Westminer suit against Seabright before appeal court

Arguments have concluded in the Nova Scotia Court of Appeal in the lawsuit between Westminer Canada and the former directors of Seabright Resources.

Westminer is seeking $62 million in damages to compensate the company for the Christmas, 1987, takeover of Seabright, a Nova Scotia gold exploration company.

After the surprise takeover, Westminer alleged it learned that the main Beaver Dam property did not contain the ore reserves on the public record. The Australian-owned company claimed Seabright had failed to disclose a material change on ore reserves prior to the takeover.

In his spring, 1993, decision, Judge Nunn ruled in favor of the Seabright directors and dismissed the case against them. He also awarded costs and damages to the former directors. Terrence Coughlan, former chief executive officer of Seabright, was awarded legal costs plus $1 million. Coughlan attended the appeal proceedings regularly. The court case has been the longest in Nova Scotia’s history. Legal costs for Seabright alone amounted to about $8 million prior to the commencement of the appeal. A decision by the appeal court is expected by early next spring. A combination of low metal prices, fallout from this lawsuit and the demise of flow-through funding has resulted in an idling of most aspects the province’s mining industry.