Forestry sale ends in court
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.