The trustees of the Hotel Pension Fund have won a legal battle in the Bermuda Supreme Court after a family failed to pay back a $400,000 loan.

The plaintiff trustees were suing ten members of the same family who in April, 1991 borrowed the money and put up a Radnor Close, Hamilton Parish home as security for the principal.

In a recent judgment from Puisne Judge Vincent Meerabux, it was noted that the principal raised was to benefit one of the defendants, Anita Virginia Brown, who in March, 1991 pleaded guilty to stealing and was remanded in custody for three weeks pending sentence.

Mrs. Brown had stolen some $250,000 from her former employers, Bermuda Drug Co. (BDC) between 1983 and 1989. BDC claimed an additional $105,000. Mr.

Justice Meerabux's judgment read: "As a matter of urgency the fifth defendant (Brown) was concerned about raising $355,000 to repay her victim in the hope to avoid a prison sentence or to substantially mitigate sentence.

"The defendant, although repaying a sum of $355,000 was nevertheless sentenced to a substantial term of imprisonment.'' The mortgage was prepared and presented to the other family members, after Mrs. Brown's husband, Arnold Brown, made arrangements for the loan from the Hotel Pension Fund, where he worked as an administrator.

But the court accepted that he undertook to refinance the mortgage within six months and agreed to repay the principal, although he later claimed he made no such arrangement.

Meanwhile, repayment for the mortgage from the pension fund required monthly payments of $3,000 for the first five years to April 1996 and subsequently, monthly payments of $4,057.07 for 15 years to March 21, 2011.

The family members, anticipating Mr. Brown would pay, signed the papers putting their house at risk.

Together as defendants with Mrs. Brown are her grandmother Marion Virginia Smith, and other family members William Sinclair Smith, Allan Clyde Smith, Larry Eugene Smith, Gloria Louise DeGraffe Smith, Duval Steve Smith, Terri-Lyn Smith, Allan Clyde Smith, Jr. and Shawn Anthony Smith.

The Trustees of the Hotel Pension Fund sought repayments from the defendants and from Mr. Brown. The court found last month that since November, 1991, no payment had been made under the terms of the mortgage.

On June 30, 1994, eight of the ten defendants obtained judgment against Arnold Brown for breach of a binding contract to refinance the $400,000 loan. They were given judgment in the sum of $514,000 against him, but were unable to enforce that judgement.

Justice Meerabux has now concluded the latest case by entering a judgment for the plaintiff Trustees of the Hotel Pension Fund against the ten defendants.

He further ordered costs for the plaintiff against all the defendants, except Mrs. Brown.

BUSINESS BUC