceeds from the recent sale of Galbraith’s Waterloo home were seized by the Canada Revenue Agency and “some measures” need to be taken to recoup those funds. Documents supporting his request argue that other PKI creditors may also have claim to the proceeds if Galbraith is declared personally bankrupt.
The order enables BDO Dunwoody “to control the estate and assets of Galbraith,” says Highley.
Just what those assets might be is anybody’s guess at this point, he says, “so the interim receiver is given powers to do an investigation and will do that.”
Galbraith has the right to appeal the order within seven days.
Highley notes the order suspends any other legal actions taken against Galbraith.
That includes Robert Siebring’s $1.5 million lawsuit. In a statement of claim not yet tested in court, Siebring, who operated holding barns at his RR1 Palmerston Ontario property for PKI, alleges Galbraith personally owes him money for breach of contract and costs related to the rental and operation of two barns and two pigeon breeding contracts.
He filed his action on Nov. 3 in Kitchener, the same day Highley filed an application to declare Galbraith bankrupt in London on behalf of his client, Jim Wiersma. Wiersma, of Fisherville, Ontario, is one of five inspectors the company’s creditors appointed at a meeting in July. His application claims Galbraith owes him nearly $23,000 and requests that PKI’s trustee, BDO Dunwoody, be appointed as Galbraith’s trustee.
Reached late yesterday, Siebring’s lawyer, Edward Oldfield, says he was unaware of Wiersma’s action. No date had been set to hear Siebring’s claim.
Highley says the next steps are up to BDO Dunwoody and may involve examining Galbraith’s records.
“Hopefully he’ll (Galbraith) realize that this is not a game; it’s a serious business,” Highley says. “There’s a lot of people out of a lot of money and there needs to be an investigation; creditors deserve it and so he should cooperate.”
“Whether or not he does is another question.”
Highley also observes that if Galbraith fails to challenge the bankruptcy application before its Dec. 3 court date, the bankruptcy will take effect that day.
Galbraith could not be reached for comment. BF
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