South Canterbury Finance is embroiled in a legal dispute with the Commonwealth Bank of Australia over the collapsed Leefield Vineyards in Marlborough.
Yesterday a closed telephone conference was held in Associate Judge Jan Doogue's chambers at the High Court at Auckland to discuss who has priority over Leefield's assets.
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Commonwealth Bank has filed proceedings against South Canterbury to determine who has priority over the Leefield development, in receivership, which includes nine houses, farm buildings and 2165ha.
South Canterbury's investment into Auckland developer Greg Olliver's redevelopment of Leefield was one of its largest exposures.
According to Leefield's receivers' second report, the Commonwealth Bank was owed $33 million and South Canterbury $17 million at the time Leefield was placed into receivership on October 19, 2006.
The properties were mortgaged by loans from both entities.
South Canterbury's investment into Leefield remains one of its largest outstanding loans, but it has a security interest over the development registered in its name.
It is this security interest, over certain priority rights of the Leefield development, that the dispute between the Commonwealth Bank and South Canterbury is centred on.
High Court action over Olliver's bankruptcy showed creditors claimed $92.5 million from his businesses.
Court records show Olliver's other creditors include St Laurence Lending, Strategic Finance, Westpac, Auguste Holdings, NZ Finance and Public Trust.
