The Tribune

By KHRISNA RUSSELL

Tribune Chief Reporter

krussell@tribunemedia.net

NEW allegations of mortgage fraud have been levelled against East Grand Bahama MP Peter Turnquest and his former Sky Bahamas business partner Captain Randy Butler, according to a recently filed Supreme Court writ.

The writ was filed by Alpha Aviation - owned by wealthy Canadian businessman Fred Kaiser - who last November filed in the Supreme Court a writ claiming Mr Turnquest and Capt Butler, “dishonestly caused” Alpha Aviation and Advanced Aviation to “pay away” $20.68m and $5.917m respectively to the airline via “some kind of bogus loans”.

Mr Turnquest was not listed as a defendant in that lawsuit.

Mr Kaiser’s latest allegations stem from 2005 and 2007 when the entity lent both Mr Turnquest and Mr Butler $279,000, which was to be repaid at four percent interest over a period of 20 years, secured by a mortgage at Winton Heights Estates.

Later in 2007, the plaintiff Alpha Aviation extended an additional loan of $120,000 to both Mr Turnquest and Capt Butler as a further charge against the Winton property, again at four percent interest combined with other terms.

At the time, Mr Turnquest was Alpha Aviation’s director and manager, while the Butlers were mortgagors of the property. The writ also names Larona Butler, wife of Capt Butler, as the third defendant.

By December 2008, the writ alleges that the Butlers together conspired to defraud Alpha Aviation by purporting to turn over their permanent and absolute tenure in the Winton property to Antoine Smith and Tiffany Smith for the sum of $420,000.

However, the second and third defendants – the Butlers – did not state on the conveyance that the property was mortgaged.

The Butlers’ actions were further compounded by failing to state on the conveyance that there was a mortgage on the property in favour of the plaintiff and neither did they inform Alpha Aviation of the sale of the property.

Additionally, it is alleged they failed to redeem the mortgage and further charge out of the proceeds of the sale.

“Despite purporting to sell their interest in the property, the second and third defendants were dishonestly parties to the deed of release date March 15, 2017,” the writ noted, adding, “in short the conveyance was a fraud.”

“At the time of making the purported conveyance, the second and third defendants fraudulently intended to injure the plaintiff and/or cause loss to it.”

Alpha Aviation went on to accuse Mr Turnquest of conspiring with the Butlers on March 15, 2017 to procure a discharge of the mortgage security by entering into a deed of release while there was still a significant sum still owed under that mortgage.

“The real predominant purpose of the deed of release was to cause damage to the plaintiff by extinguishing its mortgage security. Pursuant to and in furtherance of the above conspiracy, the first defendant (Mr Turnquest) carried out and otherwise participated in a series of acts that had the foreseeable result of defrauding or otherwise harming the plaintiff.”

Payments

Alpha Aviation believes Mr Turnquest allegedly caused loss of the mortgage security over the property and that he failed to ensure the payments were made in respect of the wrongfully discharged mortgage since May 27, 2019.

This alleged fraud, Alpha Aviation said, is worth $220,313.43.

“At the time of making the deed of release, the first defendant fraudulently intended to injure the plaintiff and or cause loss to it where he unlawfully conspired and combined together to defraud the plaintiff,” the writ states.

Alpha Aviation further accused Mr Turnquest of breaching his duty as director by failing to comply with a duty of honest and fidelity and not acting in the best interest of the company by failing to ensure the mortgage payments were made in a timely manner.

He is also accused of extinguishing the mortgage security on the property which prevented Alpha Aviation from foreclosing the mortgage and exercising its power of sale and collecting the monies due.

The writ said that at all material times both Turnquest and Butler must have known that entering into a deed of release of the mortgage breached their fiduciary duties dishonestly and that the outstanding sum held by the Butlers on resulting trust of Alpha Aviation. As a result of their actions Alpha Aviation is claiming damages, that it holds the legal title to the property by virtue of the mortgage.

Further, the company charges that a declaration that the defendants hold the sum of $220,313.43 and or all assets representing such sums; compensation for breach of the director’s duties, interest pursuant to the Supreme Court Act or in equity; further or other relief and costs.

Attempts to contact Mr Turnquest and Capt Butler for comment were unsuccessful yesterday.