The NSW Supreme Court has extended its deadline to Wagga's International Hotel owners to come up with a buy-out deal that would end a family dispute that has seen the business placed in receivership .
If two family owners cannot agree to exchange shares in the hotel enterprise previously valued at $3.12 million, the court will clear the way to liquidate the business and its real estate assets.
Justice Kelly Rees found in May last year there was an "inability to agree upon a regime to manage the hotel" between majority owner Basil Berrigan and his nephew, part owner and former hotel manager Joel Berrigan.
Alan Hayes, of Sydney firm Hayes Advisory, was then appointed as receiver to run the hotel and the two directors have continued a legal fight over the accommodation, restaurant and events centre on the Sturt Highway.
Mr Hayes told The Daily Advertiser on Monday that he could not comment beyond stating that "the court's orders were extended".
"The time period to do a deal was extended," he said.
The court previously heard that the International Hotel offered 80 rooms and employed 35 staff prior to the coronavirus pandemic.
In December, Justice Rees granted an initial 14-day stay of orders so that Basil Berrigan had the opportunity to buy out Joel Berrigan's shares in, Crow Inn Pty Limited and Puddy Pty Limited, two of the companies that own the hotel's business operations and real estate.
"Basil and Joel accept that their relationship has irretrievably broken down, for which each blames the other," Justice Rees stated in the judgement last month.
"I am not minded to make a buy-out order but may stay a winding up order for a short period to allow Basil to buy-out Joel's shares at a value determined with the assistance of [accountant] Andrew Teece and Mr Hayes, should he wish to avail himself of that opportunity," Justice Rees stated.
Should the owners be unable to reach a deal, Justice Rees' orders will give Mr Hayes the ability to "start the likely joint disposal of the two principal, closely related, assets, namely the hotel business and the land on which it operates".
The disagreement between the two family members and business partners stemmed from Joel Berrigan's plan to build a new 42-room hotel on Forsyth Street, which was approved by Wagga City Council in April 2019.
The court heard Basil Berrigan objected to Joel seeking to start a new hotel in Wagga's CBD as he "thought the hotel would be in direct competition with the International Hotel [and] create a conflict of interest" with Joel's directorship.
Basil offered to buy out Joel's 40 per cent share of the International Hotel for $4.16 million, with 25 per cent of that money withheld unless he continued to work for the business for another five years, but negotiations via their respective solicitors broke down.
Justice Rees stated that "events this year have deteriorated significantly" as the dispute prevented the appointment of a new general manager or forming a quorum for a directors' meeting.
The court's statement of facts said that the Berrigan family constructed the International Hotel in Wagga in 2012 using $10 million from the sale of the Airport Sydney International Hotel in 2002.
In December, Justice Rees determined that Joel Berrigan owned 30 per cent of the International Hotel after ruling on the disputed ownership of 10 per cent of the shares that were inherited from Thomas Berrigan, who is Basil's father and Joel's grandfather.
Justice Rees did not make a judgement on Joel's claim of $1.55 million in unpaid wages and superannuation from the hotel for himself and his wife.