Forestry sale ends in court

Wairarapa News - - FRONT PAGE - HAN­NAH BARTLETT

A real es­tate firm has won the right to claim dam­ages, in­ter­ests, and costs from Motuek­abased Forest­lands NZ Ltd, which is at the cen­tre of a Se­ri­ous Fraud Of­fice ( SFO) probe.

Welling­ton firm Lead­ers Real Es­tate Ltd, which in 2017 re­branded as Ray White, brought a claim against the Forest­lands group of com­pa­nies, over a 2016 sale of forestry es­tate in Hawkes Bay, Wairarapa, and South­land.

Lead­ers Real Es­tate al­leged Forest­lands, which is headed by sole di­rec­tor Rowan Charles Kearns of Motueka, failed to pay com­mis­sion owed fol­low­ing the sale of the es­tate.

The Septem­ber 2016 sale of eight tracts of for­est has also left in­vestors in Forest­lands’ in­vest­ment com­pa­nies wait­ing the re­turn of their money, and prompted the Fi­nan­cial Mar­kets Au­thor­ity (FMA) to step in.

Eigh­teen mil­lion dol­lars owed to in­vestors was put into a trust by Forest­lands in March 2017, af­ter dis­cus­sions with the FMA.

The FMA con­firmed in March 2017 that it had also re­ferred some mat­ters re­lated to Forest­lands to the SFO.

At the Nel­son Dis­trict Court on Friday, Judge Tony Zohrab granted a sum­mary judg­ment in favour of Lead­ers Real Es­tate over the sale.

He said he was ‘‘con­tent to con­clude there is a ba­sis for the claim’’, de­ter­min­ing there was ba­sis for not just the prin­ci­pal sum sought – dam­ages based on com­mis­sion – but also in­ter­ests and costs.

Judge Zohrab said the de­fen­dant had taken no steps to pay the com­mis­sion owed.

Lawyer Costas Mat­sis, on be­half of Lead­ers Real Es­tate, had sub­mit­ted it was ap­pro­pri­ate for in­ter­est to be ap­plied.

‘‘The fam­ily has had the ben­e­fit of the non-pay­ment of com­mis­sion since, the date is dif­fi­cult to as­cer­tain, but we’ve fo­cussed on Septem­ber 2016,’’ he said.

He said in­ter­est should be ap­plied at the statu­tory rate of five per cent.

Af­fi­davits con­tain­ing in­voices were also sub­mit­ted to the court, which de­tailed costs in­curred on a so­lic­i­tor-client ba­sis.

No rep­re­sen­ta­tives for Forest­lands NZ ap­peared at court.

Judge Zohrab granted the judg­ment – agree­ing to in­ter­ests ap­plied at five per cent, costs re­lated to le­gal fees, and the com­mis­sion sought.

The Septem­ber 2016 sale at the cen­tre of the dis­pute saw Forest­lands NZ, and 18 other ‘‘as­so­ci­ated com­pa­nies’’, sell for­est blocks in Hawkes Bay, Wairarapa and South­land to New Forests Aus­tralia New Zealand For­est Op­er­at­ing Fund 2.

The sale to the fund, which man­ages forestry in­vest­ments for over­seas su­per funds, was ap­proved by the Over­seas In­vest­ment Of­fice, but the sale price was kept con­fi­den­tial.

A judge has backed a claim by a real es­tate agent, seek­ing dam­ages, in­ter­ests, and costs as­so­ci­ated with a 2016 forestry sale by Motueka-based Forest­lands.

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