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Real Estate companies under fire in court battle over Perot's Island

Professionals involved in a huge property deal between multi-millionaires came under attack in court yesterday.

Lawyer Mr. Julian Hall, representing American heiress Marion MacMillan, attacked realtors Cooper Associates and the Bank of Butterfield's real estate company Betco.

The two firms were involved in a failed attempt by Canadian tycoon Michael De Groote to buy Perot's Island in Riddell's Bay from Mrs. MacMillan for $8.5 million.

The heiress, who is worth an estimated $700 million, backed out of the deal.

Mr. De Groote has now taken her to Supreme Court.

Mr. Hall said Cooper's and the bank were acting for Mr. De Groote "when as a matter of law they should have been regarded as acting for the defendant'' (Mrs. MacMillan).

The two bodies were guilty of misdeeds, inaction and breaches of duty, he said, and therefore so was Mr. De Groote.

Mr. Hall also attacked law firm Appleby, Spurling and Kempe, who were representing both Mrs. MacMillan and Mr. De Groote around the time of the 1990 deal.

Mr. Hall said that despite a promise to Mrs. MacMillan, AS&K acted for Mr. De Groote "in certain matters regarding this transaction''.

He demanded that Mr. De Groote's lawyer, Mr. John Riihiluoma, produce documents concerning Richard Spurling's involvement in the deal.

Mr. Riihiluoma has told the court there was nothing sinister or improper done during the deal, least of all by Mr. De Groote.

Taking the witness stand, Mr. De Groote said he only dealt with AS&K, and Mrs.

Elaine Darling of Cooper's.

He said he understood Betco to be Mrs. MacMillan's representative.

Mr. De Groote described how he arrived in Canada with his Belgian family in 1948. He bought a small company and built it up into Laidlaw Inc., one of Canada's largest.

In 1988 he sold control of Laidlaw, and later made plans to emigrate. One of the main reasons was to reduce his tax payments, he said.

He also wanted an international business base to work from.

After considering havens like Switzerland, Monaco, the Channel Islands and the Caymans, Bermuda became his "main target''.

He began looking for houses of a "reasonable size'' that would match the 27-acre Ontario estate where he entertained his four children, eight grandchildren and business contacts.

Among the properties he considered were Paget Hall and Everbreeze in Warwick, which he initially rented and found extremely uncomfortable.

He wanted Perot's Island for its large home, pool, guest quarters, greenhouses and boating facilities.

The case continues today.

Mr. Michael De Groote.