Metalore banking on appeal of 1990 Brookbank decision

Almost two years after an Ontario court awarded the Brookbank gold property near Beardmore, Ont., to Ontex Resources (ASE), President George Chilian of Metalore Resources (TSE) says he is sure his shareholders will be compensated for their loss when the Court of Appeal hears the case on Jan. 11, 1993.

Speaking to a range of skeptical to adoring shareholders at a recent annual meeting, Chilian said Metalore will be reimbursed for its exploration expenditures even if it does not win the Brookbank claims back. “We spent $4 million and the judge never awarded us compensation when he took away the properties,” said Chilian. “I think, at least, we’ll be awarded what we expended.”

The initial judgment, handed down in December, 1990, ruled that Metalore intentionally provided misleading facts and withheld vital information from joint venture partner Ontex. Chilian says the ruling was based on “incorrect evidence,” with the judge’s final remarks copied directly from a factum submitted by Ontex’s lawyer.

The key block of 18 claims hosts a gold deposit with reserves of 1.4 million tons grading 0.26 oz. per ton.

Chilian also criticized rival Ontex Resources for turning down a deal with Placer Dome (TSE) for further exploration on the properties. “In December ’91, Placer Dome wanted to get in there if only Ontex would sign a consent form. (Ontex President Sam) Fuda refused, and ended up with nothing.”

Chilian, who hasn’t drawn a salary for two years, says his priority until the appeal is to pay off current liabilities of at least $250,000. Metalore produces natural gas from wells in southwestern Ontario. For the year ended March 31, the company had net income of $235,965 from revenues of $977,790.