Major shareholder to sue Rok for more than £5m

ROK Property Solutions has been forced into a legal battle with Mark Kay, its biggest shareholder and a former director, over claims that he is owed more than £5m in bonuses.

Rok received a writ from Kay’s lawyer last Friday. Kay, who resigned as a director at the end of September, is claiming that Rok owes him a total of £5m, plus interest, in unpaid bonuses for 2002 and 2003.

He has retained his 12% stake in the company.

The dispute centres on the interpretation of some aspects of Kay’s contract with Rok. It is understood that Rok was made aware of Kay’s belief in his financial entitlement in early 2004.

Garvis Snook, Rok’s chief executive, said the company would contest the proceedings. He said: “Mark has a particular view of his entitlement, which is completely at odds with the board’s. We have taken advice that is very firm and we will vigorously defend our position.”

Rok has appointed legal firm Ashurt to advise it on the matter.

We will vigorously defend our position

Garvis Snook, Rok chief executive

If the case goes to trial it will be heard at the Commercial Court, which according to Herbert Smith, lawyer for Kay, has a record of dealing with cases quickly.

Kay joined the Rok board in April 2001 after it acquired his property development company Rockeagle Land for about £14.7m. The Rockeagle business has been run by Nick Hole since 2002.

Rok’s shares dipped slightly when the announcement about the impending legal action was made to the stock exchange on Monday, but it had recovered by the close of trading and finished almost 5%, or 23p up.

Snook said that, despite the fact that Rok was in dispute with its biggest shareholder, it was “business as usual” at the company, but because of the scale of the claim it was “obliged to make a statement”.

Both Kay, who is based in Belgium, and Herbert Smith declined to comment on the proceedings.