Grenville sues High Ridge for blocking Glencore deal
2008-03-10 15:54 ET - Street Wire
Also Street Wire (C-HRR) High Ridge Resources Inc
by Stockwatch Business Reporter
It has been growing for nine months, but the bad blood between Grenville Gold Corp. and High Ridge Resources Inc. has finally borne a lawsuit in Canada. As dutifully reported by Grenville on March 4, 2008, the same day it filed its lawsuit, Grenville is suing High Ridge for claiming to own its (that is, Grenville's) 148 hectares of mining property in the San Mateo area of Peru known as the Bella Rubia concession.
Grenville alleges that it is the rightful owner of the property, and that High Ridge's conflicting claim is a slander of title that has interfered with Grenville's exploitation of the property. Specifically, Grenville says High Ridge's false claim on the property killed a potential deal with Glencore International AG, which forced the plaintiff to option an interest in the project to Journey Resources Corp. in early February.
Grenville says a subsidiary bought the Bella Rubia concessions from the Sociedad Minera de Responsabilidad Limitada Bella Rubia for $700,000 (U.S.) in an agreement notarized on July 9, 2007. The company says its NI 43-101 technical report, published Aug. 29, 2007, referred to the concessions.
On Sept. 14, 2007, two months later, High Ridge published its conflicting claim. In that news release, High Ridge said it had optioned the Bella Rubia concessions a month before Grenville, on June 9, 2007, for the same amount and from the same vendor.
Grenville says High Ridge intended to damage Grenville's business when it published its claim on the property. Grenville also says High Ridge representatives repeated the claim to the Bella Rubia concessions to representatives of Glencore International. As a result of the uncertainty caused by High Ridge's claim, Grenville alleges Glencore refused to process material from Grenville's Silveria project, which surrounds the disputed concessions. Glencore's refusal, in turn, forced Grenville to advance more money to its subsidiaries to pay for the project, and eventually forced Grenville to option away 75 per cent of the project to keep it moving.
Other costs claimed by Grenville include loss of investor confidence and a decrease in share price; delays in developing the concessions; and increased communication expenditures from reassuring brokers and investors that it owns the concessions.
Grenville asked High Ridge to retract its claim on Feb. 22, 2008, but High Ridge refused.
Grenville wants a court order forcing High Ridge to retract its claim on the property as well as damages.
John Sullivan of Harper Grey LLP represents Grenville. None of the allegations have been proven in court.
