An accountant for the Beaverbrook Art Gallery says paintings that had been "expenditures" on Lord Beaverbook's ledger were mysteriously listed as "assets" months after his death.

Robert Young told an arbitration hearing into a dispute over ownership of 133 paintings worth an estimated $100 million that the Beaverbrook U.K. Foundation's books were altered shortly after the British newspaper baron died.

He also noted no documents were provided to explain the changes.

The gallery claims the paintings were an outright gift from William Maxwell Aitken, also known as Lord Beaverbrook, who was raised in Newcastle, N.B.

But the foundation that administers Beaverbrook's fortune says the paintings were merely on loan, and wants them returned.

They include J.M.W. Turner's Fountain of Indolence, estimated to be worth as much as $25 million, and Hotel Bedroom by Lucien Freud, which could be worth as much as $8 million.

During Monday's hearing, Young said there is no indication in financial information prepared prior to Lord Beaverbrook's death in June 1964 that the artworks were on loan from the foundation. He said the paintings were not listed as assets of the foundation and some paintings were in fact listed as "expenditures" under a heading called "pictures for gallery."

Young then testified that the records from after Beaverbrook's death are "fundamentally different," with some paintings listed as "assets" of the foundation.

Three months after his death, Young said, paintings were described as being on loan with no supporting documents explaining the reason for the change.

But an accountant for the Beaverbrook U.K. Foundation says the same set of records supports the foundation's claim of ownership.

Michael Kenyon testified that his review of the foundation's books provides "strong evidence" to support its argument that the paintings were on loan to the gallery.

Gallery lawyers suggested earlier in the arbitration that either Beaverbrook or his family may have tried to change the status of the paintings from gifts to loans after the paintings had already changed hands. 

The arbitration, being heard by retired Supreme Court justice Peter Corey, is now in its fifth week.