Former XL Leisure Group boss Phil Wyatt and his associates controlled Viking Airlines and handled its agreements with failed company Goldtrail Travel, the High Court heard yesterday.
Goldtrail went into administration in July 2010 at a cost of £25 million to the Air Travel Trust fund. Viking Airlines sold seats through the company.
Wyatt, his fellow defendants Halldor Sigurdarson and Magnus Stephensen who were directors of Viking, and Black Pearl Investments are contesting a claim for £1.4 million by Goldtrail liquidator PwC.
The liquidator alleges the defendants were involved in the “misapplication” and “misuse of payments” to Goldtrail in the run up to the failure.
PwC is also pursuing a claim for £3.64 million against Turkish carrier Onur Air.
Wyatt has yet to give evidence in court. Former Viking director Sigurdarson was cross examined yesterday by counsel for PwC Hilary Stonefrost QC, who sought to establish that Wyatt and his fellow defendants controlled Viking.
They say there was no overall control between themselves and Viking chief executive Christian Tajeran, who is not a defendant and has declined to appear in court as he is in the Congo.
In a witness statement, Sigurdarson told the court: “Myself, Phil Wyatt and Magnus Stephensen provided services to Viking.”
Sigurdarson said he provided consultancy services to Viking Airlines but was employed by BPI UK, a wholly owned subsidiary of Black Pearl Investments.
Citing email and other evidence, Stonefrost told Sigurdarson: “I would suggest this goes beyond consultancy. You are the person who controlled the money at Viking and Meridian Aviation [the general sales agent for Viking].”
Stonefrost said: “You directed the financial manager of Viking to make a payment on behalf of BPI UK. This kind of direction goes beyond consultancy doesn’t it?”
The QC cited evidence showing Tajeran had granted power of attorney over Viking to former XL Airways executive and Viking employee Christopher Broad.
She said: “Isn’t it the case that you, My Wyatt, Mr Stephensen and Mr Broad had complete control of Viking? You had control of the finances. Broad had power of attorney.”
Sigurdarson said: “I don’t agree we entirely controlled Viking.”
Stonefrost referred to a series of emails relating to a commercial agreement between Viking and Goldtrail, none of which were copied to Tajeran and identifying Black Pearl Investments as “the purchaser” of Goldtrail shares.
Abdulkadir Aydin, sole director of Goldtrail, transferred more than £10 million to himself and his family before putting the company into administration. He is now resident in Ukraine.
The case continues.