This post covers questions sent to Cult Wines Ltd yesterday as well as a look at who has legal control over the wine portfolios held by Premier Cru Fine Wine Investments Ltd.
Questions I put to Philip and Tom Gearing of Cult Wines Ltd:
One further question I could have asked is: what have you been told by Premier Cru about the 'shortfall' in clients' portfolios? What reasons for the shortfall have you been given?
It is not clear that Premier Cru Fine Wine Investment Ltd is actually going into liquidation or will just be wound up. The only mention of a liquidator in any correspondence I have seen is in the email sent from Cult Wines Ltd to Premier Cru clients sent on 8th August. The letter from Premier Cru (31st July 2014) makes no mention of a liquidator.
It is crucial to know who has currently legal control over the wines clients portfolios held in Premier Cru's umbrella account at EHD as whoever has control can release the wines to Premier Cru clients assuming that title was clear.
From the Premier Cru letter (31st July 2014) appears that Premier Cru Fine Wine Investments Ltd still has legal control over their clients' wines stored at EHD as the agreement with Cult Wines Ltd is not due to be finalised until 14th August.
'We have therefore undertaken a review of our market competitors and have concluded that Cult Wines, who are currently the UKs leading fine wine investment company as the best positioned to assume management of your portfolio and on this basis we are finalising an agreement to migrate our private clients to Cult Wines (PCI) Limited which we hope to complete by August 14th 2014.'
It is interesting that there is no mention of a liquidator here. Premier Cru Fine Wine Investments Ltd has legal control over the wines until 14th August 2014. After that date legal control will be with Cult Wines Ltd assuming that the agreement is finalised as envisaged.
Assuming that title to their wines can be established, then Premier Cru ought to be able to release wines up to 14th August to their clients who do not want to accept Cult's proposal and want to make their own arrangements. From 14th August it would appear to be Cult Wines Ltd, who will be able to release wines.
From Premier Cru to their clients (31st July 2014):
'To help us complete the transition to Cult Wines as quickly and as smoothly as possible, please confirm your agreement to the transfer of your account to Cult Wines by no later than August 14th 2014. All you need to do is reply to this notice indicating that you would be content to transfer your account to Cult Wines. If we do not receive any reply to this notice by August 14th 2014, we will assume that you do not object to this transfer.'
The inferred advice from Premier Cru to their clients not wishing to accept Cult Wines Ltd's proposal is to contact them (Premier Cru) 'no later than August 14th 2014 declining Cult Wines Ltd's proposal and asking for their wines to be transferred to whatever arrangements individual clients are making. This notification may have to be done through Premier Cru's registered office.