Merc wins court case against Whittleys

Boat builders Neville and Steven Whittley have failed to heed a court order to pay judgment debts to Mercury Marine, opening up the possibility of further legal action against them by the marine engine giant. The continuing legal battle comes as the Whittleys say their company is “trading quite well and enjoying good growth”.

Whittley Marine was a high profile casualty of the global financial crisis. It went into voluntary administration at the height of the GFC, owing substantial debts to a range of marine industry suppliers, including Mercury. Whittley also owed money to Yaffa Publishing Group, which publishes Marine Business and Fishing World magazines. The Whittley debts to YPG were for advertising and also remain unpaid.

Marine Business understands Mercury had a number of discussions with Neville Whittley regarding the debts.

A source close to Mercury said the engine giant had made numerous requests that Whittley Marine provide a repayment plan for the debts. “Neville Whittley responded with repeated promises that a proposal would be made, however, nothing of substance materialized,” the insider said.

It is understood that Mercury made these repayment requests prior to Whittley Marine entering voluntary administration.

Marine Business spoke with Neville Whittley. “We have had a pretty tough time of it but the business is now going quite well,” he said. “We’re doing the very best that we can.

“We owed (Mercury) money and we were prepared to pay them back, given time. Every other supplier stood by us and we’ve stood by them.

“I would have hoped we could come to some commonsense arrangement with Mercury, however when they went legal, the negotiations stopped.”

Late last year Mercury instigated proceedings in the Supreme Court of Victoria against Whittley Marine and Neville and Steven Whittley. The Whittley brothers were sued under personal guarantees that they had provided to Mercury Marine for the Whittley Marine debts.

The action against Whittley Marine was brought to an end when the company was placed in administration and executed a deed of company arrangement.

The action against the Whittley brothers continued. It is understood they defended the proceedings, arguing that the guarantees were not enforceable because Mercury Marine did not have cause to believe that the guarantors had understood the nature and effect of the guarantees.

On December 9, 2009, Mercury Marine was successful in obtaining Judgments in the Supreme Court against Neville Whittley and Steven Whittley for the Whittley debts that they had guaranteed.

The judgments remain unpaid. Marine Business understands Mercury has the option to pursue further legal avenues, including personally bankrupting both Whittley brothers.

Up until the GFC hit in 2008, Whittley and Mercury enjoyed a very close business relationship, with the boat builder purchasing large numbers of MerCruisers for its popular cruisers and ski boats.

Mercury executives were not available for comment on these developments.