Crown opens Tenths Trust fraud case

The Crown has opened its case against former Wellington Tenths Trust chairman Sir Ralph Heberley Ngatata Love, alleging he corruptly sold his influence over the development of trust land.

In a written version of his opening address provided to NBR by the High Court, Crown Solicitor Grant Burston said Sir Ngatata favoured property developers Equinox Group and Redwood Group who were seeking to develop trust land at Pipitea St in Wellington.

In exchange for that favour, Sir Ngatata and/or his partner Lorraine Skiffington received the benefit of $1.5 million plus GST, the Crown alleged.

The Crown described Sir Ngatata as “a prominent figure within Maoridom and is a kaumatua of various iwi. During the main period of the offending, he was also a professor of business management at Victoria University’s School of Management."

Ms Skiffington was charged with the same offences as Sir Ngatata but the charges were stayed on health grounds by court order last November.

Name suppression for both defendants has been lifted.

The events involved in the trial began in October 2005 when developers Equinox and Redwood approached Sir Ngatata to talk about developing the Pipitea St land.

Sir Ngatata introduced the developers to his son, Matene Love, and represented that he could negotiate a joint venture deal, although Matene had no mandate to act on behalf of the trust.

In February 2006 the developers wrote to Matene proposing a $100,000 fee in exchange for a five-year right of first refusal.

After further negotiation, it was agreed that the developers would pay Matene’s company, Yellowstone, $150,000, with more payments made as the project developed.

“The payment to Yellowstone formed part of the development costs for the project. It therefore affected the profit margin of the eventual joint venture between the Tenths and the Developers and so was to the Tenths’ detriment.”

Matene Love, who received $150,000 from the arrangements, pleaded guilty to a charge under the Secret Commissions Act last September.

In a letter to Matene in August 2006, the developers wrote: “We confirm we have made a provision to pay Yellowstone Consultants $1,500,000.00 out of Pipitea Street Project [sic]. At the moment that is all that it will sustain and it does depend on the final outcome of the rents. Please confirm that is acceptable.”

Shortly after that, Ms Skiffington took over negotiations at the instigation of Sir Ngatata, said the Crown.

Document destruction

In December 2006 the developers signed a lease agreement on the land, along with a “services agreement” in which they would pay $1.5 million to Pipitea St Developments Ltd, a company associated with Ms Skiffington.

A further $1.5 million would be paid once conditions in the lease agreement were met.

A draft copy of the Services Agreement marked as “Ngatata’s working copy” was found in a document destruction bin at the couple’s Plimmerton residence by Serious Fraud Office investigators.

The Crown said the SFO traced $1.4 million of the funds paid to PSDL by the developers to the mortgage account on the Plimmerton property, which was acquired for $1.8 million by the couple in December 2006.

The Services Agreement held that PSDL was an independent contractor to Tenths Trust and that the deal should remain confidential.

However, the Crown said none of the arrangements about payments to PSDL happened with the knowledge of anyone at Tenths Trust except Sir Ngatata, and it would call other trustees as witnesses to that contention.

The Crown said Sir Ngatata had represented to the developers that the money was “covering the Treaty claims etc.”

In May 2008 the developers’ solicitor sent a copy of the services agreement to the solicitor for Tenths Trust.

“The evidence will be that in response to this, [Sir Ngatata] contacted the solicitor concerned saying that the ‘services agreement’ was not to be released and that it was confidential. He was upset and annoyed that it had been released. Ms Skiffington subsequently emailed the developers’ solicitors, asking for the services agreement to be ‘completely gathered back’ and ‘never provided to third parties’ because it is ‘a strictly confidential agreement’.”

The Crown has charged Sir Ngatata with obtaining by deception under the Crimes Act, or if that charge is not proven beyond doubt, it asked for a verdict of obtaining a secret commission.

The trial is set down for 11 days.

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