Auckland property investor Vast Investments Ltd, controlled by Dabin Wang, was held liable for a $800,000 loss on resale after defaulting on agreement to buy a Herne Bay property for $5.7 million. Interest for late settlement now sees total damages payable exceeding $1.2 million.
In March 2022, Vast Investments agreed to buy the Hamilton Road property with settlement due in three months. After Vast failed to settle, vendor NZ Tourist Investments Ltd put the property back on the market, listing with Ray White Remuera as agent for the resale.
The High Court was told of eight potential buyers inspecting the property. Two made offers. One, a conditional offer, was later withdrawn during negotiations over price. The second was accepted; an unconditional offer at $4.9 million.
Sued for the $800,000 loss on resale, Vast Investments said Ray White Remuera had prejudiced the sale price before resale by setting a low appraisal; between $4.5 million and $5.0 million. Vast Investments claimed a registered valuer it hired had appraised the property on resale at $5.4 million with that appraisal including a markdown acknowledging a market decline over previous months.
Associate judge Brittain ruled a $4.9 million resale represented the current market price. It was a sale to a buyer unrelated to the vendor. Ray White Remuera conducted a conventional marketing programme. It helped negotiate an increased offer, obtaining for the vendor an extra $100,000 over an initial offer made.
In addition to the $800,000 loss on resale, Vast Investments was ordered to pay costs of resale and interest at a rate of fourteen per cent, as specified in the sale agreement, until the debt is cleared. By date of the court hearing, interest currently due was calculated at some $405,000. Part of the debt due was cleared by the vendor keeping a $570,000 deposit Vast Investments paid.
NZ Tourist Investments Ltd v. Vast Investments Ltd – High Court (18.12.23)
24.036