A creditor of the debt-ridden International Tin Council, whose collapse 18 months ago plunged the world tin market into a crisis, has asked a court to appoint a receiver for the council.
Maclaine Watson and Co., a London Metal Exchange trader that is owed 6 million, (about US$10 million), by the insolvent council, this week asked a judge to appoint a receiver to pursue what the company alleges is the council's right to claim contributions from its 22 member governments to cover its debts.Mark Littman, a lawyer for Maclaine Watson, said in high court that the company's action was aimed at enforcing an arbitration award made in its favor last November of about 6 million.
The application, which is being contested by the council, is one of a series of court actions involving the council, its member governments, creditors, metal brokers and the London Metal Exchange, resulting from the council's default in October 1985.
The council defaulted with debts to banks and metal brokers of hundreds of millions of pounds. Banks lent the council funds to buy tin and some brokers sold the council tin on credit.
The council administered the International Tin Agreement, which allowed it to intervene in the market to buy or sell tin to stabilize prices. The council's default had the effect of suspending the agreement indefinitely, leading to a sharp fall in the price of tin when there was no intervention buying of surplus tin.
Without the council's support, the price of tin plunged from 8,000 a ton to a low of 4,000 last year.
Earlier this week the 22 member governments voted in London to extend the council's life for another two years, but in the much-weakened form of a statistical and industry studies body.