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A misunderstood money-lending scheme tied to the failed finance company Bluechip is about to cost a 73-year-old Welcome Bay man his family farm.
His 20.3 hectare dairy-beef farm on Kaiate Falls Road is going under the hammer on March 1 in Tauranga and farm owner Bryan Jones is hoping people will placard the auction house.
Bryan Jones stands by his farm’s ‘sacred place’ – a place of significant family heritage that could soon be lost.
Bryan is confident hundreds of people will turn up to support him protest the court-ordered sale.
“I understand that my daughter-in-law has gone on Facebook and she’s got 300 friends, and her 300 friends have got 300 friends each and they are all sympathetic towards what’s happened here and it sounds like they are all going to turn up at the sale.”
The farm, used today for fattening cattle to sell, was purchased in 1931 by Bryan’s grandfather who then passed it to Bryan’s father before Bryan took ownership in 1975.
Today, Bryan lives there with his wife and two of their three children and their families, both married and each with two children. The wives are both pregnant and on maternity leave.
“We’ve got Mum and Dad buried on the place,” says Bryan.
“We’ve got all the grandchildren’s placentas buried in what we call a ‘sacred place’; it’s actually a very large rimu tree Mum and Dad planted probably back in the ‘30s when they first came here – it’s going to make a lot of people upset if we do lose it.”
The High Court has ordered the sale as Bryan has refused to pay a $700,000 debt owed to a property developer.
Bryan says the problem arose in 2006 when he entered into a contract with Bluechip.
The contract saw him lend money to the finance company in return for a series of payments.
Bryan borrowed $70,000 against his farm to loan to Bluechip.
He was unaware the money he was lending made him an investor in a three-apartment tower block development in Auckland.
“I didn’t really know, and had not been told, that I was actually buying a property – they (Bluechip) were talking about a contract where I loaned them the money, they paid you interest on it and they paid out what would be a bit like a bonus each month; and it ran for four years and at the end of four years the mortgage was repaid and there was a possibility there could be a bonus of $15,000 in it for me.”
The deal sounded good, but when Bluechip collapsed in 2007 Bryan learned about the property investment and his culpability for much more than his original $70,000.
“It wasn’t until after it folded that I went and saw a professional advisor, I suppose you would call them, that I was advised, or told, that I had actually bought units in Auckland.”
Westpac bank’s acquisition and review of this Bluechip debt revealed to Bryan he owed about $450,000.
The developer was asking for a further $700,000 to complete his contract – an amount he was entitled to ask for owing to his agreement with Bluechip.
Bryan has no way of paying back either the $450,000 mortgage or the $700,000 debt and feels aggrieved because the contract details were never explained to him.
“I was never told about it by a legal advisor and I have got no show of paying it anyway, and if it had been explained to me at the time, I never would have signed such a deal.”
An attempt to broker a deal with the developer was made, but its terms fell short of being acceptable for Bryan and so the developer pursued a court order to sell the farm.
This order was granted in January with Bryan failing to file an appeal in time.
“My case is slightly different to everybody else’s because my wife wouldn’t have anything to do with the (Bluechip) deal and so I went into it all by myself.”
He believes since his wife shares ownership of the farm and was not a party to the Bluechip deal it is not possible for the court to order the sale of it to pay the developer.
Bryan says the whole scenario is crooked and it is unfair on him when it was Bluechip that roped him in to it.
“The broker that did the deal with me, he got taken to court, he got prosecuted and he was on his way to prison, but before they got the door shut, he died of cancer.”
With the family farm at stake, Bryan stands to lose everything.
“There is no doubt about it that when this has all happened I am going to be bankrupt – there is no doubt about that.
“The way I see it I will be out on the street on $230 a week and living on food parcels.”
He hopes on March 1, people will turn out en masse at the Advantage Realty Limited Harcourts auction house at 330 Cameron Road to protest the sale.
The auction is scheduled for 1pm.
View the auction listing here.
Posted on 01-03-2012 15:24 | By Surfwatch
We all know Bluechip was entering into crooked deals, and those that were not fully explained to investors. However the developer must not be involved in crooked dealings because the court would not have allowed the developer to proceed with a sale of the property if that was the case. Therefore now that the property has been sold for less than the amount owing, Mr Jones has passed his bad investment decision and loss down to another innocent party - the developer. Why does a relieved Mr Jones feel that this is OK.