Shareholders in Harbour Gardens Ltd., which has been investigated by Police over theft allegations, claimed last night that they had not been informed by its directors that the company's shareholding structure had been changed.

Commercial Crime Unit detectives submitted a file this month to the Director of Public Prosecutions following an investigation into claims that more than $100,000 has been stolen from the company.

The Royal Gazette reported last week that annual returns for the company at the Registrar of Companies showed its shareholding structure changed twice since it was set up in 1995 to convert the pool wing of the former Palm Reef Hotel in Harbour Road, Paget, into nine up-market condominiums.

Residents who bought the townhouses became shareholders of the company.

Last night one owner, Ken Spurling, said he had spoken to four other owners who said they had not been informed by the directors of the changes - which he understood to be a breach of the Companies Act.

The directors of Harbour Gardens Ltd. are leading Bermudian businessmen Arthur Jones, the owner and director of Coldwell Banker JW Realty, and Fraser Butterworth, the president and secretary of the Institute of Bermuda Architects.

Last night Mr. Jones' lawyer, Joe Wakefield of Wakefield Quin, said there had been "no double dealing" regarding the shares, and the returns at the Registrar of Companies may have been a "clerical error".

Mr. Spurling and three other townhouse owners issued a civil writ against Mr. Jones, Mr. Butterworth and the company in May 1999 to get them to hand over the company, unencumbered of debt, with the 999 year leases which were part of the sale agreement. The matter has still not been settled.

Mr. Spurling said he would be signing a Supreme Court oath this morning asking the courts to force the company and its directors to disclose all documents concerning the company for the civil case.

He claimed they did not disclose the shareholding changes in earlier documents relating to the civil case.

Mr. Spurling told The Royal Gazette last night: "Horrified is the word that comes to mind to find out that it appears we have paid all this money and that we were shareholders and have share certificates and suddenly its all changed, and that's what appears to have been filed at the Registrar of Companies.

"Our lawyers have seen the file at the Registrar of Companies and there appears to be a discrepancy.

"It appears that the shareholding structure has been changed and we knew nothing about it.

"Under the Companies Act, I believe shareholders must be notified by the directors and a meeting held to approve any changes. I don't think you can have a meeting to have the shareholding structure changed without the shareholders being told.

"We have got to ask the courts to ask them to explain that. There is documentation regarding the change to the shareholding and we were totally unaware of that until The Royal Gazette brought it up.

"In a civil action all the documentation is presented in the hope that it can be settled out of court. It would appear they (Mr. Butterworth, Mr. Jones and Harbour Gardens) haven't presented everything as a full disclosure so I will be swearing an oath in the Supreme Court this morning asking the court to command them to supply this specific information (about shareholding changes) which it would appear they have not supplied."

Mr. Quin said last night:"There has been no double dealing in respect to the shares, I can guarantee that. There may have been some clerical error in respect to what has been filed, but all the shareholders will get voting shares as soon as they pay for their leases."