Former Prime Minister Jenny Shipley has taken the stand in the high-profile case against directors of failed property company Mainzeal.
Dressed in black, Shipley took the oath in the Auckland High Court, but spoke for only 10 minutes before the court broke for lunch.
Shipley led New Zealand between December 1997 and December 1999 and left Parliament in 2002. She was a director of Mainzeal from 2004 until February 2013 and chair of the company when receivers were appointed in February 2013.
Liquidators acting for creditors argue the directors were “reckless” in not pulling the plug on the company earlier.
Unsecured creditors, including many sub-contractors working on Mainzeal projects, were owed more than $115 million when the company collapsed.
Evidence from earlier in the trial suggested there were warning signs about company finances as early as 2004, and that the company was technically insolvent in 2010.
Lawyers for liquidators BDO argue directors breached their obligations somewhere between January 2011 and July 2011 – two years before they put the company into liquidation.
But Shipley and the other directors, who include former Brierley Investments boss Paul Collins and Richard Yan, head of Mainzeal owner Richina Pacific, argue there was no reckless or illegitimate trading.
As Shipley told the court this morning: “I consider the board of Mainzeal was diligent and careful, in the circumstances we faced at the time. We kept the interests of Mainzeal’s creditors, employees and customers firmly in mind at all times and endeavoured to protect their interests and avoid loss.”
Shipley will read her evidence over the next couple of days and is likely to be cross-examined on Monday.