The family business empire of Lord Mayor Lisa Scaffidi is under pressure after the Supreme Court ordered her husband Joe to sell Perth properties that had been in the family for several decades to repay a $2 million loan.
The Supreme Court ordered the sale of three warehouses on Gladstone Street, Perth, after Scaffidi Holdings and the Scaffidi Family Trust defaulted on a loan from Secure Funding of about $1.7 million.
Another $300,000 is due in interest, which has been accruing at 12.75 per cent since soon after the default in September.
The properties were bought in the 1960s by the late Antonio Scaffidi, a property developer.
It is understood the Scaffidi groups failed to repay the loan, initially secured in August 2007, after a bitter stoush last year between his sons, Joe and Gino, who are co-directors of Scaffidi Holdings.
It is believed Joe Scaffidi was at the time seeking to wind up Scaffidi Holdings, citing insolvency, but his co-director and brother Gino tried to block the move on the grounds it was still solvent.
The three city warehouses owned by Scaffidi Holdings had provided a healthy rental income and are believed to be worth close to $4 million.
They were used as security against the loan.
Master Craig Sanderson also ordered in his court judgment last month for the Scaffidi groups to pay court costs for the lender.
The loss of the family properties is the latest in a series of legal developments that have put pressure on Ms Scaffidi and her husband.
Central City, one of the Scaffidis' property development companies, was also being sued last year for about $1 million by an aggrieved investor in the family's Barrack Street hotel.
Earlier this year, Joe Scaffidi's building company, Premier Building Solutions, came under investigation by the Workplace Ombudsman over allegations he underpaid four Filipino migrant employees.
Ms Scaffidi came out in support of her husband when the migrant allegations arose, claiming she wanted to "do a Tammy Wynette" and stand by her man.
She could not be contacted yesterday.
The Scaffidi brothers were also unavailable for comment.