Blue Chip victims win leave to take case to Supreme Court

Lawyer Paul Dale. Photo / Greg Bowker

About 300 victims in the $80 million Blue Chip property disaster have been granted a last chance to fight deals to buy units in five inner-city Auckland high-rise blocks.

The Supreme Court yesterday granted them leave to challenge a Court of Appeal decision which in March went against them.

Paul Dale, the Auckland barrister representing the group, said he was pleased with this step and expected the case to go to court next year.

"This is about the question of whether investment products offered by Blue Chip breached the Securities Act and if so, what the answer is and if not, whether the agreements are unenforceable by the developers," he said.

The investors agreed to buy units in the Barclay, Bianco, Icon, Chatham and The Stadium blocks which were finished some time ago.

Some Blue Chip investors took ownership of the units, some have made arrangements with the developers and others are challenging the deals they signed because they were told they would never have to buy the apartments when they put their money into unusual investment products Blue Chip was selling.

Corporate entities involved in the litigation include Turn and Wave, Greenstone Barclay Trustees and Icon Central. Blue Chip investors who appealed the High Court case include Neil Tony Hickman, David John Lester and Anthony Collingwood.

In granting leave to appeal, the Supreme Court said the issue was whether the marketing by Blue Chip companies and sales agents of investment products amounted to offers to the public of equity and debt securities.

If the outcome was favourable to the investors, the court must decide if that impeached the developers' ability to enforce the agreements for sale and purchase.

In March, the appeal court dismissed litigation brought by Blue Chip investors who signed up for units in the multimillion-dollar apartment complexes. They had fought to have a High Court decision overturned on sale and purchase deals they signed.