Court rules against appointment of co-CEO of Access Financial
No 2 CEOs
THE Supreme Court has ruled that the recent appointment of a co-chief executive officer of Access Financial Services was in breach of court orders.
Following a ruling by Justice Bryan Sykes on April 11, the board of directors appointed Alexander Johnson, business development manager and executive director to act as CEO with Marcus James.
But on Wednesday, Justice Bryan Sykes ruled that the defendants as directors of the company "cannot appoint any other person as chief executive officer until interim injunction granted by Miss Justice Edwards is determined," according to an unsigned formal order obtained by the Caribbean Business Report.
James, CEO of the microlending outfit, named the company directors Christopher Berry, Gary Peart and Brian Goldson as well as Mayberry West Indies as defendants in a claim filed with the High Court on April 3.
The order made on Wednesday added that the defendants cannot initiate or continue any disciplinary proceedings against James nor modify James's salary and emoluments until the application for an interim injunction is heard and determined.
At the same time, the order that authorised the defendants to exercise their powers under Article 112 of the Articles of incorporation is also still in place.
James and the directors of Access have been embroiled in a dispute surrounding certain actions.
In a letter to James, the board set out the following charges against him: failure to address critical issues on a timely basis, failure to present the board a timely and cogent analysis of the factors that caused the unexpected downturn of the fourth quarter (2013) results, together with a plan for addressing the factors that caused it; failure to obtain approval from the board for capital expenditure; breach of fiduciary duty; and failure to obtain board approval prior to negotiating loan agreements.
But James contends the charges aren't ratified by the board.
The directors are represented by former minister of finance, Hugh Small as well as Conrad George and Adam Jones of Hart Muirhead Fata, while James is represented by former Attorney General Ransford Braham as well as Georgia Gibson Henlin and Taneisha Rowe of Henlin Gibson Henlin.
They are to return to court on Thursday. Founded by James, Access began operating in 2000 and now has 15 outlets islandwide. It is the leading microfinance company in Jamaica. Mayberry acquired a 49 per cent minority stake in Access in 2006 for $38 million.
Access became the first company to list on the JSE Junior Market in 2009.
For the 12 months ended December 31, 2013, Access posted $270 million in net profit, up from $238 million in the corresponding period in the prior year. Interest income from loans increased by 28 per cent or $759.7 million during the year ended December 31, 2013, from $595.3 million in the prior year.
The principal shareholders in Access are James and Mayberry West Indies, a 100 per cent-owned subsidiary of Mayberry Investments Limited.
The market value of Mayberry's investment in Access has grown to $1.3 billion to date, according to the company's financial statements. Mayberry has been the lead broker for 14 companies out of the 22 Junior Stock Exchange listings and has raised $2 billion in capital since its inception. Last year, Mayberry listed three junior market companies and raised $300 million.